::::::::::::::::: OXUS GOLD 2005 :::::::::::::::::

Minesite round-up for the year:


Another example of a junior successfully keeping up with the big guns was Aurum Mining (AIM: AUR), which saw its shares appreciate 257 per cent to 121.5p. Aurum has completed a bankable feasibility study on its Andash copper-gold project in Kyrgyzstan, and initial production is expected in 2008. There are also near-mine exploration opportunities, and the company has so far sidestepped the political travails that contributed to one of the year’s highest profile debacles - Oxus Gold. Hopefully Aurum Mining will be presenting at our January Forum on the 16th.

Oxus shares (AIM: OXS) have lost 51 per cent of their value to rest at the year’s end on 38.25p, and have done so in dramatic style. The Jerooy project in Kyrgyzstan has been taken away by the Kyrgyz government, and the Amantaytau Goldfields now seems likely to go the same way. Oxus’ subsidiary Marakand Minerals (AIM: MKD) also lost its Khandiza project in Uzbekistan, and Oxus’ abandoned attempt to buy Eurogold’s assets in Eastern Europe has got it embroiled in litigation. A recent joint venture with KazakhGold in Romania is good news, but nevertheless, Oxus’ shareholders have had a rough time. Marakand shares did even worse, dropping 67 per cent to 6.65p.

Another disaster was Asia Energy’s (AIM: AEN) probable loss of its Phulbari coal project in Bangladesh, which took its shares down 73 per cent to 104.5p. A £2.5 million investment in GVM Metals (AIM: GVM) with coal interests in South Africa is some progress in a new direction, but hardly replaces Phulbari.

The troubles of Oxus and Asia Energy illustrate another of the year’s distinguishing features – real political threats to assets in unstable, faraway places have appeared with some regularity, and have understandably played havoc with the share prices of the company’s affected. What this goes to show is that a well-informed consciousness of political risk is a must for mining investors.