Farm out agreement

12 Jun 2007 07:00

Celtic Resources Holdings PLC12 June 2007 FOR IMMEDIATE RELEASE 12th June 2007 Celtic Resources Holdings Plc ("Celtic" or "the Company") Dostyk farm out agreement signed with Cigma Metals Corporation Celtic today announces that an agreement has been signed between Eureka MiningPlc ("Eureka") and Dostyk Gold LLP, its 100% owned subsidiaries, and CigmaMetals Corporation ("Cigma") which will allow Cigma to earn up to 90% of DostykGold LLP. Dostyk Gold LLP is the holder of the license of the 14,000 km2 Dostyk miningarea, located in northern Kazakhstan. It is Cigma's intention to convert thecurrent resource estimates into JORC compliant resources. Summary: • Cigma has made an initial payment of US$300,000 to secure 51% of the project. These funds will be used by Dostyk LLP to fund the working programme in accordance with the license conditions; • Four diamond drilling rigs are currently operating on Dostyk's Berezky and Quartzite copper and gold prospects, with 1,300 metres drilled to date. • Cigma has the right to acquire a further 20% following a second payment of US$700,000 increasing it's percentage participation to 71%; • A third and final option to acquire a further 19% on payment of US$1,000,000 in 2008 will increase Cigma's percentage participation to 90%, upon which Eureka will maintain a 10% carried interest. For further information please contact: Kevin Foo / Jonathan Scott-Barrett Leesa Peters / Jane StaceyCeltic Resources Holdings Plc Conduit PRTel: + 44 (0)20 7921 8800 Tel: +44 (0)20 7429 6666 / + 44 (0)781 215 9885Investors@celticresources.com leesa@conduitpr.com www.celticresources.com Dostyk The Dostyk mining area is situated in northern Kazakhstan between the cities ofSemipalatinsk and Karaganda, in a well developed industrial region of Kazakhstan. Dostyk's properties comprise the Mykubinsk exploration and mining licence (MG785) covering an area of 14,189 km(2) and the Central Kazakhstan exploration andmining licence (MG 612) covering an area of 4,917 km(2). Both licences weregranted in 1995 for a period of 25 years with minimum expenditure commitment ofUS$5 million for each licence. The geology of the Dostyk properties comprises mainly volcanic and sedimentaryrocks varying in age from Carboniferous to Ordovician. Both licence areas aretraversed by the central Kazakhstan deep fault and a number of complimentaryfault systems. Granitoid intrusives are also seen in the area. There arenumerous known occurrences of VMS, porphyry, epithermal/mesothermal gold andsedex style mineralisation located by soviet regional exploration activity. Manyof these occurrences require further work and Eureka has prioritised five areasfor future exploration work. Cigma has started drilling on 2 of the 5 areas aiming to convert the depositsinto JORC compliant Resources. A program of approximately 20,000 metres ofdrilling has been planned and budgeted. Cigma Metals Corporation Cigma Metals Corporation is a mineral exploration company focusing on theexploration and development of its 3 exploration properties totaling 740 squarekilometers in the Tomsk Oblast region of Siberia in Russia, and approximately14,000 square kilometers in the Dostyk region of Kazakhstan. All the projectareas were selected based on their proximity to a well-developed infrastructure,known mineral occurrences and from historical records of gold and base metalsproduction. Cigma Metals Corporation's stock trades on the following exchangesunder the symbol "CGMX.PK" on the NASD OTC Pink Sheets in the United States ofAmerica, and under the symbols "C9KA.F" on the Frankfurt Exchange. This information is provided by RNS The company news service from the London Stock Exchange