Jerooy Project update

22 Feb 2006 08:07

Oxus Gold PLC22 February 2006 news release For immediate release: 22 February 2006 Oxus Gold plc JEROOY PROJECT STATUS UPDATE LONDON 22 February 2006: Oxus Gold plc ("Oxus" or the "Company") announces thaton 21 February 2006 it served notices of disputes on the Kyrgyz Government inrespect of the United Kingdom - Kyrgyz Republic Bilateral Investment Treaty, theUnited States - Kyrgyz Republic Bilateral Investment Treaty, the Law onInvestments of the Kyrgyz Republic, and the Talas Gold Mining Company JointVenture Agreement. The dispute notices invite the Kyrgyz Government to engage inconsultations and negotiations with the Oxus Group with a view to agreeing uponan amicable resolution of the disputes, failing which the Oxus Group intends topursue claims in international arbitration. With construction of the processing plant at the Jerooy mine site nearingcompletion, pursuant to a government issued construction license, projectdevelopment has reached the stage where the approval of the Kyrgyz Government isrequired to start mining. Such approval has not been forthcoming and without thereinstatement of the Jerooy mining license, Talas Gold is not in a position toextract ore for future feed into the processing plant. As a result of thisfailure by the Kyrgyz Government to reinstate the mining license, constructionat the project site has been put on hold pending a satisfactory resolution tothe licensing issue. Gold production from the Jerooy deposit is therefore likelyto be delayed. Bill Trew, CEO of Oxus, speaking from Bishkek, stated "We have been building theJerooy mine in good faith and with the express encouragement and full knowledgeof the Kyrgyz Government. We remain committed to delivering gold from theproject as soon as possible but we need the full cooperation of our Kyrgyzpartners. We are ready to enter into negotiations at any time. If we can resolvethe licensing issue swiftly we can complete construction and still produce goldlater this year." -END- For further information, please contact: Oxus Gold plcRichard Wilkins/Joanna Solino Tel: +44 (0)20 7907 2000 Bankside Consultants Ltd.Keith Irons/Oliver Winters Tel: +44 (0)20 7367 8873 This information is provided by RNS The company news service from the London Stock Exchange