OREANDA-NEWS. On 28 February 2008 KazakhGold Group Limited announced that it is  currently in negotiations with respect to the potential acquisition by the  Company of certain gold mining assets with the owners of  the Assets, although, as of the date of this press release, no written  agreement has been reached. The acquisition price of the Assets is expected to  be approximately US$ 60 million.

The Company intends to finance the acquisition of the Assets with the  proceeds from a private placing of up to 2.3 million new  ordinary shares in the form of Global Depository Receipts with institutional investors. Mirabaud Securities Limited and JPMorgan Cazenove  Limited are acting as placing agents of the Company in relation to the  Placing.  The new GDRs, when issued, will  be admitted to listing on the Official List of the UK Listing Authority and to trading on the Main Market of London Stock Exchange plc's  Main Market for listed securities.
 
Based on a competent persons' report, the Assets include JORC classified  mineable reserves which have been estimated at approximately 4.4 million tonnes  at a grade of 7.3g/t gold (1.039 million ounces of gold), plus over 117  thousand ounces of gold at inferred category, and an additional C2 resource  estimated at 4.7 million tonnes at a grade of 6.8g/t gold (1.028 million ounces  of gold). The JORC resources and reserves were estimated at a 3.0g/t gold  cut-off grade, based on significant historical exploration work. A feasibility  study on the project has been carried out. Historical testwork results show an  average gold recovery rate of approximately 85%. The reserves are suitable for bulk  mechanised mining and an average of 140,000 ounces of gold per year are  projected to be produced over the first six years of production. The operations  hold valid exploration permits and mining licences, which are in good standing.
 
There can be no assurance that agreement with respect to the acquisition of  the Assets will be reached or that the acquisition will be completed at all. In  the event that the acquisition is not completed, the proceeds of the Placing  will be used to fund the development and operation of the Company.
 
The Company also confirms that it continues to intend to seek a listing of  its ordinary shares on the Official List of the UK Listing Authority and  admission to trading on the London Stock Exchange plc's Main Market for listed  securities.