Severstal acquires 22% of the issued shares of Celtic Resources Holdings Plc

ZAO  Severstal Resurs (“Severstal Resurs”), which manages the mining assets of OAO Severstal, announces that Severstal’s  subsidiary Bluecone Limited has agreed to acquire for cash approximately 12.3 million common shares of Celtic Resources Holdings Plc (“Celtic”). The purchase represents approximately 22% of the issued shares of Celtic.  The shares were acquired from Aton International Ltd.

Mr. Roman Deniskin, CEO of Severstal Resurs, said: “Severstal Resurs believes the purchase of a 22% stake in Celtic, with its attractive mining assets in Russia and Kazakhstan, to be an excellent investment.  We think particularly highly of Celtic’s management.  This share acquisition is wholly consistent with SeverStal Resurs’ strategy to diversify within mining in alliances with internationally reputable partners”.

Celtic Resources Holdings Plc (Celtic) operates the Suzdal and Zherek gold mines in Eastern Kazakhstan and produces gold using bioleaching BIOX® technology. The Company also has а 50% stake in the Shorskoye operating molybdenum mine in Kazakhstan as well as a 74.5% stake in the Tominskoye copper/gold project in the Chelyabinsk region in Russia.
The Company produced about 2 tons of gold in 2006.

Shares in Celtic have been listed on the AIM market in London since October 2002. The Company is incorporated and registered in Ireland.

Severstal Resurs manages all of Severstal's mining operations. Severstal Resurs consists of four high-quality mining complexes in northwest Russia and in Western Siberia producing iron ore and coking coal, and is the second largest producer of pellets and coking coal in Russia.

In 2006 Severstal's Mining division produced 5.4 million tons of coal concentrate, 2.2 million tons of coking coal, 2.1 million tons of steam coal, 9.5 million tons of iron ore pellets and 4.5 million tons of iron ore concentrate. The reserves and resources of the company were estimated by IMC Limited to be 1.8 billion tonnes of iron ore as at 1 January 2006 and 0.7 billion tonnes of coal as at 1 April 2006.

The scrap business of Severstal Resurs consists of а number of scrap metal yards in the Northwestern, central and Southern parts of Russia. The total processing capacity is 1.3 million tonnes of scrap per year. Scrap is delivered to Europe and Middle East through the ports of St. Petersburg, Murmansk, Arkhangelsk, Rostov and Taganrog.