Companies: CER ��

Celtic Resources has received $80 million (�44 million) from Russian oligarch Vladimir Potanin for withdrawing from the Nezhdaninskoye gold mine.

Interros, Potanin's �5.2 billion investment group, has paid the money to AIM-quoted Celtic for its remaining 20 per cent stake in South Verkhoyansk Mining Company (SVMC), which holds the licence for the potentially rich Nezhdaninskoye mine in Russia's Yakutia region. Originally, Celtic, whose principal interests are in Kazakhstan, claimed 50 per cent of SVMC and planned to take that to 100 per cent in a �155 million shares-and-cash deal to be backed by mining major American Barrick.

However, Russian mining giant Norilsk Nickel, which is controlled by Interros, 'gazumped' the Celtic bid with a lower, but all-cash offer. In what has become an ominously familiar pattern, Russian interests then challenged Celtic's title to 30 per cent of SVMC.

Celtic, steered by entrepreneur Kevin Foo, eventually decided to relinquish its claim to that 30 per cent in exchange for an agreement Interros would buy its remaining 20 per cent for the equivalent of �44 million. This sum, a third of Celtic's present AIM value, has now been paid.

That leaves Celtic focused on producing gold from its Suzdal and Zherek mines in Kazakhstan and studying potential new projects to acquire. With a �44 million war chest, Foo and chairman Peter Hannen are evaluating the possibilities.

At 286.5p, Celtic's shares have fallen from 531.5p in early 2004. If the deployment of the �44 million looks wise and metal markets confidence returns, they should have some recovery potential.

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Celtic Resources	AIM	�112.77m	202.00p	10.50p
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