Sale of gold mine interest

Celtic Resources Holdings PLC
03 February 2006


                          Celtic Resources Holdings Plc
                                        
            Sale of interest in Nezhdaninskoye raises US$80 million
                                        
                              Future plans outlined
                                        
Celtic Resources Holdings Plc ("Celtic" or "the Company") today announces that 
it has agreed to sell 20% of The South Verkhoyansk Mining Company ("SVMC") for 
US$80 million cash. SVMC is the holder of the license for the Nezhdaninskoye 
gold mine in Yakutia, Russia ("Nezhdaninskoye").

The Company has had productive discussions on the future of Nezhdaninskoye with
Interros Group, one of Russia's largest private investment companies and a
controlling shareholder in Norilsk Nickel and Polyus. As a result of these
discussions, KM Technologies (Overseas) Limited, an investment vehicle for the
Interros Group, has made the cash offer. The transaction is conditional on
Celtic withdrawing all legal actions concerning the disputed ownership in
Nezhdaninskoye. In addition to the cash consideration, Celtic expects to receive
the repayment of the principal component of the debts owed by SVMC to Celtic
totalling approximately US$10 million.

Following discussions with the Company's advisers, the board of Celtic has
unanimously decided that its acceptance of the cash offer is in the best
interests of Celtic and its shareholders. The US$80 million will be held in
escrow and released to the Company conditional upon the withdrawal of all legal
actions by Celtic in relation to the ownership of Nezhdaninskoye, which is
expected to occur by 31st March 2006.

Whilst its goal of developing Nezhdaninskoye has not been met, the Company
recognises that a cash return of this magnitude in the current business climate
in Russia is exceptional and very much in the best interests of shareholders.
Celtic's total investment in Nezhdaninskoye to date has been approximately US$30
million.

Celtic has always maintained, and continues to do so, that it owns 50% of SVMC,
but third parties laid claim to 60% of this interest. Full details of these
disputes were provided by the Company on 6th October and 24th November 2005. For
almost three years, Celtic has been in negotiations with various parties,
principally IG Alrosa, relating to the future of the Nezhdaninskoye mine and
whilst doing so, had agreed to postpone legal actions concerning the disputed
shareholding in SVMC. These legal actions were reactivated when Polyus announced
that it had acquired from IG Alrosa certain gold properties which included the
interests in Nezhdaninskoye which Celtic did not own.

Whilst the Company believes that the continuation of the legal cases would have
eventually resolved the ownership dispute in Nezhdaninskoye in its favour, this
process could have taken between 18 and 24 months to complete, at substantial
financial and managerial cost to the Company and with no guarantee of success.
Consequently, Celtic believes that resolution of the disputed 30% interest in
SVMC is best left to remaining SVMC shareholders and the third parties.

The future

Celtic's fundamental aim remains: to grow into a significant gold mining
company. This will be accomplished by building on the production base at the
Suzdal and Zherek mines in Kazakhstan and by way of new acquisitions in the FSU
and elsewhere. The Company has been assessing a number of such acquisitions and
continues to do so in order to build up its gold resources under management.

Kazakhstan update

In Kazakhstan, Group gold production from Suzdal and Zherek for 2005 will total
more than 37,000 ozs, an increase of approximately 17% on 2004. While this level
of production is short of management's forecast, the Board is satisfied with the
progress at both mines throughout 2005 and is confident of the increase in
production forecast for the current year.

Construction of a new plant at Suzdal to treat sulphide ores using BIOX(R)
technology was completed in May 2005 and full scale commissioning is underway.
Various mechanical issues, principally due to western supplied air blowers to
the BIOX(R) plant, are being overcome. Suzdal mine production is forecast to
reach a rate of more than 60,000 ounces in the current year and, at full
capacity is expected to produce 100,000 ounces of gold per year.

At Zherek, open pit heap leach operations continued normally and for the full
year exceeded budget forecasts. We will investigate further the potential for
mining the sulphide ores in place below the open pit.

Comment

Peter Hannen, Chairman of Celtic, commented, "Whilst this is not the outcome we
anticipated or wished for, it does now provide an opportunity to reinvest the
substantial cash value we have obtained.

In the last three years, the Company has moved forward on all of its goals for
shareholders - except its ability to convert Russian gold mine ownership into
producing ounces. We disposed of all non-core assets, now represented by
shareholdings in companies worth significantly more that their original values
and increased our ownership from 15% to 100% of Suzdal. We have introduced
leading processing technology to Kazakhstan via the Suzdal agglomeration-heap
leach for low grade oxide ores and the BIOX(R) process for refractory sulphide
ores. The Company has learned a lot about asset acquisitions in the region from
its recent experience and the management has gained valuable insights, which we
will now use to move forward and continue building a significant company geared
to the bright future of gold."

For further information please contact:

Kevin Foo / Kate Dexter Smith            Leesa Peters / Laurence Read
Celtic Resources Holdings Plc            Conduit PR
Tel: + 44 (0)20 7921 8800                Tel: [phone]
[e-mail]            Tel: [phone]
                                         [e-mail]

Frank Moxon / Nick Morgan
Williams de Broe Plc
Tel: [phone]

                             www.celticresources.com




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