Oxus Mining plc (“Oxus”) (OXS.L) announces that it has been notified by MAED Limited (“MAED”) that it now has an interest in 34,934,237 ordinary shares in the company, amounting to 19.29% of the issued share capital. Full details of this notification are contained in a separate announcement released today. MAED, which is the contractor at Amantaytau, has indicated that (together with associates) it wishes to become involved in the management of the Company and may seek representation on the board.

Oxus also reports further developments in the financing of the construction of the Amantaytau Phase 1 open pit heap leach operation. In addition, Oxus announces that it has been granted the exclusive rights to develop Khandiza through either a concession agreement or a production sharing agreement.

Amantaytau Financing

For the last few months the Group has concentrated on financing activities for the Amantaytau Phase 1 project in Uzbekistan. On 17 July 2002 Amantaytau Goldfields AO (“AGF”) signed a senior loan agreement for a US$31 million project finance facility with Société Générale. On 16 August 2002 Oxus signed an agreement with Société Générale for a US$23 million subordinated insured loan to Oxus’ wholly owned subsidiary, Oxus Resources Corporation (“ORC”). It has been intended that the proceeds of the subordinated insured loan would be on lent to AGF to complete the construction financing requirement net of financing costs, pre-paid interest and costs associated with the insurance guarantee. Draw down of both facilities is subject to further documentation of the subordinated insured loan and satisfaction of other conditions. Oxus has satisfied or is in a position to satisfy all conditions for the draw down of the project finance to AGF other than the provision of a guarantee by an appropriate insurance company.

The outstanding material condition that ORC has not been able to fulfil is the provision of a guarantee by an AA rated guarantor in respect of the proposed subordinated insured loan. Oxus’ prospectus dated 24 May 2002 stated that ORC proposed to enter into a performance contract with AGF under which it would make an advance to AGF and that AGF would agree to repay the advance plus the sunk costs of ORC and interest in accordance with an agreed repayment schedule which would be sufficient to service and redeem the subordinated insured loan. As stated in the prospectus, it was proposed that the ability of AGF to construct and operate the AGF Phase 1 project and to meet the schedule of repayments would be guaranteed by Templeton Insurance Limited (“Templeton”) (or a subsidiary or associate of Templeton) in turn guaranteed by an AA rated insurer. Prior to the issue of the prospectus Templeton undertook to Oxus that it had reached agreement with an appropriate insurer to issue the guarantee. Templeton gave its written consent to the inclusion in the prospectus of references to Templeton’s name in the form and context in which they appeared. Oxus had been notified by Templeton that Hermes Kreditversicherungs AG (“Hermes”) would provide this guarantee through the agency of College Hill Underwriters Limited.

Oxus has continued to work with College Hill Underwriters Limited and Templeton to arrange for the guarantee to be issued. Oxus has now concluded that such a guarantee is unlikely to be provided by or on behalf of Hermes, and accordingly Oxus has now made formal demand for Templeton to honour its contractual obligations or face legal action.

Oxus is investigating alternatives for the provision of the additional Oxus loan to AGF but does not expect to be able to do so in time to meet the revised target of 8 November 2002 set for the achievement of all conditions precedent for the project finance facility. It is therefore likely that it will not be possible to fulfil the conditions precedent for the project finance facility in the near future and there is a risk that Société Généraleand the syndicate banks will not agree to further extensions for the satisfaction of those conditions. Oxus continues to work closely with Société Générale, the syndicate banks and its financial advisers, Endeavour Financial, in an effort to structure, if necessary, a viable alternative strategy for the development of AGF Phase 1 prior to 8 November 2002.

If no alternative to the insurance guarantee can be found prior to 8 November 2002 it is the intention of the directors to undertake a programme of cost reduction in order to preserve the Company’s working capital until a revised financing package or alternative development strategy can be agreed. The directors will also consider, amongst other options, the possibility of an amalgamation with a strategic industry partner if it is felt that this is the most efficient way to deliver shareholder value.

For the avoidance of doubt Oxus confirms that there is no connection between College Hill Underwriters Limited and Oxus public relations consultant College Hill Associates Limited.

Khandiza Concession Agreement

With regard to the Khandiza property in Uzbekistan, Oxus is pleased to announce that, pursuant to a decree of the Cabinet of Ministers of the Government of Uzbekistan issued on 17 October 2002, it has been granted the exclusive rights to develop Khandiza through either a concession agreement or a production sharing agreement, and not via a 50% owned joint venture, as previously contemplated. Oxus will undertake to complete a feasibility study within 24 months from the date of the decree.

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Contacts:

Oxus Mining
Tel: +44 (0) 1483 714 411
Roger Turner, CEO oxus@oxus.demon.co.uk
Sacha Borthwick, VP Corporate Development & IR www.oxusminingplc.com

Brown Shipley Corporate Finance
Tel: +44 (0) 20 7606 9833
Bill Staple

College Hill Associates
Tel: +44 (0) 20 7457 2020
Archie Berens