Oxiana will not exercise its option at Kalimantan Gold"s KSK Contract of Work (COW) in Central Kalimantan, Indonesia.

Oxiana considers that its 2007 exploration program during which it spent US$2.5 million drilling 16 holes over 6000 metres, adequately tested the four highest ranked copper prospects within the KSK COW and failed to indicate the presence of a shallow-style economic porphyry deposit.

Kalimantan Gold CEO Rahman Connelly says: "While Oxiana's decision is disappointing our own geologists retain confidence in the copper potential of the KSK COW. For this reason the board has commissioned an independent report from leading expert Dr Peter Pollard who has consulted to most of the world's major copper projects. His report will form the basis of a data package to be provided to two major mining companies that have already confirmed their interest to review data."

Following encouraging results from a scout drilling program Kalimantan is stepping-up the drilling program at the Jelai epithermal gold prospect in East Kalimantan, where it plans to have three drill rigs working shortly.

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