Severstal strategic holding

Celtic Resources Holdings PLC
14 August 2007


                                        
                          Celtic Resources Holdings Plc
                          ("Celtic" or "the Company")
                                        
                 Severstal acquires strategic holding in Celtic

Celtic is pleased to announce that ZAO Severstal Resurs ("Severstal Resurs"), 
which manages the mining assets of OAO Severstal ("Severstal") has informed the
Company that Severstal's subsidiary, Bluecone Limited, has agreed to acquire 
for cash approximately 12.3 million shares of €0.25 each in the Company 
("Ordinary Shares"), a c.22% interest in the current issued share capital, 
through a purchase of Ordinary Shares from Aton International Limited.

Severstal is an international steel producer with a listing on the Russian
Trading System and the London Stock Exchange. Incorporated in 1993, the company
focuses on high value-added and unique niche products and has a successful track
record of acquiring and integrating high-quality assets in North America and
Europe. Severstal's mining assets in Russia are securing its supplies of raw
materials. In 2006 Severstal produced 17.6 million tonnes of steel and had
revenues of US$12.4bn, PBT of US$1.8bn and EPS of US$1.27.
.
Celtic Chairman, Peter Hannen, said, "We are delighted to welcome Severstal into 
Celtic as our largest shareholder. They are a major player in the Russian Iron 
and Steel industry and are currently expanding internationally and we look 
forward to working with them productively and profitably to achieve our strategic 
objectives in the region".

For further information please contact:

Kevin Foo / Jonathan Scott-Barrett   Jane Stacey / Leesa Peters
Celtic Resources Holdings Plc        Conduit PR
Tel: + 44 (0)20 7921 8800            Tel: [phone]
[e-mail]        [e-mail]

Simon Raggett / Braden Saunders      Peter Krens
Strand Partners Limited              Mirabaud Securities Limited
Tel: [phone]            Tel: [phone]


                            www.celticresources.com
                                        

Celtic Resources Holdings Plc

Celtic operates the Suzdal and Zherek gold mines and the Shorskoye molybdenum 
mine in Kazakhstan and has a 74.51% interest in the Tominskoye copper project in 
the Chelyabinsk region of southern Russia. It produced approximately 62,000 
ounces of gold in 2006 and had a pre-tax profit of US$39.8m. It is a leader in 
the processing of refractory gold ores and operates the only BIOX plant in the 
FSU at its Suzdal mine.

Celtic intends to use its strong balance sheet, sound operating record and cash 
flow from its three operating mines to achieve the following key targets within 
three years:

   • Substantially increase our gold reserves by acquisition and internal
     growth
   • Increase gold production to more than 300,000 oz/yr
   • Maintain cash operating costs at less than US$350/oz
   • Develop highly profitable base metal projects through acquisition and
     exploration with selected partners
   • Build on current levels of profit and to continually strengthen our
     balance sheet.


Severstal Resurs

Severstal Resurs manages all of Severstal's mining operations. Severstal is an 
international steel producer with a listing on the Russian Trading System and 
the London Stock Exchange.  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 a 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 the Middle East through the ports of St. Petersburg, Murmansk, Arkhangelsk, 
Rostov and Taganrog.




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