KHAN RECEIVES NOTICE FROM STATE PROPERTY COMMITTEE OF MONGOLIA

Ulaanbaatar, /MONTSAME/ Khan Resources Inc. has provided a further update concerning the new Nuclear Energy Law that was approved by the Mongolian Parliament on July 16, 2009. Khan continues to advance discussions with the Mongolian state owned company, MonAtom LLC ("Monatom"), to find a mutually satisfactory solution which complies with Mongolian laws and maximizes value for all stakeholders.
As previously reported, the Nuclear Energy Law states that it gives the Mongolian Government the right to take ownership without payment of not less than 51% of the shares of a project or joint venture if uranium resources were determined through exploration with State funding, or not less than 34% if State funding was not used during exploration to determine the resource. To that effect, Khan wishes to announce that its 58% owned Mongolian subsidiary, Central Asian Uranium Company, Limited ("CAUC"), has received a formal notice from the State Property Committee of Mongolia ("SPC") requiring CAUC to propose to its shareholders a resolution to approve an increase of the Mongolian State ownership in CAUC to 51%. The notice provides that if a favourable resolution is not provided to SPC by January 31, 2010, CAUC's mining license may be in danger of revocation.
"We view this notice as part of the process of implementing the new Nuclear Energy Law", said Martin Quick, President and Chief Executive Officer of Khan. "We have been working cooperatively with representatives of the Mongolian Government in an effort to reach a mutually satisfactory arrangement that will provide the framework which allows the Government of Mongolia to achieve its goals while also protecting Khan's investment in the project and enabling us as the operator to proceed with the development of the mine. Our discussions have been constructive, and are continuing. As set out in our Directors' Circular, we believe that even with 51% Government participation, the Dornod property is highly valuable to Khan and that value is not recognized in ARMZ' hostile bid."
On November 30, 2009, Atomredmetzoloto JSC ("ARMZ") launched an unsolicited take-over bid for all of the shares of Khan . On December 15, 2009, the Board of Directors of Khan issued its Directors' Circular unanimously recommending that shareholders reject the ARMZ Offer. The Board continues to believe that the ARMZ Offer is an opportunistic attempt by ARMZ to take advantage of the regulatory uncertainty in Mongolia, and that in addition to being inadequate and failing to provide full value to Khan shareholders, the ARMZ Offer contains objectionable conditions that are prejudicial to Khan and its shareholders.
CAUC is currently 58% owned by Khan, 21% owned by MonAtom, a Mongolian state owned company, and 21% owned by JSC Priargunsky Industrial Mining and Chemical Union ("JSC PIMCU"), a subsidiary of ARMZ. CAUC holds the mining license for the Main Dornod Property. As previously announced, the mining license was temporarily suspended in July 2009, and CAUC has submitted an application to re- register the mining license under the new Nuclear Energy Law passed in July 2009.
Khan Resources Inc. is a Canadian company engaged in the acquisition, exploration and development of uranium properties. Its current activities are focused on the Dornod area in northeastern Mongolia, the site of a former Russian open-pit uranium mine. Khan holds interests in the Main Dornod Property, licensed for mining, and in the Additional Dornod Property, licensed for exploration.
S.Batbayar