Alhambra Resources Ltd. - Kemerkol Oil and Natural Gas Subsoil License Dispute



    CALGARY, Sept. 30 /CNW/ - Alhambra Resources Ltd. ("Alhambra" or the
"Corporation") announces that as a result of litigation in the Republic of
Kazakhstan to which Alhambra was not a party, legal title to the Kemerkol
subsoil oil and natural gas contract no. 1580 ("Kemerkol License") has been
recently reinstated to Saga Creek Gold Company LLP ("Saga Creek"), Alhambra's
wholly owned subsidiary in the Republic of Kazakhstan.
    By way of background, in 2003 Alhambra directly and indirectly purchased
all of the issued and outstanding units of Saga Creek. In connection with
negotiations related to this transaction, it was agreed that the vendor
("Vendor") of the Saga Creek units would retain beneficial ownership of the
right to receive the Kemerkol License, once it was issued. In keeping with
that agreement, the Kemerkol License was transferred to the Vendor when the
Kemerkol License was issued by the Republic of Kazakhstan in 2005. After a
series of subsequent transactions and court decisions in the Republic of
Kazakhstan not involving Alhambra, title to the Kemerkol License has been
recently reinstated to Saga Creek.
    Victoria Oil & Gas PLC, Feax Investment Co. Ltd. and Victoria Energy
Central Asia LLP, (collectively the "Plaintiffs") claim entitlement to the
Kemerkol License but were unsuccessful before the courts in the Republic of
Kazakhstan. Consequently, they commenced legal proceedings in the Court of
Queen's Bench of Alberta on September 26, 2008 against Alhambra and others to
prevent Alhambra and Saga Creek from disposing of the Kemerkol License until
entitlement thereto has been determined by the courts. The Court granted a
temporary injunction in that regard on September 26, 2008. The action alleges
that the Vendor acted fraudulently regarding the Kemerkol License and along
with restoration of the Kemerkol License claims for punitive damages of
$5,000,000 from all the defendants. Alhambra believes there is no prospect
that it could be found liable for such damages.
    As for the entitlement to the Kemerkol License, Alhambra does not now and
has never claimed a beneficial interest in the Kemerkol License nor has it
ever been material to its gold mining business and operations in the Republic
of Kazakhstan, and views itself as being unfortunately involved in third party
litigation regarding the disputed ownership of the license.
    Alhambra does not believe the Courts of Alberta should have intervened in
the dispute over the Kemerkol License, denies all allegations in the Statement
of Claim and intends to vigorously defend the action commenced by the
Plaintiffs, even though no compensatory damages are being sought from
Alhambra. Alhambra will continue to monitor the dispute regarding the Kemerkol
License and take whatever actions the board of directors deem necessary in the
best interests of Alhambra, subject to the terms of the temporary injunction
while it subsists.

    About Alhambra

    Alhambra is a Canadian based gold exploration and production corporation
engaged in the exploration of and production from its 100% owned Uzboy
Project. Alhambra is currently in its sixth year of operations in the Republic
of Kazakhstan.
    Alhambra common shares trade on The TSX Venture Exchange under the symbol
ALH and in Germany on the Frankfurt Open Market under the symbol A4Y. The
Corporation's website can be accessed at www.alhambraresources.com.

    
    The TSX Venture Exchange Inc. has neither approved nor disapproved the
    information contained herein.
    

    This news release contains forward-looking information including but not
limited to comments regarding the timing and content of upcoming work programs
and potential mineral recovery processes. Forward-looking information includes
disclosure regarding possible future events, conditions or results of
operations that is based on assumptions and courses of action, and therefore,
involves inherent risks and uncertainties. For any forward-looking information
given, management has assumed that the analytical results it has received are
reliable and the metallurgical testing methodologies applied are consistent
with industry standards. Although management has a reasonable basis for the
conclusions drawn, actual results may differ materially from those currently
anticipated in such statements. For such statements, we claim the safe harbor
for future.





For further information:

For further information: Donald D. McKechnie, Chief Financial Officer,
(403) 228-2855; John J. Komarnicki, Chairman and Chief Executive Officer,
(403) 228-2855

Organization Profile

ALHAMBRA RESOURCES LTD.

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