Variation to terms of Convertible Loan Note

ELECTRUM RESOURCES plc("Electrum Resources", "Electrum" or the "Company")

AIM: ECR

US OTC: MTGDY

Variation to Terms of Convertible Loan Notes Approved

London 29 September 2010

Electrum Resources plc, the diversified mineral and renewable energy development company, is pleased to announce that at today's extraordinary meeting of holders ("Loan Note Holders") of the unsecured convertible loan notes of a principal amount £2,565,000 ("Loan Notes") issued by the Company and constituted by a loan note instrument dated 17 October 2007 ("Loan Note Instrument"), approval was secured from Loan Note Holders by way of extraordinary resolutions to vary the terms of the Loan Note Instrument in accordance with the Company's announcement of 14 September 2010.

The key terms of the varied Loan Note Instrument are now as follows:

- The Loan Notes are repayable on 17 October 2013, a 3-year extension to the previous repayment date;

- Conversion of the Loan Notes at the election of Loan Note Holders may take place at 1.1 pence per share; and

- The rate of interest carried by the Loan Notes is 10% per annum.

The Company retains the ability to:

- Repay the Loan Notes early, subject to the right of Loan Note Holders to elect to receive repayment in shares at the conversion price of 1.1 pence per share; and

- Purchase Loan Notes at any price and at any time by tender, private treaty or otherwise by agreement with the relevant Loan Note holder.

Patrick Harford, Managing Director of Electrum Resources plc, comments:

"The approval of these new terms by Loan Note holders puts Electrum on a substantially improved financial footing for the continued development of its asset portfolio. This will enable the Company to achieve the maximum benefit from its projects."

About Electrum

Electrum Resources plc is a diversified mineral and renewable energy development company which specialises in identifying undervalued projects and structuring them to maximise their development and capital raising potential. Electrum holds a substantial interest in THEMAC Resources Group, a company listed on the TSX Venture Exchange. The primary objective of THEMAC Resources Group is to return the Copper Flat project, a former producing copper-molybdenum-gold-silver mine located in New Mexico, USA, to commercial production. Electrum also has solar energy interests in New Mexico along with numerous other promising assets elsewhere in the world.

For further information please contact

Electrum Resources plc

Michael Silver, Chairman Tel: +44 (0) 20 7929 1010

Patrick Harford, Managing Director

Email: [email protected]

Website: www.electrum-resources.com

Daniel Stewart & Company plc

Oliver Rigby/Tessa Smith Tel: + 44 (0) 20 7776 6550

Old Park Lane Capital plc

Forbes Cutler Tel: +44 (0) 20 7518 2603

Bankside Consultants Ltd

Simon Rothschild Tel: +44 (0) 20 7367 8888

Barry Kaplan Associates

Larry Kaplan Tel: +1 732 747 0702