MK Gold Company Announces Completion of Positive Las Cruces Project Feasibility Study.

Business Editors

SALT LAKE CITY--(BUSINESS WIRE)--March 26, 2001

The Board of Directors of MK Gold Company has accepted the results of the final feasibility study of the Las Cruces Project (Project) and has authorized the company's management to proceed with the next stage of the Project, which includes permitting and project financing.

The Project is held by a wholly owned subsidiary of MK Gold Company, Cobre Las Cruces, S.A. (CLC), and was acquired from Rio Tinto plc in September 1999. The Project is at the eastern margin of the Iberian Pyrite Belt, 15 kilometers northwest of Seville and is based on a high-grade copper deposit which was discovered in 1994 by geophysical surveying. The Board's decision was based on three factors:

1. a positive feasibility study produced by Bechtel

International, Inc. (Bechtel), demonstrating the technical

viability of the Project,

2. an environmental impact study produced by FRASA Ingenieros

Consultores, S.L. which determined that the Project can be

designed for environmental compatibility, and

3. an analysis indicating that the Project's economic performance

will be robust, using conservative criteria.

In February 2000, Bechtel was awarded a contract to produce a feasibility study of bankable quality, which required close coordination with other internationally recognized subcontractors and consultants. The Project was designed to a high standard of environmental care. An open pit is planned to excavate 150 meters of calcareous clay, known as marl, and a thin sandstone aquifer which overlies the orebody, before mining the ore reserve which consists of 15.8 million tonnes of chalcocite ore, grading 5.94% copper. An average of 1.2 million tonnes per year of ore will be mined and processed over the 13 1/2-year life of the operation, producing more than 834,000 tonnes of cathode copper. Protection of the water resources of the area affected by the mine was carefully planned and includes dewatering the open pit and re-injection of the extracted groundwater into the aquifer to avoid adverse impact on surrounding groundwater users. Water needed to process ore will be pumped 15 kilometers from a sewage treatment plant located in Seville.

A state-of-the-art, environmentally friendly, hydrometallurgical facility was designed, based on a ferric leaching process developed by Dynatec Corporation. The ore mined will be crushed and ground using conventional technology followed by copper leaching, solvent extraction and electrowinning to produce cathode copper of LME grade A quality. Plant design will allow production of up to 72,000 tonnes per year of cathode copper with an average annual production of 63,000 tonnes per year. Copper recovery is conservatively estimated at an average of 89%. Tailings from the process plant will be filtered, producing a nearly dry material that will be progressively encapsulated in marl. This system of tailings management eliminates the need for a conventional tailings dam with the associated risk of failure.

The Project will positively impact the local economy through the generation of 1,000 temporary jobs during construction and 270 permanent positions. Indirect employment required to support the Project is estimated at 750 jobs throughout the Project life. The economics of processing gold-bearing gossan that caps the orebody and primary mineralization located beneath the enriched chalcocite deposit have yet to be determined. After mining ceases, the open pit will be partially backfilled with marl to isolate the aquifer and mineralized zone in the base of the open pit. The open pit will then be filled with run-off water to create a permanent lake of good quality water. The remaining overburden will be carefully contoured and re-vegetated throughout mining operations and after the mine closure.

The capital costs of the Project are estimated at US$289 million, including working capital, land purchases, and contingencies, but excluding interest during construction and other financing costs. Cash operating costs per pound of copper produced are expected to average US$0.33 per pound, which places the Project among the lowest cost copper producers internationally.

In conjunction with an application by CLC for a mining concession, the feasibility study and the environmental impact study were submitted to regional authorities for the Government of Andalusia on Friday, March 23rd. The schedule developed by Bechtel in the feasibility study allows 23 months for land acquisition, contractor mobilization, engineering and construction, following receipt of the mining concession.

MK Gold is engaged in the business of mining gold, contract mining, and exploring for and acquiring precious metal and other mineral properties. Leucadia National Corporation holds 72.9% of MK Gold Company's outstanding stock. The Company is incorporated in Delaware and its executive offices are located at 60 East South Temple, Suite 2100, Salt Lake City, Utah 84111.

For further information, contact John Farmer at 801-297-6900, or visit MK Gold Company's website at www.mkgold.com.

This press release and statements by the Company in reports to its shareholders and public filings, as well as oral public statements by Company representatives, may contain certain forward-looking information that is subject to certain risks and uncertainties that could cause actual results to differ materially from those projected. Without limitation, these risks and uncertainties include the volatility of copper prices, imprecision of reserve estimates, risks of exploration and development stage projects, political risks of development in foreign countries, risks associated with environmental regulations, mining risks and competition. Additional information about these and other factors that could affect the Company's business is set forth in the Company's 1999 Annual Report on Form 10-K and other filings with the Securities and Exchange Commission.