12 MONTH INTERIM MONTH REPORT FOR THE PERIOD JANUARY 1 - DECEMBER 31, 2006

· Total Central Asia Gold ("CAG") group gold production during the financial
year 2006 was approximately 311 kg (10,000 oz). 

· Central Asia Gold plans to produce 1,400 - 1,500 kg of gold in 2007 (45,000 -
48,000 oz) 

· Consolidated revenues for the 12-month period amounted to MSEK 74.43 (MSEK
26.96), whereof MSEK 36.02 during the last quarter (MSEK 15.64). 

· The net result after tax for the financial year 2006 was MSEK -18.27 (MSEK +
4.02), whereof MSEK -5.88 during the last quarter (MSEK +6.00). A non cash flow
effecting currency exchange rate loss in the parent company of some MSEK 10.5
is included in the 12 month group net result. 

· EPS was SEK -0.066 for the reporting period (SEK 0.022). For the quarter
October - December 2006 EPS was SEK -0.016 (SEK 0.026). 


Background
Central Asia Gold AB ("CAG AB") is a Swedish junior mining company with
operations in Eastern Siberia, Russia. The group structure consists of the
Swedish joint stock parent company that in its turn controls two wholly-owned
Russian subsidiaries of the limited liability type. Further, the subsidiary OOO
Tardan Gold owns four other subsidiaries. The first, OOO Mars, is owned 50% and
contains vehicles and equipment. The second one, the alluvial gold producer OOO
Artelj Tyva, is owned 99.8%. Thereafter, OOO Kopylovskoye in Irkutsk is owned
99% and, lastly, OOO Tardan Gold owns the subsidiary OOO Perspektiva that is a
company without significant assets used by the Central Asia Gold group as a
vehicle when participating in public privatization auctions in Russia. OOO
Tardan Gold is also in the process of taking over the full ownership of the
Irkutsk region based alluvial gold producer OOO Artelj Lena. 

The operations involve exploration and production of gold primarily in the Tyva
and Irkutsk regions in Russia. 

The group's main assets comprise seven mineral licenses held by the various
subsidiaries. The licenses as at early January 2007 (given completion of the
ongoing Artelj Lena acquisition) encompass some 747,000 troy ounces ("oz") of
gold reserves according to the Russian C1+C2 categories, as well as 1,055,000
oz of P1 gold resources and 5,765,000 oz of P2 gold resources. CAG AB got
publicly listed on the Swedish NGM Nordic Growth Market stock exchange on March
29, 2005. The number of shareholders is currently some 5,000. 

Results - the Group 
For the twelve month period ended December 31, 2006 the group reports a net
result after tax of MSEK -18.27 (MSEK 4.02) which corresponds to SEK -0.066 per
share (SEK 0.022). For the quarter October - December 2006 the net result after
tax was MSEK -5.88 (MSEK 6.00) equalling EPS of SEK -0.016 (0.026). 

Gold sales revenues were MSEK 42.54 during the financial period (2.04), whereof
MSEK 22.79 during the quarter October - December (1.34). This corresponds to an
average realised price of USD 608 per oz. In addition to that, a revenue
component of MSEK 5.70 (MSEK 0.49) in the P/L-account relates to service income
from the subsidiary OOO Mars, that offers transportation services, partly to
external clients. Service income from OOO Mars was MSEK 1.73 during the fourth
quarter of the reporting period (MSEK 0.13). 

Operating costs amounting to MSEK 26.19 on the subsidiary level have been
capitalised as mining permits during the twelve month period (MSEK 16.74),
whereof MSEK 11.50 during the fourth quarter (MSEK 6.47). 

Total operating costs in the group during the reporting period amounted to MSEK
82.67 (MSEK 23.91), whereof MSEK 38.10 pertains to the fourth quarter (MSEK
8.40). 

Net financial items were MSEK -9.09 during the reporting period (MSEK +0.98),
whereof 
MSEK -3.26 (MSEK 0.45) during the quarter October - December. The relatively
big negative figure during the reporting period is to a large extent explained
by non cash flow effecting currency exchange rate losses in the parent company
mainly attributable to the second quarter of the financial year. 

The tax cost for the twelve month period was MSEK -1.08 (MSEK 0) and the
minority share of the net result was MSEK -0.14 (0). 

It is important to emphasize that the fourth quarter of 2006 is the last
quarter when operating costs get capitalized in respect of the Tardan mine that
is now in first stage production. That means that ore is being processed and
gold extracted via a gravimetric processing line. The second enrichment stage
involving a leaching facility is scheduled to come on stream in late 2007. This
however implies that full Tardan operating costs will as from January 1, 2007
be charged to the group profit and loss account without a capitalization
component. In this context should also be repeated that the two alluvial
producers of the CAG group essentially produce and sell their gold during the
second half of each calendar year. 

Operations

Tardan

General overview
Tardan is a medium sized gold deposit that was privatised in a public auction
in the summer of 2003. The Tardan officially established Russian reserves
(C1/C2) and P1 resources, lastly updated in the early 1990ies, amount to
413,000 oz of gold. In addition, it is estimated to contain 4,354,000 oz of P2
gold resources (Russian classification standards). The appraisal work has so
far only been conducted to a depth of some 100 m. 
Some 30 ore bodies exist within a 3.3 square kilometre area of the license
block 80 km to the East of the region's capital Kyzyl. The average gold grade
of the reserves is 10.7 grams/tonne ("g/t"). 
A considerable exploration programme which involved core drilling, trenching
and construction of underground drifts and shafts was carried out in the Soviet
time and has in 2004 - 2006 been supplemented by new data gathering. 

High grade ore bodies
The development programme in respect of the high grade gold ore bodies on the
Tardan deposit continues according to plan. During the last quarter of 2006 the
gravimetric processing plant was assembled on site and the walls and roof of
the factory building got erected in order to cover the processing plant from
the impact of the weather. At the same time some five additional buildings got
constructed, and a few more will get completed in 2007. The buildings represent
dormitories for the staff, a building for the new laboratory, an administrative
building, a canteen and further a building for housing hygiene equipment and
entertainment facilities for the personnel. Also, a central heating system for
the whole camp including the processing plant has been constructed. The source
of the system is a coal fuelled heating plant. 

The initial ore production has commenced on ore body number 26, while as
additional ore bodies have also been prepared for production start. 

The processing plant has been tested during December 2006 - February 2007, and
the turn-key supplier's representatives have been on the site during this
period to make sure the plant starts working as agreed. The OOO Tardan Gold
production team is now pleased with the plant, and the initial production
results are promising. Full year 2007 production from the plant is currently
estimated to end in the range of 330 - 400 kg. The decisive factor will be the
launch of the leaching facility, that is expected to increase the recovery
factor from 50 - 55% to 90%. Tardan Gold management will strive to achieve this
by the end of 2007. 

Just as in the older Kopto processing plant, OOO Tardan Gold will install ovens
in this new plant in order to be able to produce Doré quality gold bars, that
then get sent to a smelter for final enrichment. 


Low grade gold mineralization
Already in 2004 the geologists of Central Asia Gold started to look for
possible reserve increase opportunities on the Tardan license block. The
approach chosen was to confirm a large scale presence, and an economically
feasible development plan, for the lower grade gold concentrations on Tardan.
This is dependent on the fact that a review of historic data as well as of
newly collected information shows that the gold on Tardan is distributed over
wider areas of the license block than the so far established high grade ore
bodies. So far the attention has been focused on the so called "Area 2" to the
East of the high grade ore bodies 24 - 29. Here a more detailed analysis has
been of an area of some 15,400 m2. It is believed that this area alone may
contain up to 10 tonnes (some 300,000 oz) of gold in the ground with a
relatively low content (averaging some 2.28 g/t). As regards Area 2, one deep
well and numerous surface trenches were constructed in the Soviet times, and
the ore body no 1 with recoverable reserves is located there. A lot of new data
was gathered in 2005, partly via two surface trenches. The analysed data so far
supports the hypothesis that there exist extractable gold ores with a
relatively low gold grade within this particular area. A decision to launch the
development programme for these lower grade gold assets can probably be
expected in late 2007, and in this context the geologic department of Central
Asia Gold will go through the ore reserve calculation procedures in the Reserve
Committee of the Russian Natural Resources Ministry. 


Kopto 

General
Together with the Kopto deposit followed an acquisition of a small processing
plant built in the 1990ies. The equipment comprises crushers, a roller mill,
cyclones, separators and shaking tables for a gravimetric process. The Kopto
plant is a small experimental unit, but has for Central Asia Gold during the
first two years of operations served as an experimental platform helping the
organization to prepare for the production work on the Tardan deposit that is
located not far away. The Kopto plant was by year end 2006 closed down as
regards the regular gold production cycle. The production people have now been
moved to the new Tardan plant. The Kopto plant will as from now be used ad-hoc
for geologic exploration work when large volume test batches of ore will be
processed. 

Gold Production in 2006
During 2006, some 17,300 tonnes of ore got processed. Thereof, 5,400 tonnes
pertained to the fourth quarter. That resulted in 50 kg of chemically pure
gold, whereof almost 16 kg is attributable to the last quarter of the reporting
period. 

Gold sales
During 2006 some 38 kg of chemically pure gold was sold. Sales proceeds
amounted to 750,000 USD equalling 614 USD/oz. 

The placer deposit Sivo Pravy Uval
This placer deposit held by the subsidiary OOO GRK Tomano ("Tomano") is located
in the Buryatiya region of Russia, which borders to the Tyva region. It holds
19,000 oz of Russian C1 gold reserves. 
Central Asia Gold in March 2005 concluded a joint venture agreement in respect
of the future development programme of this project. The joint venture partner,
the Russian company OOO GRK Oreol ("Oreol") is the operator of the project, and
shall secure the financing. So far no major development activity has yet been
conducted on the license block. 




The subsidiary gold placer producer Artelj Tyva 
The subsidiary OOO Artelj Tyva produces gold from two gold placers, Bolshoy
Agliyak and Maly Agliyak. Remaining official gold reserves C1/C2 according to
the Russian State Reserve Committee (GKZ) amounted to some 70,000 oz as at the
beginning of 2007 and the average gold grade in the gold containing sands is
recorded at 0.95 g/m3. 

As a placer gold producer, Artelj Tyva produces gold during the warm season of
the year, that is during May - October. The gold production during the
production season 2006 amounted to 261 kg (8,400 kg) including a few nuggets
with a total weight of about 3 kg. This is less than in 2005 due to severe
water flooding that occurred in summer 2006 in China and Eastern Siberia. The
water flooding stalled the production work in Artelj Tyva for a few weeks. 

In the reporting period, Artelj Tyva realised 258 kg of gold corresponding to
an average price of some 607 USD/oz. 


Investments, Liquidity and Financing
Net investments into material fixed assets and financial fixed assets during
the full financial year 2006 amounted to MSEK 149.02 (MSEK 50.50). The figure
for the quarter October - December 2006 was MSEK 92.12 (MSEK 34.35). 

Cash on group accounts was MSEK 81.95 at the end of December 2006 (17.13). 

Employees
The group companies on average employed 422 persons during 2006. As at year end
the number of employees was 506 whereof 46 women and 460 men. 


Share data and outstanding warrants
As per the end of 2006 the number of outstanding shares was 366,196,923. Par
value per share is SEK 0.20. All shares carry one vote and have equal rights to
the company's assets and profits. After the end of the reporting period a
directed rights issue of 36,000,000 shares was registered in February 2007. The
issue price was SEK 1.86 per share. The issue was conducted to finance the
acquisition of the alluvial gold producer Artelj Lena in Irkutsk. As at the
date of this report the number of shares outstanding is therefore 402,196,923.
No more warrants are any longer outstanding. 


Major events after the end of the reporting period

Acquisition of the gold deposit "Kopylovskoye" 
Central Asia Gold in November 2006 agreed on the final terms of the acquisition
of the mining project Kopylovskoye in Irkutsk. "Kopylovskoye" is located 120 km
from the city Bodaibo some 880 km to the north-east of the city of Irkutsk. The
established gold reserves have an average grade of some 3 g/t. The geologic
structure of the project is relatively simple. The gold reserves as per early
2007 amount to 7.45 tonnes (some 240,000 oz) in the categories C1 + C2. In
addition, The P1 resources amount to some 293,000 oz. 

The reserves, though, have only been assigned to a limited part of the ore zone
and only down to a depth of some 30 m. 
The final price and payment conditions for the acquisition imply that Central
Asia Gold, via its subsidiary OOO Tardan Gold, acquires 99% of the Kopylovskoye
project for a consideration of 15 million USD ("MUSD"). Thereof, 12 MUSD will
be paid in cash in instalments, the last one to be paid in May 2007. In
addition, CAG will issue new shares for a counter value of 3 MUSD. The issue
price will be set in relation to the market price of the shares at the time of
completing the issue. The share issue is scheduled to get completed in March
2007. As per December 31, 2006 only a limited part of the purchase price had
been paid, however the ownership of the license company OOO Kopylovskoye had
already been transferred to Central Asia Gold. 

Acquisition of the Irkutsk based gold placer producer Artelj Lena
Central Asia Gold in December 2006 agreed to acquire fully the Irkutsk region
based gold producer Artelj Lena for a consideration of some 9 MUSD.
Approximately half of this amount had been made available to the sellers as at
year end 2006. The acquisition was then fully financed via the above described
new issue of 36 million CAG shares in February 2007. Artelj Lena is an alluvial
gold producing workers' collective (Russian "artelj"). The average gold
production during the last three years has amounted to 830 kg of gold (26,600
oz). The number of employees as at the end of the production season 2006 is
some 510. 

Since the legal status needs to be changed from workers' collective to Limited
Liability Company before it can be acquired by a legal entity, an intermediary
transaction has taken place. This follows the same pattern as when CAG acquired
the subsidiary OOO Artelj Tyva in 2005. Central Asia Gold has as at the date of
this report already fully paid the purchase price and the ownership rights have
been transferred from the sellers. Legally, Artelj Lena is expected to get
consolidated in the CAG group accounts sometimes during March 2007, and
consequently the full gold production in 2007 will be attributable to CAG. The
management team of Artelj Lena will remain in office and carry out the short
term gold production plan. The 2007 gold production target is 800 kg (25,700
oz) . 


Next reports due 

The following are the reporting dates of Central Asia Gold AB in 2007: 

Publishing of annual report for financial year 2006: 2007-05-23
Interim report for Q1 2007 (Jan - March): 2007-05-30
Annual General Meeting in Stockholm: 2007-06-12
Interim report for Q2 2007 (Jan -.June): 2007-08-29
Interim report for Q3 2007 (Jan -.Sept): 2007-11-28


Dividend
The Board of Directors of CAG AB recommends that no dividend be paid for 2006.

Annual report and Annual General Meeting 
The Annual General Meeting (AGM) will be held in Stockholm on Tuesday, June 12
at the address Operaterassen, Karl XII:s Torg, 111 47 Stockholm beginning at
15.00. The annual report will be available in the premises of the Company at
Brovägen 9, Stocksund, Sweden as from May 23. It will also be published on the
company's website and will be mailed to the shareholders that so request. 


Company information
The full name of the parent company is Central Asia Gold AB (publ). It is a
joint stock company of the public type headquartered in Stockholm with Swedish
registration number 556659-4833. The registered address is Brovägen 9, SE-182
76 Stocksund. 

(For complete report see attached file)