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UPDATE 1-Mongolia court rules in favor of Khan Resources

* Appellate court upholds administrative court decision

* Says NEA has right to appeal ruling within 30 days

Oct 27 (Reuters) - Khan Resources Inc KRI.TO said the Mongolian appellate court ruled in its favor regarding its mining license and upheld an administrative court decision, which was contested by the Nuclear Energy Agency (NEA).

In July, the Capital City Administrative Court had said notices issued by the NEA meant to invalidate the mining license held by Khan’s subsidiary, Central Asian Uranium Co LLC, were illegal and invalid.

Khan, which owns license to explore uranium at Dornod, has been facing trouble from the Mongolian authorities.

The NEA has a right to appeal the appellate court ruling within 30 days, Khan said in a statement.

“We now trust the NEA will move forward with re-registering our licenses under the Mongolian Nuclear Energy Act, or will provide just cause as to why not, all as prescribed by the laws of Mongolia,” Chief Executive Grant Edey said in a statement.

The company had submitted applications for re-registration of the mining and exploration licenses in November 2009.

Shares of Toronto, Ontario-based Khan closed at 38.5 Canadian cents Tuesday on the Toronto Stock Exchange. They have lost 38 percent of their value year to date. (Reporting by Bhaswati Mukhopadhyay in Bangalore; Editing by Aradhana Aravindan)

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