Medusa Mining Ltd. – Co-O Mine update

Medusa Mining Limited , the Australian based company operating and developing gold mines in the Philippines, announces that drilling has commenced on the Co-O Mine deeps, with rigs drilling on each side of the Oriental Fault. Drilling will be undertaken systematically westwards and eastwards away from the Oriental Fault and, subject to topographic and other constraints, will aim to intersect the vein system at approximately the 2950 metres level, which is 100 metres below the current bottom of the mine or 200 metres below adit level. It is anticipated that the first results from the drilling will be available in late February.

The Company also advises that torrential monsoonal rain over the last two weeks at the Co-O Minesite caused a landslide on Monday night in the vicinity of the main Co-O adit, resulting in approximately 60,000-70,000 tonnes of material slipping from approximately 70 metres above the adit. Some of the material has temporarily blocked the adit entrance, cut power lines and other services to the mine. No personnel were affected by the slide as all were evacuated through the Tinago Shaft at the western end of the mine.

It is anticipated that, with three front end loaders working around the clock, the adit will be re-opened by the end of the week and services restored soon after. Slope stabilisation works have commenced. Continuing rain at the site delayed a full assessment of the situation until Tuesday afternoon as the mine access road was temporarily cut.

The Directors consider that the delay should not materially impact on the Company’s production targets. At this stage, stockpiles which ran down over the Christmas period, should keep the mill running until late this week.

Geoffrey Davis, Managing Director of Medusa, commented:

”The landslide is a minor setback for us which we expect to rectify fully, with all services restored within the next two weeks. The positive news is that the additional drilling on the Co-O Mine deeps will assist us in defining the vertical extent of the vein system, thus giving us a more accurate idea of the mine’s depth potential.”

For further information, please contact: Medusa Mining Limited +61 8 9367 0601 Geoffrey Davis, Managing Director

Roy Daniel, Finance Director

Ambrian Partners +44 (0)20 7776 6417

Richard Brown / Richard Greenfield