Chairman`s Address to Shareholders

 
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MEDUSA MINING LIMITED 
                                                             ABN: 60 099 377 849 
                                                       Unit 7, 11 Preston Street 
                                                                  Como  WA  6152 
 
                                                                      PO Box 860 
                                                        Canning Bridge  WA  6153 
 
                                                      Telephone:  [phone] 
                                                      Facsimile:  [phone] 
 
                                               Email:  [e-mail] 
                                               Internet: www.medusamining.com.au 
 
 
                                                                    ANNOUNCEMENT 
 
                                                                17 November 2010 
 
 
 
CHAIRMAN'S ADDRESS AT AGM 
 
Please find attached the Chairman's address which will be delivered today at the 
Company's  Annual  General  Meeting,  to  be  held  in the Goldsworthy Room, The 
Sheraton Hotel, 207 Adelaide Terrace, Perth, Western Australia at 11.00 am 
 
 
 
 For further information please contact: 
 
 Roy Daniel 
 Finance Director 
 Phone: [phone] 
 Website:www.medusamining.com.au 
 
 
 
 
CHAIRMAN'S ADDRESS 
 
Dear Shareholders, 
 
This  is  my  first  AGM  as  Chairman  of  Medusa and I would like to take this 
opportunity to introduce myself. 
 
My  background is as  a mining engineer  by qualification and  I have learned my 
trade  in  the  Canadian  mining  industry  for  more  than  40 years, mostly in 
underground  mines,  mining  commodities  such  as  potash, coal, gold, zinc and 
copper.  In more recent years I have  managed major mining projects, been CEO of 
HudBay Minerals Inc., as well as Chairman of the Mining Association of Canada. 
 
Since  joining Medusa  in July  this year,  my expectations  have been more than 
confirmed  as the  Company has  achieved substantial  and stable  production and 
established  itself as a gold  producer with cash costs  among the lowest in the 
world.  Your Board of Directors together  with Management plans to continue this 
strong  organic growth and  cost performance profile,  and has set an achievable 
corporate  objective  of  producing  between  300,000 and 400,000 ounces of gold 
within 5 years. 
 
Our  Managing Director, Geoff Davis, who  has a profound knowledge of Philippine 
geology, advises that our well established Co-O Mine and 820 square kilometre of 
land  position  which  comprises  a  structurally  well-defined  but  relatively 
unexplored  mineral field, has the geological potential to achieve our corporate 
objective.  This region of the Philippines is well endowed with minerals and the 
demonstrated  potential at the Co-O  Mine, several advanced exploration targets, 
as  well as the potential to discover  new deposits, all give us confidence that 
Medusa's 5 year organic growth objective is well underpinned. 
 
Within  and around  the Co-O  Mine, together  with areas  identified as advanced 
exploration  targets,  we  will  this  year  continue  our  US$21 million annual 
exploration  programme. This programme  is expected to  extend the potential for 
mineral  resources at  the Co-O  Mine, improve  our confidence  of other mineral 
resources and identify new deposits. 
 
At  site our workforce now exceeds 1,900 people  with a wide range of skill sets 
that  also  benefit  local  businesses.  We  are  proud  to operate with minimal 
expatriates,  attesting to the abundance of skilled personnel in the Philippines 
and  the willingness of employees to develop  new skills in the fields of mining 
and  exploration. We support the  provincial government and local municipalities 
through payment of local taxes, employment, and community programmes. 
 
Well  before  financial  year-end,  our  Co-O  Mine  and  Mill were consistently 
operating  at a rate equivalent to 100,000 ounces  of gold per year. The Company 
produced  89,679 ounces of  gold in  the last  financial year  and as one of the 
lowest  cash cost  producers in  the world  generated a  net profit after tax of 
US$65.8  million. The Company is in a  strong positive cash position and expects 
to self-fund all cash requirements for the next financial year. 
 
We  look  forward  to  the  immediate  year  ahead  and plan to continue to make 
improvements  with the aim of  increasing gold production from  the Co-O Mine by 
having available the full 1,000 tonne per day ore processing capacity of the Co- 
O  Mill. In the  2011-2012 financial year, we  also expect to  have the new Saga 
vertical shaft which will access new mining areas. 
 
In  addition, as announced  earlier this morning,  I am pleased  to tell you the 
Company  is planning to  further increase production  capacity by building a new 
mill  capable of producing  200,000 ounces per year  and by continuing to expand 
the mine. 
 
My  observations from  a recent  site visit  are that  we have  a very dedicated 
workforce  who  work  well  together,  with  common  goals which include safety, 
achieving  production targets and  controlling costs. It  is also clear that our 
mining  and exploration activities fit well  with the local communities near our 
work sites. 
 
During  this last financial year Medusa  has also grown corporately. In addition 
to the listings on the ASX and TSX, the Company has delisted from AIM and is now 
listed  on the LSE.  Recently, Medusa also announced and paid a maiden dividend, 
recognising  the substantial support of the  Company's shareholders, and aims to 
pay a regular dividend annually. 
 
Medusa  today, I believe  is in an  enviable position with   its high grade Co-O 
Mine, recent near mine exploration success to further fuel growth, together with 
the  potential of regional exploration success to achieve our 5 year self-funded 
organic production target. 
 
In  closing on behalf  of the Board  of Directors, I  would like to particularly 
thank  Geoff Davis our MD, and his  team for extraordinary leadership in guiding 
Medusa  through challenging times to become a demonstrable low cost producer and 
also  our  Philippine  workforce  who  make  safe  production and exploration an 
everyday  reality. To our shareholders, thank you for the solid support over the 
last  many years and  I hope that  the demonstrated performance  to date and the 
growth  opportunities within  reach will  convince you  to continue  that strong 
support. 
 
Thank You 
 
 
Peter R Jones 
Chairman 
 
 
 
 
 
[HUG#1463182] 
 
 
 
 
 
 
 
 
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Source: Medusa Mining Ltd via Thomson Reuters ONE