Medusa Mining Ltd New Co-O Plant to Increase Production Capacity

 
TIDMMML 
 
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 
 
                 NEW Co-O PLANT TO INCREASE PRODUCTION CAPACITY 
 
      Medusa Mining Limited (ASX and LSE - MML; TSX - MLL) ("Medusa" or the 
     "Company"), through its Philippines operating company Philsaga Mining 
Corporation is pleased to announce that the Board has approved the construction 
 of a new Co-O treatment plant and associated infrastructure ("New Plant"). In 
 addition, a major mine expansion/development program ("Expansion") at the Co-O 
              Mine to increase production capacity has commenced. 
 
    For the year ended 30 June 2010, the Co-O Mine and current mill produced 
  89,679 ounces of gold. Once fully operational, the New Plant is expected to 
 provide processing capacity to produce 200,000 ounces of gold per annuam based 
               on the current grade of the Co-O Mine's reserves. 
 
  Preliminary cost estimates for the New Plant (with an initial design capacity 
      to treat 750,000 tonnes per annum) and Expansion are expected to be 
      approximately US$80 million and the Company intends to fund the cash 
            requirements of the New Plant and Expansion internally. 
 
     The construction time for the New Plant after the necessary regulatory 
  approvals are granted is estimated at between 18 to 24 months, and the full 
   benefits of the Expansion are expected to be realised shortly thereafter. 
 
 The Company is currently in preliminary discussions with engineering groups and 
                  will provide further details in due course. 
 
              Geoff Davis, Managing Director of Medusa, commented: 
   "This decision heralds a new era for the Co-O Project, and demonstrates the 
  Board's confidence in the future of its Co-O operations. It also confirms a 
                   measured approach to our growth strategy. 
 
  The drill results released on 29 October 2010 re-inforce the growth potential 
                     of the Co-O Mine and surrounding area. 
 
      It is also pleasing that the capital requirements of the New Plant and 
 Expansion will be funded out of cashflow and that the cashflow generated from 
 the New Plant once it is operational is intended to in turn fund the Company's 
                          next project, Bananghilig." 
 
                    For further information please contact: 
 Australia 
 
 Medusa Mining Limited                      [phone] 
 
 Geoffrey Davis, Managing Director 
 
 Roy Daniel, Finance Director 
 
 United Kingdom 
 
 Fairfax I.S. PLC                           [phone] 
 
 Financial Adviser and Broker 
 
 Ewan Leggat/Laura Littley 
 
 Lothbury Financial Services                [phone] 
 
 Michael Padley/Libby Moss 
 
 Canada 
 
 Nicholas Sayce, Investor Relations         [phone] 
 
 
  Technical  and scientific information in this  report has been reviewed and is 
based  on  information  compiled  by  Mr  Geoff  Davis,  who  is a member of The 
Australian  Institute of  Geoscientists. Mr  Davis is  the Managing  Director of 
Medusa  Mining Limited  and has  sufficient experience  which is relevant to the 
style  of mineralisation  and type  of deposits  under consideration  and to the 
activity  which he is undertaking to qualify  as a "Competent Person" as defined 
in  the  2004 Edition  of  the  "Australasian  Code for Reporting of Exploration 
Results,  Mineral Resources  and Ore  Reserves" and  is a  "Qualified Person" as 
defined   in   "National   Instrument   43-101" of   the   Canadian   Securities 
Administrators.  Mr Davis consents to the inclusion in the report of the matters 
based on his information in the form and context in which it appears. 
 
  Refer  to  the  Technical  Report  which  was filed onSEDAR in August 2010 for 
further discussion of the Co-O Deposit's geology, structural controls, drilling, 
sampling  and  assaying  information,  and  any  known  material  environmental, 
permitting, legal, title, taxation, socio-political, marketing or other relevant 
issue. 
 
  DISCLAIMER 
  This  announcement may  contain certain  forward-looking statements. The words 
'anticipate',  'believe', 'expect', 'project', 'forecast', 'estimate', 'likely', 
'intend',   'should',   'could',  'may',  'target',  'plan'  and  other  similar 
expressions are intended to identify forward-looking statements. Indications of, 
and guidance on, future earnings and financial position and performance are also 
forward-looking statements. 
 
  Such  forward-looking statements are not  guarantees of future performance and 
involve  known and unknown risks, uncertainties and other factors, many of which 
are  beyond  the  control  of  Medusa,  and  its officers, employees, agents and 
associates,  that  may  cause  actual  results  to  differ materially from those 
expressed or implied in such statements. 
 
  Actual  results,  performance  or  outcomes  may  differ  materially  from any 
projections  and forward-looking statements  and the assumptions  on which those 
assumptions are based. 
 
  You  should not place undue reliance on forward-looking statements and neither 
Medusa  nor  any  of  its  directors,  employees,  servants or agents assume any 
obligation to update such information. 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
 
[HUG#1463180] 
 
 
 
 
 
 
 
 
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     originality of the information contained therein. 
 
Source: Medusa Mining Ltd via Thomson Reuters ONE