Co-O Mine

31 October 2011

Medusa Mining Limited

Co-O Mine

(ASX & LSE: MML)

Medusa Mining Limited ("Medusa" or the "Company"), through its Philippines operating company Philsaga Mining Corporation advises that on 26 October 2011, an underground miner on afternoon shift was involved in a fatal accident in a shrinkage stope at the mine. The broken ore that the miner was standing on collapsed due to an undetectable cavity caused by bridging above the full ore chute.

He was recovered by the Mine Rescue Team and transported to the Mine Hospital where he was pronounced dead on arrival. All relevant Government departments have been notified and the Company is providing a full range of support services to the deceased's family.

This very unfortunate accident, the first Lost Time Accident in six months, will cause a reduction in the December quarter production as the stopes have temporarily ceased operation while an investigation into the accident is being conducted. Aside from the stopes in question, the mine is fully operational.

The Company prioritises employee safety above production and currently has a workforce of around 1,000 at the mine out of a total workforce of approximately 2,700 employees.

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