LEGEND MINING LIMITED — Interim / Quarterly Report 2003

Jan 29, 2003

Dear Sir

Please find attached our Quaterly Report of Activities, and the Consolidated Statement of Cashflows for the period ended 31 December 2002.

Yours sincerely

Murray McDonald Director LEGEND MINING LIMITED

QUARTERLY REPORT for the period ended 31 December 2002

• High grade gossan and rock chip results from six prospects within 675km2 Karratha Gold and Base Metals Project Area identify new drill targets
• RC drilling at Elizabeth Hill
• Hamill Resources Ltd highlights two anomalous gold trends at Emerald JV

$\mathbf{1}$ . KARRATHA GOLD AND BASE METALS PROJECTS

In October 2002 further field exploration was undertaken on Legend's extensive tenement holdings between Karratha, Roebourne and the Radio Hill Nickel mine. Based on gold and base metal results from this program, a focussed and significant exploration effort will now be accelerated over what has recently become one of the largest holdings in this highly prospective vet underexplored greenstone belt.

A program of mapping and sampling to enhance definition of mineralisation controls at a number of prospects was completed, with a total of 180 rock chip and gossan samples collected. The principal targets were the Orpheus Shear Zone south of the regional Sholl Shear Zone, and the area surrounding the Carlow Castle and Carlow South copper-gold resources previously reported as containing 91,000t at 10.0g/t Au (indicated and inferred). Significant results with greater than 1.0g/t gold and/or 1.0% base metals are given in Table 1 below.

Orpheus and Sholl (Legend 100%)

At least four significant gold/copper/zinc mineralisation centres were confirmed along the 7.5 kilometre strike of the Orpheus Shear Zone. From east to west these are: Orpheus, Nickol Anticline, Reef 3 and B5 - a new discovery east of the Golden Reef alluvial workings. Some of the better rockchip sample results included 14.74g/t gold, 5.58% copper and 5.63% zinc at Orpheus and 13.05g/t gold, 20.77% copper and 9.71% zinc at Reef 3. At the Orpheus and Nickol Anticline prospects, several parallel gossanous shear zones were shown to be highly enriched in base and precious metals (Table 1).

Mineralisation along the Orpheus Shear Zone has been only lightly drill tested by previous explorers. Legend is planning to further drill this extensive mineralised system based on the highly encouraging results from recent fieldwork.

Carlow Castle, Mine Well, Railway (Legend 100%)

Interpretation of recently acquired detailed aeromagnetics and the October field exploration program resulted in greater knowledge of the copper/gold mineralisation controls present in the area of the Carlow Castle and Carlow South high grade resources and surrounding mineral occurrences.

It had been previously demonstrated that at least three different orientations of fault and shear systems host copper/gold mineralisation in the area around the historic Carlow Castle Main Workings. This concept led to the discovery by Legend of the Carlow South high grade gold copper resource, which has a central core grading 10.0g/t Au below a thin soil cover and has yet to be closed off. We now have an upgraded mineralisation model that can be applied with confidence over a much larger area around Carlow.

Several composite rockchip samples taken along large regional linear features returned elevated gold/copper values at Railway, Railway North and Carlow West. These large structures have yet to be subjected to detailed geological assessment. Legend will continue follow-up work in the coming field season to prioritise drill targets and is confident of finding further Carlow South style copper/gold mineralisation within the 52km2 project area.

	Sample	East	North				Cu-		Zn-
Target	No.	GDA94	GDA 94	Au	Ag	Cu	Rp1	Zn	Rp1
				ppm	ppm	$\frac{1}{2}$	₩	₩	℅
Orpheus	KA04	49 8765	768 6848	14.74	293	4.74	5.75	0.04	0.04
Orpheus	KA05	49 8775	768 6826	8.53	23	1.15		0.01
Orpheus	KA06	49 8826	768 6926	11.62	65	5.97		0.01
Orpheus	KA10	49 9572	768 7161	0.71	16	0.29		2.89
Orpheus	KA11	49 9781	768 7389	0.69	11	2.38		5.63
Orpheus	KA12	49 9782	768 7477	6.70	$3137*$	5.58	7.65	0.46	0,61
Orpheus	KA13	50 0107	768 7577	0.20	55	0.22		2.64
Orpheus	KA15	49 9322	768 7342	0.10	6	0.11		1.15
A4	KA75	49 3795	768 9104	0.51	2	0.96		0.01
B5	KA37	49 5120	768 5332	1.76	2	0.05		0.02
B5	KA39	49 5069	768 5242	1.66	2	0.05		0.06
B5	KA168	49 5240	768 5469	1.56	1	0.04		0.05
Nickol
Anticline	KA87	49 6889	768 6668	1.75	1	0.03		0.02
Reef 3	KA27	49 5499	768 6254	0,90	295	20.77	28.42	0.07	0.09
Reef 3	KA28	49 5475	768 6210	0.60	68	6,49	7.65	9.71	15.18
Reef 3	KA29	49 5470	768 6204	13.05	89	9.13	11.05	3,91	5.16
Reef 3	KA176	49 5460	468 6000	0,18	1	0.25		3.97
Carlow
West	KA132	50 6464	769 8843	0.01	1	4.72		0.01
Railway	KA154	50 8712	769 6687	1.21	2	0.13		0.01
Railway	KA157	50 8810	769 6356	443	0	0.00		0.00
Railway
North	KA162	50 9028	769 8400	0.45	4	5.89		0,01
Railway North	KA163
		50 9028	769 8400	0.49	1	1.12		0.02

Table 1 Significant Sample Results, October 2002 Sampling Program
-----------------------------------------------------------------------------

Composite rock chip and gossan samples were collected and descriptions and GPS locations recorded. Analyses were by Genalysis Laboratory Services Pty Ltd using B/SAAS for Au (0.01ppm detection), $B/ARS$ for Ag $(0.1$ ppm), Cu (1ppm) and Zn (1 ppm). Repeat check analyses for Cu and Zn were by AX/OES (10ppm). Note *: one silver check assay was also by AX/OES (5ppm).

$\mathbf{z}$ . MUNNI MUNNI JOINT VENTURE (LEGEND 33 1/3%)

During November to December 2002 33 reverse circulation holes were drilled at the Elizabeth Hill Silver Project with a total of 4096 m. Secondary silver minerals were detected in 5 holes with best results to date of 250ppm in AG43 at 118-119m and 233ppm in AG33 at 190-194m.

Most of the holes drilled south of the mine intersected only minor carbonate alteration and no or patchy silver mineralisation. The east-west trending Elizabeth Hill Fault was found to have a shallow (30°) northerly dip but does not appear to be mineralised. Widespread but low grade (tens of ppm) silver anomalies are associated with an east-west fault immediately south of the previously mined orebody.

Check assaying is in progress to explain discrepancies between logging and assaying. Evaluation will be completed once final analyses have been received.

3. EMERALD GOLD PROJECT. (LEGEND 40%)

Hamill Resources Ltd is earning up to 80% by conducting exploration at Emerald, south of Mt Ida in the Eastern Goldfields.

An auger geochemistry program was designed to test an area in the south of the project considered favourable for hosting gold mineralisation, based upon favourable structural intersections and rock types. Seven east – west lines spaced 200m apart were drilled at $25m$ intervals for a total of $437$ holes, and assayed for Au, As, and Ni at 1.8m depth. Significant elevations in Ni over interpreted ultramafic units on the northern five lines indicate a high level of integrity for much of the assay data. The program highlighted two trends anomalous in gold.

Manay to annel

Murray McDonald DIRECTOR

30 January 2003

Quarterly Report 31.12.02

The information on Munni Munni JV exploration results contained in this report is based on information compiled by consulting geologist Mr Finn Barrett MSc, MGSA, MAIG, MSEG of Barrett Exploration Pty Ltd. Mr Barrett consents to the inclusion in this report of the matters based on his information in the form and context in which it appears. The information on Karratha Gold and Base Metals Projects exploration results is based on
information compiled by consulting geologist Mr Frans Voermans FAusIMM, MAI the inclusion in this report of the matters based on his information in the form and context in which it appears. The information on Emerald exploration results is based on information compiled by Mr Clive Jones MAusIMM of Hamill Resources Ltd. Mr Jones consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

$Rule 5.3$

Appendix 5B Mining exploration entity quarterly report

Introduced 01/07/96. Origin: Appendix 8.

	Name of entity
--	----------------	--	--	--

LEGEND MINING LIMITED

${\rm ABN}$

$\tau_{\rm g}$

22 060 966 145

Quarter ended ("current quarter")
-31 December 2002

	Consolidated statement of cash flows
	Cash flows related to operating activities			Current quarter \$A'000	Year to date $(12$ months)
					\$A'000
1.1	Receipts from gross sales and related debtors
1.2	Payments for	(a) development (b) production $\left( c\right)$	exploration and evaluation	(217)	(835)
		administration (d)		(123)	(405)
1.3	Dividends received
1.4	Interest and other items of a similar nature received				8
1.5	Interest and other costs of finance paid				(8)
1.6	Income taxes paid
1.7	Other (provide details if material)
	Net operating cash flows			(340)	(1240)
	Cash flows related to investing activities
1.8	Payment for purchases of:	(a) $\circled{b}$ (c)	prospects equity investments other fixed assets		(12)
1.9	Proceeds from sale of:	(a) (b) (c)	prospects equity investments other fixed assets		688 32
1.10	Loans to other entities
1.11	Loans repaid by other entities
1.12	Other (provide details if material)
	Net investing cash flows				708
1.13			Total operating and investing cash flows (carried forward)	(340)	(532)

+ See chapter 19 for defined terms.

1.13	Total operating and investing cash flows (brought forward)	(340)	(532)
	Cash flows related to financing activities
1.14	Proceeds from issues of shares, options, etc.	35	397
1.15	Proceeds from sale of forfeited shares
1.16	Proceeds from borrowings	465	465
1.17	Repayment of borrowings		(167)
1.18	Dividends paid
1.19	Other (provide details if material) - share placement fee
	Net financing cash flows	500	695
	Net increase (decrease) in cash held	160	163
1.20	Cash at beginning of quarter/year to date	216	213
1.21	Exchange rate adjustments to 1.20
1.22	Cash at end of quarter	376	376

Payments to directors of the entity and associates of the directors Payments to related entities of the entity and associates of the related entities

		Current quarter \$A'000
1.23	Aggregate amount of payments to the parties included in item 1.2	78
1.24	Aggregate amount of loans to the parties included in item 1.10

Explanation necessary for an understanding of the transactions $1.25$

Non-cash financing and investing activities

Details of financing and investing transactions which have had a material effect on consolidated assets and $2.1$ liabilities but did not involve cash flows

Post Quarter Events

$\epsilon_{\rm g}$

⁺ See chapter 19 for defined terms.

Details of outlays made by other entities to establish or increase their share in projects in which the $2.2$ reporting entity has an interest

Financing facilities available
Add notes as necessary for an understanding of the position.

		' Amount available : \$A'000 HALLMARK	Amount used \$A'000
3.1	Loan facilities
3.2	Credit standby arrangements

Estimated cash outflows for next quarter

		\$A'000 . .
4.1	Exploration and evaluation	50
	4.2 Development
	------------------ Total	50 ومستنبذ

Reconciliation of cash

	Reconciliation of cash at the end of the quarter (as shown in the consolidated statement of cash flows) to the related items in the accounts is as follows.	Current quarter \$A'000	Previous quarter \$A'000
-51	Cash on hand and at bank	79
52	Deposits at call	297	199.
5.3	Bank overdraft
5.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	376	216

⁺ See chapter 19 for defined terms.

Changes in interests in mining tenements

		Tenement reference	Nature of interest [note $(2)$ ]	Interest at beginning of quarter	Interest at end of quarter
6.1	mining in Interest tenements relinquished, reduced or lapsed	E30/118		91%	40%
6.2	mining in Interests tenements acquired or increased

Issued and quoted securities at end of current quarter
Description includes rate of interest and any redemption or conversion rights together with prices and dates.

		Number issued	Number quoted	Par value (cents)	Paid-up value (cents)
7.1	Preference $^{\texttt{+}}$ securities (description)
7.2	Changes during quarter (a) Increases through issues (b) Decreases through return of capital, buy- backs, redemptions
7.3	+ Ordinary securities	42,234,665	42,234,665
7.4	Changes during quarter (a) Increases through issues Decreases (h) through return of capital, buy- backs, redemptions	500,000	500,000
7.5	+ Convertible debt securities (description)

• See chapter 19 for defined terms.

7.6	Changes during quarter (a) Increases through issues Decreases (b) through return of capital, buy- backs, redemptions
7.7	Options (description and conversion factor) LEGA1 LEGO	2,350,000 36,189,207	36,189,207	Exercise Price 22¢ 15¢	Expiry Date 30.05.2006 30.4.2005
7.8	Issued during quarter
7.9	Exercised during quarter
7.10	Expired during quarter
7.11	Debentures (totals only)
7.12	Unsecured notes (totals only)

$\tau$ .

Compliance statement

• This statement has been prepared under accounting policies which comply with accounting standards as defined
  in the Corporations Law or other standards acceptable to ASX (see note 4). $\mathbf 1$
• This statement does give a true and fair view of the matters disclosed. $\mathbf 2$

lledgr Date: Sign here: (Company Secretary)	30.1.03
----------------------------------------------------------	---------

GREG LEDGER Print name:

• See chapter 19 for defined terms.

$\gamma_{\perp}$

Notes

$\tilde{\Sigma}_1$

• The quarterly report provides a basis for informing the market how the entity's activities have been financed $\mathbf{I}$ for the past quarter and the effect on its cash position. an entity wanting to disclose additional information is encouraged to do so, in a note or notes attached to this report.
• $\mathbf 2$ The "Nature of interest" (items 6.1 and 6.2) includes options in respect of interests in mining tenements acquired, exercised or lapsed during the reporting period. If the entity is involved in a joint venture agreement and there are conditions precedent which will change its percentage interest in mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
• Issued and quoted securities. The issue price and amount paid up is not required in items 7.1 and 7.3 for fully 3 paid securities.
• The definitions in, and provisions of, AASB 1022: Accounting for Extractive industries and AASB 1026: $\overline{4}$ Statement of Cash Flows apply to this report.
• 6 Accounting Standards ASX will accept, for example, the use of International Accounting Standards for foreign entities. If the standards used do not address a topic, the Australian standard on that topic (if any) must be complied with.

No election also the state of color and also also also also also also also also

Appendix 31.03.02

⁺ See chapter 19 for defined terms.