LEGEND MINING LIMITED — Interim / Quarterly Report 2006

Jan 30, 2006

Appendix 5B

$Rule 5.3$

Mining exploration entity quarterly report

Introduced 1/7/96. Origin: Appendix 8. Amended 1/7/97, 1/7/98, 30/9/2001.

Name of entity

LEGEND MINING LIMITED

ABN

22 060 966 145

Quarter ended ("current quarter")

31 December 2005

Consolidated statement of cash flows

			Current quarter	Year to date
Cash flows related to operating activities		\$A'000	$\binom{12}{12}$ months) \$A'000
1.1	Receipts from product sales and related debtors		4	3,716
	Adjustment on the first time application of AIFRS			4,623 907
1.2	Payments for	(a) exploration and evaluation	(1, 846)	(8, 543)
		(b) development
		(c) production		(6,773)
		(d) administration	(258)	(1,772)
1.3	Dividends received
1.4		Interest and other items of a similar nature received	36	205
1.5 1.6	Interest and other costs of finance paid Income taxes paid		(252)	(605)
1.7	Other (provide details if material)
	Net Operating Cash Flows		(2,316)	(12, 865)
	Cash flows related to investing activities
1.8	Payment for purchases of: (a)prospects
		(b)equity investments
		(c) plant & equipment	(7)	(81)
		(d) mine ppty $\&$ dymt
1.9	Proceeds from sale of:	(a)prospects
		(b) equity investments (c)other fixed assets	16	16 96
1.10	Loans to other entities
1.11	Loans repaid by other entities
1.12	Other
	Mt Gibson Gold Project assets acquisition		(250)	(250)
	Security deposits		(1,088)	(1,138)
	Net investing cash flows		(1,329)	(1, 357)
1.13		Total operating and investing cash flows (carried
	forward)		(3,645)	(14, 222)

⁺ See chapter 19 for defined terms.

1.13	operating and investing cash flows Total (brought forward)	(3,645)	(14, 222)
	Cash flows related to financing activities
1.14	Proceeds from issues of shares, options, etc.		10,145
1.15	Proceeds from sale of forfeited shares
1.16	Proceeds from borrowings	3,000	3,000
1.17	Repayment of borrowings		(526)
1.18	Dividends paid
1.19	Other - Rental & Interest	w	(23)
	- Capital raising costs	w	(129)
	Net financing cash flows	3,000	12,467
	Net increase (decrease) in cash held	(645)	(1,755)
1.20	Cash at beginning of quarter/year to date	1,053	3,070
	Adjustment on first time application of AIFRS		(907) 2,163
1.21	Exchange rate adjustments to item 1.20
1.22	Cash at end of quarter	408	408

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	103
1.24	Aggregate amount of loans to the parties included in item 1.10

1.25 Explanation necessary for an understanding of the transactions

Directors salary and consultancy fees

Non-cash financing and investing activities

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

Acquisition of the Mt Gibson Gold Project assets from Oroya Mining Limited on the 16 November 2005, by the issue of 30 million fully paid ordinary shares.

The ordinary shares are held in escrow as;

• (a) 15 million fully paid ordinary shares held in escrow for twelve months from issue date.
• (b) 15 million fully paid ordinary shares held in escrow for eighteen months from issue date.
• $2.2$ Details of outlays made by other entities to establish or increase their share in projects in which the reporting entity has an interest

$N/A$

⁺ See chapter 19 for defined terms.

Financing facilities available

Add notes as necessary for an understanding of the position.

		Amount available \$A'000	Amount used \$A'000
3.1	Loan facilities	$(a)$ 3,000 (b) $3,145$	(a) 3,000 (b) $\sim$
3.2	Credit standby arrangements	w

Note

(i). The \$3,000,000 loan referred to in $3.1(a)$ was drawn down on the 15 November 2005 and full disclosure details are contained in the announcement to the Australian Stock Exchange on the 16 November 2005.

(ii). The \$3,145,000 facility referred to in 3.1(b) was approved by Macquarie Bank Ltd on the 28 December 2005 and full disclosure details were contained under the heading "Cash Position" in Item 4 of the December 2005 Quarterly Report released to the Australian Stock Exchange on the 31 January 2006, with this Appendix 5B report.

Estimated cash outflows for next quarter

		\$A'000
4.1	Exploration and evaluation	900
4.2	Development	MA
	Total	900

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 SA'000	Previous quarter SA'000
5.1	Cash on hand and at bank	391	1,036
5.2	Deposits at call	17
5.3	Bank overdraft
5.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	408	1,053

$+$ See chapter 19 for defined terms.

Changes in interests in mining tenements

		Tenement	Nature of interest	Interest at	Interest at
		reference	(note (2))	beginning	end of
				of quarter	quarter
6.1	Interests in mining	M51/0201	Surrendered 18/11/2005	100%	$0\%$
	tenements relinquished,	M51/0474	Surrendered 18/11/2005	100%	$0\%$
	reduced or lapsed	M53/0058	Surrendered 18/11/2005	100%	$0\%$
		M53/0101	Surrendered 18/11/2005	100%	$0\%$
		M53/0102	Surrendered 18/11/2005	100%	$0\%$
		M53/0103	Surrendered 18/11/2005	100%	$0\%$
		M53/0313	Surrendered 18/11/2005	100%	$0\%$
		M53/0314	Surrendered 18/11/2005	100%	$0\%$
		M53/0315	Surrendered 18/11/2005	100%	$0\%$
		E53/0422	Surrendered 03/10/2005	100%	$0\%$
		P53/0693	Surrendered 03/10/2005	100%	$0\%$
		P53/0698	Surrendered 03/10/2005	100%	$0\%$
		P53/0699	Surrendered 03/10/2005	100%	$0\%$
		P53/0700	Surrendered 03/10/2005	100%	$0\%$
		P53/0707	Surrendered 03/10/2005	100%	0%
		P53/1114	Surrendered 08/11/2005	100%	$0\%$
		E53/1165	Surrendered 18/10/2005	100%	$0\%$
		E57/483	Surrendered 08/12/2005	100%	0%

⁺ See chapter 19 for defined terms.

6.2	Interests in mining	M59/11	Acquired 16/11/2005	$0\%$	100%
	tenements acquired or	M59/13	Acquired 16/11/2005	$0\%$	100%
	increased	M59/14	Acquired 16/11/2005	0%	100%
		M59/15	Acquired 16/11/2005	0%	100%
		M59/16	Acquired 16/11/2005	0%	100%
		M59/17	Acquired 16/11/2005	$0\%$	100%
		M59/166	Acquired 16/11/2005	0%	100%
		M59/217	Acquired 16/11/2005	0%	100%
		M59/304	Acquired 16/11/2005	0%	100%
		M59/305	Acquired 16/11/2005	0%	100%
		M59/308	Acquired 16/11/2005	0%	100%
		M59/309	Acquired 16/11/2005	$0\%$	100%
		M59/328	Acquired 16/11/2005	0%	100%
		M59/402	Acquired 16/11/2005	0%	100%
		M59/403	Acquired 16/11/2005	0%	100%
		M59/404	Acquired 16/11/2005	0%	100%
		G59/11	Acquired 16/11/2005	0%	100%
		G59/12	Acquired 16/11/2005	0%	100%
		G59/13	Acquired 16/11/2005	0%	100%
		G59/14	Acquired 16/11/2005	0%	100%
		G59/15	Acquired 16/11/2005	$0\%$	100%
		G59/16	Acquired 16/11/2005	0%	100%
		G59/17	Acquired 16/11/2005	0%	100%
		G59/18	Acquired 16/11/2005	$0\%$	100%
		L59/12	Acquired 16/11/2005	0%	100%
		L59/13	Acquired 16/11/2005	0%	100%
		L59/14	Acquired 16/11/2005	0%	100%
		L59/16	Acquired 16/11/2005	0%	100%
		L59/21	Acquired 16/11/2005	$0\%$	100%
		L59/45	Acquired 16/11/2005	$0\%$	100%
		L59/46	Acquired 16/11/2005	0%	100%
		E59/1041	Acquired 16/11/2005	0%	100%

⁺ See chapter 19 for defined terms.

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.

		Total number	Number quoted	Issue price per security (see note $3)$ (cents)	Amount paid up per security (see note 3) (cents)
$7.1\,$	Preference *securities (description)
7.2	Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs, redemptions
7.3	+ Ordinary securities	458,578,322	308,578,322		Fully paid
7.4	Changes during quarter (a) Increases through issues (b) Decreases through returns of capital, buy- backs	(a) 30,000,000	30,000,000	10.0	Fully paid
7.5	+ Convertible debt securities (description)	1 Secured Convertible Note (\$5,000,000 face value) 10% coupon rate expiring 10 November 2006
7.6	Changes during quarter (a) Increases through issues (b) Decreases through securities matured, converted
7.7	Options (description and conversion factor)	2,350,000 15,000,000 50,000 2,000,000 1,500,000	u. u, u.	Exercise price 22.0 20.0 20.0 $10.0$ 30.0	Expiry date 30.05.2006 20.04.2007 30.07.2007 07.02.2008 30.07.2009
$7.8\,$	Issued during
7.9	quarter Exercised during		u,
7.10	quarter Expired during quarter		u.

⁺ See chapter 19 for defined terms.

7.11	Debentures (totals only)	w
7.12	Unsecured notes (totals only)	سد

Compliance statement

$\mathbf{1}$ This statement has been prepared under accounting policies which comply with accounting standards as defined in the Corporations Act or other standards acceptable to ASX (see note 4).

$\overline{\mathcal{L}}$

This statement does give a true and fair view of the matters disclosed.

ษ∕
∞อง∉ก ∑≅ว

Sign here:

...................................... (Company secretary)

Print name: ..Andrew Chapman...................................

Notes

• $\mathbf{I}$ The quarterly report provides a basis for informing the market how the entity's activities have been financed 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.
• $\overline{2}$ 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 a mining tenement, it should disclose the change of percentage interest and conditions precedent in the list required for items 6.1 and 6.2.
• 3 Issued and quoted securities The issue price and amount paid up is not required in items 7.1 and 7.3 for fully paid securities.
• The definitions in, and provisions of, AASB 1022: Accounting for Extractive 4 Industries and AASB 1026: Statement of Cash Flows apply to this report.
• 5 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.

$= 1.7$

⁺ See chapter 19 for defined terms.