PERSEUS MINING LIMITED — Interim / Quarterly Report 2004

Jan 27, 2005

DECEMBER 2004 OUARTERLY STOCK EXCHANGE REPORT

Summary

Following Perseus Mining Limited's successful listing on the Australian Stock Exchange on 22 September, three of the Company's projects were drilled in the December Quarter. In summary:

• Better than expected results were obtained from extensional drilling at Grumesa (Ghana). ٠
• The Tolubay project (Kyrgyz Republic) was significantly re-rated based on encouraging early drill results, extensive strong geochemical anomalism and a favorable geological setting.
• The Savoyardy (Kyrgyz Republic) drilling program undertaken by Lalo Ventures was cut short due to weather conditions.
• Despite access problems preventing work at Tengrela (Ivory Coast) during the quarter, $\bullet$ exploration work commenced in January 2005.

Tengrela (Ivory Coast)

A short interruption to the UN enforced ceasefire in Ivory Coast prevented work on Tengrela during the December quarter, but a program consisting of pitting the identified anomalies and infill soil sampling was commenced in late January. A small drilling rig acquired by Perseus for reconnaissance drilling on the Tengrela project has arrived in Ghana and will be commissioned in February prior to transportation to Tengrela to drill a series of regionally significant soil anomalies. An aggressive exploration program is planned for the remainder of the 2004-05 season, which will run through to June, by which time it is expected that in excess of 10,000m of drilling will have been completed at Tengrela.

Grumesa (Ghana)

Drilling to extend a higher grade portion of the 450,000oz Kayeya deposit at Grumesa was undertaken in October and November. This drilling is a precursor to infill drilling and a feasibility study that will review the viability of mining and toll treating higher grade mineralisation through a mill located 30km away at Obuasi, possibly commencing in 2005.

The initial phase of drilling comprised 21 reverse circulation drill holes and three diamond drill hole tails totaling 1,028m. Nearly all holes in the initial phase were drilled either at the outer limits of the original higher grade target area or at depth. Two diamond drill holes totaling 120m were also completed to obtain bulk metallurgical samples. A considerable delay in sample analysis was experienced and the Company is still awaiting results of a small number of resamples. Significant mineralisation was encountered in most holes, with best intercepts including 30m $\omega$ 1.8g/t, 20m $\omega$ $2.0g/t$ and 68m $\omega$ 1.1g/t Au. KRC145 was successful in tracing the southern shallow dipping zone of mineralisation a further 100m north. It ended in mineralisation having intercepted 19m $\omega$ 1.5g/t and a further $21m$ @ 1.2g/t Au. This zone remains open down dip to north and along strike. Additional bottom of hole intercepts from other holes ending in mineralisation included 2m $\omega$ $4.4g/t$ and 56m $@1.1g/t$ Au. (see Table 1 and Figure 1).

$\mathbf 1$

The main infill phase will commence after approvals are obtained, and sites are prepared, probably in March. The program will be expanded to test the extensions to gold mineralisation delineated in the initial phase reported above.

The feasibility study has commenced and will be conducted concurrently with infill drilling. The Base Line Environmental Study is in progress as the basis to preparing an Environmental Impact Statement. Core and RC samples are being prepared and will be air freighted to an Australian laboratory for the completion of CIL testwork and continuation of heap leach testwork. Preliminary mining and haulage scope of works documents have been distributed to several contractors.

Tolubay (Kyrgyz Republic)

The wide zone of gold mineralisation intersected by drilling, the set of coherent geochemical anomalies and the style of mineralisation with similarities to deposits on the Carlin Trend, Nevada, highlight the potential of the Tolubay prospect.

Perseus drilled hole ZDDH001 below PDC 1-98, one of three wide spaced holes drilled by Phelps Dodge in 1998 that intercepted stratabound mineralisation, including $20m$ ( $\hat{a}$ ) 1.9g/t Au from 60m. ZDDH001 intercepted a zone of mineralisation averaging 1.0g/t Au from 99m to 170m down hole, which included a sub intercept of $22m$ $\omega$ 1.8g/t Au.

The second hole, ZDDH002 was drilled approximately 120m along strike to the east of ZDDH001. The target zone was intersected from about 88m to 190m in ZDDH002 and the hole was terminated at 193m in meta limestone. Assays are still outstanding. Hole ZDDH003 located 1,300m west along strike of ZDDH001, is currently being drilled

Perseus completed the first geochemical sampling for gold in the area when it undertook an orientation sampling program for gold and multi elements over 10km strike of the 15km target Samples were taken on a number of traverses at a sample spacing of 100m to 200m. The zone. traverses were generally sub-horizontal to slope contours and were separated vertically by 50m to 200m. The gold assay results for the 314 soil and rock chip samples indicate that the most coherent and strongest gold in soil anomalies are shedding from the Lower Carboniferous limestone-chert lithologies rather than the Upper Carboniferous limestone-shale contact zone currently being drilled. Gold Mineralisation within the Upper Carboniferous limestone-shale contact zone occurs within altered shale associated with arsenic mineralisation immediately above cinnabar bearing jasperoid and limestone. The new target lithologies are located stratigraphically more than 100m below and outcrop topographically above the previously identified mineralized Upper Carboniferous limestone-shale contact zone. The 2km long Obdilla North anomaly, clearly the strongest anomaly, is centered about 6km west of ZDDH001 (see Table 2 and Figure 2).

Savoyardy (Kyrgyz Republic)

Diamond drilling south-west of Pogranichnoe by joint venture partner, Lalo Ventures Inc was suspended due to extreme weather conditions. The only hole, SDH001, was completed to a depth of 104.6m without intercepting significant mineralisation when it was abandoned. A detailed exploration program to test areas of known significant mineralisation will be planned during the March Quarter.

Kwatechi (Ghana)

Subsequent to quarter end, Caspian Oil and Gas Limited subsidiary Leo Shield Exploration Ghana Limited ("Leo Shield") and Perseus subsidiary Sun Gold Resources Limited ("Sun Gold") have signed an agreement giving Sun Gold the right to earn a majority equity in the Kwatechi Joint Venture by undertaking exploration and a feasibility study. Anglogold Ashanti Limited ("Ashanti") also agreed to sell its minority rights in the Kwatechi Joint Venture to Sun Gold for US$10,000.

The 43.3sq km Kwatechi prospecting licence and 69.5sq km Kwatechi prospecting licence application, owned by Tropical Exploration and Mining Company Ltd ("Tropical") are the subject of the Kwatechi Joint Venture. The licence adjoins the Grumesa-Awisam licence and lies 8km south of Sun Gold's Kayeya gold resource and 40km north-east of the Damang mine. All three projects are hosted by Tarkwaian rocks. Previous exploration has defined significant gold in soil and trench anomalies that have never been tested by drilling. During January Sun Gold sent for analysis 400 infill soil samples previously collected by Leo Shield and Ashanti.

Under the new farmin agreement, Sun Gold has the right to earn a 76% interest in the property by funding the development of the project to profitable production. Tropical and Leo Shield each retain a 7% interest (the Government retains 10% on production) which is convertible to a 1.25% net smelter royalty at the option of those parties within 30 days of completion of a feasibility study. Sun Gold can withdraw from the joint venture at any time and is required to pay US$3,600 to Tropical annually while it remains in the joint venture.

The Company is preparing the Kwatechi property for drilling during February.

Mark Calderwood Managing Director

28 January 2005

The information in this report that relates to exploration results, is based on information compiled by Mr Mark Calderwood, who is a Member of The Australasian Institute of Mining and Metallurgy. Mr Calderwood is a full-time employee of the Company. Mr Calderwood has sufficient experience, which is relevant to the style of mineralisation and type of deposit 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'. Mr Calderwood consents to the inclusion in this report of the matters based on his information in the form and context in which it appears.

Table 1 – Grumesa Drilling Results
------------------------------------	--

Hole	North	East	Azm	Dip	Depth	From	To	Intercept	Grade
	(m)	(m)	$\binom{6}{2}$	(°)	(m)	(m)	(m)	(m)	Au g/t
KRC127	89240	60340	270	$-60$	40	Ţ	10	9	1.7
						38	40	$2^{(2)}$	4.4
KRC128	89240	60320	$\overline{270}$	$-60$	40	$\pmb 0$	17	17	0.9
					incl.	$\overline{c}$	6	4	2.5
						31	40	$9^{(2)}$	0.8
KRC129	89280	60360	270	$-60$	$\overline{30}$	$\overline{0}$	$\overline{13}$	$\overline{13}$	1.0
KRC130	89280	60340	271	$-60$	$\overline{50}$	$\overline{9}$	26	$\overline{17}$	0.8
						33	39	$\boldsymbol{6}$	0.9
						45	50	$5^{(2)}$	0.6
KRC131	89280	60320	$\overline{271}$	$-60$	60	$\overline{13}$	$\overline{47}$	$\overline{34}$	1.5
					incl.	20	40	20	2.0
KRC132	89300	60231	90	$-50$	$\overline{75}$	$\overline{19}$	$\overline{75}$	$56^{(2)}$	1.1
					incl.	21	31	10	2.2
					and	50	54	4	2.0
KRC133	89580	60343	90	$-60$	30	15	$\overline{22}$	$\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\overline{\over$	$0.8,$
KRC134	89580	60361	90	$-60$	$\overline{30}$	$\overline{9}$	$\overline{19}$	10	$0.8,$
KRC135	89580	60380	$\overline{90}$	$-60$	$\overline{30}$	$\overline{6}$	21	$\overline{15}$	1.2
					incl.	16	21	5	$2.2,$
KRC136	89580	60400	90	$-60$	30	1	22	21	0.8
KRC137	89540	60327	89	$-60$	30	$\overline{6}$	27	21	0.4
KRC138	89540	60347	90	$-60$	$\overline{24}$	$\overline{\tau}$	18	11	1.0
					incl.	$\overline{7}$	11	4	1.9
KRC139	89540	60367	90	$-60$	$24,$	$\overline{0}$	10	$\overline{10}$	0.3
KRC140	89500	60274	90	$-60$	30	$\overline{4}$	12	$\overline{8}$	1.1
					incl.	4	8	4	1.8
KRC141	89500	60233	90	$-50$	30	$\overline{20}$	$\overline{26}$	$\overline{6}$	0.4
$KRC143^{(1)}$	89400	60274	269	$-60$	90	66	$84^{(3)}$	$\overline{18}$	1.0
$K\overline{RC144^{(1)}}$	89400	60115	91	$-50$	120.1	47	115	68	1.1
					incl.	54	66	12	$1.7,$
					and	70	76	6	2.1
					and	97	$104^{(3)}$	$\tau$	$1.4,$
						113	115	$\overline{2}$	1.0
$KRC145^{(1)}$	89500	60108	90	$-50$	120	Ţ	$\overline{54}$	$\overline{53}$	0.8
					incl.	21	$40,$	19	1.5
						99	$120^{(3)}$	$21^{(2)}$	1.2
KRC146	89600	60162	90.	$-50$	60	$\overline{6}$	36	$30,$	$1.8,$
					incl.	12	27	15	2.8
KRC147	89600	60200	$\overline{90}$	$-50$	$\overline{45}$	10	$\overline{19}$	$\overline{9}$	$\overline{1.7}$
						25	39	14	0.6

Notes

1. combination RC and diamond drill hole2) holes ended in mineralisation3) interval with assays pending

Table 2 - Drill Intercepts - ZDDH001 - Tolubay
------------------------------------------------	--	--	--

DDHole	North	East	Azmጦ	Dipጦ	Depth	From(m)	Тo	Intercept(m)	Grade
	(m)	(m)			(m)		(m)		Au $g/t$
ZDDH001	446516	256860	360	-80	201	99	170	71	1.0
					incl.	99	101	2	1.6
					and	107	109		3.2
					and	114	136	22	1.8
					incl.	124	130	6	3.7
						170	182	12	0.2
						191	192		0.4

Notes

1. analysis was undertaken by Alex Stewart Assay and Environmental Laboratories Ltd using fire assay method.

Figure 1

		Recent Intercepts
RCHole	ref.on plan	InterceptAu	FН
KRC127KRC128KRC129KRC130KRC131KRC132KRC133KRC134KRC135KRC136KRC137KRC138KRC139KRC140KRC141KRC143KRC144KRB145	127and128and129130and131incl.132133134135136137138139140141143144145and	9m @ 1.7g/t2m* @ 4.4g/t17m @ 0.9g/L9m* @ 0.8a/t13m @ 1.0g/t15m @ 0.8g/t6m @ 0.9g/t34m @ 1.5g/t20m @ 2.0g/L56m @ 1.1g/t7m @ 0.8g/t10m @ 0.8g/t15m @ 1.2g/t22m @ 0.8g/t21m @ 0.4a/t11m @ 1.0g/t10m @ 0.9g/L5m @ 1.1g/t6m @ 0.4a/L18m @ 1.0g/t68m @ 1.1g/L19m @ 1.5g/t21m @ 1.2g/L	ΚFĸ۶К۶ΚFKΕĸ۶К۶ĸΕΚFKFΚFк۶ΚFΚFKFКΕKΕК۶
KRB146KRR147	146147	30m @ 1.8o/L9m @ 1.7g/t14m @ 0.6g/t

— 1,511 m m m m m m m m
toric Intercents

RCInterceptAvg.AuHoleAu (g/l)KRC0031.315m @ 0.7g/t27m @ 2.0g/land46m @ 2.2g/tKRC0041.833m @ 3.0g/t1,7KRC006KRC0091,245m*@ 1.5g/tKRC0531.023m"@ 2.0g/t@ 1.4g/tKRC0566.822m*KRC06413m* @ 3.3g/12.4KRC0760.9@ 1.3g/l16m*67m °@ 1.2g/t1.2.KRC0784m @ 2.19/122m @ 1.5g/KRC087a.z1.5g/tand@ 1.0g/tKRC0861.082m*@ 1.0g/tKRC0940.829m -KRC1200.516m @ 1.4g/tKRC1220.96 0m* @ 0.0g/lKRC1251.332m* @1.2g/t2m* @ 29.4g/tKRB0681,40.6KRB15328m*@ 1.1g/tKR81630.515m @ 0.8g/t		argraffoarft	Historic Intercepts

$\hat{\theta}$

Figure 2

TOLUBAY PROJECT

Appendix 5B

Mining exploration entity quarterly report

Name of entity

PERSEUS MINING LIMITED

ABN

27 106 808 986

Quarter ended ("current quarter")

31 December 2004

Consolidated statement of cash flows

	Cash flows related to operating activities	Current quarter$A'000	Year to date$(6$ months)
			$A'000
1.1	Receipts from product sales and related debtors
1.2	Payments for(a) exploration and evaluation	(235)	(315)
	(b) development
	(c) production
	(d) administration	(198)	(266)
1.3	Dividends received
1.4	Interest and other items of a similar nature
	received	35	54
1.5	Interest and other costs of finance paid
1.6	Income taxes paid
1.7	Other - (provide details if material)
	Net Operating Cash Flows	(398)	(527)
	Cash flows related to investing activities
1.8	Payment for purchase or renewal of:
	(a) prospects
	(b) equity investments
	(c) other fixed assets	(125)	(282)
1.9	Proceeds from sale of:(a) prospects
	(b) equity investments
	(c) other fixed assets
1.10	Loans repaid to other entities	(74)	(176)
1.11	Loans repaid by other entities	77	108
1.12	Other - (provide details if material)
	Net investing cash flows	(122)	(350)
1.13	Total operating and investing cash flows (carried
	forward)	(520)	(877)

1.13	Total operating and investing cash flows (broughtforward)	(520)	(877)
1.141.151.161.171.18	Cash flows related to financing activitiesProceeds from issues of shares, options, etc.Proceeds from sale of forfeited sharesProceeds from borrowingsRepayment of borrowingsDividends paid		3,717
1.19	Other - share issue expenses	(164)	(384)
	Net financing cash flows	(164)	3,333
	Net increase (decrease) in cash held	(684)	2.456
1.201.21	Cash at beginning of quarter/year to dateExchange rate adjustments to item 1.20	3,541(25)	403(27)
1.22	Cash at end of quarter	2,832	2,832

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	175
-1.24	Aggregate amount of loans to the parties included in item 1.10	٠
エラミ	Explanation persecury for an understanding of the transactions

Explanation necessary for an understanding of the transactions $1.25$ A$'000 Consultancy fees and Executive Directors' remuneration 130 Accounting, secretarial and corporate services 45 NB. Includes $62,000 from Quarter 1

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

$N/A$

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

Lalo Ventures Ltd - Savoyardy project - $76,382

Financing facilities available

Add notes as necessary for an understanding of the position.

• $3.1$ Loan facilities
• $3.2$ Credit standby arrangements

Amount available$A'000	Amount used$A'000

Estimated cash outflows for next quarter

Total350

Reconciliation of cash

	Reconciliation of cash at the end of the quarter (asshown in the consolidated statement of cash flows) tothe related items in the accounts is as follows.	Current quarter$A'000	Previous quarter$A'000
5.1	Cash on hand and at bank	936	329
5.2	Deposits at call	1,896	3,212
5.3	Bank overdraft
5.4	Other (provide details)
	Total: cash at end of quarter (item 1.22)	2,832	3,541

Changes in interests in mining tenements

		Tenement reference	Nature of interest(note (2))	Interest atbeginningof quarter	Interest atend ofquarter
-6.1	Interests in miningtenements relinquished,reduced or lapsedInterests in miningtenements acquired orincreased	None
6.2		None

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

		Total number	Number quoted	Issue pricepersecurity (cents)	Amount paid up persecurity (cents)
7.1	Preference+ securities(description)
7.2	Changes duringquarter	۰
7.3	$\overline{+}$ Ordinarysecurities	59,518,450	22,335,005
7.4	Changes duringquarter
7.5	+ Convertible debtsecurities(description)
7.6	Changes duringquarter
7.7	Options(description andconversion factor)			Exercise price	Expiry date
		19,982,500	11,167,500	$20$ cents	31/03/2009
7.8	Issued duringquarter
7.9	Exercised duringquarter
7.10	Cancelled/Expiredduring quarter			$\equiv$
7.11	Debentures(totals only)	۰
7.12	Unsecured notes(totals only)	۰

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).
• This statement gives a true and fair view of the matters disclosed. $\overline{2}$

TIM

Sign here:

Print name:

Managing Director MARK ANDREW CALDERWOOD Date: 28 January 2005