Resolute Mining Limited — Capital/Financing Update 2007

Feb 25, 2007

ASX ANNOUNCEMENT

SYAMA UPDATE

Resolute Mining Limited is pleased to announce that following the completion of the detailed design, it has updated the project economics for the redevelopment of the Syama gold mine in Mali.

Capital

The revised capital for the Project is US$118 million. As a result of changes in scope for the project and a shift in materials and labour costs there has been an increase in the overall capital of 22% (US$22 million). Of this increase, 65% relates to scope changes and 35% relates to cost escalation since the estimate completed in February 2006.

The largest area of movement has been in the electrical cost estimate as a result of the need for more cabling than previously anticipated.

Table 1 below summarises the Capital by area and compares it with the February 2006 estimate.

Area Description	2007 Total US$Millions	2006 TotalUS$ Millions	℅Change
Site Establishment & Construction Costs	3.6	3.1	18.0%
Treatment Plant	54.0	45.9	17.7%
Infrastructure and Services	17.5	10.8	62.8%
Mining	5.3	5.6	$-6.6%$
EPCM	18.5	15.9	15.8%
Owners Costs	19.4	15.3	27.0%
lTotal	$118.3	$96.6	22.5%

Table 1 Revised Capital Estimate Comparison

Operating Costs

Operating costs have been re-estimated and have increased approximately 9% since the last review in February 2006 with the comparison summarised in Table 2 below.

The January 2007 fuel price used in this analysis is comparable to that used earlier.

The increase in mining costs is higher relative to the other areas and reflects latest unit rates with current fuel costs.

AreaDescription	2007 TotalUS$/t	2006 TotalUS$/t	%Change
Mining	$14.36	$12.26	17.2%
Processing	$17.86	$17.09	4.5%
Admin	$4.11	$4.09	0.6%
Total	$36.33	$33.44	8.7%

Table 2 Comparison of Operating Costs

Ore Reserves and Mine Design

A further refinement of the open pit design with an in-wall ramp has been completed. The new design changes the ramp positions providing a second exit to the waste dumps and does not cut back the southeast wall of the pit where there is a concern about exposing graphitic shear zones at depth.

The reserve cut-off grade has also been increased from 1.75g/t to 2g/t Au to reflect the recent increases in operating costs. The new pit contains 11,726,399 tonnes at 4.10 g/t Au for 1,546,610 ounces of gold and has a strip ratio of 5:1.

Project Economics

The various changes outlined above have been incorporated into a revised financial model of the project. The increase in costs have been matched by an increase in the gold price to show a project with a return above the required hurdle rate.

Considerable upside to the project exists beyond that included in the financial model. There are underground resources immediately below the pit which combined with the continuing exploration success in the Quartz Vein Hill area to the north of the pit, provide confidence that a project of a much longer term can eventuate.

Table 3 on the following page provides a comparison between the 2006 economics and the current project economics.

StudyVersion	Gold Price	Capex	Op. CostsUS$ pertonne	NPV	IRR	Cash Cost
		US$ per oz US$Million	Milled	US$Million	%	per oz
Feb-06	$550	$96.6	$33.44	$85.50	25.6%	$336
Feb-07	$600	$118.3	$36.33	$69.99	22.4%	$370

Table 3 Comparison of the Project Economics

Progress

Plant

GRD Minproc has completed the detailed design and procurement of long lead items for the processing plant.

Outokumpu has reviewed the roaster area and has recommended that the original shell of the roaster be replaced since this has been extensively corroded and the refractories need to be replaced. The new roaster shell and lining is to be designed for the concentrate feed thus it will be "fit for purpose" and some of the large blowers will be replaced resulting in a more efficient power usage.

Site demolition of the flotation area and parts of the crushing area are close to completion. Local contractors have been identified and awarded parts of the village and camp refurbishment programmes and a local contractor has commenced construction of a 70 man security village close to the original main gate to the mine.

Mining Contract

A mining fleet has been ordered for the project and includes a mix of O&K diggers, Cat trucks and Atlas Copco drill rigs. Fleet delivery and mining contractor mobilisation is scheduled for the September 2007 quarter.

Schedule

Construction activity is scheduled to ramp up in March with the crushing and grinding circuits and refurbished CIL area ready by late 2007. Commissioning of these areas will commence early in 2008 with completion and commissioning of the flotation and roasting areas scheduled for the second half of 2008.

PETER SULLIVAN Chief Executive Officer

26 February 2007