Quarterly Report

Centamin Egypt Limited 06 November 2007 November 06, 2007 Centamin Egypt Limited ('Centamin' or 'the Company') FIRST QUARTER REPORT 30 September 2007 REPORT TO SHAREHOLDERS QUARTERLY HIGHLIGHTS - Sukari Mineral Resource upgraded to 6.84 million ounces of gold Measured and Indicated and 3.6 million ounces of gold Inferred - Record Increase of 800,000 oz Measured and Indicated and 600,000 oz Inferred for the 3 month period - Amun Deeps discovery continues to add significant high grade ounces - Drilling continues to encounter significant mineralization in the Pharaoh Zone - 28,807.63m of drilling was completed during the quarter - Commencement of Grade Control Drilling - Dismantling of the Kori Kollo Processing Plant in Bolivia completed - Dismantling of 28MW Isparta Power Plant Turkey completed - Delivery and Assembly of Mining Fleet Commences - Significant drill intersections for the quarter Amun Zone (9900N - 10700N) - RCD1177 - 65m @ 18.31g/t Au - RCD1155 - 17m @ 3.98 g/t Au - RCD1166 - 23m @ 6.23g/t Au - RCD 1178 - 105m @ 4.10g/t Au and 17m @ 12.45 g/t Au - RCD1187 - 51m @ 4.45g/t Au and 14m @ 4.44g/t Pharaoh Zone (>11200N) - D1164 - 53m @ 3.21g/t Au - RCD756 - 58m @ 3.76g/t - D1179 - 15m @ 4.19g/t Au from surface - D1203 - 148m @ 1.33g/t Au from surface RESOURCE ESTIMATION AND DRILLING PROGRAM The final September Quarter Sukari global resource estimate was calculated to be 148.45Mt @ 1.43g/t Au for 6.84 Moz Au Measured and Indicated, and 64.4Mt @ 1.7g/ t for 3.6 Moz Inferred, at a 0.5g/t Au cut off grade (Table 1), a (16%) increase on the previous quarter. The resource was updated twice during the quarter, the most recent upgrade showed the largest month-on-month increase since drilling started in 1997; with 660,000oz being added in a 5 week period, highlighting the significance of the Amun Deeps resource extensions, which added over 80% of the increase. Also of significance is the average grade at the 0.5g/t cut off has increased 2.8% for the Measured and Indicated portion (from 1.39 g/t to 1.44 g/ t) and 6% in the Inferred grade (from 1.6 g/t to 1.7 g/t) during the quarter. Table 1 - Current Sukari Project Mineral Resource Estimate Mineral Resource (September 2007) Total Measured Indicated (Measured + Indicated) Inferred Cut-off Mt g/t Moz Mt g/t Moz Mt g/t Moz Mt g/t Moz 0.5 57.43 1.40 2.6 91.02 1.45 4.2 148.45 1.43 6.84 64.4 1.7 3.6 0.7 41.13 1.72 2.3 65.46 1.79 3.8 106.59 1.76 6.04 47.6 2.2 3.3 1.0 26.50 2.21 1.9 42.57 2.30 3.1 69.07 2.27 5.03 32.7 2.8 2.9 Note to Table: Figures in table may not add correctly due to rounding The resource estimate was independently calculated by Hellman and Schofield Pty Ltd ('H&S') and is an estimate of recoverable tonnes and grade using Multiple Indicated Kriging with block support correction. Measured resources exist in areas where drilling is available at a nominal 25 x 25 metre spacing, Indicated resources occur in areas drilled at approximately 25 x 50 metre spacing and Inferred resources exist in areas of broad spaced drilling. The resource model extends from 9700mN to 12200mN and to a maximum depth of 350RL (a maximum depth of 950 metres below the crest of Sukari Hill). The estimate has been adjusted to present land surfaces and previous underground mining. It was based on 110,239 two metre down hole composites and surface rock chip samples, from data received up to September 12, 2007. Measured and indicated resources account for 65% of total. Significant growth of the gold resource occurred from 10000N to 10500N, associated with robust and high grade intersections of the down dip extension of the Hapi Zone and several deeper mineralisation zones. Gold mineralisation is still open at depth. Resources are also being added in the Ra and Pharaoh Zones. Recent drilling has intersected strong surface mineralisation in the far north of the hill. Amun Deeps (9900 - 10700N) Drilling at Amun Deeps continued to intersect strong mineralisation, adding resource ounces down dip of current geological data, infilling resource block and geological data gaps at and beneath the pit margins and increasing understanding of the mineralisation trends, particularly the high grade Hapi Zone. Thick zones of strongly mineralised porphyry have been intersected in all drilling. Drilling will continue in this area for the next few months. Studies have commenced of the underground mining potential for the deeper parts of the mineralisation. Several holes returned strong assays over significant widths (Table 2); most have visible gold specks in the high grade Hapi Zone quartz veins, strongly disrupted geological contacts and areas of higher intensity arsenopyrite and pyrite mineralisation. Recent hole RCD1177 on 10200N, drilled down dip of hole RCD1163 (23m @ 2.60g/t Au from 334m), intersected the Hapi Zone at the hangingwall margin of the porphyry, in a zone of strongly disrupted and altered porphyry and serpentinite with abundant quartz veining and sulphides, returned extremely high grade intersection of 65m @ 18.31g/t Au, including the first 5m @ 209.43g/t (Figure 2). RCD1173 was drilled to test at depth the southern extension of the porphyry at 10000N, following up mineralisation in holes RCD384 and RCD499. Strong mineralisation was intercepted within the porphyry below the Hapi Zone including 26m @ 3.59g/t from 384m and 33m @ 2.37g/t from 431m. RCD1173 was not included in the September resource upgrade, so will add ounces next quarter. Further holes RCD1262 and RCD1263 in the same area await diamond drilling tails to test the mineralised porphyry and infill the resource blocks. Hole RCD1187 was drilled on 10450N to infill the resource model at the pit shell margin, up dip of high grade hole D1073, and confirmed the position of the Hapi Zone, intersecting 51m @ 4.45g/t Au from 299m, including a high grade core zone of 9m @ 15.51g/t from 322m, in a zone of disrupted quartz veining, strong sericite, silica, pyrite and arsenopyrite alteration (Figure 3). Data from this hole was also not included in the latest resource upgrade. Mineralisation intercepted in hole RCD1178 on 10300N added significant ounces to the September resource model, with 105m @ 4.10g/t from 380m and 17m @ 12.45g/t from 500m being returned. The hole targeted the down dip extension of the mineralisation in RCD1125 (49m @ 1.86g/t from 340m and 20m @ 1.17g/t from 498m). A further step out hole is planned. Overall drilling and assay results from the Amun Deeps program indicate the thick, strongly mineralised down dip extension of the Hapi Zone in the main porphyry is very consistent over 500m of strike currently drilled, and will continue to add significant ounces to the gold resource (Figure 4). In addition, further step out holes down dip of those described above have been pre-collared for DD tailing to determine down dip width of the porphyry and continuity of the strong mineralisation already intersected. Pharaoh Zone - >11200N Drilling continued in the Pharaoh Zone during the quarter, testing the deeper extensions of the Hapi and deeper zones, the footwall contact area at depth and the shallow, west dipping, surface outcropping Cleopatra and Antony mineralisation zones in the north of the hill. Holes successfully intersected continuous gold mineralisation and added resource ounces in the targeted areas (Table 2). D1164 on 11250N intersected the Hapi Zone at 544m (20m @ 1.33g/t Au), but the best intersection was at depth, with 53m @ 3.21g/t Au from 711m (including 8m @ 9.36g/t and 3m @ 11.27g/t) being intersected to the footwall contact. Hole RCD756 on 11425N also intersected a very strong, high grade zone of 58m @ 3.76g/ t Au from 791m, including higher grade zones. This and several other similar intersections in the area highlights the underground potential at Sukari throughout the deposit. Holes D1203 on 11950N and D1205 on 12000N intersected strong near surface mineralisation, attributed to the outcropping, west dipping, strongly sericite-silica-pyrite-arsenopyrite altered and quartz veined Cleopatra and Antony Zones. D1203 intersected 148m @ 1.33g/t Au from surface, with several higher grade zones included; and D1205 returned 14m @ 1.32g/t Au from 9m and 112m @ 1.30g/t Au from 48m. Drilling on the NE and NW sides of the northern part of the hill continues to define these zones. Regional Exploration Drilling is continuing on several near mine prospects, following up anomalous rock chip sample geochemistry, mapped alteration and geological structures. One hole, SRC002, 900m north of the hill at the Student prospect, returned 2m @ 9.78g/t Au from 31m. Field investigation continues of other prospects on the exploitation licence such as Umm Kola, and Sukari North. First pass rock chip sampling and geochemistry at the greenfields Sami South prospect, 5km south along strike of Sukari Hill, returned two 15 - 20m wide gold anomalous zones, 200m apart, in sheared, ferruginous hydrothermally altered sediments and igneous rocks, with narrow quartz veins and weathered pyrite evident. Peak assay was 1.1g/t Au. Follow up work is continuing. Grade Control Grade control drilling was carried on all available benches during the quarter; in the Amun Zone at 1185RL and 1222RL and 1300RL (Figure 5). 3,547 metres were drilled by the contractor, Capital Drilling. All assay results were returned by the end of September. Gold mineralisation estimated from grade control modelling corresponds to expected mineralisation in the resource model; assay results highlight shallow easterly and westerly dipping structures. Project Finance During the quarter, the due diligence process with Barclays Capital, the investment banking division of Barclays Bank PLC, continued with the drafting of various project facility and supporting agreements. Completion of the project financing schedule has been moved out to the first quarter of next year to accommodate the work schedule of all parties involved in the process. Construction Camp Completion of the 700 man accomodation facility is nearing finalisation with several of the first accomodation parcels being ready for occupation during the middle part of quarter four. The accomodation facilities are a combination of the traditional dome style bricked facility and conventional demountable style. Concrete has been poured for the kitchen facility, fit out equipment ordered and the Company is scheduled to take possession of the new facility towards the end of the year. Site Works Upgrading of the 10km access road to the Sukari site, container lay down facilities and security hut complex facilities have all been completed. Earthworks have been completed for the mine lay down area for the mining fleet. Tailings Storage Facility Knight Piesold Pty Ltd has been appointed to carry out the design and construction supervision of the Tailings Storage Facility. Design work is ongoing with Knight Piesold staff on site during the quarter performing geotechnical investigations. Final design and appropriate bid documentation will be completed during the quarter. Project Engineering and Design A contract for the engineering and design work for the process plant was awarded in mid-March to MetPlant Engineering Services Pty Ltd, an Australian-based company. A technical team visited Bolivia (April 2007) to review the Kori Kollo processing plant dismantling progress and travelled onto Egypt in early May to the Sukari plant site location. Data and information gathered from these visits will be used to finalise design and engineering work. Completion of this work is scheduled for the fourth quarter of 2007. Seawater Supply System Tender documents were distributed during the quarter for the Seawater Supply System which will, draw in and transport raw seawater, via a staged pumped pipeline, to the Sukari site where it will be processed through a desalination plant for end use as process plant water, mine site dust suppression water and after secondary processing and treatment for construction camp drinking water. Finalisation of the tender responses will occur during the fourth quarter of 2007. Kori Kollo Process Plant / Isparta Power Station On October 24, 2007, the Company announced that both the Kori Kollo processing plant and the Isparta power plant had arrived safely at the Egyptian seaport of Alexandria and their cargoes had been discharged. The dismantling of the Kori Kollo processing facility in Bolivia and the Isparta 28MW power plant in Turkey was completed in September and both sites were closed and signed off. All staff from Bolivia and Turkey have now relocated to Egypt to continue with the reassembly of the plants at Sukari. The Isparta power plant consisted of 24 pieces of break bulk and 56 containers containing more than 900 individual packages. The Kori Kollo processing plant comprised 270 pieces of break bulk and 55 containers. Trucking of freight has now commenced to the Sukari site and is expected to take several weeks. This latest development represents an exciting phase for the Company as it takes another step towards the commissioning of the first modern gold mine in Egypt which is scheduled for the fourth quarter of 2008. Mining Caterpillar, through their Egyptian authorised dealer Mantrac, has been selected as the supplier of haulage trucks, articulated dump trucks, excavators, graders and dozers. The initial mining fleet will largely comprise: CAT 365 BLME Excavator (1) RH 120E Excavator (1) CAT 785C Rear Dump Truck (5) CAT 14H Grader (1) CAT 834H Wheel Dozer (2) H180D Rock Breaker (1) CAT 16M Grader (1) CAT D10R Dozer (2) Atlas Copco has been selected to supply grade control and blast hole drilling equipment. Initial fleet selection comprises: ROC F9 Pioneer Drill (1) L8 MKII Production Drill (1) L8 MKII RC Rig (1) During the quarter assembly of the five CAT 785C Rear Dump Trucks and one RH 120E Excavator commenced after successful arrival of the equipment in the Port of Alexandria and subsequent transportation to the Sukari site. In October, the Company took active possession of the RH 120E Excavator after a successful completion test and handover to Company personnel. During the fourth quarter the Company will take possession of the balance of the mining fleet and is scheduled to commence mining activity in December 2007. Owners Team The Company's organisational structure continues to grow with several key appointments being made in the quarter. In a booming resource market, the Company is very pleased with the quality of the personnel that have been attracted to the project and the positions below have now been filled. The Company will continue with its large 'owners team' approach. - Project Manager - Deputy Project Manager (HSE/Infrastructure) - Construction Manager - Construction Supervisor - GIS & Data Base Manager - Senior Surveyor - Mining Manager - Senior Mine Engineer - Mill Superintendent - Logistics Manager - Power Plant Superintendent - Engineering Manager - Project Controller - Manager Procurement Services - Purchasing Officer Sukari Gold Project Sukari Gold Project - Background Centamin is a mineral exploration and development company that has been actively exploring in Egypt since 1995. The principal asset of Centamin is its interest in the Sukari Gold Project, located in the Eastern Desert of Egypt. The Sukari Gold Project is at an advanced stage of development, with construction having commenced in quarter two of 2007 and first gold production expected during the fourth quarter of 2008. A definitive feasibility study (the 'DFS') for the development to commercial production of the Sukari Gold Project was completed in February 2007. A summary of the findings of the DFS were: â€¢ the DFS concluded that a 4mpta plant producing on average 200,000 ounces per annum, over 15 years of mining, is economically robust; and â€¢ total Capital Construction costs are estimated at US$216m with average cash operating costs of US$290/oz (inclusive of 3% royalty) over the 15 year mining period. The Sukari Gold Project will be the first large-scale modern gold mine to be developed in Egypt. Centamin's operating experience in Egypt gives it a significant first-mover advantage in acquiring and developing other gold projects in the prospective Arabian-Nubian Shield. The Sukari Gold Project is hosted by a large, sheeted vein-type and brittle-ductile shear zone hosted gold deposit developed in a granitoid intrusive complex. Gold mineralization is hosted exclusively by a granitoid body of granodiorite - tonalite composition referred to as the Sukari Porphyry. The Company has entered into a Concession Agreement with the Egyptian Government that provides for exploration and exploitation rights at the Sukari Gold Project and whereby the Operating Company, owned 50% by the Company's wholly owned subsidiary, Pharaoh Gold Mines NL ('PGM') and 50% by Egyptian Mineral Resource Authority ('EMRA'), has been established. Centamin is entitled to recover all of its exploration, operating and capital costs from operating surpluses of the operating company. The Sukari Mining License covers an area of 160 km2 and is for a period of 30 years, with an option for a further 30 years. The Sukari Gold Project has been scheduled for open pit mining over an initial 15-year period. During that time 78 Mt ore @ 1.5 g/t Au is expected to be mined, producing 3.7 Moz gold. A further 374 Mt of waste material is also expected to be mined resulting in a waste to ore strip ratio of 4.8:1. Ore and waste will be mined using conventional open pit mining methods. The operation is planned to utilize selective mining techniques to separate ore and waste. Provision has been made for drilling and blasting all primary and oxide materials. Ore will be hauled to the run of mine pad next to the processing plant and either direct tipped to the crusher or stockpiled for future reclaim at the 4 Mtpa process plant throughput rate. Mining will be progressed at an increased rate compared to processing; approximately 5 Mt of ore is expected to be mined and 4 Mt of ore will be processed annually. Operating at an increased mining rate allows the cutoff grade for feed to the plant (referred to as 'cutover' grade) to be increased in the early years of the schedule. This in turn increases the metal output and project revenue in these early years, thus increasing the discounted operating surplus cashflow. According to current schedules, the low-grade stockpile produced as a result of applying a cutover grade, will be processed after mining has ceased, extending the current operating life of the project for a further six years. As a result, the average milled grade during the mining period is forecast to be 1.87 g/t Au, compared to 0.66 g/t Au for the low-grade stockpile. Centamin will own and operate its mining fleet. The production fleet will be based on 380 t class excavators and 150 t class rigid body trucks. At full production, three production fleets, each comprising a single excavator and sharing a maximum of 21 trucks, will be required. The capital cost of the initial mining fleet has been estimated by AMC at US$48.8 million. The proposed process route entails: â€¢ crushing; â€¢ stockpiling crushed ore; â€¢ grinding; â€¢ flotation of a (bulk sulphide) concentrate containing the precious metals; â€¢ thickening of the concentrate; â€¢ fine milling of the concentrate; â€¢ leaching the precious metals from the concentrate in a dilute cyanide solution; â€¢ absorbing the precious metals onto activated carbon; â€¢ stripping the precious metals from the carbon; â€¢ recovering the precious metals as gold dore; and â€¢ placing the concentrate tailing in the tailings storage facility. Tailings from the treatment of weathered oxide ore early in the mining schedule contain too much gold to discard. Hence, the bulk flotation tail is further treated by: â€¢ thickening; â€¢ leaching the precious metals into a dilute cyanide solution; â€¢ adsorbing the precious metals onto activated carbon; â€¢ stripping the precious metals from the carbon; â€¢ recovering the precious metals as gold dore; and â€¢ placing these tailings in the tailings storage facility. Process water will be drawn from the Red Sea. The seawater will be pumped approximately 25 km to the mine site to satisfy all process plant and mining requirements. Most of the seawater will be pumped into a raw water pond located near the processing plant, whilst around 500m(3)/day will be pumped to a water treatment plant for potable and fresh water supplies. Power will be generated on site by a 28 MW power station, operated on heavy fuel oil. A temporary construction camp facility will be required to cater for approximately 500 construction employees and 20 senior staff. This will be constructed at the Sukari Gold Project. An overall schedule has been developed covering all phases of the project; key dates are listed below: Project Go-Ahead Decision Feb 2007 (Completed) Construction Camp Q4 2007 Commence Site Works Q3 2007 Commence Tailings Storage Facility Q4 2007 Kori Kollo Plant Arrives Egypt Q4 2007 (Completed) Commence Mining Pre-strip Q4 2007 Project Finance Q1 2008 Commissioning and Production Q4 2008 Progress pictures can be viewed on the Company's website - www.centamin.com. On behalf of Centamin Egypt Limited Josef El-Raghy Managing Director/CEO November 06, 2007 Information in this report which relates to exploration, geology, sampling and drilling is based on information compiled by geologist Mr R Osman who is a full time employee of the Company, and is a member of the Australasian Institute of Mining and Metallurgy with more than five years experience in the fields of activity being reported on, and is a 'Competent Person' for this purpose and is a 'Qualified Person' as defined in 'National Instrument 43-101 of the Canadian Securities Administrators'. His written consent has been received by the Company for this information to be included in this report in the form and context which it appears. The assay samples were analysed by Ultra Trace Pty Ltd, Canning Vale, Western Australia. The information in this report that relates to mineral resources is based on work completed by Mr Nicolas Johnson, who is a Member of the Australian Institute of Geoscientists. Mr Johnson is a full time employee of Hellman and Schofield Pty Ltd and 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' and is a 'Qualified Person' as defined in ' National Instrument 43-101 of the Canadian Securities Administrators'. Mr Johnson consents to the inclusion in the report of the matters based on his information in the form and context in which it appears. Table 2 - Significant Intersections September 2007 Quarter HOLE NORTH EAST DIP AZI EOH FROM TO INTERVAL Au ppm RCD714 11225 10957 -90 0 296.8 208 217 9 7.50 incl. 209 211 2 28.70 RCD756 11425 10620 -90 0 877.5 791 849 58 3.76 incl. 809 816 7 7.05 incl. 820 825 5 14.84 RCD778 11825 10895 -75 270 599.6 76 128 52 1.09 RCD1125 10300 10700 -86 270 590.6 340 389 49 1.86 incl. 348 349 1 30.00 396 425 29 1.00 498 518 20 1.17 RCD1162 10250 10700 -87 270 570.5 347 422 75 1.94 incl. 349 351 2 5.48 incl. 362 363 1 13.6 incl. 403 407 4 10.04 RCD1163 10200 10650 -85 270 573.3 334 361 27 2.33 incl. 336 339 3 12.73 D1164 11250 10672 -90 0 764.5 361 371 10 1.98 incl. 361 365 4 3.09 544 564 20 1.33 711 764 53 3.21 incl. 728 736 8 9.36 incl. 752 755 3 11.27 RCD1165 10150 10663 -80 270 719.4 338 366 28 1.40 incl. 348 349 1 10.70 371 388 17 3.98 incl. 375 376 1 12.30 incl. 382 383 1 41.60 RCD1166 10100 10611 -87 270 534.5 279 302 23 6.23 incl. 279 281 2 13.40 incl. 288 289 1 14.90 incl. 296 297 1 14.70 309 377 68 1.89 incl. 336 337 1 9.93 incl. 363 364 1 11.20 419 469 50 1.07 RCD1173 10000 10675 -77 270 571.00 364 368 4 3.04 384 410 26 3.59 incl. 384 385 1 27.30 incl. 405 406 1 35.70 415 464 49 1.79 incl. 432 433 1 8.75 incl. 438 439 1 9.32 incl. 445 447 2 6.27 incl. 454 455 1 6.47 RCD1177 10200 10706 -87 270 727.1 367 432 65 18.31 incl. 367 372 5 209.43 incl. 370 371 1 1040.00 RCD1178 10300 10758 -85 270 617.6 380 485 105 4.10 incl. 380 382 2 29.20 incl. 412 413 1 71.90 incl. 424 426 2 12.36 incl. 466 469 3 14.24 incl. 472 474 2 17.24 500 517 17 12.45 incl. 501 503 2 76.35 incl. 516 517 1 12.45 D1179 11850 10825 -40 270 265.15 0 15 15 4.19 incl. 6 8 2 15.3 incl. 12 13 1 6.96 134 153 19 1.45 RCD1186 10400 10749 -85 270 639.5 341 377 36 1.91 incl. 341 342 1 5.32 incl. 358 359 1 5.87 incl. 371 372 1 6.30 incl. 374 375 1 16.10 449 455 14 3.32 RCD1187 10450 10750 -70 270 452.7 299 350 51 4.45 incl. 304 305 1 36.00 incl. 322 331 9 15.51 383 397 14 4.44 incl. 383 384 1 43.50 RCD1189 10050 10560 -87 270 485.6 155 180 25 1.71 incl. 173 174 1 7.49 219 239 20 2.46 incl. 234 237 3 6.45 251 282 31 1.62 incl. 273 275 2 6.06 D1203 11950 10820 -45 270 248.72 0 148 148 1.33 incl. 55 56 1 5.93 incl. 62 66 4 5.25 incl. 90 91 1 6.43 D1205 12000 10823 -45 270 165.12 9 23 14 1.32 48 160 112 1.30 incl. 60 61 1 9.94 incl. 75 76 1 5.95 incl. 85 86 1 12.70 incl. 99 100 1 13.60 incl. 109 110 1 6.15 D1208 11775 10848 -90 0 153.58 47 78 31 1.23 D1209 11800 10806 -60 270 598.6 465 490 25 2.33 incl. 485 487 2 7.26 incl. 465 466 1 15.30 incl. 473 474 1 11.20 RCD1213 10500 10500 -75 270 289 108 136 28 2.56 incl. 123 126 3 10.75 166 192 26 4.28 incl. 170 171 1 13.70 incl. 174 177 3 20.97 245 264 19 1.57 incl. 246 247 1 6.69 SRC004 12827 10914 -60 150 180 31 33 2 9.78 MANAGEMENT DISCUSSION AND ANALYSIS The following Management's Discussion and Analysis of the Financial Condition and Results of Operations ('MD&A') for Centamin Egypt Limited (the 'Company' or 'Centamin') should be read in conjunction with the Interim Consolidated Financial Statements for the three months ended September 30, 2007 which are unaudited. The effective date of this report is November 06, 2007. The financial information presented in this MD&A has been prepared in accordance with Australian equivalents to International Financial Reporting Standards (AIFRS), other mandatory professional reporting requirements and the Corporations Act 2001. In addition to these Australian requirements, further information has been included in the Unaudited interim Consolidated Financial Statements for the three months ended September 30, 2007 in order to comply with applicable Canadian securities law, as the Company is listed on the Toronto Stock Exchange. Additional information relating to the Company, including the Company's most recent Annual Report for the year ended June 30, 2007 and other public announcements is available at www.centamin.com. All amounts in this MD&A are expressed in United States dollars unless otherwise identified. FORWARD LOOKING STATEMENTS Some of the statements contained in this MD&A, including those relating to strategies and other statements, are predictive in nature, and depend upon or refer to future events or conditions, or include words such as 'expects', ' intends', 'plans', 'anticipates', 'believes', 'estimates' or similar expressions that are forward looking statements. Forward looking statements include, without limitations, the information concerning possible or assumed further results of operations as set forth herein. These statements are not historical facts but instead represent only expectations, estimates and projections regarding future events and are qualified in their entirety by the inherent risks and uncertainties surrounding future expectations generally. The forward looking statements contained in this MD&A are not guarantees of future performance and involve certain risks and uncertainties that are difficult to predict. The future results of the Company may differ materially from those expressed in the forward looking statements contained in this MD&A due to, among other factors, the risks and uncertainties inherent in the business of the Company. The Company does not undertake any obligation to update or release any revisions to these forward looking statements to reflect events or circumstances after the date of this MD&A or to reflect the occurrence of unanticipated events. BACKGROUND Centamin is a mineral exploration and development company that has been actively exploring in Egypt since 1995. The principal asset of Centamin is its interest in the Sukari Project, located in the Eastern Desert of Egypt. The Sukari Project is at an advanced stage of development, with construction having commenced in March 2007 and first gold production expected during the fourth quarter of 2008. A definitive feasibility study (the 'DFS') for the development to commercial production of the Sukari Project was compiled in February 2007 by Roche Process Engineering Pty Ltd. The DFS provides that the capital cost to develop the project is estimated at US$216.5 million (including mining fleet and contingencies but not including the leased mining fleet). According to the DFS, the Sukari Project reserve will be mined by a single open pit over a 15-year period. During that time 78 Mt ore grading 1.5 g/t is expected to be mined, containing 3.7M oz gold. Over this 15-year mining period the project is expected to produce on average 200,000 oz of gold annually at an average cash operating cost of US$290/oz. The Sukari Project will be the first large-scale modern gold mine to be developed in Egypt. Centamin's operating experience in Egypt gives it a significant first-mover advantage in acquiring and developing other gold projects in the prospective Arabian-Nubian Shield. SELECTED FINANCIAL INFORMATION FROM THE UNAUDITED INTERIM CONSOLIDATED INCOME STATEMENTS Three Months Ended Three Months Ended September 30, 2007 September 30, 2006 US$ US$ Revenue 1,512,838 553,351 Other income 1,840 - Corporate administration expenses (553,591) (399,356) Foreign exchange gain 5,512,072 201,614 Share based payments (787,453) - Other expenses (155,831) (4,587) Profit before income tax 5,529,875 351,022 Tax (expense)/income - - Net profit for the period 5,529,875 351,022 Earnings per share - Basic (cents per share) 0.732 0.061 - Diluted (cents per share) 0.711 0.060 Results for the Three Months Ended September 30, 2007 Revenue of $1,512,838 comprises interest revenue applicable on the Company's available cash and working capital balances and term deposit amounts. The reported figure is significantly higher than for the corresponding period last year due to the higher average cash holdings. Other income of $1,840 represents value added tax refunded to the Company on an overseas purchase. Corporate administration expenses of $553,591 comprise expenditure incurred for communications, consultants, directors' fees, stock exchange listing fees, share registry fees, employee salaries and general office administration expenses. The amount reported is higher than last period due to increased compliance costs associated with the Company's listings on three separate stock exchanges. Foreign exchange gain of $5,512,072 is attributable to positive exchange rate movements during the period as a result of the weakening United States dollar against the Canadian dollar. Share based payments of $787,453 relate to the requirement to recognise the cost of granting options to directors, company executives and employees under AIFRS over the option vesting period. Other expenses of $155,830 comprise non-cash expenses for depreciation and employee entitlements. The profit after tax of the consolidated entity for the three months ended September 30, 2007 was $5,529,875. SELECTED FINANCIAL INFORMATION FROM THE UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS September 30, 2007 June 30, 2007 US$ US$ Total current assets 120,858,810 136,735,715 Total non-current assets 105,032,814 81,982,697 Total assets 225,891,624 218,718,412 Total current liabilities 7,155,532 6,367,968 Total non-current liabilities 150,000 150,000 Total liabilities 7,305,532 6,517,968 Net assets 218,586,092 212,200,444 Current assets have decreased to $120,858,810 at September 30, 2007 primarily due to the application of funds against development expenditures at the Sukari project. Non-current assets have increased to $105,032,814 at September 30, 2007 as a result of the expenditure incurred ongoing exploration resource drilling at Sukari and initial construction activities at Sukari. The Company's accounting policy is to capitalise expenditure of this nature under the categories of Property, Plant and Equipment and Exploration, Evaluation & Development. Current liabilities have increased to $7,155,532 at September 30, 2007 due to the acquisition of a second hand power plant in Turkey and trade creditors balance higher as a result of increased activity at the Sukari Gold project. The acquisition price of the second hand power plant was US$9.75M of which US$1.97M remains to be paid, as at September 30, 2007 as the final payment of this transaction. Non-current liabilities as at September 30, 2007 remain unchanged. SELECTED FINANCIAL INFORMATION FROM THE UNADUITED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Three Months Ended September 30, 2007 US$ Total equity at beginning of period 212,400,444 Movement in issued equity 98,160 Movement in reserves 757,613 Profit for the period 5,529,875 Total equity at end of period 218,586,092 Issued equity has increased due to the exercise of employee options. Reserves have increased due to the effect of expensing share based option payments. Profit for the three months ended September 30, 2007 is analysed under the section Consolidated Income Statement. SELECTED FINANCIAL INFORMATION FROM THE UNAUDITED INTERIM CONSOLIDATED CASH FLOW STATEMENTS Three Months Ended Three Months Ended September 30, 2007 September 30, 2006 US$ US$ Net cash flow from operating activities (2,262,676) 21,187 Net cash flow from investing activities (19,812,403) (3,003,705) Net cash flow from financing activities (381,059) 96,977 Net decrease in cash and cash equivalents (22,456,138) (2,885,541) Cash and cash equivalents at the beginning of the financial period 136,501,015 44,513,500 Effects of exchange rate changes 5,678,075 191,343 Cash and cash equivalents at the end of the financial period 119,722,952 41,819,302 Three Months Ended September 30, 2007 The net cash flow from operating activities for the three months ended September 30, 2007 of $2,262,676 is attributable to payments for corporate salary and wages, corporate administration and compliance related costs offset by interest revenue received. The net cash flow from investing activities for the three months ended September 30, 2007 of ($19,812,403) is attributable to exploration expenditure of $2,777,812 and Sukari development expenditure of $17,034,591. The net cash flow from financing activities for the year ended September 30, 2007 of ($381,059) is attributable to equity raised through exercise of employee share options offset by project financing due diligence expenditure being incurred. The overall net decrease in cash for the three months ended September 30, 2007 of $22,456,138, excluding the effect of exchange rate movements, results in a closing cash balance of $119,722,952. LIQUIDITY AND CAPITAL RESOURCES The Company's principal source of liquidity as at September 30, 2007 is cash of $119,722,952 (September 30, 2006 - $41,819,302). Of this amount $118,972,281 has been invested in daily rolling short term higher interest money market deposits. The Company's principal sources of cash for the three months ended September 30, 2007 were proceeds from cash investments and interest revenue received from cash investments. The following is a summary of the Company's outstanding commitments as at September 30, 2007: Payments due Total Less than 1 year 1 to 5 years US$ US$ US$ Turkish Power Plant 1,957,000 1,957,000 - Creditors 4,625,873 4,625,873 - Total commitments 6,582,873 6,582,873 - The Company's financial commitments are limited to controllable discretionary spending on work programs at the Sukari Project, administration expenditure at the Egyptian and Australia office locations and for general working capital purposes. The Company's financial obligations in relation to the Turkish power plant are limited to the following: â€¢ A US$9.75 million series of progressive payments relating to the acquisition of a second hand power generation plant acquired in February 2007 and presently located in Turkey. The first payment of US$1.9 million was made upon signing of the sale and purchase contract in February 2007, the second and third payments of US$1.9 million each were paid on April 30, 2007 and August 13, 2007, and the final payment was due upon the earlier of power plant location or the expiry date of a letter of credit established as security for the payments. This expiry date was October 9, 2007. This final payment was made on October 1, 2007. On April 17, 2007 the Company announced that it had appointed Barclays Capital, the investment banking division of Barclays Bank PLC, as Mandated Lead Arranger to arrange a financing facility of up to US$100M for the Sukari Gold Project. During the quarter, the due diligence process with Barclays Capital, the investment banking division of Barclays Bank PLC, continued with the drafting of various project facility and supporting agreements. Completion of the project financing schedule has been moved out to the first quarter of next year to accommodate the work schedule of all parties involved in the process. Other than described above the company has no other off balance sheet arrangements. OUTSTANDING SHARE INFORMATION As at November 06, 2007 the Company had 757,069,232 fully paid ordinary shares issued and outstanding. The following table sets out the fully paid ordinary shares issuable under the Employee Share Option Plan and Warrants issued under the recent TSX listing: As at November 06, 2007 Number Shares on Issue 757,069,232 Options issued but not exercised 12,405,000 Warrants issued by not exercised 8,794,691 778,268,923 SEGMENT DISCLOSURE The Company is engaged in the business of exploration for precious and base metals only, which is characterised as one business segment only. SIGNIFICANT ACCOUNTING ESTIMATES Management is required to make various estimates and judgements in determining the reported amounts of assets and liabilities, revenues and expenses for each period presented and in the disclosure of commitments and contingencies. The significant areas where management uses estimates and judgements in preparing the consolidated financial statements are the determination of carrying values and impaired values of exploration assets. INTERNAL CONTROLS Disclosure controls and procedures are designed to provide reasonable assurance that all relevant information is gathered and reported to management, including the CEO and CFO, on a timely basis so that appropriate decisions can be made regarding public disclosure. Management, with the participation of the certifying officers, has evaluated the effectiveness of the design and operation, as of June 30, 2007, of the Company's disclosure controls and procedures (as defined by the Canadian Securities Administrators). Based on that evaluation, the certifying officers have concluded that such disclosure controls and procedures are effective and designed to ensure that material information relating to the Company and its subsidiaries is known to them by others within those entities. Internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of our financial reporting and compliance with Canadian generally accepted accounting principles in our financial statements. Management has evaluated the design of internal control over financial reporting and has concluded that such internal controls over financial reporting are designed to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principles in Canada. In addition, there have been no changes in the Company's internal control over financial reporting during the quarter ended September 30, 2007 that have materially affected, or are reasonably likely to materially affect, its internal control over financial reporting. FINANCIAL INSTRUMENTS At September 30, 2007 the Company has exposure to interest rate risk which is limited to the floating market rate for cash. The Company does not have foreign currency risk for non-monetary assets and liabilities of the Egyptian operations as these are deemed to have a functional currency of United States dollars. The Company has no significant monetary foreign currency assets and liabilities apart from Canadian dollar and United States dollar cash term deposits which are held for the purposes of funding a portion of the mine construction for the Sukari Project. The Company currently does not engage in any hedging or derivative transactions to manage interest rate or foreign currency risks. RELATED PARTY TRANSACTIONS The related party transactions for the three months ended September 30, 2007 are summarised below: - Salaries, superannuation contributions, consulting and Directors fees paid to Directors during the three months ended September 30, 2007 amounted to A$429,865 (September 30, 2006: A$201,265). - Mr S El-Raghy and Mr J El-Raghy are Directors and shareholders of El-Raghy Kriewaldt Pty Ltd ('ELK'), which provides office premises to the Company in Australia. All dealings with ELK are in the ordinary course of business and on normal terms and conditions. Rent paid to ELK during the three months ended September 30, 2007 amounted to A$15,315 (September 30, 2006: A$13,395). - Mr S El-Raghy provides office premises to the Company in Alexandria, Egypt. All dealings are in the ordinary course of business and on normal terms and conditions. Rent paid during the three months ended September 30, 2007 amounted to GBP 1,950 (September 30, 2006: GBP 1,950). - Mr C Cowden, a non-executive director, is also a director and shareholder of Cowden Limited, which provides insurance broking services to the Company. All dealings with Cowden Limited are in the ordinary course of business and on normal terms and conditions. Insurance premiums paid to Cowden Limited during the three months ended September 30, 2007 amounted to A$33,541 (September 30, 2006: A$846). SUBSEQUENT EVENTS On November 01, 2007 the Company announced that it has entered into an agreement with Westwind Partners Inc. as lead underwriter on behalf of a syndicate of underwriters to purchase, on a bought deal private placement basis, 83,333,334 special warrants of the Company at a price of C$1.20 per special warrant, for aggregate gross proceeds of C$100,000,001 (the 'Offering'). As a result of this raising the Company is debt free, unhedged and able to aggressively pursue further exploration and the underground development of the newly discovered high grade Amun Deeps. Other than as set out above there has not risen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely in the opinion of the Directors of the Company to affect significantly the operations of the company, the results of those operations, or the state of affairs of the Company in subsequent financial years. The accompanying Interim Consolidated Financial Statements for the quarter ended September 30, 2007 have been prepared in accordance with Australian Equivalents to International Financial Reporting Standards and has not been audited by the Company's Auditors. UNAUDITED INTERIM CONSOLIDATED INCOME STATEMENTS Three Months Ended Three Months Ended September 30, 2007 September 30, 2006 US$ US$ Revenue - Note 4 1,512,838 553,351 Other income - Note 4 1,840 - Administration expenses (553,591) (399,356) Foreign exchange gain 5,512,072 201,614 Share based payments (787,453) - Other expenses (155,831) (4,587) Profit before income tax 5,529,875 351,022 Tax (expense)/income - - Net profit for the period 5,529,875 351,022 Earnings per share - Basic (cents per share) 0.732 0.061 - Diluted (cents per share) 0.711 0.060 The above Unaudited Interim Consolidated Income Statements should be read in conjunction with the accompanying notes. UNAUDITED INTERIM CONSOLIDATED BALANCE SHEETS September 30, 2007 June 30, 2007 US$ US$ CURRENT ASSETS Cash and cash equivalents 119,722,952 136,501,015 Trade and other receivables 39,258 86,893 Inventories 808,637 140,400 Prepayments 287,963 7,407 Total current assets 120,858,810 136,735,715 NON-CURRENT ASSETS Plant and equipment 12,000,080 12,067,243 Exploration, evaluation and development expenditure - Note 5 93,032,734 69,915,454 Total non-current assets 105,032,814 81,982,697 Total assets 225,891,624 218,718,412 CURRENT LIABILITIES Trade and other accounts payable 6,604,983 5,910,093 Provisions 550,549 457,875 Total current liabilities 7,155,532 6,367,968 NON-CURRENT LIABILITIES Trade and other accounts payable 150,000 150,000 Total non-current liabilities 150,000 150,000 Total liabilities 7,305,532 6,517,968 NET ASSETS 218,586,092 212,200,444 EQUITY Issued Capital - Note 7 218,013,229 217,915,069 Reserves 6,805,353 6,047,740 Accumulated losses (6,232,490) (11,762,365) TOTAL EQUITY 218,586,092 212,200,444 The above Unaudited Interim Consolidated Balance Sheets should be read in conjunction with the accompanying notes. UNAUDITED INTERIM CONSOLIDATED STATEMENTS OF CHANGES IN EQUITY Issued Options Reserve Accumulated Capital Reserves US$ Losses Total US$ US$ US$ US$ At June 30, 2006 94,219,681 2,294,794 433,192 (18,646,792) 78,300,875 Profit for the period - - - 6,884,427 6,884,427 Share options exercised 364,185 - - - 364,185 Cost of share based payments - - 3,376,854 - 3,376,854 Contributions of equity 123,274,103 - - - 123,274,103 Transfer to issued capital 57,100 - (57,100) - - At June 30, 2007 217,915,069 2,294,794 3,752,946 (11,762,365) 212,200,444 Profit for the period - - - 5,529,875 5,529,875 Share options exercised 68,320 - - - 68,320 Cost of share based payments - - 787,453 - 787,453 Contributions of equity - - - - - Transfer to issued capital 29,840 - (29,840) - - At September 30, 2007 218,013,229 2,294,794 4,510,559 (6,232,490) 218,586,092 The above Unaudited Interim Consolidated Statement of Changes in Equity should be read in conjunction with the accompanying notes. UNAUDITED INTERIM CONSOLIDATED CASH FLOW STATEMENT Three Months Ended Three Months Ended September 30, 2007 September 30, 2006 US$ US$ CASH FLOWS FROM OPERATING ACTIVITIES Payments to suppliers and employees (3,775,514) (532,164) Interest received 1,512,838 553,351 Net cash generated by/(used in) operating activities (2,262,676) 21,187 CASH FLOWS FROM INVESTING ACTIVITIES Payments for exploration (2,777,812) (3,003,705) Payments for development (17,034,591) - Net cash generated by/(used in) investing activities (19,812,403) (3,003,705) CASH FLOWS FROM FINANCING ACTIVITIES Proceeds from the conversion of options 68,320 91,294 Project finance due diligence costs (276,301) - Financial activity (bank charges) (173,078) 5,683 Net cash generated by/(used in) financing activities (381,059) 96,977 Net decrease in cash and cash equivalents (22,456,138) (2,885,541) Cash and cash equivalents at the beginning of the period 136,501,015 44,513,500 Effects of exchange rate changes on the balance of cash held in foreign 5,678,075 191,343 currencies Cash and cash equivalents at the end of the period 119,722,952 41,819,302 The above Interim Consolidated Cash Flow Statements should be read in conjunction with the accompanying notes. NOTE 1: STATEMENT OF SIGNIFICANT ACCOUNTING POLICIES Nature of Operations, Going Concern and Accounting Policies Statement of Compliance Centamin Egypt Limited (the 'Company') and its subsidiaries (collectively 'the Group') are engaged in the exploration for precious and base metals located in the western desert region of Egypt. The Company was incorporated under the Corporations Law of South Australia on March 24, 1970. These consolidated financial statements have been prepared in accordance with Australian general accepted accounting principles, as applicable to a going concern. Accordingly, they do not give effect to adjustments that would be necessary should the Company be unable to continue as a going concern and therefore be required to realise its assets and liquidate its liabilities and commitments in other than the normal course of business and at amounts different from those in the accompanying consolidated financial statements. The Company has a need for financing for working capital, and the exploration and development of its mineral properties. The Company's continuance as a going concern is dependent upon its ability to obtain adequate financing and to reach profitable levels of operations. It is not possible to predict whether financing efforts will be successful or if the Company will attain profitable levels of operations. Basis of Preparation The accompanying unaudited interim consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Australia. The financial statements are prepared using the same accounting policies and methods of application as those disclosed in note 3 to the consolidated financial statements for the year ended 30 June 2007, but they do not include all the disclosures required by Australian Accounting Standards for annual financial statements. In the opinion of management, all adjustments considered necessary for fair presentation have been included in these financial statements. Operating results for the three months ended September 30, 2007 are not necessarily indicative of the results that may be expected for the full year ending June 30, 2008. For further information see the Company's consolidated financial statements, including notes thereto, for the year ended June 30, 2007. The significant accounting policies which have been adopted in the preparation of these unaudited interim consolidated financial statements are: (A) ACCOUNTS PAYABLE Trade payables and other accounts payable are recognised when the consolidated entity becomes obliged to make future payments resulting from the purchase of goods and services. (B) DEBT AND EQUITY INSTRUMENTS ISSUED BY THE COMPANY Debt and equity instruments are classified as either liabilities or as equity in accordance with the substance of the contractual arrangement. (C) EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE Exploration and evaluation expenditures in relation to each separate areas of interest are recognised as an exploration and evaluation asset in the year in which they are incurred where the following conditions are satisfied: i) the rights to tenure of the area of interest are current; and ii) at least one of the following conditions is also met: a) the exploration and evaluation expenditures are expected to be recouped through successful development and exploration of the area of interest, or alternatively, by its sale: or b) exploration and evaluation activities in the area of interest have not at the reporting date reached a stage which permits a reasonable assessment of the existence or otherwise of economically recoverable reserves, and active and significant operations in, or in relation to, the area of interest are continuing. Exploration and evaluation assets are initially measured at cost and include acquisition of rights to explore, studies, exploration drilling, trenching and sampling and associated activities. General and administrative costs are only included in the measurement of exploration and evaluation costs where they are related directly to operational activities in a particular area of interest. Exploration and evaluation assets are assessed for impairment when facts and circumstances (as defined in AASB 6 'Exploration for and Evaluation of Mineral Resources') suggest that the carrying amount of exploration and evaluation assets may exceed its recoverable amount. The recoverable amount of the exploration and evaluation assets (or the cash-generating unit(s) to which it has been allocated, being no larger than the relevant area of interest) is estimated to determine the extent of the impairment loss (if any). Where an impairment loss subsequently reverses, the carrying amount of the asset is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset in previous years. Where a decision is made to proceed with development in respect of a particular area of interest, the relevant exploration and evaluation asset is tested for impairment, reclassified to development properties, and then amortised over the life of the reserves associated with the area of interest once mining operations have commenced. (D) FOREIGN CURRENCY All foreign currency transactions during the period have been brought to account using the exchange rate in effect at the date of the transaction. Foreign currency monetary items at balance date are translated at the exchange rate existing at that date. Non-monetary assets and liabilities carried at fair value that are denominated in foreign currencies are translated at the rates prevailing at the date when the fair value was determined. All exchange differences are brought to account in the interim consolidated income statement in the financial period in which they arise. (E) GOODS AND SERVICES TAX Revenues, expenses and assets are recognised net of the amount of goods and services tax (GST), except: i. Where the amount of GST incurred is not recoverable from the taxation authority, it is recognised as part of the cost of acquisition of an asset or as part of an item of expense; or ii. For receivables and payables which are recognised inclusive of GST. The net amount of GST recoverable from, or payable to, the taxation authority is included as part of receivables or payables. (F) IMPAIRMENT OF ASSETS (OTHER THAN EXPLORATION AND EVALUATION) At each reporting date, the consolidated entity reviews the carrying amounts of its tangible and intangible assets to determine whether there is any indication that those assets have suffered an impairment loss. If any such indication exists, the recoverable amount of the asset is estimated in order to determine the extent of the impairment loss (if any). Where the asset does not generate cash flows that are independent from other assets, the consolidated entity estimates the recoverable amount of the cash-generating unit to which the asset belongs. Recoverable amount is the higher of fair value less costs to sell and value in use. In assessing value in use, the estimated future cash flows are discounted to their present value using a pre-tax discount rate that reflects current market assessment of the time value of money and the risks specific to the asset for which the estimates of future flows have not been adjusted. If the recoverable amount of an asset (or cash-generating unit) is estimated to be less than its carrying amount, the carrying amount of the asset (cash-generating unit) is reduced to its recoverable amount. Each cash generated unit is determined on an area of interest basis. Where an impairment loss subsequently reverses, the carrying amount of the asset (cash-generating unit) is increased to the revised estimate of its recoverable amount, but only to the extent that the increased carrying amount does not exceed the carrying amount that would have been determined had no impairment loss been recognised for the asset (cash generating unit) in prior years. (G) LOANS AND RECEIVABLES Trade receivables, loans, and other receivables are recorded at amounts due less any allowance for doubtful debts. (H) PLANT AND EQUIPMENT Plant and equipment, and equipment under finance lease are stated at cost less accumulated depreciation and impairment. Plant and equipment will include capitalised development expenditure. Cost includes expenditure that is directly attributable to the acquisition of the item as well as the estimated cost of abandonment. In the event that settlement of all or part of the purchase consideration is deferred, cost is determined by discounting the amounts payable in the future to their present value as at the date of acquisition. Depreciation is provided on plant and equipment. Depreciation of capitalised development expenditure will be provided on a unit of production basis over recoverable reserves, whilst on other fixed assets are calculated on a straight line basis so as to write off the cost or other re-valued amount of each asset over its expected useful life to its estimated residual value. The estimated useful lives, residual values and depreciation method are reviewed at the end of each annual reporting period. The following estimated useful lives are used in the calculation of depreciation: Plant & Equipment & Office Furniture - 4-10 years Motor Vehicles - 2 -8 years (I) PRINCIPLES OF CONSOLIDATION The consolidated financial statements are prepared by combining the financial statements of all the entities that comprise the consolidated entity, being the company (the parent entity) and its subsidiaries as defined in Accounting Standard AASB 127 'Consolidated and Separate Financial Statements'. Consistent accounting policies are employed in the preparation and presentation of the consolidated financial statements. The consolidated financial statements include the information and results of each subsidiary from the date on which the company obtains control and until such time as the company ceases to control such entity. In preparing the consolidated financial statements, all significant intercompany balances and transactions, and unrealised profits arising within the consolidated entity are eliminated in full. (J) REVENUE RECOGNITION Interest revenue is recognised on a time proportionate basis that takes into account the effective yield on the financial asset. (K) SHARE-BASED PAYMENTS Employee share options that vested before January 1, 2005 have not been expensed. The shares are recognised when the options are exercised and the proceeds are allocated to share capital. Equity-settled share-based payments granted after November 7, 2002 that were vested on or after January 1, 2005, are measured at fair value at the date of grant. Fair value is measured under the Black-Scholes option valuation model. The fair value determined at the grant date of the equity-settled share-based payments is expensed on a straight-line basis over the vesting period, based on the consolidated entity's estimate of shares that will eventually vest. (L) SUPERANNUATION FUND The Company contributes to, but does not participate in, compulsory superannuation funds on behalf of the Employees and Directors in respect of salaries and directors' fees paid. Contributions are charged against income as they are made. (M) TAXATION Current tax Current tax is calculated by reference to the amount of income taxes payable or recoverable in respect of the taxable profit or tax loss for the period. It is calculated using tax rates and tax laws that have been enacted or substantively enacted by reporting date. Current tax for current and prior periods is recognised as a liability (or asset) to the extent that it is unpaid (or refundable). Deferred tax Deferred tax is accounted for using the comprehensive balance sheet liability method in respect of temporary differences arising from differences between the carrying amount of assets and liabilities in the financial statements and the corresponding tax base of those items. In principle, deferred tax liabilities are recognised for all taxable temporary differences. Deferred tax assets are recognised to the extent that it is probable that sufficient taxable amounts will be available against which deductible temporary differences or unused tax losses and tax offsets can be utilised. However, deferred tax assets and liabilities are not recognised if the temporary differences giving rise to them arise from the initial recognition of assets and liabilities (other than as a result of a business combination) which affects neither taxable income nor accounting profit. Furthermore, a deferred tax liability is not recognised in relation to taxable temporary differences arising from goodwill. Deferred tax assets and liabilities are offset when they relate to income taxes levied by the same taxation authority and the company/consolidated entity intends to settle its current tax assets and liabilities on a net basis. Current and deferred tax for the period Current and deferred tax is recognised as an expense or income in the income statement, except when it relates to items credited or debited directly to equity, in which case the deferred tax is also recognised directly in equity, or where it arises from the initial accounting for a business combination, in which case it is taken into account in the determination of goodwill or excess. Tax Consolidation The Company and all its wholly-owned Australian resident entities are part of a tax-consolidated group under Australian taxation law. Centamin Egypt Limited is the head entity in the tax-consolidated group. Tax expense/income, deferred tax liabilities and deferred tax assets arising from temporary differences of the members of the tax-consolidated group are recognised in the separate financial statements of the members of the tax-consolidated group using the 'separate taxpayer within group' approach. Current tax liabilities and assets and deferred tax assets arising from unused tax losses and tax credits of the members of the tax-consolidated group are recognised by the company (as the head entity in the tax-consolidated group). Due to the existence of a tax funding arrangement between the entities in the tax-consolidated group, amounts are recognised as payable to or receivable by the company and each member of the group in relation to the tax contribution amounts paid or payable between the parent entity and the other members of the tax-consolidated group in accordance with the arrangement. Where the tax contribution amount recognised by each member of the tax-consolidated group for a particular period is different to the aggregate of the current tax liability or asset and any deferred tax asset arising from unused tax losses and tax credits in respect of that period, the difference is recognised as a contribution to (or distribution to) equity participants. NOTE 2: SEGMENT REPORTING Primary reporting - Business Segments The economic entity is engaged in the business of exploration for precious and base metals only, which is characterised as one business segment only. Secondary reporting - Geographical Segments The principal activity of the economic entity during the year was the exploration for precious and base metals in Egypt and funding is sourced from Australia. NOTE 3: EVENTS SUBSEQUENT TO BALANCE DATE On November 01, 2007 the Company announced that it has entered into an agreement with Westwind Partners Inc. as lead underwriter on behalf of a syndicate of underwriters to purchase, on a bought deal private placement basis, 83,333,334 special warrants of the Company at a price of C$1.20 per special warrant, for aggregate gross proceeds of C$100,000,001 (the 'Offering'). As a result of this raising the Company is debt free, unhedged and able to aggressively pursue further exploration and the underground development of the newly discovered high grade Amun Deeps. Other than as set out above there has not risen in the interval between the end of the financial year and the date of this report any item, transaction or event of a material and unusual nature likely in the opinion of the Directors of the Company to affect significantly the operations of the company, the results of those operations, or the state of affairs of the Company in subsequent financial years. NOTE 4: REVENUE Three months Three months ended ended September 30, September 30, 2007 2006 US$ US$ (a) Revenue Interest revenue 1,512,838 553,351 (b) Other income VAT refund 1,840 - 1,514,678 553,351 NOTE 5: EXPLORATION, EVALUATION AND DEVELOPMENT EXPENDITURE Three months ended Three months ended September 30, 2007 June 30, 2007 US$ US$ Exploration and evaluation phase expenditure - At Cost (a) Balance at the beginning of the period 4,627,793 43,733,808 Expenditure for the period 2,782,000 3,473,398 Transfer to Development phase expenditure - (42,579,413) Balance at the end of the period 7,409,793 4,627,793 Development expenditure - At Cost (a) Balance at the beginning of the period 65,287,661 1,154,038 Expenditure for the period 20,335,280 21,554,210 Transfer from Exploration and evaluation phase expenditure - 42,579,413 Balance at the end of the period 85,622,941 65,287,661 Net book value of exploration, evaluation and development phase 93,032,734 69,915,454 expenditure (a) Included within the cost amount of exploration evaluation and development assets is $5,311,744 being the excess of consideration over the net tangible assets acquired on the acquisition of Pharaoh Gold Mines NL in January 1999. This amount has been treated as part of the cost of exploration, evaluation and development. Management believe that the recovery of these amounts will satisfactorily be made through the exploitation of the project in due course. (b) Development of the Sukari Gold Project commenced in March 2007. Items of development phase expenditure relevant to the project are being separately accounted for as development phase expenditure. NOTE 6: CONTINGENT LIABILITIES The Directors are not aware of any contingent liabilities as at the date of these unaudited interim consolidated financial statements. NOTE 7: ISSUED CAPITAL Three months ended Three months ended September 30, 2007 June 30, 2007 US$ US$ Fully paid ordinary shares Balance at beginning of the period 217,915,069 86,838,243 Issue of shares under Employee option plan 68,320 45,810 Transfer from share options reserve 29,840 64,492 Placements - 130,966,524 Balance at end of the period 218,013,229 217,915,069 Change to the then Corporations Law abolished the authorised capital and par value concept in relation to share capital from 01 July 1998. Therefore, the Company does not have a limited amount of authorised capital and issued shares do not have a par value. Fully Paid Ordinary Shares Three months ended Three months ended September 30, 2007 June 30, 2007 Number US$ Number US$ Balance at beginning of the period 755,734,232 217,915,069 579,640,369 86,838,243 Employee share option plan 120,000 68,320 200,000 45,810 Transfer from share options reserve - 29,840 - 64,492 Placements - - 175,893,863 130,966,524 Balance at end of the period 755,854,232 218,013,229 755,734,232 217,915,069 Fully paid ordinary shares carry one vote per share and carry the right to dividends. Share options granted under the employee share option plan In accordance with the provisions of the employee share option plans, as at September 30, 2007, executives and employees have options over 13,370,000 ordinary shares. The expiry dates of the granted options are detailed in Note 10. Share options granted under the employee share option plan carry no rights to dividends and no voting rights. Further details of the employee share option plan are contained in Note 10 to the financial statements. Share warrants on issue As part of the Canadian listing process undertaken during the financial year on the Toronto Stock Exchange (TSX) the Company was required to issue to its nominated share broker share warrants as part of the arrangement. Share warrants are identical in nature to share options however they are differentiated as such because the latter in Canada typically relates to options issued to employees under employee share plans. As at 30 June 2007 there were 8,794,691 warrants on issue over and equivalent number of ordinary shares (of which 8,794,691 are vested). Further details of the share warrants are contained in Note 10 to the financial statements. NOTE 8: RELATED PARTY TRANSACTIONS The related party transactions for the three months ended September 30, 2007 are summarised below: - Salaries, superannuation contributions, consulting and Directors fees paid to Directors during the three months ended September 30, 2007 amounted to A$429,865 (September 30, 2006: A$201,265). - Mr S El-Raghy and Mr J El-Raghy are Directors and shareholders of El-Raghy Kriewaldt Pty Ltd ('ELK'), which provides office premises to the Company in Australia. All dealings with ELK are in the ordinary course of business and on normal terms and conditions. Rent paid to ELK during the three months ended September 30, 2007 amounted to A$15,315 (September 30, 2006: A$13,395). - Mr S El-Raghy provides office premises to the Company in Alexandria, Egypt. All dealings are in the ordinary course of business and on normal terms and conditions. Rent paid during the three months ended September 30, 2007 amounted to GBP 1,950 (September 30, 2006: GBP 1,950). - Mr C Cowden, a non-executive director, is also a director and shareholder of Cowden Limited, which provides insurance broking services to the Company. All dealings with Cowden Limited are in the ordinary course of business and on normal terms and conditions. Insurance premiums paid to Cowden Limited during the three months ended September 30, 2007 amounted to A$33,541 (September 30, 2006: A$846). NOTE 9: EARNINGS PER SHARE Basic earnings per share are calculated using the weighted average number of shares outstanding. Diluted earnings per share are calculated using the treasury stock method. In order to determine diluted earnings per share, the treasury stock method assumes that any proceeds from the exercise of dilutive stock options and warrants would be used to repurchase common shares at the average market price during the period, with the incremental number of shares being included in the denominator of the diluted earnings per share calculation. The diluted earnings per share calculation excludes any potential conversion of options and warrants that would increase earnings per share. The weighted average number of ordinary shares used in the calculation of basic earnings per share is 755,786,243 (September 30, 2006: 578,745,369). The weighted average number of ordinary shares used in the calculation of diluted earnings per share is 778,268,923 (September 30, 2006: 586,385,369). The earnings used in the calculation of basic and diluted earnings per share is US$5,529,875 (September 30, 2006: US$351,022). NOTE 10: SHARE BASED PAYMENTS The consolidated entity has an Employee Share Option Plan in place for executives and employees. Options are issued to key management personnel under the Employee Option Plan 2006 (previously the Employee Option Plan 2002) as part of their remuneration. Options are offered to key management personnel at the discretion of the Directors, having regard, among other things, to the length of service with the consolidated entity, the past and potential contribution of the person to the consolidated entity and in some cases, performance. Each employee share option converts into one ordinary share of the Company on exercise. The options carry neither rights to dividends nor voting rights. Options vest over a period of 12 months, with 50% vesting and exercisable after six months and the other 50% vesting and exercisable after 12 months of issue. All options are issued with a term of three years. At the discretion of the Directors part or all of the options issued to an executive or employee may be subject to performance based hurdles. No performance based hurdles have been applied for issues granted to date. In addition options (Series 6) were issued to the Company's share broker in Canada as a gratitude payment for professional services provided during the listing process on the Toronto Stock Exchange in January 2007. Details of those options were: â€¢ Exercisable any time within 2 years of grant date. The following reconciles the outstanding share options granted under the Employee Share Option Plan, and other share based payment arrangements, at the beginning and end of the financial year: Three months Three months ended ended September 30, September 30, 2007 2006 Number of Number of options options Balance at beginning of the period (a) 13,490,000 7,840,000 Granted during the period - - Forfeited during the period - - Exercised during the period (b) (120,000) (450,000) Expired during the period - - Balance at the end of the period (c) 13,370,000 7,390,000 Exercisable at the end of the period 7,732,500 2,475,000 a) Balance at the start of the period Options series Number Grant date Expiry / Exercise Fair value at Exercise Date price grant date A$ A$ Series 1 395,000 04/02/05 04/02/08 0.2804 0.1357 Series 2 200,000 17/02/05 17/02/08 0.2804 0.1435 Series 3 1,700,000 31/10/05 31/10/10 0.3500 0.1753 Series 4 1,500,000 08/12/05 08/12/08 0.4355 0.1495 Series 5 250,000 30/08/06 30/08/09 0.6566 0.2785 Series 6 2,000,000 10/01/07 10/01/09 0.8000 0.2393 Series 7 3,615,000 31/01/07 31/01/10 0.7106 0.3518 Series 8 2,330,000 24/05/07 24/05/10 1.0500 0.4661 Series 9 1,500,000 25/06/07 25/06/10 1.1636 0.3210 13,490,000 b) Exercised during the period Three months ended Number Exercise Date Share price September 30, 2007 exercised at exercise date A$ Issued 04 February 2005 50,000 18/07/07 1.280 Issued 31 January 2007 10,000 08/08/07 1.275 15,000 12/09/07 1.210 10,000 24/09/07 1.390 35,000 27/09/07 1.330 120,000 c) Balance at the end of the period Options series Number Grant date Expiry / Exercise Fair value at Exercise Date price grant date A$ A$ Series 1 395,000 04/02/05 04/02/08 0.2804 0.1357 Series 2 150,000 17/02/05 17/02/08 0.2804 0.1435 Series 3 1,700,000 31/10/05 31/10/10 0.3500 0.1753 Series 4 1,500,000 08/12/05 08/12/08 0.4355 0.1495 Series 5 250,000 30/08/06 30/08/09 0.6566 0.2785 Series 6 2,000,000 10/01/07 10/01/09 0.8000 0.2393 Series 7 3,545,000 31/01/07 31/01/10 0.7106 0.3518 Series 8 2,330,000 24/05/07 24/05/10 1.0500 0.4661 Series 9 1,500,000 25/06/07 25/06/10 1.1636 0.3210 13,370,000 NOTE 11: SHARE WARRANTS The following share warrants were in existence during the current reporting period:- Warrants series Number Grant date Expiry Date Exercise price Fair value at grant date C$ A$ Series 1 3,751,431 05/04/2007 05/04/2009 0.8600 0.3011 Series 2 4,429,678 13/04/2007 11/04/2009 0.8600 0.2743 Series 3 613,582 20/04/2007 20/04/2009 0.8600 0.2868 8,794,691 Share warrants are specific to the Company's listing on the Toronto Stock Exchange (TSX) and retain the same characteristics as share options but are referred to separately under the TSX listing rules. a) Exercised during the period There were no share warrants exercised during the three months ended September 30, 2007. NOTE 12: Impact of reconciliation between Australian accounting standards and Canadian GAAP There are no material differences between the Income Statements, Balance Sheets, Statement of Changes in Equity and Cash Flow Statements presented under Australian accounting standards and Canadian GAAP. The Company would be required under Canadian GAAP to adopt the provisions of Sections 3855 (Financial Instruments - Recognition and Measurement), 3861 (Financial Instruments - Disclosure and Presentation) and 1530 (Comprehensive Income) from July 1, 2007 which address the classification, recognition and measurement of financial instruments in the financial statements and the inclusion of other comprehensive income. These new standards require that the Company identifies all financial instruments and accounts for these financial instruments at their fair value. Costs associated at the recognition date with these financial standards can be either immediately expensed or offset against the fair value of the financial instruments. The Company has elected to expense all costs associated with the acquisition of financial instruments. Financial assets are classified as one of the following groupings: loans and receivables, assets held to maturity, available for sale financial assets or assets held for trading. Changes in the fair value of available for sale financial assets are taken to equity and reported in the new Statement of Comprehensive Loss, until the financial asset is either derecognized or impaired, where it is then accounted for in the Statement of Operations. Changes in the fair value of assets held for trading are reflected in the Statement of Operations. Assets held to maturity and loans and receivables are measured at amortised cost. Financial liabilities are classified as either trading or at amortised costs. Comparative periods have not been adjusted to reflect the implementation of these new standards. In addition to recognising the unrealized fair value changes in available for sale financial assets in the Statement of Comprehensive Loss, unrealized gains and losses on translating financial statements of self sustaining foreign operations, unrealized gains and losses on foreign currency translation associated with hedges, donations from non-owners and appraisal credit increases are also recognized in the new statement. As the company does not presently hold any financial instruments for which amounts would be required to be recognised in a Statement of Comprehensive, this statement has not been presented in this report. Form 52-109F2 - Certification of Interim Filings I, Mark Smith, Chief Financial Officer of Centamin Egypt Limited, certify that: 1. I have reviewed the interim filings (as this term is defined in Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings) of Centamin Egypt Limited (the issuer) for the interim period ended September 30, 2007; 2. Based on my knowledge, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings; 3. Based on my knowledge, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial conditions, results of operations and cash flows of the issuer, as of the date and for the period presented in the interim filings; 4. The issuer's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures for the issuer, and we have designed such disclosure controls and procedures, or caused them to be designed under our supervision, to provide reasonable assurance that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which the interim filings are being prepared. Mark Smith Chief Financial Officer Egypt : November 06, 2007 Form 52-109F2 - Certification of Interim Filings I, Josef El-Raghy, Managing Director/CEO of Centamin Egypt Limited, certify that: 1. I have reviewed the interim filings (as this term is defined in Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings) of Centamin Egypt Limited (the issuer) for the interim period ended September 30, 2007; 2. Based on my knowledge, the interim filings do not contain any untrue statement of a material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it was made, with respect to the period covered by the interim filings; 3. Based on my knowledge, the interim financial statements together with the other financial information included in the interim filings fairly present in all material respects the financial conditions, results of operations and cash flows of the issuer, as of the date and for the period presented in the interim filings; 4. The issuer's other certifying officers and I are responsible for establishing and maintaining disclosure controls and procedures for the issuer, and we have designed such disclosure controls and procedures, or caused them to be designed under our supervision, to provide reasonable assurance that material information relating to the issuer, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which the interim filings are being prepared. Josef El-Raghy Managing Director Egypt : November 06, 2007 This information is provided by RNS The company news service from the London Stock Exchange

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