Interim Results

Eurasia Mining PLC 29 September 2006 29 September 2006 Eurasia Mining Plc ('Eurasia' or the 'Company') Ticker- AIM:EUA Chairman's Interim Statement The six months to June of 2006 have been the most active in recent years for your company and are already yielding positive results. We finalised the purchase of our Kola projects in northwest Russia, we are progressing well on feasibility study work for platinum production in the Urals and we continue with our gold exploration work in eastern Siberia. Kola In May 2006, Eurasia announced an agreement whereby Anglo Platinum Limited ('Anglo Platinum') is providing funding of up to $10 million for the Kola projects in return for an initial interest of 40%, representing 50% of an 80% interest held in our jointly owned company, Urals Alluvial Platinum Limited. Once this work is complete or if a bankable feasibility study has been completed at that stage, Anglo Platinum has an option for 90 days to buy Eurasia's directly held 20% holding in Kola for $6 million or $5 per ounce of platinum group metals ('PGM') resource, whichever is the lesser. Anglo Platinum also has the option of requiring Urals Alluvial Platinum Limited to acquire the 20% interest, thereby maintaining the 50:50 ownership. In the Kola Peninsula of north-west Russia, drilling programmes were commenced on all three projects: West Imandra, Volchetundra and Monchetundra. Each has intersected horizons where geological conditions suggest PGM may be present. While drilling has progressed well, delays in obtaining assay results have arisen due to the scarcity of approved laboratories in Russia coupled with restrictions on the export from the country of samples for assay. Drilling work is underway on two of the Kola projects, Volchetundra and Monchetundra. In both of these areas, sulphide mineralisation has been encountered. Eurasia plans to drill a total of 4,000 metres on the two areas during 2006, of which 2,974 m had been completed by early September. To date no assays have been returned from this years drilling programmes but to highlight their potential, it is worth restating the results that have been obtained and published previously. At Monchetundra, 7 earlier drill holes have returned mineralised intercepts, with two main styles identified. A narrow zone, with intercepts of 0.8-3.6 metres at grades of 6 to 8.4 g/t of platinum and palladium ('Pt+Pd') at depths of 78 - 232 metres; and wider zones of lower grade mineralisation, with intercepts ranging from 11.6-19.9 metres of 1.7 to 2.4 g/t Pt+Pd at depths of 38 - 181 metres. The current drilling programme, which will continue into 2007, will focus on confirming these zones and determining their continuity, in order to build resource blocks. On the Volchetundra area, this year's drilling has focused on areas with anomalous Pd and Pt till geochemistry, located along strike from zones where trenching and grab sampling had previously produced several assays of 0.5 to 10 g/t Pt+Pd. At West Imandra in the Kola Peninsula, Eurasia completed drilling a total of 2,300 metres in eight drill holes, representing the first drill profile across the ultramafic intrusion. The profile was designed to locate PGM-bearing horizons in bedrock beneath the glacial cover soils. The first target tested a zone of PGM mineralisation, the presence of which was suggested in at least one horizon from surface outcrop sampling. Here a chromite layer gave an assay of 1 gram per tonne of platinum prior to the commencement of Eurasia's drill programme. Near this location, two drill holes intersected four chromite horizons, with associated disseminated sulphide mineralisation. The assay results from these holes returned PGM values of 0.1 to 0.65 g/t Pt over intervals of 0.3 to 1.3 metres. Exploration work continues on a number of other targets in the licence area, including an area where a trench value returned 2.4 g/t Pt over one metre. Urals In the Urals, Eurasia has a 50-50 joint venture with Anglo Platinum which is funding all the work up to the completion of a feasibility study. Our main project is at West Kytlim in the central Urals, where three drill rigs have been working on two areas defined for resource drilling as part of a feasibility study underway since October 2005. Work is progressing well, with 154 holes completed in the first six months of 2006 totaling 2,100 metres of drilling. Bulk sampling has been completed on material stockpiled at the end of the 2005 field season, following modifications to the wash plant aimed at improving the recovery of fine platinum. This plant is designed to simulate the recoveries of a full-scale operation. This has resulted in concentrates that are now being processed for their platinum content and assay work is underway to produce a resource calculation. The joint venture is aiming to commence pilot production in 2007 but this is dependent on obtaining all the necessary federal and local government permits in time for the field season, which begins early next summer. Other Prospects and New Opportunities Elsewhere Eurasia continues to work on projects on its own account. In the Urals, follow up drilling was completed in September on the Baronskoye project, where a licence for palladium-gold mineralization discovered by the company was successfully renewed. Here Eurasia holds a 75% interest with the local expedition holding the balance. Also, we continue to work on gold projects that we have targeted as having the potential to be mined in the near term, working with Russian partners. Gold exploration projects have also been advanced under our exploration alliance with AngloGold Ashanti, with their expenditure of approximately $1 million. AngloGold recently announced their intention to withdraw from our alliance as they had formed a new venture with the Russian gold producer Polymetal, which could cause future conflicts of interest. Eurasia plans to continue these projects on its own account or with a new partner. Financing During February 2006 the company raised £700,000 via a convertible loan note. These funds were used by the company to pay for its 60% participation in the Kola acquisition. During August 2006 the company raised approximately $1.7 million (£900,000) for working capital and to pursue new opportunities. This funding is in addition to the $3 million being expended on exploration work through the Anglo Platinum joint ventures during the 2006 financial year. I look forward to presenting the results of all this work in the coming months. Michael Martineau Chairman 28 September 2006 Consolidated Profit and Loss Account For the six months ended 30 June 2006 6 months to 6 months to 12 months to 30 June 30 June 31 December 2006 2005 2005 (unaudited) (unaudited) (audited) £ £ £ Impairment of assets (29,129) (58,942) (156,925) Other administrative expenses (356,699) (540,481) (933,374) Administrative expenses and operating loss (385,828) (599,423) (1,090,299) Share of operating loss in joint venture (83,530) - (477,602) Total operating loss: group and share of joint (469,358) (599,423) (1,567,901) ventures Interest receivable 4,328 4,554 6,257 Interest payable (39,169) - - Foreign exchange (loss) / gain (50,118) 69,101 121,592 Loss on ordinary activities before taxation (554,317) (525,768) (1,440,052) Taxation - - - Loss on ordinary activities after taxation (554,317) (525,768) (1,440,052) Minority interest 12,693 (11,481) (1,693) Retained loss for the period (541,624) (537,249) (1,441,745) Loss per share (0.49)p (0.57)p (1.43)p Consolidated Statement of Total Recognised Gains and Losses For the six months ended 30 June 2006 6 months to 6 months to 12 months to 30 June 30 June 31 December 2006 2005 2005 (unaudited) (unaudited) (audited) £ £ £ Loss for the financial period (541,624) (537,249) (1,441,745) Exchange adjustments on foreign currency net investments (734) 41,617 37,675 Total recognised gains and losses for the period (542,358) (495,632) (1,404,070) Shareholders' Funds For the six months ended 30 June 2006 6 months to 6 months to 12 months to 30 June 30 June 31 December 2006 2005 2005 (unaudited) (unaudited) (audited) £ £ £ Total recognised gains and losses for the period (542,358) (495,632) (1,404,070) New share capital issued 962,379 871,500 871,500 Convertible loan notes issued - equity component 54,288 - - Net addition / (reduction) in shareholders' funds 474,309 375,868 (532,570) Opening shareholders' funds 1,647,579 2,180,149 2,180,149 Closing shareholders' funds 2,121,888 2,556,017 1,647,579 Consolidated Balance Sheet As at 30 June 2006 30 June 2006 30 June 2005 31 December 2005 (unaudited) (unaudited) (audited) £ £ Fixed assets Intangible - exploration, development and production interests 887,673 1,383,275 1,280,810 Tangible 37,089 40,729 41,172 Interest in joint venture 104,609 670,680 197,410 Other investments 2,393,138 110,059 146 Total fixed assets 3,422,509 2,204,743 1,519,538 Current assets Debtors 227,464 300,222 202,410 Cash at bank 739,510 265,387 198,201 Total current assets 966,974 565,609 400,611 Creditors - amounts falling due within one year (1,824,937) (147,398) (213,019) Net current (liabilities) / assets (857,963) 418,211 187,592 Total assets less current liabilities 2,564,546 2,622,954 1,707,130 Creditors - amounts falling due after more than one year (486,665) (88,911) (93,251) Net assets 2,077,881 2,534,043 1,613,879 Capital and reserves Called-up share capital 6,155,586 5,188,086 5,188,086 Share premium account 7,029,253 7,034,374 7,034,374 Other reserves 54,288 - - Capital redemption reserve 3,539,906 3,539,906 3,539,906 Profit and loss account (14,657,145) (13,206,349) (14,114,787) Equity shareholders' funds 2,121,888 2,556,,017 1,647,579 Minority interest (44,007) (21,974) (33,700) 2,077,881 2,534,043 1,613,879 Consolidated Cash Flow Statement For the six months ended 30 June 2006 6 months to 6 months to 12 months to 30 June 30 June 31 December 2006 2005 2005 (unaudited) (unaudited) (audited) £ £ £ Net cash outflow from operating activities (262,704) (680,188) (902,244) Returns on investments and servicing of finance (11,705) 4,554 6,257 Capital expenditure and financial investment (1,562,424) (16,320) 132,901 Net cash outflow before financing (1,836,833) (691,954) (763,086) Financing: Issue of ordinary shares 200,000 871,500 871,500 Issue of convertible loan stock 655,000 - - Short term loan 1,525,330 - - Increase in cash in the period 543,497 179,546 108,414 Reconciliation of net cash flow to movement in net funds Increase in cash in the period 543,497 179,546 108,414 Increase in long term debt (398,969) - - Translation difference (2,188) 2,679 6,625 Movement in funds in the period 142,340 182,225 115,039 Net funds at 1 January 198,201 83,162 83,162 Net funds at 30 June 340,541 265,387 198,201 Reconciliation of operating loss to operating cash flows Operating loss (469,358) (599,423) (1,567,901) Depreciation charges 3,009 2,561 5,413 Loss on sale of marketable securities - - 5,476 Impairment charge 29,129 58,942 156,925 Loss attributable to joint venture 83,530 - 477,602 (Increase)/decrease in debtors (25,053) (52,076) 44,664 Increase/(decrease) in creditors 116,039 (90,192) (24,423) Net cash outflow from operating activities (262,704) (680,188) (902,244) Notes: 1 No dividend is proposed in respect of the period 2 The results for the period are derived from continuing activities. 3 The calculations of loss per share have been based on the retained loss after taxation for the period and on a weighted average of 110,589,618 ordinary shares in issue during the period. 4 The unaudited results have been prepared on a going concern basis and on the basis of the accounting policies adopted in the audited accounts for the year ended 31 December 2005. 5 Intangible assets - exploration, development and production interests 30 June 31 December 2006 2005 £ £ Balance prior to re-allocation to other 1,212,417 1,280,210 investments Re-allocated to other investments (note 6 (324,744) - below) Balance at end of period 887,673 1,280,210 During the period ended 30 June 2006, an amount of £324,744 in respect of the Company's Kola Peninsula deferred expenditure exploration interests was transferred to 'Other investments'. Refer to note 6, below. 6 Other investments 30 June 31 December 2006 2005 £ £ Balance at beginning of period 146 154,018 Disposals - (153,888) Kola expenditure re-allocated from intangible 324,744 assets (note 5) Purchase of Kola Companies 1,419,130 - Advances to Kola Companies for exploration 661,899 - expenditure Exchange (12,781) 16 Balance at end of period 2,393,138 146 Other investments during 2006 relate to the Company's acquisition of ZAO Terskaya Mining Company and ZAO Yuksporskaya Mining Company (the 'Kola Companies'), together with deferred expenditure incurred prior to the acquisition and funds subsequently advanced for 2006 exploration expenditure. In terms of the Company's agreement with its joint venture partner Anglo Platinum Limited, 80% of the Kola Companies investment will be transferred to the Group's Urals Alluvial Platinum joint venture, while the Company will retain 20% of the investment. Completion of these transfers is expected before 30 September 2006. 7 Creditors falling due within one year 30 June 31 December 2006 2005 £ £ Short term creditors 329,058 213,019 Short term loan due within one year 1,495,879 - 1,824,937 213,019 The short term loan is in respect of funds advanced by Anglo Platinum Limited for its share of the purchase price of the Kola Companies, together with funds advanced for 2006 exploration expenditure of those companies. In return for the transfer of an 80% interest in the Kola Companies by Eurasia Mining Plc to its joint venture, Urals Alluvial Platinum Limited, this loan will be assumed by Urals Alluvial Platinum. This is expected to complete before 30 September 2006. 8 Creditors falling due after more than one year 30 June 31 December 2006 2005 Convertible unsecured loan stock: £ £ Redemption value at 30 June 2006 470,000 - Un-amortised issue costs and equity reserve (71,031) - Convertible loan stock balance at end of 398,969 - period Minority shareholder loan: 87,696 93,251 486,665 93,251 Loan stock with a face value of £700,000 was issued on 31 March 2006, bearing interest at a rate of 8%. The stock is convertible, at the holders' option at any time before maturity on 31 March 2008, into ordinary shares at the rate of £0.05 per share. Loan stock to the face value of £230,000 was converted to ordinary shares during April 2006. Any unconverted stock is redeemable at maturity on 31 March 2008. The allocation of redemption face value between liability and equity components has been accounted for in accordance with Financial Reporting Standard FRS 25. 9 The interim report is unaudited and does not constitute Statutory Accounts as defined in section 240 of the Companies Act 1985. A copy of the Group's 2005 Statutory Accounts has been filed with the Registrar of Companies. The auditors' opinion on these Statutory Accounts was unqualified. 10 The Interim Report for the six months to 30 June 2006 was approved by the Directors on 28 September 2006. For further information, please contact: Company Information Company Number 3010091 Directors Registrars M P Martineau (Chairman) Capita IRG Plc The Registry C Schaffalitzky (Managing 34 Beckenham Road Director) Beckenham Kent BR3 4TU G C FitzGerald (Non Executive) Secretary Bankers M J de Villiers National Westminster Bank plc 1 Princes Street London EC2R 8PH Head Office and Registered Solicitors Office 1 Hay Hill Eversheds LLP London W1J 6DH Senator House Telephone: +44 (0) 20 7495 85 Queen Victoria Street 4877 London EC4V 4JL Facsimile: +44 (0) 20 7493 8858 E-mail: info@eurasia-mining.plc.uk www.eurasiamining.co.uk Nominated Adviser and Stockbroker W H Ireland Limited 24 martin Lane London EC4R 0DR And 11 St. James's Square Manchester M2 6WH +44 (0) 161 8322174 Russian Office Joint stockbroker 1 Lunacharsky Street King & Shaxson Limited Ekaterinburg 6th Floor, Candlewick House Russia 120 Cannon Street Telephone: +(7) 3432 London EC4N 6AS 615187 Facsimile: +(7) 3432 615924 Auditors Grant Thornton UK LLP Manor Court Barnes Wallis Road Segensworth Fareham Hampshire PO15 5GT This information is provided by RNS The company news service from the London Stock Exchange

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