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September 08, 2008


Lundin announces a net loss of USD 436.3 million in Q4

Lundin Mining Corporation reported an unaudited net loss of USD 436.6 million in Q4 of 2007. The unaudited net loss is after non cash impairment charges of USD 491.9 million relating to its merger with EuroZinc and the acquisition of Rio Narcea.

Lundin Mining in a statement said that it unaudited earnings, before impairment charges and income taxes, remain unchanged from the recent preliminary release. Excluding one time non cash impairment charges, unaudited earnings after income taxes were USD 55.3 million for the Q4 of 2007.

As previously reported, sales revenue in the Q4 of 2007 was USD 253.1 million up by 7.2% YoY as increased copper and nickel sales from the Neves-Corvo and the Aguablanca mines were partially offset by lower zinc volumes and prices. Included in the current quarter was USD 56.9 million of pricing adjustments relating to final pricing of third quarter sales as well as year end price adjustments based on the forward metal price curve. Sales of copper now represent over fifty percent of the Company's revenue.

Net earnings after income taxes but before impairment charges for the Q4 2007 were USD 6.9 million below the corresponding period in 2006 as a result of higher income tax expense in 2007. Increased sales were offset by the effect of lower zinc prices and higher costs resulting from the strength of the Euro. Approximately 75% of operating costs are based in Euro.

Mr Phil Wright president & CEO of Lundin Mining said that "These are large one off adjustments and relate primarily to changes in metal prices and exchange rates that have occurred since the EuroZinc and Rio Narcea transactions were undertaken. These items are non cash and will have the effect of marginally increasing future earnings as a result of reducing future amortization.”

Lundin Mining Corporation is a rapidly growing, diversified base metals mining company with operations in Portugal, Spain, Sweden and Ireland. The Company currently has six mines in operation producing copper, nickel, lead and zinc. In addition, Lundin Mining holds a development project pipeline which includes the world class Tenke Fungurume copper-cobalt project in the Democratic Republic of Congo and the Ozernoe zinc project in Russia.