chairmans address macmin silver ltd

Chairman’s Address
Macmin Silver Ltd

Welcome to the 15th AGM of Macmin Silver Ltd.

I would particularly welcome Garry Edwards as Macmin’s new CEO. We believe that as Garry has a strong financial, analytical and management background, he will ensure that the Texas Project moves ahead as efficiently as possible.

I would like to thank Denis O’Neill, who has stepped aside for personal reasons, for his efforts for Macmin over the past 15 years.

I am pleased to report that silver production started at Twin Hills in mid year with our first sale of silver taking place in early November.

In 2007, the silver price traded between approximately US$11.60oz and US15.80oz which is a new 25 year high. The exchange rate between Australian dollars and US dollars has strengthened significantly during the year, and the current A$16.50 price per oz is $1.50 or so below its high in 2006, but is still an attractive price for Macmin. Our view is that the silver price will strengthen further in 2008.

Commissioning of the Twin Hills Silver Mine over the past six months revealed a number of problems and performance was disappointing. It did not lead to full scale production as quickly as anticipated. This is not unusual with new mines, but as outlined in our ASX release of 15th October 2007, we believe we have identified the problems and are moving to overcome them.
The first commercial production heap of 120,000 tonnes is currently undergoing leaching.

We had forecast production of approximately 130,000 ozs for the December quarter. This may not be met, but production is gradually increasing and over the coming months we expect production to increase to a monthly rate of 180,000 oz. An initial sale of 6,450oz of silver powder was made recently.

Exploration has continued this year with drilling at the Tally Ho Silver Project and at Mt Gunyan, within the Texas Silver Project.

At the Tally Ho Project, sufficient drilling has now been undertaken to allow a JORC compliant resource to be estimated which will be completed 2008, and could lead to development.
Exploration on this Central Queensland project will begin in earnest in the New Year with the recent granting of the Mt Scott tenement and imminent grant of two other tenements adjoining Tally Ho. Other silver projects are also under evaluation in Central Queensland.

With a very healthy outlook for silver prices going forward, drilling will continue at Mt Gunyan.
We recently announced a 1 metre interval of very high grade mineralisation – 542g/t silver and 172g/t gold. This is exceptionally high grade with one tonne of rock having a gross metal value of approximately AUD $4,300.00 at current metal prices. In this business grade is king.
In addition, recent drilling has encountered massive sulphide mineralisation which represents an exciting new target in the mineralised system at Mt Gunyan.

It has been a positive year for the companies in which Macmin holds equity investments. New Guinea Gold has poured its first gold from the Sinivit Gold Mine and both Malachite and
Frontier have produced JORC compliant statements on deposits they have drilled, and Frontier has just produced a very encouraging Conceptual Mining Study for its Kodu deposit.

Approximately half of Macmin’s shareholders reside outside Australia, mainly in Germany and Switzerland, and have proven to be strong supporters of the company. I met many of the
shareholders in Geneva, Zurich, Frankfurt, Amsterdam, Munich and Paris in early November and I am pleased to report that I was encouraged by their enthusiasm.

Before closing, it would be remiss of me not to acknowledge Directors, Management and all Employees of the company. As you are all aware, there is a major resources boom in progress
affecting companies’ ability to employ skilled and loyal staff, particularly with new IPO’s listing daily. Your company has been listed for 15 years, and the dedicated team of people built up over that time are an essential and valuable asset of this company, which should not be overlooked by the shareholders. I thank everyone working for the company for their tireless effort.

In closing, I wish all shareholders a prosperous 2008 and thank you for your support over the past year.


Yours faithfully

R.D. McNeil
CHAIRMAN