items of interest from quarterly report

Anvil in some difficulty but taking wise precautionary steps.
The Review must be finalised - (looks positive) - and after that finance secured to see Anvil on the way again.

Sorting out the electric furnaces and then getting Dikulushi working in first quarter 09 will give income stability.

The report seems to be a "steady as she goes" against a strong headwind.
Will not be likely to excite market or attract buyers.


FROM THE QUARTERLY REPORT ------------------------

DRC Government Review of Mining Agreements
The Company has concluded negotiations with Gécamines and the DRC Government on the Kinsevere Contrat
d’Amodiation (“Lease Agreement”), Mutoshi joint venture (“JV”) agreement and the Dikulushi Mining Convention.
The Company has copies of signed minutes of meetings held with Gécamines and DRC Government officials
during which the renegotiated commercial terms and conditions were agreed.
While the process to be followed to bring the DRC Government review of mining agreements to a formal
conclusion has not been fully enunciated, the Company understands that the minutes have been approved by the
Gécamines board and sent to Kinshasa for consideration by the Minister of Mines.
In relation to the Kinsevere Contrat d’Amodiation and Mutoshi JV agreement, it is anticipated that once the
Minister of Mines has ratified the commercial terms and conditions contained in the minutes, this will conclude the
negotiation, approval and ratification process, with only the execution of amendment agreements for attachment
to the original agreements to be formalised. The Company expects to be in position to announce the final terms
and conditions agreed between and amongst the parties following ministerial ratification of the minutes.
The process by which the renegotiated commercial terms and conditions agreed with Gécamines and the DRC
Government will be formalised for Dikulushi under the Dikulushi Mining Convention, has not been communicated to the Company.



Summary of current position and outlook
In recent months, Anvil and the base metals mining sector generally, have been subjected to a number of
significant negative events, most notably a sharp fall in the copper price which declined by approximately 50%
from prices seen in September as well as illiquid capital markets. In Anvil’s case, the impact of these events has
been compounded by uncertainty regarding the review of mining agreements by the Government of the
Democratic Republic of Congo (“DRC”), operational difficulties at the Dikulushi underground mine, delay in the commissioning of the Electric-Arc Furnace (“EAF”) at Kinsevere and increases in operating costs.
The cumulative effects of these events have placed Anvil in a difficult position, particularly in relation to the
continued development of the Stage II Solvent Extraction-Electrowinning (“SX-EW”) plant at Kinsevere, for which
the total projected cost is $380 million. As at October 31, 2008 approximately $136 million has been spent and
approximately $56 million committed, mainly for the purchase of key equipment with long lead times, leaving
almost $190 million of expenditure over the next 9 to 12 months to complete the project.
As at November 12, 2008, Anvil has approximately $90 million in cash and short-term deposits and $38 million in
longer term investments, the majority of which do not mature within the next three years. Furthermore, in the
current environment, there is limited availability of debt finance for mining companies and the Company has
concluded that raising equity finance is not currently a viable option.
Management has carefully considered these conditions and developed a strategy for the next six to eighteen
months that takes into account the Group’s current position, consensus estimates of copper prices, conservative estimates of production and operating costs and the potential to raise debt finance in the event that availability of such finance improves in 2009.
The key elements of the strategy are:
• Maintaining a minimum cash balance over this period as required for the Group’s operations;
• Finalizing the tentative agreements reached with Gécamines and the DRC Government for the Company’s
mining properties in DRC;
• Operating the Dikulushi underground mine and Kinsevere mine at a positive cash flow;
• Curtailing all but essential capital spending;
• Reducing exploration costs to essential activities related to the definition of resources at the Dikulushi and
Kinsevere mines; and
• Cutting general and administrative costs to the minimum necessary to support essential operations.
Central to this strategy, the Company has placed the fabrication and construction works associated with the
Kinsevere Stage II SX-EW development on hold until additional finance is available and there is greater certainty in global financial and commodity markets. Design work and civil works will continue and are expected to be completed later this year. In order to complete this development and maintain a minimum cash balance
throughout the construction and commissioning phase, the Company requires additional funding. The Company is
in discussions with a number of possible lenders and preliminary indications are that debt finance could be
available in the first half of 2009, assuming satisfactory resolution of negotiations with the DRC Government
regarding the Company’s mining agreements, which the Company expects to be finalized during the fourth
quarter of 2008.
While the Company currently expects to have financing arranged in time to allow for the recommencement of the
Kinsevere Stage II SX-EW development during the third quarter of 2009, with commissioning of the plant in early
2010, there can be no assurance that required finance will be available and that development of the project will
re-commence within this timeframe.
In the event that finance is not available during 2009, the Company believes that with the implementation of the
strategy outlined above and using conservative estimates of medium-term copper prices, it can operate its
Kinsevere Stage I and Dikulushi mines in a profitable manner, with positive cash flow. The Company has
therefore concluded that the going concern assumption made in connection with the financial statements for the
quarter and nine months ended September 30, 2008, is appropriate.
Key points for the quarter1
• Financial results for the third quarter 2008 were impacted by several one-off adjustments, including:
�� Provision of $2.6 million for impairment of available-for-sale investments;
�� An impairment of $2.9 million in connection with the write down of the value of the Company’s
investment in Sub Sahara Resources NL (“Sub-Sahara”);
�� Provisional pricing adjustments of $9.4 million resulting from the sharp fall in the price of copper during
the September quarter and post quarter end; and
�� A write down of $2.5 million in the value of exploration work carried out in the Philippines.
• Net copper sales of $42.3 million, a decrease of 44% compared to the third quarter 2007.
• Net loss of $17.3 million (-$0.24 per share), compared to net income of $39.1 million (0.55 per share) in the
third quarter of 2007.
• Cash flows from operating activities, before working capital movements, of -$1.0 million (-$0.01 per share),
compared to positive cash flow in the third quarter of 2007.
• Quarterly production of 12,107 tonnes of copper and 189,867 ounces of silver produced in concentrate, a
decrease of 18% and a decrease of 69% respectively compared to the third quarter 2007.
• Development of the Dikulushi underground mine using an Avoca cut and fill mining method, on schedule for
commencement of full production in the first quarter 2009.
• Further development of the Kinsevere Stage II project.
Key points for the year to date1
• Production of 34,655 tonnes of copper, an increase of 13% compared to the same period of 2007.
• Net sales of $177.4 million, a decrease of 3.5% compared to the same period of 2007.
• Net income of $12.6 million or $0.18 per share, a decrease of 87% compared to the same period of 2007.
• Operating cash flow before working capital movements of $59.9 million or $0.84 per share.
• Copper production of 34,655 tonnes.
Near Term Objectives (next six months)
• Finalization of discussions with the DRC Government regarding review of the Group’s mining agreements.
• Commissioning of the EAF to design capacity at Kinsevere.
• Completion of updated Mineral Resource estimates for Kinsevere and Mutoshi.
• Commencement of full scale production from the underground mine at Dikulushi.
• Completion of preliminary studies on the development of a Stage II SX-EW plant at Mutoshi.
Longer Term Objectives (2009 onwards)
• Completion of construction and commissioning of the Kinsevere Stage II SX-EW plant.
• Completion of feasibility study for the Mutoshi Stage II SX-EW project.
• Completion of preliminary studies on an expansion of the Kinsevere 60,000 tonnes per year SX-EW plant.