Mr. Michael Mason reports

GEOVIC MINING CORP. PROVIDES PROJECT UPDATE

Geovic Mining Corp.'s 60.5-per-cent subsidiary, Geovic Cameroon PLC (39.5 per cent owned or represented by Societe Nationale d'Investissement du Cameroun (SNI) (Cameroon national investment corporation)), has provided an update on progress at the Nkamouna cobalt-nickel-manganese project in Cameroon, Africa, as well as an update on status of financing and product sales.

As reported in April, 2011, upon completion of the feasibility study undertaken by Lycopodium Minerals Pty. Ltd., the estimated scope and cost of the Nkamouna project have increased significantly. As a result, the company's efforts have increasingly focused on opportunities to introduce additional partners or strategic investors to the project.

Technical activities

The company has intentionally limited its activities in order to conserve cash until such time as project debt and equity financing arrangements are in place. However, certain technical and environmental programs were undertaken pursuant to commitments with government and/or in the interest of making sure that the metallurgical process was fully demonstrated.

ESA update

The Nkamouna project obtained its environmental authorizations from the Republic of Cameroon in 2007. In a letter dated Sept. 3, 2010, the Ministry of Environment and Protection of Nature confirmed that the 2007 authorizations remain valid, but requested that the environmental and social assessment (ESA) document be updated for consistency with the Lycopodium feasibility study. Geovic Cameroon retained Knight Piesold and Co. of Denver, Colo., United States, and Rainbow Environment Consult SARL of Yaounde, Cameroon, the original ESA authors, to update the documents as requested by the ministry. The updated ESA was completed on April 30, 2011, and has been posted on the company website since that time. It was submitted to the ministry in May, 2011, and is fully aligned with the plans presented in the feasibility study.

Critical habitat fieldwork

Among the component plans presented in the updated ESA was a biodiversity management plan. This plan called for additional fieldwork to assess the quality of the habitat in and around the project area to support a variety of flora and fauna species. Geovic Cameroon retained a qualified expert to accomplish this fieldwork, which was completed in July-August, 2011. The consultant's work confirmed the presence of a number of important fauna species, including great apes. Geovic Cameroon also engaged a highly qualified panel of experts to review the consultant's work and to assist in the mitigation planning process. This work is continuing and will continue throughout the life of the project.

Hydrosizer demonstration

The only element of the metallurgical process that remained undemonstrated after the feasibility study was the use of hydrosizing equipment for removing fine waste from the coarser, heavier concentrate. All other aspects of the metallurgical process had been fully demonstrated using continuous pilot-scale testing and/or bench-scale testing. In November of 2011, Geovic Cameroon commissioned Allied Mineral Laboratories of Perth, Western Australia, to perform the hydrosizer pilot demonstration. This testwork was completed successfully and the entire physical upgrading and hydrometallurgical plant flow sheets have now been fully demonstrated in the laboratory and in pilot plant operations. The testwork also identified potential areas of improving the flow sheet, which will need to be further investigated during the detailed design phase of the project.

Financing and product sales

The company has devoted most of its efforts to seeking and evaluating a means to finance the Nkamouna project since the feasibility study was completed. It has considered many possible alternatives. It continues to focus its attention on strategic investments into the project with one or more strategic investors, through direct ownership, joint ventures or similar arrangements, including a sale of a potentially significant portion or all of its interest in the project. An investor in such an arrangement could agree to assist in financing and project management, and to purchase much of the mixed cobalt-nickel sulphide (MSP) and manganese carbonate products from the project.

Numerous parties contacted have existing business structures or facilities that indicate an interest to secure a supply of the product it expects to produce from the Nkamouna project. Confidentiality agreements have been executed with many of these entities and the company has shared technical information and provided samples of the product(s) to be produced, for testing by the potential customer.

Due diligence reviews by other parties

Once processing compatibility was confirmed, six parties commenced due diligence site visits to the project. Some of these parties continue to have an interest to make potentially significant investments in the project by which they could secure some or all of the company's MSP product, and in some instances its manganese carbonate product as well. Others have expressed little or no interest in ownership in the project, but are willing to consider other incentives in order to secure a reliable long-term future supply of cobalt from the project.

Active negotiations with large state-owned companies in two countries

It has had active negotiations with large state-owned companies in two Asian countries since mid-2011. Business propositions have ranged from a conventional strategic investment in the operating subsidiary, to a subordinated debt facility sufficient to cover some or all the Geovic Cameroon shareholders' equity requirements in a project financing arrangement in exchange for the right to secure MSP product, along with other possibilities. The company hopes to be in a position to move one of these discussions into final contracted arrangements in 2012.

Geovic's chief executive officer, Mike Mason, said: "We are making good headway toward bringing a strong strategic partner on board, and with a strategic partner comes the ability for the company and the other Geovic Cameroon shareholder to fund the equity portion of a financing so that project debt financing can be secured. We hope to see that completed in 2012, but Geovic's position in the project may change, potentially significantly, to accomplish this. We are committed to move the project into production. Given the magnitude of projected construction and start-up costs, and Geovic's current financial position, selling some or even all of our interest in the project is an acceptable alternative."

We seek Safe Harbor.