Inmet Mining Corporation
TSX : IMN

Inmet Mining Corporation

April 29, 2008 09:29 ET

Inmet Announces First Quarter 2008 Earnings of $2.21 Per Share

TORONTO, ONTARIO--(Marketwire - April 29, 2008) - Inmet Mining Corporation
(TSX:IMN) -



Highlights

- Higher net income per share

Net income this quarter of $2.21 per share was higher than in the
first quarter of 2007, mainly because copper and gold prices were
higher. We realized record copper prices this quarter, at US $4.16
per pound, compared to US $2.81 per pound last year. Zinc prices were
lower at US $1.08 per pound compared to US $1.38 per pound. Copper
sales this quarter included $16 million in finalization adjustments
relating to 2007 sales.

- Production consistent with last year

Copper and gold production was constant between periods and zinc
production was marginally lower this year.

- Operating cash flow per share down because of changes in working
capital

Operating cash flow was $77 million or $1.59 per common share
compared to $105 million or $2.17 per share in the first quarter of
2007. Operating cash flow before changes in working capital was
$114 million or $2.36 per share.

- Las Cruces on schedule

Plant construction is on schedule and we expect Las Cruces to produce
its first copper cathode in the fourth quarter of 2008. Capital cost
estimates to complete the project remain unchanged. We have entered
into contracts with smelters to sell the majority of the 130,000
tonnes of high grade ore and expect shipments to start in June.

- Proceeding with development at Petaquilla

We entered into an agreement with Teck Cominco Limited to proceed
with development of Petaquilla. Over the next 18 months we will act
as operator on behalf of Teck Cominco and will fund at least
US $50 million of our and Teck Cominco's share of expenditures to
advance the project.

- Injunction at Cerattepe

On March 28 we received notice of a court injunction preventing
further development work at the Cerattepe property. The injunction
decision has been appealed and we expect to receive the results of
the appeal soon. If the appeal is not successful, the project will be
delayed.


Key financial data

-------------------------------------------------------------------------
three months ended March 31
2008 2007 change
-------------------------------------------------------------------------
FINANCIAL HIGHLIGHTS
(thousands, except per share amounts)

Sales
Gross sales $276,281 $286,614 -4%

Net income
Net income $106,674 $101,078 +6%
Net income per share $2.21 $2.09 +6%

Cash flow
Cash flow provided by operating
activities $76,750 $104,980 -27%
Cash flow provided by operating
activities per share(1) $1.59 $2.17 -27%
Capital spending $111,414 $51,935 +115%
-------------------------------------------------------------------------

OPERATING HIGHLIGHTS
Production(2)
Copper (tonnes) 19,200 19,500 -2%
Zinc (tonnes) 20,300 22,100 -8%
Gold (ounces) 56,300 56,000 +1%

Cash costs
Copper (US $ per pound)(3) $0.33 $0.10 +230%
Gold (US $ per ounce)(3) $392 $448 -13%
-------------------------------------------------------------------------

as at March 31 as at December 31
FINANCIAL CONDITION 2008 2007
----------------------------------
Current ratio 6.3 to 1 5.6 to 1
Gross debt to total equity 22% 18%
Net working capital balance (millions) $982 $855
Cash balance (millions) $906 $841
Shareholders' equity (millions) $1,575 $1,392
-------------------------------------------------------------------------

(1) Calculated as cash flow provided by operating activities divided by
average shares outstanding for the respective period.
(2) Inmet's share.
(3) Cash cost per pound of copper and cash cost per ounce of gold are
non-GAAP measures - see Supplementary financial information on pages
31 and 33.


First quarter press release


Where to find it

Our financial results ............................ 4
Key changes in 2008 .............................. 4
Understanding our performance .................... 5
Earnings from operations ....................... 7
Corporate costs ................................ 12
Results of our operations ........................ 14
Cayeli ......................................... 14
Pyhasalmi ...................................... 16
Troilus ........................................ 18
Ok Tedi ........................................ 20
Status of our development projects ............... 22
Las Cruces ..................................... 22
Cerattepe ...................................... 23
Petaquilla ..................................... 24
Managing our liquidity ........................... 25
Financial condition .............................. 27
Managing risk .................................... 29
Accounting changes ............................... 30
Supplementary financial information .............. 31
Quarterly review ................................. 34
Consolidated financial statements ................ 35

In this press release, Inmet means Inmet Mining Corporation and we, us
and our mean Inmet and/or its subsidiaries and joint ventures. This quarter
refers to the three months ended March 31, 2008.

Forward looking information

Securities regulators encourage companies to disclose forward-looking
information to help investors understand a company's future prospects. This
press release contains statements about our future financial condition,
results of operations and business.
These are "forward-looking" because we have used what we know and expect
today to make a statement about the future. Forward-looking statements usually
include words such as may, expect, anticipate, believe or other similar words.
We believe the expectations reflected in these forward-looking statements are
reasonable. However, actual events and results could be substantially
different because of the risks and uncertainties associated with our business
or events that happen after the date of this press release. You should not
place undue reliance on forward-looking statements. As a general policy, we do
not update forward-looking statements except as required by securities laws
and regulations.

Our financial results

-------------------------------------------------------------------------
(thousands, except per share amounts) three months ended March 31
2008 2007 change
-------------------------------------------------------------------------
EARNINGS FROM OPERATIONS(1)
Cayeli $53,655 $59,435 -10%
Pyhasalmi 27,994 31,442 -11%
Troilus 8,635 2,812 +207%
Ok Tedi 53,918 40,015 +35%
Other (494) (488) +1%
-------------------------------------------------------------------------
143,708 133,216 +8%
-------------------------------------------------------------------------
DEVELOPMENT AND EXPLORATION
Corporate development and exploration (2,618) (842) +211%
-------------------------------------------------------------------------
CORPORATE COSTS
General and administration (3,648) (2,840)
Investment and other income 14,754 7,427
Interest expense (447) (438)
Income and capital taxes (44,870) (35,650)
Non-controlling interest (205) 205
-------------------------------------------------------------------------
(34,416) (31,296) +10%
-------------------------------------------------------------------------
Net income $106,674 $101,078 +6%
-------------------------------------------------------------------------
Basic net income per share $2.21 $2.09 +6%
-------------------------------------------------------------------------
Diluted net income per share $2.21 $2.09 +6%
-------------------------------------------------------------------------
Weighted average shares outstanding 48,282 48,278 -
-------------------------------------------------------------------------
(1) Gross sales less smelter processing charges and freight, cost of
sales, depreciation and provisions for mine rehabilitation.



Key changes this year

-------------------------------------------------------------------------
three months ended see
(millions) March 31 page
-------------------------------------------------------------------------
EARNINGS FROM OPERATIONS
Sales
Higher metal prices denominated in
Canadian dollars $23 7
Lower sales volumes (18) 8
Costs
Lower smelter processing charges and
freight 14 10
Higher operating costs, including costs
that vary with income and cash flows (9) 11
-----------------------------------------------------------
Increase in earnings from operations,
compared to 2007 $10

CORPORATE COSTS
Higher taxes from higher income (10) 13
Change in tax rates 1 13
Foreign exchange gain 7 12
Higher interest income 2 12
Other (4)
-----------------------------------------------------------
Increase in net income, compared to 2007 $6
-----------------------------------------------------------


Understanding our performance

Metal prices

The table below shows the average metal prices, in US dollars and Canadian
dollars, we realized (the prices we realize include finalization adjustments -
see Gross sales on page 7).

-------------------------------------------------------------------------
three months ended March 31
2008 2007 Change
-------------------------------------------------------------------------
US dollar metal prices
Copper (per pound) US $4.16 US $2.81 +48%
Zinc (per pound) US $1.08 US $1.38 -22%
Gold (per ounce) US $776 US $559 +39%
-------------------------------------------------------------------------
Canadian dollar metal prices
Copper (per pound) C$4.16 C$3.29 +26%
Zinc (per pound) C$1.08 C$1.61 -33%
Gold (per ounce) C$776 C$654 +19%
-------------------------------------------------------------------------

Exchange rates affect revenue and earnings. The table below shows the
average exchange rates we realized.

-------------------------------------------------------------------------
three months ended March 31
2008 2007 change
-------------------------------------------------------------------------
Exchange rates
1 US$ to C$ $1.00 $1.17 -15%
1 euro to C$ $1.51 $1.54 -2%
-------------------------------------------------------------------------

Canadian dollar revenue and earnings were lower in the first quarter
compared to the same period last year because of the significant increase in
the value of the Canadian dollar relative to the US dollar. This lowered gross
sales this quarter by $40 million and net income by $26 million, which
includes a $6 million foreign exchange loss from the repatriation of Cayeli
earnings in the first quarter of 2008. There was a small change in the average
value of the Canadian dollar relative to the euro between periods, which
increased net income slightly because euro-based costs were slightly lower
when converted to Canadian dollars. There was however a larger change in the
value of the euro to Canadian dollar from December 31, 2007 to March 31, 2008
and when euro denominated cash and short-term intergroup receivables were
revalued, resulted in foreign exchange gains of $7 million recorded in
Investment and other income in 2008.

Treatment charges and freight down for copper and up for zinc

Treatment charges are one component of smelter processing charges. We
also pay smelters for content losses and price participation.

The table below shows the average smelter processing charges we realized.

-------------------------------------------------------------------------
three months ended March 31
2008 2007 change
-------------------------------------------------------------------------
Treatment charges
Copper (per dry metric tonne of
concentrate) US$52 US$73 -29%
Zinc (per dry metric tonne of
concentrate) US$310 US$124 +150%
-------------------------------------------------------------------------
Price participation
Copper (per pound) US$0.05 US$0.08 -38%
Zinc (per pound)(1) US$(0.04) US$0.01 -500%
-------------------------------------------------------------------------
Freight charges
Copper (per dry metric tonne of
concentrate) US$50 US$30 +67%
Zinc (per dry metric tonne of
concentrate) US$39 US$24 +63%
-------------------------------------------------------------------------
(1) Zinc price participation is based on a zinc price of US $2,000 per
tonne in 2008 and US $3,500 per tonne in 2007.

Copper treatment charges were lower this quarter than they were in 2007
because we have better contract terms with smelters. Zinc treatment charges
were higher than 2007, but zinc price participation was down significantly.

Statutory tax rates down slightly

The table below shows the statutory tax rates for each of our taxable
operating mines.

-------------------------------------------------------------------------
2008 2007 change
-------------------------------------------------------------------------
Statutory tax rates
Cayeli 24% 27% -3%
Pyhasalmi 26% 26% -
Ok Tedi 37% 37% -
-------------------------------------------------------------------------
Cayeli's tax rate is lower because the withholding tax rate was reduced
from 8 percent to 5 percent.

EARNINGS FROM OPERATIONS

Earnings from operations includes the following:

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Gross sales $276,281 $286,614 -4%
Smelter processing charges (44,157) (64,606) -32%
Cost of sales:
Direct production costs (77,534) (73,716) +5%
Inventory changes 2,940 (3,608) -181%
Provisions for mine rehabilitation
and other non-cash charges (4,652) (2,053) +127%
Depreciation (9,170) (9,415) -3%
-------------------------------------------------------------------------
Earnings from operations $143,708 $133,216 +8%
-------------------------------------------------------------------------

Gross sales revenues were 4 percent lower this quarter because of lower
volumes sold

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Gross sales by operation
Cayeli $100,616 $117,734 -15%
Pyhasalmi 54,908 65,340 -16%
Troilus 34,251 30,242 +13%
Ok Tedi(1) 86,506 73,298 +18%
-------------------------------------------------------------------------
$276,281 $286,614 -4%
-------------------------------------------------------------------------
Gross sales by metal
Copper $168,168 $143,324 +17%
Zinc 48,806 89,781 -46%
Gold 43,287 41,057 +5%
Other 16,020 12,452 +29%
-------------------------------------------------------------------------
$276,281 $286,614 -4%
-------------------------------------------------------------------------
(1) Our 18 percent share of Ok Tedi's sales.



Key components of the change in sales

-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Higher copper prices, denominated in C$ $37
Lower zinc prices, denominated in C$ (24)
Higher gold prices and other metal prices,
denominated in C$ 10
Lower sales volumes (33)
-------------------------------------------------------------------------
Decrease in gross sales, compared to 2007 $(10)
-------------------------------------------------------------------------

Higher copper and gold prices; lower zinc prices

We record sales using the metal price we receive for sales that settle
during the reporting period. For sales that have not been settled, we use an
estimate based on the month we expect the sale to settle and the metal's
forward price at the end of the reporting period. We recognize the difference
between our estimate and the final price we receive by adjusting our gross
sales in the period we settle the sale (finalization adjustment).
Copper sales were higher this quarter because of $16 million in
finalization adjustments for sales recorded in the fourth quarter of 2007.
There were minimal adjustments to zinc sales.
Our finalization adjustments were calculated using US $3.02 per pound for
copper and US $1.07 per pound for zinc. The average LME price for copper this
quarter was US $3.54 per pound and US $1.10 per pound for zinc. The copper
price increased substantially during the quarter, peaking at US $4.03 per
pound.

At the end of this quarter, the following sales had not been settled:
- 29 million pounds of copper provisionally priced at US $3.83 per
pound
- 11 million pounds of zinc provisionally priced at US $1.06 per pound.

The finalization adjustment we record for these sales will depend on the
actual price when the sale actually settles, which can be from one to five
months after we initially record it.

Lower sales volume

-------------------------------------------------------------------------
three months ended March 31
2008 2007 change
-------------------------------------------------------------------------
Sales volumes
Copper (tonnes) 18,300 20,000 -9%
Zinc (tonnes) 20,500 25,200 -19%
Gold (ounces) 55,300 61,800 -11%
-------------------------------------------------------------------------

Our sales volumes are directly affected by the amount of production from
our mines, and our ability to ship to our customers.
Sales volumes this quarter were in line with production in the first
quarter of 2007, but sales were down compared to 2007 first quarter sales
because shipping that had been delayed in the fourth quarter of 2006 was
recognized in the first quarter of 2007.

Production

-------------------------------------------------------------------------
three months ended March 31 objective
Inmet's share(1) 2008 2007 change 2008
-------------------------------------------------------------------------
Copper (tonnes)
Ok Tedi 6,700 8,200 31,300
Cayeli 8,100 7,500 33,600
Pyhasalmi 3,500 3,200 13,000
Las Cruces - - 18,900
Troilus 900 600 7,000
-------------------------------------------------------------------------
19,200 19,500 -2% 103,800
-------------------------------------------------------------------------
Zinc (tonnes)
Cayeli 12,700 11,900 47,800
Pyhasalmi 7,600 10,200 30,900
-------------------------------------------------------------------------
20,300 22,100 -8% 78,700
-------------------------------------------------------------------------
Gold (ounces)
Troilus 35,000 33,200 163,200
Ok Tedi 21,300 22,800 121,300
-------------------------------------------------------------------------
56,300 56,000 +1% 284,500
-------------------------------------------------------------------------
Pyrite (tonnes)
Pyhasalmi 194,500 160,500 +21% 505,000
-------------------------------------------------------------------------
(1) Inmet's share represents 100 percent for Cayeli, Pyhasalmi and
Troilus, 18 percent for Ok Tedi and 70 percent for Las Cruces.

This quarter:
- copper production this quarter was consistent with the first quarter
of 2007. This was the net result of higher throughput and grades at
Cayeli and Pyhasalmi, and lower production at Ok Tedi.
- zinc production was lower mainly because grades at Pyhasalmi were
lower.
- gold production did not change. Although grades were higher at both
Troilus and Ok Tedi, throughput was down at both mines.

2008 outlook for sales

We expect sales of all metals for the year to be consistent with our 2008
production estimates in the chart above. Our higher copper production outlook
is based on our expectation that production will start at Las Cruces.
The total amount we will receive in Canadian dollars will be affected by
US dollar denominated metal prices and the exchange rate between the US dollar
and the Canadian dollar.

Smelter processing charges and freight were substantially less this
quarter

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Smelter processing charges and freight
by operation
Cayeli $22,013 $31,168 -29%
Pyhasalmi 10,820 18,614 -42%
Troilus 2,187 2,693 -19%
Ok Tedi(1) 9,137 12,131 -25%
-------------------------------------------------------------------------
$44,157 $64,606 -32%
-------------------------------------------------------------------------
Smelter processing charges and freight
by metal
Copper $20,894 $27,479 -24%
Zinc 19,772 33,715 -41%
Other 3,491 3,412 +2%
-------------------------------------------------------------------------
$44,157 $64,606 -32%
-------------------------------------------------------------------------
Smelter processing charges by type and
freight
Copper treatment and refining charges $5,975 $11,024 -46%
Zinc treatment charges 11,792 7,084 +66%
Copper price participation 1,963 3,860 -49%
Zinc price participation (1,894) 11,016 -117%
Content losses 16,257 21,963 -26%
Other 2,272 1,527 +49%
Freight 7,792 8,132 -4%
-------------------------------------------------------------------------
$44,157 $64,606 -32%
-------------------------------------------------------------------------
(1) Our 18 percent share of Ok Tedi's smelter processing charges and
freight.

Copper treatment and refining charges were lower this quarter compared to
2007 because of more favourable contract terms with smelters. Zinc treatment
charges were higher, but lower prices significantly reduced zinc price
participation charges.

2008 outlook for smelter processing charges and freight

We have finalized the contract terms for long-term copper sales at our
operating mines, and treatment charges are averaging about US $50 per dry
metric tonne with little to no price participation.
We have not finalized terms for zinc yet, but we are seeing higher zinc
treatment charges in 2008, at about US $325 per dry metric tonne. We expect
price escalation/de-escalation (price participation) of zinc concentrate to be
approximately US $0.10 per dry metric tonne for zinc prices greater than US $
2,000 per tonne ($1.36 per pound), and (US $0.10) per dry metric tonne
for zinc prices less than US $2,000 per tonne.
Production is planned to begin at Las Cruces in 2008. For five months
starting in June 2008, the mine intends to sell crushed ore and pay smelter
processing charges. These charges are expected to be higher than what our
other operations pay because of the impurity levels in this ore.
We expect copper cathode production to start in the fourth quarter.
Copper cathode will be sold directly to buyers, bypassing the smelters and
eliminating smelter and refining treatment charges.

Direct production costs and cost of sales were consistent with last year

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Direct production costs by operation
Cayeli $23,340 $20,901 +12%
Pyhasalmi 14,604 13,617 +7%
Troilus 19,947 19,337 +3%
Ok Tedi(1) 19,643 19,861 -1%
-------------------------------------------------------------------------
Total direct production costs 77,534 73,716 +5%
Inventory changes (2,940) 3,608 -181%
Reclamation, accretion and other
non-cash expenses 4,652 2,053 +127%
-------------------------------------------------------------------------
Total cost of sales $79,246 $79,377 -
-------------------------------------------------------------------------
(1) Our 18 percent share of Ok Tedi's direct production costs.

Depreciation was slightly lower than last year

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Depreciation by operation
Cayeli $2,373 $2,697 -12%
Pyhasalmi 2,150 2,361 -9%
Troilus 2,418 2,709 -11%
Ok Tedi 2,229 1,648 +35%
-------------------------------------------------------------------------
$9,170 $9,415 -3%
-------------------------------------------------------------------------

Ok Tedi has higher depreciation because it has been spending on new mine
equipment and other sustaining capital over the last few years.

2008 outlook for depreciation

We estimate depreciation will be about $50 million for 2008. This is
higher than 2007 because production at Las Cruces should begin, and Ok Tedi
will begin depreciating the capital for its mine waste management project.

CORPORATE COSTS

Corporate costs include general and administration costs, taxes and
interest. We also record income from investments in this category, as well as
income we receive from other transactions.

Investment income was higher because of foreign exchange gains

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007
-------------------------------------------------------------------------
Interest income $8,723 $6,879
Dividend income and royalty - 1,000
Foreign exchange gain (loss) 6,858 (8)
Other (827) (444)
-------------------------------------------------------------------------
$14,754 $7,427
-------------------------------------------------------------------------

We recorded a net foreign exchange gain of $6.9 million this quarter. We
recognized a gain of $13 million because we revalued some of our foreign
currency denominated accounts and cash balances, and recognized a deferred
foreign exchange loss of $6 million when dividends were received from Cayeli.
Interest income was higher this quarter compared to the same quarter last
year because we had higher cash balances in 2008.

2008 outlook for investment and other income

Investment and other income is affected by cash balances, interest rates
and exchange rates.
We plan on repatriating approximately $200 million in cash from Cayeli
and expect to record a foreign exchange loss of about $20 million in the
second quarter of 2008. We repatriated Pyhasalmi's 2007 distributable earnings
in April and will record a foreign exchange gain of $6 million. These
distributable earnings were accumulated at exchange rates that were different
from the rate that applied when the dividend was ultimately paid. This foreign
exchange difference is deferred until the funds are repatriated and then they
are recorded in investment and other income.
Because Ok Tedi distributes its earnings more frequently, the effect of
repatriation is normally not significant.
Starting on June 30, 2008, the Las Cruces credit facility will convert to
a US dollar loan and will be denominated in US dollars, rather than euros.
From that date forward, we will revalue the loan to euros (the functional
currency of Las Cruces). Foreign exchange gains or losses on revaluations will
be reflected in investment and other income.
At March 31, 2008, we held only (euro)3 million in cash in Canada that
could be affected by foreign exchange gains or losses.

Income tax expense was higher in the quarter because of higher earnings

-------------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007 change
-------------------------------------------------------------------------
Cayeli $19,124 $13,671 +40%
Pyhasalmi 6,023 6,907 -13%
Ok Tedi 19,347 14,617 +32%
Las Cruces 250 - +100%
Corporate 126 455 -72%
-------------------------------------------------------------------------
$44,870 $35,650 +26%
-------------------------------------------------------------------------

Our tax expense changes as our earnings change. Cayeli's effective tax
rate was 33 percent this quarter. This is higher than its statutory rate of
24 percent because taxable foreign exchange gains in its Turkish lira tax
accounts generated an additional tax expense of $7 million.

2008 outlook for income tax expense

We are not expecting any further changes in statutory tax rates at our
operations in 2008.

Results of our operations

CAYELI

-------------------------------------------------------------------------
revised
three months ended March 31 objective
2008 2007 change 2008
-------------------------------------------------------------------------
Tonnes of ore milled
(000's) 278 259 +7% 1,100
Tonnes of ore milled
per day 3,100 2,900 +7% 3,000
-------------------------------------------------------------------------
Grades (percent) copper 3.6 3.5 +3% 3.8
zinc 6.5 6.2 +5% 6.0
-------------------------------------------------------------------------
Mill recoveries
(percent) copper 81 83 -2% 81
zinc 70 75 -7% 72
-------------------------------------------------------------------------
Production (tonnes) copper 8,100 7,500 +8% 33,600
zinc 12,700 11,900 +6% 47,800
-------------------------------------------------------------------------
Cost per tonne of
ore milled (C$) $84 $80 +5% $80
-------------------------------------------------------------------------

Cayeli delivers on its production target

Cayeli produced ore this quarter at an annualized rate of more than
1.1 million tonnes, which is consistent with our annual objective and
seven percent higher than the first quarter of last year. Copper and zinc
production were also higher than last year.

2008 outlook for production and costs

Cayeli expects to complete improvements to its ore pass system in 2008,
allowing it to reliably mine and process 1.1 million tonnes of ore annually.
Development in 2008 is focusing on access and level development of the lower
mine ore blocks. Mine development rates are higher than 2007 and development
of the lower mine is proceeding as planned. We expect to operate at an annual
production rate of 1.2 million tonnes by 2009.
We have revised our cost per tonne estimate to be in line with
first quarter costs. Costs could change, depending on the value of the Turkish
lira relative to the US dollar. If the Turkish lira decreases in value,
Turkish lira based costs such as labour will go down, reducing our costs.
Royalties also have a significant impact on costs and are variable
depending on earnings. Cost per tonne of ore milled in the first quarter
includes $15 per tonne in royalties, compared to our objective of $10 per
tonne, which is based on metal price assumptions for the remainder of the
year.

Financial review

Lower earnings this quarter because shipments in 2007 were considerably
higher than production

-------------------------------------------------------------------------
(millions of Canadian dollars unless three months ended March 31
otherwise stated) 2008 2007
-------------------------------------------------------------------------
Sales analysis
Copper sales (tonnes) 6,700 8,200
Zinc sales (tonnes) 13,900 15,700
----------------------------
Gross copper sales $64 $59
Gross zinc sales 34 56
Other metal sales 3 3
----------------------------
Gross sales 101 118
Smelter processing charges and freight (22) (31)
-------------------------------------------------------------------------
Net sales $79 $87
-------------------------------------------------------------------------
Cost analysis
Tonnes of ore milled (thousands) 278 259
Direct production costs ($ per tonne) $84 $80
-------------------------------------------------------------------------
Direct production costs 23 21
Change in inventory (2) 3
Depreciation and other non-cash costs 4 3
-------------------------------------------------------------------------
Operating costs $25 $27
-------------------------------------------------------------------------
Operating earnings $54 $60
-------------------------------------------------------------------------
Operating cash flow $15 $60
-------------------------------------------------------------------------

The table below shows what contributed to the change in operating earnings
and operating cash flow between 2008 and 2007.

-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Change in metal prices, denominated in Canadian
dollars $-
Lower sales volumes (10)
Lower smelter processing charges 6
Higher royalties (from higher Turkish lira based income) (2)
-------------------------------------------------------------------------
Decrease in operating earnings, compared to 2007 $(6)
Lower tax rate 1
Higher tax expense (8)
Changes in working capital (34)
Other 2
-------------------------------------------------------------------------
Decrease in operating cash flow, compared to 2007 $(45)
-------------------------------------------------------------------------

The change in working capital this quarter is from higher accounts
receivable because of timing of payments and a higher copper sales price used
to value quarter-end receivables.

Capital spending on budget

-------------------------------------------------------------------------

three months ended March 31 objective
2008 2007 change 2008
-------------------------------------------------------------------------
Capital spending $5,700 $5,100 +12% $23,000
-------------------------------------------------------------------------

Capital spending in the quarter was mainly for replacing mine equipment.

2008 outlook for capital spending

Cayeli expects to spend $23 million in 2008 on repairing a ventilation
raise, buying mine equipment and replacing other equipment.

PYHASALMI
-------------------------------------------------------------------------
three months ended March 31 objective
2008 2007 change 2008
-------------------------------------------------------------------------
Tonnes of ore milled
(000's) 348 326 +7% 1,370
Tonnes of ore milled
per day 3,800 3,600 +7% 3,750
-------------------------------------------------------------------------
Grades (percent) copper 1.1 1.0 +10% 1.0
zinc 2.4 3.4 -29% 2.5
sulphur 42 39 +8% 41
-------------------------------------------------------------------------
Mill recoveries
(percent) copper 96 95 +1% 94
zinc 92 92 - 90
-------------------------------------------------------------------------
Production (tonnes) copper 3,500 3,200 +9% 13,000
zinc 7,600 10,200 -25% 30,900
pyrite 194,500 160,500 +21% 505,000
-------------------------------------------------------------------------
Cost per tonne of
ore milled (C$) $42 $41 +2% $36
-------------------------------------------------------------------------

Strong mill performance this quarter

Mill throughput performance was better than expected this quarter and
higher than the first quarter of 2007. Mill efficiency was lower in the first
quarter of 2007 because of hard ore and the failure of a conveyer belt. Zinc
production was lower in the first quarter of 2008 compared to 2007 because
mining was from stopes containing lower grade ore.

2008 outlook for production and costs

We expect production for the year to be consistent with our earlier
estimates and in line with production in the first quarter.
The improvements to maintain throughput and increase efficiency in the
mill are well underway. Pyhasalmi has purchased copper flotation cells and a
primary mill motor for the mill. A new mill motor will allow speed to be
adjusted more easily, which should increase throughput capacity in the
grinding circuit and reduce energy costs. These capital improvements should be
completed during the second quarter.
We expect costs to come down over the rest of the year, but this will
also depend on the euro to Canadian dollar exchange rate.

Financial review

Lower sales volumes reduce operating earnings
-------------------------------------------------------------------------
(millions of Canadian dollars unless three months ended March 31
otherwise stated) 2008 2007
-------------------------------------------------------------------------
Sales analysis
Copper sales (tonnes) 3,500 3,400
Zinc sales (tonnes) 6,600 9,500
Pyrite sales (tonnes) 124,000 134,000
----------------------------
Gross copper sales $28 $24
Gross zinc sales 15 33
Other metal sales 12 8
----------------------------
Gross sales 55 65
Smelter processing charges and freight (11) (19)
-------------------------------------------------------------------------
Net sales $44 $46
-------------------------------------------------------------------------
Cost analysis
Tonnes of ore milled (thousands) 348 326
Direct production costs ($ per tonne) $42 $41
-------------------------------------------------------------------------
Direct production costs $15 $13
Change in inventory (2) (1)
Depreciation and other non-cash costs 3 3
-------------------------------------------------------------------------
Operating costs $16 $15
-------------------------------------------------------------------------
Operating earnings $28 $31
-------------------------------------------------------------------------
Operating cash flow $31 $40
-------------------------------------------------------------------------

The table below shows what contributed to the change in operating earnings
and operating cash flow between 2008 and 2007.

-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Lower metal prices, denominated in Canadian dollars $(1)
Lower sales volumes (5)
Lower smelter processing charges and freight 4
Higher operating costs (1)
-------------------------------------------------------------------------
Decrease in operating earnings, compared to 2007 $(3)
Lower tax expense because of lower earnings 1
Changes in working capital (7)
-------------------
Decrease in operating cash flow, compared to 2007 $(9)
-------------------------------------------------------------------------

The change in working capital this quarter is mainly because of the timing
in paying tax installments.

Capital spending in 2008 will mainly be used to improve mill efficiencies
-------------------------------------------------------------------------
three months ended March 31 objective
(thousands) 2008 2007 change 2008
-------------------------------------------------------------------------
Capital spending $1,800 $300 +500% $12,000
-------------------------------------------------------------------------

Spending this quarter was mainly for the copper flotation cells and other
asset replacements and upgrades.

2008 outlook for capital spending

We expect to spend $12 million in 2008, mainly for mine and mill
equipment.

TROILUS
-------------------------------------------------------------------------
three months ended March 31 objective
2008 2007 change 2008
-------------------------------------------------------------------------
Tonnes of ore milled
(000's) 1,400 1,635 -14% 6,600
Tonnes of ore milled
per day 15,400 18,200 -14% 18,100
-------------------------------------------------------------------------
Strip ratio 1.2 0.9 +33% 1.1
-------------------------------------------------------------------------
Grades gold
(grams/
tonne) 0.93 0.79 +18% 0.93
copper
(percent) 0.07 0.05 +40% 0.11
-------------------------------------------------------------------------
Mill recoveries
(percent) gold 84 80 +5% 83
copper 91 84 +8% 92
-------------------------------------------------------------------------
Production gold
(ounces) 35,000 33,200 +5% 163,200
copper
(tonnes) 900 600 +50% 7,000
-------------------------------------------------------------------------
Cost per tonne of
ore milled (C$) $14 $12 +17% $12
-------------------------------------------------------------------------

Mining of the J4 pit is complete

The J4 pit was completed this quarter. A final cut in the bottom
recovered an additional 130,000 tonnes of ore grading over 1 gram per tonne of
gold (about 3,500 recoverable ounces) that had not been previously included in
the mine plan.
Throughput this quarter was lower than the first quarter of last year and
below our expectations because of ore hardness and equipment failures. Even
though fewer tonnes were milled in the quarter, gold production was
five percent higher than last year because grades from the 87 pit were higher
and because of extra tonnage from the J-4 pit. Gold recoveries this quarter
were also higher than expected.
In January 2008, Troilus completed its program to upgrade the primary
ball mill pumps to 1,500 horse power and secondary ball mill pumps to
1,000 horsepower. These investments should improve our throughput of softer
ores in 2008.

2008 outlook for production and costs

We will continue with our plans to mine out the upper benches of the
87 pit and once these are complete we will have access to the higher grade,
softer ore of the main 87 pit that has been undisturbed since early 2005. The
pit will remain on track for completion in early 2009 and then stockpile
recovery will begin. Troilus expects to meet targeted gold and copper
production for the year.

Financial review

Higher gold prices helped earnings
-------------------------------------------------------------------------
(millions of Canadian dollars unless three months ended March 31
otherwise stated) 2008 2007
-------------------------------------------------------------------------
Sales analysis
Gold sales (ounces) 35,100 39,700
Copper sales (tonnes) 800 700
----------------------------
Gross gold sales $26 $25
Gross copper sales 7 4
Other metal sales 1 1
----------------------------
Gross sales 34 30
Smelter processing charges and freight (2) (2)
-------------------------------------------------------------------------
Net sales $32 $28
-------------------------------------------------------------------------
Cost analysis
Tonnes of ore milled (thousands) 1,400 1,635
Direct production costs ($ per tonne) $14 $12
-------------------------------------------------------------------------
Direct production costs $20 $20
Change in inventory (1) 2
Depreciation and other non-cash costs 4 3
-------------------------------------------------------------------------
Operating costs $23 $25
-------------------------------------------------------------------------
Operating earnings $9 $3
-------------------------------------------------------------------------
Operating cash flow $6 $-
-------------------------------------------------------------------------

The table below shows what contributed to the change in operating earnings
and operating cash flow between 2008 and 2007.

-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Higher metal prices denominated in Canadian dollars $7
Higher operating costs (1)
-------------------------------------------------------------------------
Increase in operating earnings, compared to 2007 $6
Changes in working capital (2)
Other 2
-------------------------------------------------------------------------
Increase in operating cash flow, compared to 2007 $6
-------------------------------------------------------------------------

OK TEDI
-------------------------------------------------------------------------
three months ended March 31 objective
(100 percent) 2008 2007 change 2008
-------------------------------------------------------------------------
Tonnes of ore milled
(000's) 5,000 6,600 -24% 25,300
Tonnes of ore milled
per day 54,900 72,500 -24% 69,000
-------------------------------------------------------------------------
Strip ratio 1.9 1.3 +46% 1.3
-------------------------------------------------------------------------
Grades copper
(percent) 0.9 0.8 +13% 0.8
gold
(grams/
tonne) 1.0 0.8 +25% 1.2
-------------------------------------------------------------------------
Mill recoveries
(percent) copper 85 85 - 85
gold 73 71 +3% 67
-------------------------------------------------------------------------
Production copper
(tonnes) 37,300 45,300 -18% 174,000
gold
(ounces) 118,500 126,700 -6% 674,000
-------------------------------------------------------------------------
Cost per tonne of
ore milled (C$) $24 $17 +41% $18
-------------------------------------------------------------------------

Lower throughput this quarter

Ok Tedi's operations were affected this quarter by a four-day strike in
March, and by problems with a conveyor belt. The strike lowered production by
about 2,500 tonnes of copper contained in concentrates (Inmet's share -
450 tonnes) and 6,400 ounces of contained gold (Inmet's share - 1,200 ounces).
Throughput was lower in February and March because lower crusher
availability and a broken conveyor belt reduced the amount of feed that could
be delivered to the mill. A higher portion of harder skarn ore also lowered
throughput.

2008 outlook for production and costs

We have not adjusted for the shortfall in production during the first
quarter. Ok Tedi's 2008 objective has remained unchanged.

Financial review

Ok Tedi benefited from higher copper and gold prices
-------------------------------------------------------------------------
(millions of Canadian dollars unless three months ended March 31
otherwise stated) 2008 2007
-------------------------------------------------------------------------
Sales analysis at 18%
Copper sales (tonnes) 7,400 7,700
Gold sales (ounces) 20,200 22,200
----------------------------
Gross copper sales $68 $56
Gross gold sales 17 16
Other metal sales 1 1
----------------------------
Gross sales 86 73
Smelter processing charges and freight (9) (12)
-------------------------------------------------------------------------
Net sales $77 $61
-------------------------------------------------------------------------
Cost analysis at 18%
Tonnes of ore milled (thousands) 900 1,200
Direct production costs ($ per tonne) $24 $17
-------------------------------------------------------------------------
Direct production costs $20 $20
Change in inventory 1 (1)
Depreciation and other non-cash costs 2 2
-------------------------------------------------------------------------
Operating costs $23 $21
-------------------------------------------------------------------------
Operating earnings $54 $40
-------------------------------------------------------------------------
Operating cash flow $39 $8
-------------------------------------------------------------------------

The table below shows what contributed to the change in operating earnings
and operating cash flow between 2008 and 2007.

-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Higher metal prices, denominated in Canadian dollars $17
Lower sales volumes (3)
Lower smelter processing charges 5
Higher variable compensation (2)
Higher operating costs (3)
-------------------------------------------------------------------------
Increase in operating earnings, compared to 2007 $14
Decreased tax expense because of lower taxable
earnings 1
Changes in net working capital 16
-------------------------------------------------------------------------
Increase in operating cash flow, compared to 2007 $31
-------------------------------------------------------------------------

The change in working capital this quarter reflects lower accounts
receivable due to timing of payments.

The mine waste management program is expected to be completed mid-year

Ok Tedi's capital spending this quarter was mainly for the mine waste
management program.

-------------------------------------------------------------------------
(18 percent) three months ended March 31 objective
2008 2007 change 2008
-------------------------------------------------------------------------
Capital spending $8,000 $6,200 +29% $23,000
-------------------------------------------------------------------------

2008 outlook for capital spending

Ok Tedi plans to spend $130 million (Inmet's 18 percent share is
$23 million) in 2008. Of the $130 million, about $43 million will be for the
mine waste management program, $27 million for the pit drainage tunnel, and
the rest for mine equipment and other sustaining capital.

Status of our development projects

Las Cruces

Quarterly development update

Plant construction

In the first quarter Las Cruces had completed the following:

- 70 percent of construction
- 81 percent of total physical progress.

Work is progressing on schedule. We have established our operations team,
and it has been working closely with the contractors to refine procedures and
ensure a smooth and rapid commissioning period beginning in late July.

Mining progress and direct ore shipping

A total of 3.9 million cubic metres of waste were removed from the mine
during the first quarter, including waste for the phase two pit extension.
Mining costs continue to be below budget because of more efficient blasting
and haulage.
Las Cruces is progressing with its plan to selectively mine and crush
approximately 130,000 tonnes of high grade ore and ship it directly to
smelters. We still expect to sell 130,000 tonnes of ore and have confirmed
orders to sell the majority of this material commencing in June. This should
result in the production of approximately 18,000 tonnes of copper.
At the same time, ore will be stockpiled in preparation for the plant
start-up in the fourth quarter. The build-up of the stockpile will permit
blending of the ore to ensure optimal feed for start-up.

2008 outlook for development and operations

Las Cruces construction is on schedule and we expect copper cathode
production to begin in the fourth quarter. By March 31, 2008,
(euro)381 million had been spent or committed on the project, and we expect to
spend the balance in 2008. Las Cruces will start generating revenue in 2008
with the shipment of high grade copper ore beginning in June and copper
cathode beginning in the fourth quarter.
The table below shows the spending this quarter and the amount required
for the balance of 2008 to complete construction:

-------------------------------------------------------------------------
(millions) Spending Lending Subsidies Funding
under received from
Tranche A project
of credit sponsors
facility
-------------------------------------------------------------------------
Up to March 31, 2008 (euro)345 (euro)113 (euro)8 (euro)231
Remainder of 2008 118 58 45 8
-------------------------------------------------------------------------
(euro)463 (euro)171 (euro)53 (euro)239
-------------------------------------------------------------------------

The table below shows expected production for 100 percent of Las Cruces

-------------------------------------------------------------------------
2008 2009
target target
-------------------------------------------------------------------------
Tonnes of ore processed (thousands) 240 800
-------------------------------------------------------------------------
Strip ratio 28 32
-------------------------------------------------------------------------
Copper grades (percent) 12 9
-------------------------------------------------------------------------
Copper production (tonnes) 27,000 64,000
-------------------------------------------------------------------------
Smelter processing charges and
freight for crushed ore sales (C $ per tonne) $210 -
-------------------------------------------------------------------------
Direct production cost of ore
processed (C $ per tonne) $172 $150
-------------------------------------------------------------------------

CERATTEPE

Quarterly development update

On March 26, 2008,we received notice from the Rize Administrative Court
of its decision to grant an injunction against the Cerattepe project. See
Managing risk at page 29 for more details. The Turkish Ministry of Energy and
Natural Resources has appealed the decision and we have joined in that
process. The injunction prevents any further development work on the property.
If the appeal succeeds, work would continue while we wait for the Court to
make its final decision on the applications to cancel the operating licences.
We expect the Court to reach its decision about the applications to cancel by
the end of 2008.
Although we are disappointed with the decision to grant an injunction, we
will continue with our efforts to advance the Cerattepe project. We continue
to maintain an active campaign of community dialogue and engagement to
reinforce support for the project.
The following work was underway this quarter:

Underground development

Ramp development reached 350 metres by the end of March. A further
400 metres is required to reach the orebody. Mobile equipment for the mine has
been ordered.

Aerial tramway

Detailed engineering has progressed and ropeway components are now ready
to ship to the site. We are in the process of obtaining permits for the
tramway to be installed by the end of 2008.

Cayeli mill expansion

The mill needs to increase its capacity from 1.2 million tonnes per year
to 1.5 million tonnes per year. This requires a new grinding and flotation
section as well as a small SAG mill and a ball mill. The design is ongoing and
major equipment has been ordered.

2008 outlook for development

We plan to continue to move the project forward and hope to start
production by the end of the first quarter of 2009, subject to the outcome of
current legal proceedings (see Managing Risk - Cerattepe legal proceedings).
To date we have spent and committed capital of $53 million.

PETAQUILLA

Quarterly development update

On March 26, 2008, we entered into an agreement with Teck Cominco Limited
to proceed with the development of the Petaquilla copper project in Panama.
Under the agreement we will work closely with Teck Cominco during the next
crucial phase of project development, acting as operator of the project on
behalf of Teck Cominco and will fund our and Teck Cominco's share of project
expenditures for an interim period that will end once we have contributed
US $50 million in development costs that have been incurred on the project or
September 30, 2009, whichever is earlier.
At the end of the interim period, Teck Cominco must choose either to
continue participating in the project and resume funding, or to sell its
interest.
The following work was underway this quarter:

Front End Engineering and Design (FEED) study

Work is continuing on this study and a project review team is currently
studying opportunities to reduce capital costs and enhance project economics.
The targeted completion date for the final study is the first half of 2009.

Drilling

Drilling to expand the resource, to confirm prospective locations for
plant and other facilities and to provide geotechnical information for
engineering work is continuing.

Plant and equipment

We have received proposals for the construction of the SAG and ball
mills. Because of the long lead times we have placed an order for two SAG
mills and four ball mills subject to cancellation terms.

Baseline work for the social and environmental impact assessment

Work is progressing in this area and we expect to submit our impact
assessment to the Panamanian environmental authorities in the second quarter
of 2009.

Petaquilla team in Panama

We have started building a dedicated team to lead all development,
engineering, technical, environmental and permitting activities in Panama.

2008 outlook for development

Petaquilla is expected to spend approximately $75 million on the project
in 2008 to complete the FEED study as well as ordering long lead time capital
equipment. The capital items must be ordered at this stage of development to
maintain the project schedule.

Managing our liquidity
-------------------------------------------------------------------------
three months ended
March 31
(millions) 2008 2007
-------------------------------------------------------------------------
CASH FROM OPERATING ACTIVITIES
Cayeli $15 $60
Pyhasalmi 31 40
Troilus 6 -
Ok Tedi 39 8
Corporate development and exploration not included
in operation's cash flow (2) (1)
General and administration (4) (3)
Other (8) 1
-------------------------------------------------------------------------
77 105
-------------------------------------------------------------------------
CASH FROM INVESTING AND FINANCING
Capital spending (111) (52)
Long-term borrowings 50 14
Funding from non-controlling shareholder 15 5
Foreign exchange on cash held in foreign currency 37 (3)
Other (3) (11)
-------------------------------------------------------------------------
(12) (47)
-------------------------------------------------------------------------
Increase in cash 65 58
Cash and short-term investments
Beginning of period 841 640
-------------------------------------------------------------------------
End of period $906 $698
-------------------------------------------------------------------------


OPERATING ACTIVITIES

Key components of the change in operating cash flows
-------------------------------------------------------------------------
three months ended
(millions) March 31
-------------------------------------------------------------------------
Higher earnings from operations (see page 4) $10
Non-cash changes in operating earnings:
Increased tax expense (5)
Changes in working capital (32)
Other (1)
-------------------------------------------------------------------------
Decrease in operating cash flow, compared to 2007 $(28)
-------------------------------------------------------------------------

Operating cash flows are lower this quarter compared to 2007 because
working capital is higher from higher accounts receivable at Cayeli, and
payment of corporate year-end incentive bonuses were higher this year.

2008 outlook for operating activities

Based on our outlook for metal prices and production, we expect our
operating cash flows for our operating mines to be in a similar range for 2008
as they were for 2007 and we expect operating cash flows from the start of
production at Las Cruces.

INVESTING AND FINANCING

Capital spending
-------------------------------------------------------------------------
three months ended revised
March 31 objective
(millions) 2008 2007 2008
-------------------------------------------------------------------------
Cayeli $6 $5 $23
Pyhasalmi 2 - 12
Troilus - - 1
Ok Tedi 8 7 23
Las Cruces 92 38 342
Cerattepe 3 2 53
-------------------------------------------------------------------------
$111 $52 $454
-------------------------------------------------------------------------

Please see Results of our operations and Status of our development
projects for a discussion of actual results and our 2008 objective.
Las Cruces borrowed an additional (euro)26 million this quarter, bringing
the total amount borrowed under Tranche A of its credit facility to
(euro)113 million.

2008 outlook for investing and financing

We expect capital spending to be $454 million in 2008:

- $325 million for the continuing development of the Las Cruces mine
and $17 million for its sustaining capital
- $53 million for development at Cerattepe assuming the injunction is
lifted
- $8 million for the mine waste management program and $5 million for
drainage tunnel underground work at Ok Tedi.

We will finance the spending at Las Cruces through a combination of debt,
government subsidies and sponsor contributions (see page 22). On June 30,
2008, the credit facility will be converted from a euro facility to a
US dollar facility. Repayments will be made in US dollars and interest will be
calculated using US Libor rates.
We also expect to invest $36 million (our 48 percent share) for FEED
studies and the deposits required for long lead time equipment at Petaquilla.
This will be funded from Inmet's current cash balances.

Financial condition

CASH

Our cash and equivalents balance of $906 million at March 31, 2008
included cash and money market instruments that mature in 90 days or less from
the date of acquisition, and short-term investments that mature in 91 days to
a year.

Cash and short-term investments were generally held in:
- short-term debt instruments issued by Canadian Crown Corporations
- AAA rated money market funds managed by leading international fund
managers investing in money market and short-term debt securities
and fixed income securities issued by leading international
financial institutions and their sponsored securitization vehicles
- cash and term and overnight deposits with leading Canadian and
international financial institutions.

Our restricted cash balance of $49 million included:
- $14 million in trust for future rehabilitation at Ok Tedi
- $14 million of cash collateralized letters of credit for Inmet
- $21 million related to issuing letters of credit to suppliers at
Las Cruces.

COMMON SHARES
-------------------------------------------------------------------------
Common shares outstanding as of March 31, 2008
and April 29, 2008 48,281,759
Deferred share units outstanding as of March 31,
2008 (redeemable on a one-for-one basis for
common shares) 76,143
-------------------------------------------------------------------------

Dividend declaration

Inmet's board of directors has declared an eligible dividend of $0.10 per
common share payable on June 15, 2008 to shareholders of record as at May 31,
2008.

FINANCIAL INSTRUMENTS

The table below shows the gold and copper forward sales, and the currency
and interest rate hedges (and their marked-to-market valuations) recorded on
our balance sheet at the end of this quarter.

-------------------------------------------------------------------------
Type of Expiry Quantity Price C$ marked-to-
contract market gain (loss)
at March 31,
2008
-------------------------------------------------------------------------
Copper forward
sales
Ok Tedi 2008 2.6 million lbs US $2.78 per lb
2009 3.2 million lbs US $2.41 per lb
----------------------------------------
5.8 million lbs US $2.58 per lb $(6.5 million)(1)
Gold forward
sales
Troilus 2008 43,700 ounces US $352 per oz. $(26.5 million)(2)

Ok Tedi 2008 3,400 ounces US $372 per oz.
2010 3,600 ounces US $748 per oz.
2011 3,600 ounces US $775 per oz.
2012 3,600 ounces US $803 per oz.
2013 1,800 ounces US $825 per oz.
-----------------------------------------------------------
16,000 ounces US $695 per oz. $(6.8 million)(2)

Currency
forward sales
Las Cruces 2008 US $215 million (euro)171.80 million $54.3 million
-----------------------------------------------------------

Interest rate
swaps
Las Cruces 2008 to US $179 million 5.2 percent $(14.5 million)
2014 (reducing in
conjunction with
debt repayment
schedule)
-------------------------------------------------------------------------
-------------------------------------------------------------------------
(1) At a copper price of US $3.86 per pound.
(2) At a gold price of US $933 per ounce.

The currency forward sale at Las Cruces expires June 30, 2008. This
forward sale has been accounted for as a hedge against the conversion of the
euro denominated credit facility to a US dollar denominated facility. On
June 30, assuming we maintain a gain position; we will receive cash on
settlement. If the hedge remains effective at June 30, this cash (or deferred
gain) will increase the carrying value of the loan and will be amortized as a
reduction to interest expense over the term of the loan.

Managing risk

The following is an update to the discussion, only where required, of the
key risks associated with our business and the strategies we use to manage
them. You can find the full discussion in our 2007 annual review.

Development at Las Cruces

Las Cruces is a development project, and while we are confident that the
project will add value as planned, there are still significant risks to
completing the project as planned, particularly in the ability of Las Cruces
contractors to meet critical construction milestones.
While there are rigorous controls on contractor performance, progress
depends on the abilities of the Las Cruces owner team and construction manager
to hire the necessary people and effectively manage them.
A local non-governmental group has initiated several legal proceedings
claiming that various government approvals for the project were not granted
according to regulatory requirements. We believe these claims are without
merit and are vigourously defending against them. Two of these proceedings
were dismissed in 2006. Two other proceedings are still outstanding.

Cerattepe legal proceedings

After the Turkish Administrative Supreme Court reinstated the project
operating licences on procedural grounds in April 2007, the plaintiffs in the
prior proceedings re-filed applications to have the licences cancelled with
the newly created Rize Administrative Court, and also made applications to
stop work on the property and to cancel a lease of the land where the ropeway
terminus will be located.
We joined the proceedings as an intervener and, together with the Turkish
Ministry of Energy and Natural Resources, have filed defences to the
application to cancel, which we continue to believe are without merit.
On March 26, 2008 we received notice from the Rize Administrative Court
of its decision to grant an injunction against the Cerattepe project. As a
result, our subsidiary Artvin Bakir Maden Isletmeleri, A.S. (ABMI) is
prevented from carrying out further development work on the Cerattepe
property.
The main defendant in the legal proceedings is the Turkish Ministry of
Energy and Natural Resources (ABMI is a co-defendant). The Ministry has
appealed the injunction decision to the Trabzon District Administrative Court,
and we expect that court will rule on the appeal in May 2008.
If the appeal succeeds, ABMI will begin work on the property again and
continue development activities until the Rize Administrative Court makes its
final decision on the cancellation applications. The status of the operating
licences would still remain subject to such decision.
Although we are disappointed with the decision to grant an injunction, we
will continue with our efforts concerning the Cerattepe project. If the
Ministry's appeal concerning the injunction is not successful or if the Rize
Administrative court decides the licenses should be cancelled, the project's
development schedule will be delayed.

Sensitivity analysis

The table below shows you the effect of key variables on our net income,
based on our 2008 objectives.

-------------------------------------------------------------------------

Would change
Would change our 2008 net
our 2008 net income per
A change of: income by: share by:
-------------------------------------------------------------------------
Metal prices
Copper (per pound) US $0.30 $44 million $0.90
Zinc (per pound) US $0.10 $8 million $0.16
Gold (per ounce)(1) US $100 $17 million $0.35
-------------------------------------------------------------------------
Exchange rates
Canadian dollar per US dollar C$0.10 $56 million $1.17
Canadian dollar per euro C$0.10 $5 million $0.11
-------------------------------------------------------------------------
Treatment and refining charges
Copper treatment charge per tonne US $10
and copper refining charge per
pound US $0.10 $4 million $0.08
Zinc treatment charge per tonne US $10 $1 million $0.02
-------------------------------------------------------------------------
Freight and energy costs
Concentrate freight per tonne 10% $3 million $0.07
Fuel price per litre $0.10 $4 million $0.08
Electricity per kilowatt hour $0.01 $5 million $0.09
-------------------------------------------------------------------------
(1) Calculations include hedging in place at December 31, 2007.

Accounting changes

We adopted a new section of the CICA Handbook:

Section 3031 - Inventories

Effective January 1, 2008, we adopted CICA Handbook section 3031 -
Inventory on a prospective basis. This Section requires inventory to be
measured at cost or net realizable value - whichever is lower.
The section also clarifies the allocation of fixed production overhead,
requires consistent use of either first-in, first-out or weighted average to
measure inventories, requires insurance and capital spares be accounted for as
property, plant and equipment and requires that any previous write-downs be
reversed when the value of inventories increases. The amount of the reversal
is limited to the amount of the original write-down.
As a result, certain administrative and other costs that were previously
included in the cost of inventory are now expensed as incurred. Metal
inventory and materials and supplies are measured at weighted average cost or
net realizable value - whichever is lower.
This change in policy had the following impact on our first quarter 2008
financial statements:

- decreased opening 2008 inventory by $5.2 million
- increased opening 2008 property, plant and equipment by $2.4 million
- decreased opening 2008 future income tax liability by $0.6 million
- decreased opening 2008 retained earnings by $2.2 million.

Recently issued accounting pronouncement:

Section 3064 - Goodwill and intangible assets

This section establishes standards for the recognition, measurement,
presentation and disclosure of goodwill subsequent to its initial recognition
and of intangible assets. This section replaces Section 3062, Goodwill and
Other Intangible Assets and Section 3450, Research and Development Costs.
Various changes have been made to other sections of the CICA Handbook for
consistency purposes. It provides guidance for the recognition of internally
developed intangible assets and ensuring consistent treatment of all
intangible assets, whether separately acquired or internally developed.
Standards concerning goodwill are unchanged from the standards included in the
previous section. This section will become effective for us beginning on
January 1, 2009. We are currently assessing the impact this change in
accounting policy will have on our consolidated financial statements.

Supplementary financial information

Page 33 includes supplementary financial information on cash costs. These
measures do not fall into the category of generally accepted accounting
principles.
We use unit cash cost information as a key performance indicator, both on
a segment basis and consolidated basis. We have included cash costs as
supplementary information because we believe our key stakeholders use this
measure as a financial indicator of our profitability and cash flows before
the effects of capital investment and financing costs, such as interest.
Since cash costs is not a recognized measure under Canadian generally
accepted accounting principles it should not be considered in isolation of
earnings or cash flows. There is also no standard way to calculate them, so
they are not a reliable way to compare us to other companies.

About Inmet

Inmet is a Canadian-based global mining company that produces copper,
zinc and gold. We have interests in four mining operations in locations around
the world: Cayeli, Pyhasalmi, Troilus and Ok Tedi. We also have interests in
three development properties, Las Cruces, Cerattepe and Petaquilla.

This press release is also available at www.inmetmining.com

Annual and special meeting of shareholders

Will be held on
- Tuesday, April 29, 2008
- 2:30 p.m. Eastern Time
- The Ontario Heritage Centre
- 8 Adelaide Street East (Gallery entrance)
- Toronto, Ontario
- audio webcast with slides available at
http://w.on24.com/r.htm?e=107899&s=1&k=B7E7BC0169960F0A95F743502559E9CF or
www.inmetmining.com.

You can also dial in by calling
- Local or international: +1.416.644.3417
- Toll-free within North America: +1.800.731.6941

Starting 5 p.m. (ET) Tuesday April 29, 2008, conference call replay will
be available
- Local or international: +1.416.640.1917 passcode 21268469 followed by
the number sign
- Toll-free within North America: +1.877.289.8525 passcode 21268469
followed by the number sign

First quarter conference call

Will be held on
- Wednesday, April 30, 2008
- 11:00 a.m. Eastern Time
- webcast available at
www.newswire.ca/en/webcast/viewEvent.cgi?eventID=2143900 or
www.inmetmining.com.

You can also dial in by calling
- Local or international: +1.416.644.3417
- Toll-free within North America: +1.800.733.7560

Starting 1 p.m. (ET) Wednesday April 30, 2008, conference call replay
will be available
- Local or international: +1.416.640.1917 passcode 21267931 followed by
the number sign.
- Toll-free within North America: +1.877.289.8525 passcode 21267931
followed by the number sign.



INMET MINING CORPORATION
Supplementary financial information

Cash costs
2008 For the three months ended March 31

per ounce
per pound of copper of gold
--------------------------------------- ---------
TOTAL
CAYELI PYHASALMI OK TEDI COPPER TROILUS
----------------------------------------------------- --------- ---------
(US dollars)

Direct production costs $1.06 $1.90 $1.27 $1.30 $567
Royalties and variable
compensation 0.24 - 0.11 0.15 -
Smelter processing
charges and freight 1.19 1.16 0.55 0.95 62
Metal credits (1.86) (3.90) (1.37) (2.07) (237)
----------------------------- --------- ---------

Cash cost $0.63 ($0.84) $0.56 $0.33 $392
----------------------------- --------- ---------
----------------------------- --------- ---------



2007 For the three months ended March 31

per ounce
per pound of copper of gold
--------------------------------------- ---------

TOTAL
CAYELI PYHASALMI OK TEDI COPPER TROILUS
----------------------------------------------------- --------- ---------
(US dollars)

Direct production costs $0.97 $1.62 $0.92 $1.06 $498
Royalties and variable
compensation 0.11 - - 0.04 -
Smelter processing
charges and freight 0.90 2.01 0.57 0.94 58
Metal credits (1.79) (5.13) (0.84) (1.94) (108)
----------------------------- --------- ---------

Cash cost $0.19 ($1.50) $0.65 $0.10 $448
----------------------------- --------- ---------
----------------------------- --------- ---------

-------------------------------------------------------------------------


Reconciliation of cash costs to statements of earnings
2008 For the three months ended March 31

per ounce
per pound of copper of gold
--------------------------------------- ---------
(millions of Canadian
dollars, except where TOTAL
otherwise note) CAYELI PYHASALMI OK TEDI COPPER TROILUS
----------------------------------------------------- --------- ---------
GAAP reference page 15 page 17 page 21 page 19

Direct production costs $23 $15 $20 $58 $20
Smelter processing
charges and freight 22 11 9 42 2
By product sales (37) (27) (18) (82) (8)
Adjust smelter processing
and freight, and sales
to production basis 3 (5) (2) (4) -
--------- --------- --------- --------- ---------
Operating costs net
of metal credits $11 ($6) $9 $14 $14
US $ to C$ exchange rate $1.00 $1.00 $1.00 $1.00 $1.00
Inmet's share of
production (000's) 18,000 7,800 14,800 40,600 35,000
--------------------------------------- ---------
Cash cost $0.63 ($0.84) $0.56 $0.33 $392
--------------------------------------- ---------
--------------------------------------- ---------



2007 For the three months ended March 31

per ounce
per pound of copper of gold
--------------------------------------- ---------
(millions of Canadian
dollars, except where TOTAL
otherwise note) CAYELI PYHASALMI OK TEDI COPPER TROILUS
----------------------------------------------------- --------- ---------
GAAP reference page 15 page 17 page 21 page 19

Direct production costs $21 $13 $20 $54 $20
Smelter processing
charges and freight 31 19 12 62 2
By product sales (59) (41) (17) (117) (5)
Adjust smelter processing
and freight, and sales
to production basis 11 (4) (1) 6 -
--------- --------- --------- --------- ---------
Operating costs net
of metal credits $4 ($13) $14 $5 $17
US $ to C$ exchange rate $1.17 $1.17 $1.17 $1.17 $1.17
Inmet's share of
production (000's) 16,400 7,000 18,000 41,400 33,200
--------------------------------------- ---------
Cash cost $0.19 ($1.50) $0.65 $0.10 $448
--------------------------------------- ---------
--------------------------------------- ---------



INMET MINING CORPORATION
Quarterly review
(unaudited)

Latest Four Quarters
-------------------------------------------------------------------------
2008 2007 2007 2007
(thousands of Canadian dollars, First Fourth Third Second
except per share amounts) quarter quarter quarter quarter
-------------------------------------------------------------------------
STATEMENTS OF EARNINGS
Gross sales $ 276,281 $ 224,773 $ 272,293 $ 320,018
Smelter processing
charges and freight (44,157) (43,902) (42,557) (55,413)
Cost of sales (79,246) (78,809) (72,057) (78,181)
Depreciation (9,170) (9,480) (8,739) (8,039)
-------------------------------------------
143,708 92,582 148,940 178,385
Corporate development
and exploration (2,618) (3,510) (2,895) (1,836)
General and administration (3,648) (12,622) (2,674) (2,162)
Investment and other income 14,754 5,968 9,644 13,415
Interest expense (447) (407) (424) (424)
Capital tax (expense) recovery (126) 212 (273) (274)
Income tax expense (44,744) (18,551) (37,649) (48,509)
Non-controlling interest (205) (27) 167 (545)
-------------------------------------------
Net income $ 106,674 $ 63,645 $ 114,836 $ 138,050
-------------------------------------------
Net income per common share $ 2.21 $ 1.32 $ 2.38 $ 2.86
-------------------------------------------
Diluted net income
per common share $ 2.21 $ 1.32 $ 2.37 $ 2.86
-------------------------------------------



Previous Four Quarters
-------------------------------------------------------------------------
2007 2006 2006 2006
(thousands of Canadian dollars, First Fourth Third Second
except per share amounts) quarter quarter quarter quarter
-------------------------------------------------------------------------
STATEMENTS OF EARNINGS
Gross sales $ 286,614 $ 258,911 $ 301,100 $ 317,624
Smelter processing charges
and freight (64,606) (65,005) (60,270) (63,668)
Cost of sales (79,377) (67,868) (73,394) (78,778)
Depreciation (9,415) (9,057) (9,025) (8,225)
-------------------------------------------
133,216 116,981 158,411 166,953
Corporate development
and exploration (842) (4,136) (2,708) (1,456)
General and administration (2,840) (6,128) (2,618) (2,624)
Investment and other income 7,427 17,972 1,759 2,940
Interest expense (438) (425) (412) (391)
Capital tax (expense) recovery (274) - 41 (246)
Income tax expense (35,376) (26,679) (42,902) (33,240)
Non-controlling interest 205 (165) 11 154
-------------------------------------------
Net income $ 101,078 $ 97,420 $ 111,582 $ 132,090
-------------------------------------------
Net income per common share $ 2.09 $ 2.02 $ 2.31 $ 2.74
-------------------------------------------
Diluted net income
per common share $ 2.09 $ 2.02 $ 2.31 $ 2.74
-------------------------------------------



INMET MINING CORPORATION
Consolidated balance sheets

March 31 December 31
(thousands of Canadian dollars) 2008 2007
-------------------------------------------------------------------------
(unaudited)
Assets

Current assets:
Cash and short-term investments (note 5) $906,044 $840,823
Restricted cash (note 6) 6,369 1,569
Accounts receivable 188,262 131,197
Inventories (note 2) 56,207 52,725
Future income tax asset 12,164 14,515
-------------------------
1,169,046 1,040,829

Restricted cash (note 6) 43,029 37,205

Property, plant and equipment 1,042,783 870,965

Investments (note 7) 40,040 32,266

Future income tax asset 9,395 7,884

Derivatives (note 8) 54,340 33,565

Other assets 8,992 25,751
-------------------------

$2,367,625 $2,048,465
-------------------------------------------------------------------------


Liabilities

Current liabilities:
Accounts payable and accrued liabilities $172,086 $172,800
Current portion of long-term debt 14,539 12,971
-------------------------

186,625 185,771

Long-term debt (note 9) 334,418 234,317

Reclamation liabilities (note 10) 91,224 84,017

Derivatives (note 8) 54,287 43,960

Other liabilities 23,918 19,249

Future income tax liabilities 41,953 37,084

Non-controlling interest 60,126 51,574
-------------------------

792,551 655,972
-------------------------

Commitments (note 11)

Shareholders' equity

Share capital 337,464 337,464

Contributed surplus 61,173 60,722

Stock based compensation 1,157 1,085

Retained earnings 1,181,436 1,076,958

Accumulated other comprehensive loss (note 12) (6,156) (83,736)
-------------------------

1,575,074 1,392,493
-------------------------

$2,367,625 $2,048,465
-------------------------------------------------------------------------
(see accompanying notes)



INMET MINING CORPORATION
Segmented balance sheets


2008 As at March 31

(unaudited) CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Assets
Cash and short-term
investments $364,092 $312,948 $151,721 $-
Other current assets 23,441 65,230 50,252 27,122
Restricted cash 14,444 - - -
Property, plant
and equipment 653 125,794 71,238 28,218
Investments 40,040 - - -
Derivatives - - - -
Other assets 6,977 335 - 6,289
-----------------------------------------------
$449,647 $504,307 $273,211 $61,629
-----------------------------------------------
-----------------------------------------------

Liabilities
Current liabilities $5,283 $48,948 $14,732 $12,190
Long-term debt 18,375 - - -
Reclamation liabilities 24,299 3,339 14,911 7,767
Derivatives - - - 26,474
Other liabilities 5,013 4,758 - 291
Future income
tax liabilities - 17,250 7,992 -
Non-controlling interest - - - -
-----------------------------------------------
$52,970 $74,295 $37,635 $46,722
-----------------------------------------------
-----------------------------------------------

2008 As at March 31

(unaudited) OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Assets

Cash and short-term
investments $44,943 $32,340 $906,044
Other current assets 47,466 49,491 263,002
Restricted cash 13,545 15,040 43,029
Property, plant
and equipment 71,861 745,019 1,042,783
Investments - - 40,040
Derivatives - 54,340 54,340
Other assets 4,786 - 18,387
----------------------- -----------
$182,601 $896,230 $2,367,625
----------------------- -----------
----------------------- -----------

Liabilities

Current liabilities $32,375 $73,097 $186,625
Long-term debt - 316,043 334,418
Reclamation liabilities 20,577 20,331 91,224
Derivatives 13,269 14,544 54,287
Other liabilities 1,527 12,329 23,918
Future income
tax liabilities 2,701 14,010 41,953
Non-controlling interest - 60,126 60,126
----------------------- -----------
$70,449 $510,480 $792,551
----------------------- -----------
----------------------- -----------


2007 As at December 31

CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Assets
Cash and short-term
investments $359,359 $333,671 $111,492 $-
Other current assets 23,455 29,384 55,069 23,644
Restricted cash 14,444 - - -
Property, plant
and equipment 629 115,064 63,147 28,413
Investments 32,266 - - -
Derivatives - - - -
Other assets 22,343 441 - 6,289
-----------------------------------------------
$452,496 $478,560 $229,708 $58,346
-----------------------------------------------
-----------------------------------------------

Liabilities

Current liabilities $16,948 $39,161 $14,560 $11,972
Long-term debt 16,267 - - -
Reclamation liabilities 24,393 3,169 13,104 7,662
Derivatives - - - 26,889
Other liabilities 5,057 4,787 - -
Future income tax liabilities - 17,723 7,393 -
Non-controlling interest - - - -
-----------------------------------------------
$62,665 $64,840 $35,057 $46,523
-----------------------------------------------
-----------------------------------------------


2007 As at December 31

OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Assets
Cash and short-term
investments $13,473 $22,828 $840,823
Other current assets 38,162 30,292 200,006
Restricted cash 11,836 10,925 37,205
Property, plant
and equipment 63,655 600,057 870,965
Investments - - 32,266
Derivatives - 33,565 33,565
Other assets 2,101 2,461 33,635
----------------------- -----------
$129,227 $700,128 $2,048,465
----------------------- -----------
----------------------- -----------

Liabilities

Current liabilities $21,487 $81,643 $185,771
Long-term debt - 218,050 234,317
Reclamation liabilities 19,708 15,981 84,017
Derivatives 9,034 8,037 43,960
Other liabilities 1,412 7,993 19,249
Future income tax liabilities - 11,968 37,084
Non-controlling interest - 51,574 51,574
----------------------- -----------
$51,641 $395,246 $655,972
----------------------- -----------
----------------------- -----------



INMET MINING CORPORATION
Consolidated statements of earnings
(unaudited)

(thousands of Canadian dollars Three Months Ended March 31
except per share amounts) 2008 2007
-------------------------------------------------------------------------

Gross sales $276,281 $286,614

Smelter processing charges and freight (44,157) (64,606)

Cost of sales (79,246) (79,377)

Depreciation (9,170) (9,415)

-------------------------------------------------------------------------
143,708 133,216


Corporate development and exploration (2,618) (842)

General and administration (3,648) (2,840)

Investment and other income (note 13) 14,754 7,427

Interest expense (447) (438)

Capital tax expense (126) (274)

Income tax expense (note 14) (44,744) (35,376)

Non-controlling interest (205) 205

-------------------------------------------------------------------------

Net income $106,674 $101,078
-------------------------------------------------------------------------

Basic and diluted net income
per common share (note 15) $2.21 $2.09
-------------------------------------------------------------------------

Weighted average shares
outstanding (000's) 48,282 48,278
-------------------------------------------------------------------------
(see accompanying notes)



INMET MINING CORPORATION
Segmented statements of earnings
(unaudited)

2008 For the three months ended March 31

CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Gross sales $- $100,616 $54,908 $34,251
Smelter processing charges
and freight - (22,013) (10,820) (2,187)
Cost of sales (494) (22,575) (13,944) (21,011)
Depreciation - (2,373) (2,150) (2,418)
-----------------------------------------------
(494) 53,655 27,994 8,635

Corporate development
and exploration (1,977) (70) (566) (5)
General and administration (3,648) - - -
Investment and other
income (expense) 10,561 4,861 - 1,361
Interest expense (447) - - -
Capital tax recovery (126) - - -
Income tax expense - (19,124) (6,023) -
Non-controlling interest - - - -
-----------------------------------------------

Net income $3,869 $39,322 $21,405 $9,991
-----------------------------------------------
-----------------------------------------------


2008 For the three months ended March 31

OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Gross sales $86,506 $- $276,281
Smelter processing charges
and freight (9,137) - (44,157)
Cost of sales (21,222) - (79,246)
Depreciation (2,229) - (9,170)
----------------------- -----------
53,918 - 143,708

Corporate development
and exploration - - (2,618)
General and administration - - (3,648)
Investment and other
income (expense) (2,862) 833 14,754
Interest expense - - (447)
Capital tax recovery - - (126)
Income tax expense (19,347) (250) (44,744)
Non-controlling interest - (205) (205)
----------------------- -----------

Net income $31,709 $378 $106,674
----------------------- -----------
----------------------- -----------



2007 For the three months ended March 31

CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Gross sales $- $117,734 $65,340 $30,242
Smelter processing
charges and freight - (31,168) (18,614) (2,693)
Cost of sales (488) (24,434) (12,923) (22,028)
Depreciation - (2,697) (2,361) (2,709)
-----------------------------------------------
(488) 59,435 31,442 2,812

Corporate development
and exploration (747) (209) (461) 575
General and administration (2,840) - - -
Investment and other
income (expense) 8,135 (315) - 292
Interest expense (438) - - -
Capital tax expense (274) - - -
Income tax expense (181) (13,671) (6,907) -
Non-controlling interest - - - -
-----------------------------------------------

Net income (loss) $3,167 $45,240 $24,074 $3,679
-----------------------------------------------
-----------------------------------------------


2007 For the three months ended March 31

OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Gross sales $73,298 $- $286,614
Smelter processing
charges and freight (12,131) - (64,606)
Cost of sales (19,504) - (79,377)
Depreciation (1,648) - (9,415)
----------------------- -----------
40,015 - 133,216

Corporate development
and exploration - - (842)
General and administration - - (2,840)
Investment and other
income (expense) - (685) 7,427
Interest expense - - (438)
Capital tax expense - - (274)
Income tax expense (14,617) - (35,376)
Non-controlling interest - 205 205
----------------------- -----------

Net income (loss) $25,398 ($480) $101,078
----------------------- -----------
----------------------- -----------



INMET MINING CORPORATION
Consolidated statements of cash flows
(unaudited)

Three Months Ended March 31
(thousands of Canadian dollars) 2008 2007
-------------------------------------------------------------------------

Cash provided by (used in) operating activities(1)

Net income $106,674 $101,078
Add (deduct) items not affecting cash:
Gain on disposition of investments (256) -
Depreciation 9,170 9,415
Future income tax 2,917 (1,735)
Accretion expense on reclamation liabilities 1,021 924
Non-controlling interest 205 (205)
Other (5,438) 897
Reclamation costs (521) (480)
Net change in non-cash working capital (note 4) (37,022) (4,914)
------------------------
76,750 104,980
------------------------

Cash provided by (used in) investing activities

Capital spending (111,414) (51,935)
Disposition of investments 1,521 -
Sale of short-term investments 300,424 120,176
Other - (46)
------------------------
190,531 68,195
------------------------

Cash provided by (used in) financing activities


Long-term debt borrowings (note 9) 50,346 13,840
Funding by non-controlling shareholder 15,129 4,648
Financial assurance deposits (7,494) (9,930)
Subsidies received 3,233 -
Other (46) (1,198)
------------------------
61,168 7,360
------------------------


Foreign exchange change on cash held
in foreign currency 37,196 (2,509)
------------------------

Increase in cash 365,645 178,026

Cash:
Beginning of period 522,505 384,610
------------------------
End of period 888,150 562,636

Short-term investments 17,894 135,553
------------------------

Cash and short-term investments $906,044 $698,189
-------------------------------------------------------------------------
(see accompanying notes)

(1) Supplementary cash flow information:

Cash interest paid $3,398 $640
Cash taxes paid $15,212 $12,371
-------------------------------------------------------------------------



INMET MINING CORPORATION
Segmented statements of cash flows
(unaudited)

2008 For the three months ended March 31

CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Cash provided by (used in)
operating activities
Before net change in
non-cash working capital ($2,672) $40,914 $24,114 $12,675
Net change in non-cash
working capital (12,077) (25,914) 7,124 (6,197)
-----------------------------------------------
(14,749) 15,000 31,238 6,478
-----------------------------------------------
Cash provided by (used in)
investing activities
Capital spending (32) (8,883) (1,759) (247)
Disposition of investments 1,521 - - -
Sale of short-term
investments 300,424 - - -
-----------------------------------------------
301,913 (8,883) (1,759) (247)
-----------------------------------------------
Cash provided by (used in)
financing activities (45) - - -
-----------------------------------------------

Foreign exchange change
on cash held in
foreign currency - 15,933 15,375 -
-----------------------------------------------

Intergroup funding
(distributions) 18,038 (42,773) (4,625) (6,231)
-----------------------------------------------

Increase (decrease)
in cash 305,157 (20,723) 40,229 -
Cash:
Beginning of period 41,041 333,671 111,492 -
-----------------------------------------------
End of period 346,198 312,948 151,721 -
Short-term investments 17,894 - - -
-----------------------------------------------

Cash and short-term
investments $364,092 $312,948 $151,721 $-
-----------------------------------------------
-----------------------------------------------


2008 For the three months ended March 31

OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Cash provided by (used in)
operating activities
Before net change in
non-cash working capital $38,741 $- $113,772
Net change in non-cash
working capital 42 - (37,022)
----------------------- -----------
38,783 - 76,750
----------------------- -----------
Cash provided by (used in)
investing activities
Capital spending (7,959) (92,534) (111,414)
Disposition of investments - - 1,521
Sale of short-term
investments - - 300,424
----------------------- -----------
(7,959) (92,534) 190,531
----------------------- -----------
Cash provided by (used in)
financing activities (615) 61,828 61,168
----------------------- -----------

Foreign exchange change
on cash held in
foreign currency 1,143 4,745 37,196
----------------------- -----------

Intergroup funding
(distributions) 118 35,473 -
----------------------- -----------

Increase (decrease)
in cash 31,470 9,512 365,645
Cash:
Beginning of period 13,473 22,828 522,505
----------------------- -----------
End of period 44,943 32,340 888,150
Short-term investments - - 17,894
----------------------- -----------

Cash and short-term
investments $44,943 $32,340 $906,044
----------------------- -----------
----------------------- -----------



2007 For the three months ended March 31

CORPORATE CAYELI PYHASALMI TROILUS
-------------------------------------------------------------------------
(thousands of
Canadian dollars) (Turkey) (Finland) (Canada)

Cash provided by (used in)
operating activities
Before net change in
non-cash working capital $3,969 $51,242 $26,523 $4,625
Net change in non-cash
working capital (7,568) 8,348 13,973 (4,140)
-----------------------------------------------
(3,599) 59,590 40,496 485
-----------------------------------------------
Cash provided by (used in)
investing activities
Capital spending (24) (7,332) (284) (166)
Sale of short-term
investments 91,825 17,576 - -
Other - - - (46)
-----------------------------------------------
91,801 10,244 (284) (212)
-----------------------------------------------

-----------------------------------------------
Cash provided by (used in)
financing activities (335) - - (1,000)
-----------------------------------------------

Foreign exchange change
on cash held in
foreign currency - (2,491) 589 -
-----------------------------------------------

Intergroup funding
(distributions) (6,420) (669) (4,698) 727
-----------------------------------------------

Increase (decrease)
in cash 81,447 66,674 36,103 -
Cash:
Beginning of period 39,899 159,195 119,260 -
-----------------------------------------------
End of period 121,346 225,869 155,363 -
Short-term investments 135,553 - - -
-----------------------------------------------

Cash and short-term
investments $256,899 $225,869 $155,363 $-
-----------------------------------------------
-----------------------------------------------


2007 For the three months ended March 31

OK TEDI LAS CRUCES TOTAL
------------------------------------------------- -----------
(thousands of (Papua New
Canadian dollars) Guinea) (Spain)

Cash provided by (used in)
operating activities
Before net change in
non-cash working capital $23,535 $- $109,894
Net change in non-cash
working capital (15,527) - (4,914)
----------------------- -----------
8,008 - 104,980
Cash provided by (used in)
investing activities
Capital spending (6,463) (37,666) (51,935)
Sale of short-term
investments 10,775 - 120,176
Other - - (46)
----------------------- -----------
4,312 (37,666) 68,195
----------------------- -----------

----------------------- -----------
Cash provided by (used in)
financing activities (877) 9,572 7,360
----------------------- -----------

Foreign exchange change
on cash held in
foreign currency (483) (124) (2,509)
----------------------- -----------

Intergroup funding
(distributions) - 11,060 -
----------------------- -----------

Increase (decrease)
in cash 10,960 (17,158) 178,026
Cash:
Beginning of period 33,972 32,284 384,610
----------------------- -----------
End of period 44,932 15,126 562,636
Short-term investments - - 135,553
----------------------- -----------

Cash and short-term
investments $44,932 $15,126 $698,189
----------------------- -----------
----------------------- -----------



INMET MINING CORPORATION
Consolidated statements of retained earnings
(unaudited)

Three Months Ended March 31
(thousands of Canadian dollars) 2008 2007
-------------------------------------------------------------------------

Retained earnings, beginning of period,
as previously reported $1,076,958 $676,747

Adjustment for inventory (note 2) (2,196) -
--------------------------

Retained earnings, restated 1,074,762 676,747

Net income 106,674 101,078
-------------------------------------------------------------------------

Retained earnings, end of period $1,181,436 $777,825
-------------------------------------------------------------------------
(see accompanying notes)



Consolidated statements of comprehensive income
(unaudited)

Three Months Ended March 31
(thousands of Canadian dollars) 2008 2007
-------------------------------------------------------------------------

Net income $106,674 $101,078
--------------------------

Other comprehensive income (loss) for the period :
Changes in fair value of gold
forward sales contracts(1) (9,634) (670)

Changes in fair value of interest
rate swap contracts(2) (2,929) (134)

Changes in fair value of foreign
exchange forward contracts(3) 7,612 821

Changes in fair value of investments(4) (6,106) 16,900

Currency translation adjustments 75,369 (3,243)

Reclassification to net income of
gains/losses realized:
Gain on sale of investment (256) -

Troilus gold hedge loss 6,997 3,819

Ok Tedi gold hedge loss 1,013 -

Foreign exchange loss on reduction of
net investment in self-sustaining
foreign operations (note 13) 5,514 -
--------------------------
77,580 17,493
--------------------------

Comprehensive income $184,254 $118,571
-------------------------------------------------------------------------
(see accompanying notes)

(1) Net of income taxes of $291 (2007 - $103).
(2) Net of income taxes of $1,793 (2007 - $81) and non-controlling
interest of $1,254 (2007 - $57).
(3) Net of income taxes of $4,660 (2007 - $504) and non-controlling
interest of $3,261 (2007 - $353).
(4) Net of income taxes of $1,313 (2007 - $1,228).



INMET MINING CORPORATION
Notes to the consolidated financial statements

1. Significant accounting policies

Our interim consolidated financial statements do not include all of
the disclosure required for annual financial statements under
generally accepted accounting principles (GAAP), and they have not
been reviewed by our external auditors. These statements do, however,
follow the same accounting policies and methods of application used
in our most recent annual consolidated financial statements, except
for the differences explained in note 2. You should read our interim
statements in conjunction with our annual statements, which you can
find in our 2007 Annual Review.

2. Changes in accounting policies

Effective January 1, 2008, we adopted CICA Handbook section 3031 -
Inventory on a prospective basis. This Section requires inventory to
be recorded at the lower of cost or net realizable value. The section
also clarifies the allocation of fixed production overhead, requires
consistent use of either first-in, first-out or weighted average to
measure inventories, requires insurance and capital spares be
accounted for as property, plant and equipment and requires that any
previous write-downs be reversed when the value of inventories
increases. The amount of the reversal is limited to the amount of the
original write-down.

As a result, certain administrative and other costs that were
previously included in the cost of inventory are now expensed as
incurred. Metal inventory and materials and supplies are measured at
the lower of weighted average cost and net realizable value.

This change in policy had the following impact on our first quarter
2008 financial statements:

- decreased opening 2008 inventory by $5.2 million
- increased opening 2008 property, plant and equipment by
$2.4 million
- decreased opening 2008 future income tax liability by $0.6 million
- decreased opening 2008 retained earnings by $2.2 million.

3. Recently issued accounting pronouncement

Section 3064 - Goodwill and intangible assets

This section establishes standards for the recognition, measurement,
presentation and disclosure of goodwill subsequent to its initial
recognition and of intangible assets. This section replaces Section
3062, Goodwill and Other Intangible Assets and Section 3450, Research
and Development Costs. Various changes have been made to other
sections of the CICA Handbook for consistency purposes. It provides
guidance for the recognition of internally developed intangible
assets and ensuring consistent treatment of all intangible assets,
whether separately acquired or internally developed. Standards
concerning goodwill are unchanged from the standards included in the
previous section. This section will become effective for us beginning
on January 1, 2009. We are currently assessing the impact this change
in accounting policy will have on our consolidated financial
statements.

4. Statement of cash flows

The following tables show the components of our net change in non-
cash working capital by segment for the three months ending March 31.

For the three months ended March 31, 2008
-------------------------------------------------------------------------

(thousands) Corporate Cayeli Pyhasalmi Troilus
-------------------------------------------------------------------------
Accounts receivable $15 $(33,374) $12,299 $(3,091)
Inventories - (2,747) (1,464) (2,687)
Accounts payable and
accrued liabilities (11,804) (1,589) (1,475) (419)
Taxes (284) 11,676 (2,236) -
Other (4) 120 - -
-------------------------------------------------------------------------
$(12,077) $(25,914) $7,124 $(6,197)
-------------------------------------------------------------------------


For the three months ended March 31, 2008
-------------------------------------------------------------
Las
(thousands) Ok Tedi Cruces Total
-------------------------------------------------------------
Accounts receivable $(9,061) $- $(33,212)
Inventories 100 - (6,798)
Accounts payable and
accrued liabilities (5,537) - (20,824)
Taxes 15,681 - 24,837
Other (1,141) - (1,025)
-------------------------------------------------------------
$42 $- $(37,022)
-------------------------------------------------------------



For the three months ended March 31, 2007
-------------------------------------------------------------------------

(thousands) Corporate Cayeli Pyhasalmi Troilus
-------------------------------------------------------------------------

Accounts receivable $(906) $14,595 $12,851 $(6,609)
Inventories - 2,567 (832) 2,189
Accounts payable and
accrued liabilities (3,258) (13,923) (1,361) 280
Taxes (3,406) 5,103 3,315 -
Other 2 6 - -
-------------------------------------------------------------------------
$(7,568) $8,348 $13,973 $(4,140)
-------------------------------------------------------------------------


-------------------------------------------------------------
Las
(thousands) Ok Tedi Cruces Total
-------------------------------------------------------------

Accounts receivable $(20,702) $- $(771)
Inventories (674) - 3,250
Accounts payable and
accrued liabilities (11,749) - (30,011)
Taxes 17,609 - 22,621
Other (11) - (3)
-------------------------------------------------------------
$(15,527) $- $(4,914)
-------------------------------------------------------------

5. Cash and short-term investments

At March 31, our cash and short-term investments are held in:

---------------------------------------------------------------------
March 31 December 31
(thousands) 2008 2007
---------------------------------------------------------------------
Cash:
Liquidity funds $322,386 $424,390
Term deposits 56,907 22,186
Corporate 254,331 -
Overnight deposits 139,003 50,822
Other 115,523 25,549
------------------------
888,150 522,947
Short-term investments:
Federal and crown corporation investments - 317,876
Corporate 17,894 -
---------------------------------------------------------------------
17,894 317,876
---------------------------------------------------------------------
Total cash and short-term investments $906,044 $840,823
---------------------------------------------------------------------

6. Restricted cash

The table below shows our restricted cash balances.

---------------------------------------------------------------------
March 31 December 31
(thousands) 2008 2007
---------------------------------------------------------------------
Collateralized cash for letter
of credit facility $14,444 $14,444
In trust for Ok Tedi rehabilitation (note 11) 13,545 11,836
Collateralized cash for letters of credit
- Las Cruces 21,409 12,494
---------------------------------------------------------------------
49,398 38,774
Less current portion:
Collateralized cash for letters of credit
- Las Cruces (6,369) (1,569)
---------------------------------------------------------------------
$43,029 $37,205
---------------------------------------------------------------------

Cash collateralized letters of credit for Las Cruces are for the
following:
- (euro)3.1 million to secure payments that will ultimately be for
the use of an electrical substation
- (euro)2.5 million to secure payments to local townships that it
will owe once certain licences are granted
- (euro)7.6 million for dewatering and other purposes.

7. Investments

The table below shows our investments.

---------------------------------------------------------------------
March 31 December 31
(thousands) 2008 2007
---------------------------------------------------------------------
Available-for-sale equity securities:
Premier Gold Mines Ltd. $17,483 $22,680
Other 5,832 9,586
---------------------------------------------------------------------
23,315 32,266
Equity accounted investment:
Minera Petaquilla S.A. 16,725 -
---------------------------------------------------------------------
$40,040 $32,266
---------------------------------------------------------------------

Our investment in Minera Petaquilla S.A. was included in Other assets
at December 31, 2007.

8. Derivatives

The table below shows the fair value of our derivatives.

---------------------------------------------------------------------
March 31 December 31
2008 2007
(thousands) (fair value) (fair value)
---------------------------------------------------------------------
Derivative asset:
Las Cruces currency forward sale $54,340 $33,565
---------------------------------------------------------------------
Derivative liabilities:
Troilus gold forward sales $26,474 $26,889
Ok Tedi gold and copper forward sales 13,269 9,034
Las Cruces interest rate swaps 14,544 8,037
---------------------------------------------------------------------
$54,287 $43,960
---------------------------------------------------------------------

9. Long-term debt

---------------------------------------------------------------------
March 31 December 31
(thousands) 2008 2007
---------------------------------------------------------------------
Credit facility - Tranche A $183,117 $125,776
- Tranche B 51,811 34,656
Promissory note 18,375 16,267
Loans from non-controlling shareholder 95,654 70,589
---------------------------------------------------------------------
348,957 247,288
Less current portion:
Credit facility - Tranche B (14,539) (12,971)
---------------------------------------------------------------------
$334,418 $234,317
---------------------------------------------------------------------

Credit facility

This quarter, Las Cruces borrowed an additional (euro)26 million
under Tranche A, the US $240 million senior secured facility, and an
additional (euro)8 million under Tranche B, the (euro)69 million
senior secured bridge financing facility. The credit facility loans
approximate fair value because the loans accrue interest at
prevailing market rates.

Loans from non-controlling shareholder

This quarter, Las Cruces received (euro)34 million of intercompany
loan advances. These loans bear interest at EURIBOR plus 8.55 percent
and are due to be repaid on February 25, 2020. The non-controlling
portion of these loans, (euro)59 million, is reflected in long-term
debt at March 31, 2008. Loans from non-controlling shareholders
approximate fair value because the loans accrue interest at
prevailing market rates.

Effective May 1, 2008, these loans will bear interest at a rate of
EURIBOR plus 6.1 percent.


10. Reclamation liabilities

This quarter, we recognized additional liabilities of $2.2 million at
Las Cruces as a result of development activities that took place.

11. Commitments

Our operations have the following capital commitments as at March 31,
2008:

- Ok Tedi has committed approximately $46.4 million (our
proportionate share is $8.4 million) to capital expenditures for
the mine waste management project.

- Las Cruces has committed $126.8 million to engineering,
procurement and construction management and additional
construction work related to the development of the mine and
process plant.

- Cayeli has committed $2.3 million for a ventilation raise.

- Cerattepe has committed approximately $24 million for construction
of a ropeway and orders for mine and mill equipment.


12. Accumulated other comprehensive loss (AOCL)

The table below shows the components of the beginning and ending
balances of AOCL.

---------------------------------------------------------------------

(thousands)
---------------------------------------------------------------------
Unrealized losses on gold forward sales contracts
(net of tax of $2,169) $(31,951)
Deferred Troilus gold hedges 5,444
Unrealized gains on foreign exchange forward contract(1) 17,067
Unrealized losses on interest rate swap contracts(2) (4,097)
Unrealized gains on investments (net of tax of $2,951) 14,506
Currency translation adjustment (84,705)
---------------------------------------------------------------------
AOCL, December 31, 2007 $(83,736)
Other comprehensive income for the three months
ending March 31, 2008 77,580
---------------------------------------------------------------------
AOCL, March 31, 2008 $(6,156)
---------------------------------------------------------------------

AOCL March 31, 2008 comprises:
Unrealized losses on gold forward sales contracts
(net of tax of $2,460) $(32,214)
Deferred Troilus gold hedges 4,083
Unrealized gains on foreign exchange forward contract(3) 24,679
Unrealized losses on interest rate swap contract(4) (7,026)
Unrealized gains on investments (net of tax of $1,638) 8,144
Currency translation adjustment (3,822)
---------------------------------------------------------------------
AOCL, March 31, 2008 $(6,156)
---------------------------------------------------------------------

1. Net of tax of $10,448 and non-controlling interest of $7,315.
2. Net of tax of $2,510 and non-controlling interest of $1,756.
3. Net of tax of $15,108 and non-controlling interest of $10,576.
4. Net of tax of $4,303 and non-controlling interest of $3,010.

The table below shows the breakdown of the currency translation
adjustment included in AOCL.

---------------------------------------------------------------------
March 31 December 31
(thousands) 2008 2007
---------------------------------------------------------------------
Pyhasalmi (euro functional currency) $15,969 $(1,466)
Las Cruces (euro functional currency) 37,481 (1,919)
Cayeli (US dollar functional currency) (45,316) (65,822)
Ok Tedi (US dollar functional currency) (11,956) (15,498)
---------------------------------------------------------------------
$(3,822) $(84,705)
---------------------------------------------------------------------

The US dollar to Canadian dollar exchange rate was $1.03 at March 31,
2008 and $0.99 at December 31, 2007. The euro to Canadian dollar
exchange rate was $1.62 at March 31, 2008 and $1.45 at December 31,
2007.

13. Investment and other income

Investment and other income are summarized as follows:

---------------------------------------------------------------------
three months ended
March 31
(thousands) 2008 2007
---------------------------------------------------------------------
Interest income $8,723 $6,879
Dividend and royalty income - 1,000
Foreign exchange gain (loss) 6,858 (8)
Other (827) (444)
---------------------------------------------------------------------
$14,754 $7,427
---------------------------------------------------------------------

Interest income

Interest and dividend income was higher in this quarter compared to
the same periods in 2007 because of higher cash balances.

Foreign exchange

We recorded a net foreign exchange gain of $6.9 million this quarter.
We recognized a gain of $13 million because we revalued some of our
foreign currency denominated accounts and cash balances, and
recognized a deferred foreign exchange loss of $6 million when
dividends were received from Cayeli.

14. Income tax expense

The tables below show our current and future income tax expense.

For the three months ended March 31, 2008
-------------------------------------------------------------------------
Las
(thousands) Corporate Cayeli Pyhasalmi Ok Tedi Cruces Total
-------------------------------------------------------------------------

Current
income taxes $- $18,550 $5,972 $17,305 $- $41,827
Future income
taxes - 574 51 2,042 250 2,917
-------------------------------------------------------------------------
$- $19,124 $6,023 $19,347 $250 $44,744
-------------------------------------------------------------------------


For the three months ended March 31, 2007
-------------------------------------------------------------------------
Las
(thousands) Corporate Cayeli Pyhasalmi Ok Tedi Cruces Total
-------------------------------------------------------------------------

Current
income taxes $386 $11,356 $6,865 $18,504 $- $37,111
Future income
taxes (205) 2,315 42 (3,887) - (1,735)
-------------------------------------------------------------------------
$181 $13,671 $6,907 $14,617 $- $35,376
-------------------------------------------------------------------------

15. Net income per share

The following tables show our calculation of basic and diluted net
income per share.

---------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007
---------------------------------------------------------------------
Net income available to common shareholders $106,674 $101,078
---------------------------------------------------------------------



---------------------------------------------------------------------
three months ended March 31
(thousands) 2008 2007
---------------------------------------------------------------------
Weighted average common shares outstanding 48,282 48,278
Plus incremental shares from
assumed conversions:
Deferred share units 76 77
---------------------------------------------------------------------
Diluted weighted average common
shares outstanding 48,358 48,355
---------------------------------------------------------------------



---------------------------------------------------------------------
three months ended March 31
(Canadian dollars per share) 2008 2007
---------------------------------------------------------------------

Basic and diluted net income per common share $2.21 $2.09
---------------------------------------------------------------------

Contact Information

  • Inmet Mining Corporation
    Richard Ross
    Chairman and Chief Executive Officer
    (416) 860-3974

    Inmet Mining Corporation
    Jochen Tilk
    President and Chief Operating Officer
    (416) 860-3972