Inter-Citic Minerals Inc. (ICI-TSX, C$1.43) · Catherine Gignac (416) 847-2790; [email protected] February 13, 2007 – 2 INVESTMENT SUMMARY Inter-Citic Minerals is a gold explorer

Please see disclaimers at the end of this report.

Mining & Minerals

Inter-Citic Minerals Inc. (ICI-TSX, C$1.43) Recommendation: Buy

Catherine Gignac (416) 847-2790; [email protected] Ovais Habib (416) 847-3406; [email protected] February 13, 2007

All values in C$ unless otherwise noted.

Current Price $1.43 Target Price (12-Month) $2.25 Target Return 57%

Changes Old New

Recomm. N/A Buy Target N/A $2.25

Company Profile Inter-Citic Minerals is a junior exploration Company with their own drill rigs, exploring and advancing the key Dachang property in NW China through strategic domestic relationships. The relationships provide access to an extensive technical database for possible new acquisitions as well as a depth of in-country experience and knowledge. N.I. 43-101 inferred resource of 1.5 M oz in two zones. www.inter-citic.com

Updated Chinese Resource Estimate Awaited; Initiating Coverage with $2.25 Target Price

• Updating qualified inferred resource with substantial increase likely. Work last year extended mineralized zones to at least 3.7 km (Dachang East), with additional zones to be drill-tested across the large project.

• Location, location, location. China’s prospectivity for large deposits and relatively low development and operating costs make it increasingly attractive for mining companies.

• New “Canadian” gold mine recently built in the same province. Eldorado Gold (ELD-T) commissioned a new US$50 million, 140,000 oz/yr gold mine about 350 km northwest of the Dachang Project.

• Buy Recommendation with Target Price of $2.25 per share. Well-financed junior gold explorer with good Chinese partners; valuation based on near-term potential for 3M-5 M ounces valued at US$25-$50/oz.

Financial Summary

Shares Out (mill) 61.0 52-Week Range $0.57 - $1.30Market Cap (mill) $75.0 Avg Weekly Volume 337,177Shares (FD mill) 71.8 Fiscal Year End Nov-30Working Capital (mill) $5.2 Book Value/Share $0.28Key Properties: Status:Dachang, China (83%) Three drilling seasons; $5.0 M program to delineate and expand

previous 1.5 million ounce inferred gold resource in two zones. Drill rigs owned by Inter-Citic; updated resource estimate pending. Option to increase to 90% interest.

Zaluntun, China (85%) Exploration deferred pending administrative resolutions. Option to increase interest to 90%.

Key Management: Key Shareholders (Est. Holding):James Moore President, CEO Asian Investors/Directors (14.8%)Garth Pierce VP Exploration Officers/Directors (15.2%)Lou Pasubio VP Finance, CFO

Source: Wellington West Capital Markets.

Price Chart

$0.00

$0.20

$0.40

$0.60

$0.80

$1.00

$1.20

$1.40

$1.60

Jan-

06Ma

r-06

May-0

6Ju

l-06

Sep-

06No

v-06

Jan-

07

Price

(C$)

0

500

1,000

1,500

2,000

2,500

3,000

Volu

me (

000)

Source: PC Quote.

Inter-Citic Minerals Inc.

Catherine Gignac (416) 847-2790; [email protected] February 13, 2007 – 2

INVESTMENT SUMMARY Inter-Citic Minerals is a gold explorer advancing the Dachang Project in northwestern China. An updated resource increase is anticipated to be released within the month, which will give an independent qualification and confirmation of the aggressive 2006 drilling, trenching and soil sampling programs. It will likely not include estimates for mineralization that may be associated with the five recently discovered new gold zones, nor the other 24 areas of known mineralization on the large property. Our one-year target price is based on the potential to delineate at least 3.0 million ounces of gold in the Dachang East area, with longer term upside to outline at least 5.0 million ounces gold.

The improving investment outlook for foreign mining companies in China, the proximity and development of a new mine by a foreign company and the long term business licence secured by Inter-Citic provide a unique opportunity for this junior gold explorer and the Company’s large prospective land package. We rate the shares Buy with a one-year target price of $2.25 per share.

INVESTMENT POSITIVES Aggressive drilling, trenching and sampling programs. The N.I. 43-101 inferred resource estimate of 1.5 million ounces outlined two years ago, in two zones on the Dachang property is being delineated and expanded. Last year’s program was successful in increasing the mineralized strike length to 3.7 km in the Dachang East area, with at least 30 known zones in total on the property.

Canadian drill rigs and crews. Inter-Citic owns two drill rigs and subcontracts through Canadian-based Cyr Drilling International Ltd. The Company’s Chinese partners and crews work closely with the Canadian drillers to improve productivity and efficiency of the programs – a unique technical advantage.

Chinese partners, shareholders and 27 year business licence. Inter-Citic Minerals has two joint ventures to explore for gold in China with the Qinghai Geological Survey Institute (QGSI) and the national Beijing Institute of Geology and Mineral Resources (BIGM). The relationships could provide access to an extensive technical database for potential acquisitions as well as a depth of in-country experience and knowledge.

INVESTMENT RISKS China - country risk. Despite the attractive low cost base and prospective resources, few foreign companies have been able to secure strong long-term business relationships in China. It is difficult for foreign companies to adapt to cultural and political differences and maintain a presence. Inter-Citic and key management have secured long-term local investors and joint venture relationships have enabled the Company to advance the Dachang Project with larger and more advanced programs in each of the last three years. This bodes well for acquiring future development permits for potential mine construction.



Technical Risk. The Dachang Project is located at a relatively high elevation averaging 4,500 metres, for which an experienced operating team will be required. Numerous mines operate at high elevations particularly in the high Andes of Chile and Peru. To-date there have not been any major interruptions or delays to their exploration programs due to the project’s location or accessibility.

Relatively unknown exploration company. Inter-Citic is a junior explorer with steady local investors, institutional and management holdings. The Company’s shares are relatively under-followed by Canadian brokers and investors reflecting the lack of awareness of the advancement of their exploration program. We believe this presents an opportunity for risk-oriented investors looking for gold exposure in China.

VALUATION SUMMARY Junior gold exploration valuation. Inter-Citic is a junior gold explorer that currently does not generate revenues. The valuation methods used herein focus on the Company’s potential to expand their current outlined resource, both in the short term and over a longer exploration and evaluation period. Further upside exists in drilling and delineating the numerous known gold anomalies and targets across the large prospective land package. Due to the location, the elevation and the potential scale of the project, an experienced operating partner could be appropriate to joint venture or acquire an interest in the Dachang Project. We use three methods determine a range of values for the Dachang Project of $1.21-$4.00, averaging $2.24 per share.

• Resource multiple applied to potential resource - $2.41 per share;

• Comparable transactions (current resource) - $2.18 per share;

• Average value of companies active in China - $1.62 per share.

The shares are rated BUY with a one-year target price of $2.25 per share.

Exhibit 1: Net Asset Valuation Summary

Total To ICI(000 oz) (000 oz) US$/oz US$000 C$ 000 C$/sh

Potential Dachang East Resource 3,024 2,510 U$25 U$62,747 $73,819 $1.21 @ US$25/oz Market Multiple 5,000 4,150 U$25 U$103,750 $122,059 $2.00


(2) Comparable Transactions 3,024 2,510 U$45 U$112,944 $132,875 $2.18

(3) Comparable Companies U$84,187 $99,043 $1.62

Average $136,592 $2.24

Potential Market Value

Source: WWCM Estimates.



DACHANG GOLD PROJECT, CHINA (83%) Inter-Citic is focused on expanding the known resource at the Dachang Project in Qinghai Province. Ownership is through a joint venture with the Qinghai Geological Survey Institute (QGSI), signed in November 2003. Inter-Citic holds a right of first refusal on any mineral exploration project in which QGSI may require foreign investment. Inter-Citic’s business licence was renewed late last year for an additional 27 years, extending to December 2033. The aggressive 2006 drilling program was aimed at updating and expanding the previous N.I. 43-101 inferred resource totaling 1.5 million ounces in two zones. Independent technical reports are filed on SEDAR (www.sedar.com), at March 2004 and December 2005.

The Dachang project covers 279 km2, at elevations of 4,400-4,600 metres. It is located approximately 165 km southeast of the city of Golmud, the supply centre for central Qinghai Province which has an airport, railway access, electric power and phone service. The world’s highest railway was opened in July 2006, starting at Golmud and heading into Tibet. Access from Golmud to Dachang is by paved and all-weather dirt roads, reportedly taking 4-5 hours to travel. Eldorado Gold’s new Tanjianshan (TJS) mine is located 350 km northwest of Dachang.

Exhibit 2: Dachang Location Map

Source: Inter-Citic Minerals.

The Dachang property is located on the northwestern end of a major, underexplored Triassic sedimentary basin, up to 1,000 km in length. Several major deposits are located along this trend, including Yulong, reportedly China’s largest copper deposit, and Lanping, the world’s third largest zinc/lead mine, according to Chinese sources.



Past work on the Dachang property was labour-intensive and not subject to modern exploration techniques. According to partner QGSI, placer mining for gold has occurred in the project area for over 200 years. Waste piles up to five metres in height are apparent. During the 1960’s and 1970’s, regional geochemical and geological databases were compiled. Silt and soil geochemical surveys were completed in the 1990’s, and from 2000-2003 QGSI completed more extensive geochemical and soil surveys, trenching, shallow shafts, plus some geophysical (induced polarization, electromagnetic) surveys and core drilling. At least seven large, regional scale anomalies were identified.

Best exploration tool is shallow trenches across large regional soil anomalies. Inter-Citic identified at least 30 major gold soil anomalies across the property. Cost-effective shallow trenches were dug across selected anomalies and returned >250 ppb gold over typically one metre intervals in almost all the trenches, as well as much higher intercepts of gold. Follow-up drilling below the trenches returned a very high “hit” rate. For example, 96 of the 101 drill holes completed in 2006 intercepted gold intervals. This demonstrates that the gold occurrences are shallow, and potentially amenable to open pit mining. Gold mineralization occurs in quartz veins and as free gold in sediments. Associated sulphide minerals include pyrite, arsenopyrite and sericite. Minor occurrences of silver, copper, lead and zinc are identified.

On the Dachang main exploration licence three northwest-southeast trending “corridors” are recognized. The property contains six regional-sized districts (North River, Western Quarter, Central, North, Southwest and East). A regional fault trending northwest and dipping to the east cuts through the sediments and volcanics on the property. Note the size of the property shown in Exhibit 3 from west to east is approximately 22 km.

Upon signing the joint venture, data compilation led to a March 2004 qualified inferred resource for Dachang East. The QGSI historical database was reviewed by consultant George Cargill for Inter-Citic in March 2004 with a resultant inferred resource estimated for the Dachang East of 5.71 million tonnes grading 7.0 g/t gold or 1.285 million ounces. This is the area that received the most attention by Inter-Citic in the years following.



Exhibit 3: Project Geology Showing Geochemical Gold Anomalies


Exploration in 2004 and 2005 totalled $5.6 million in expenditures. This included drilling, trenching, extensive mapping and soil geochemical surveys, magnetometer and time domain electromagnetic surveys. From September to December 2004, 7 trenches totaling 467 metres and 15 core holes totaling 3,623 metres were completed at Dachang East. From August to November 2005, 101 trenches totaling 23,710 metres and 22 core holes totaling 2,487 metres were completed at Dachang North.

Encouraging 2004-2005 trench and drill results. Trenching returned anomalous gold and consistent sections including: 4.59 g/t gold over 4.09 metres (North), 4.15 g/t over 3.3 m (Western), 3.52 g/t over 6.97 m (Central). Selected drill intersections from the North River area included 2.67 g/t over 17 m and 12.64 g/t over 2.20 m. The average of three intersections in the Central area was 3.88 g/t over 4.17 m.

N.I. 43-101 Dachang NR-2 inferred resource estimated in December 2005. This area in the northern portion of the licences was estimated, based on trenching and drill holes, to contain 1.28 million tonnes grading 5.81 g/t gold or containing 238,000 ounces. The mineralization was tested along an 800 metre strike length to an average depth of about 200 metres (open to west and at depth), with an average resource block thickness of 3.9 metres.



Encouraging but limited results led to a larger exploration program in 2006. Inter-Citic acquired two Canadian drill rigs to improve core recovery and productivity. The Company also started the field season earlier in the year – May 2006. The work was focused on Dachang East where mineralization was identified along a two km strike length, and the preliminary inferred resource estimate two years earlier totaled 1.3 million ounces. From May to December 2006, extensive trenching, drilling and geochemical sampling was completed. To-date Inter-Citic has completed 138 holes (116 at Dachang East) totaling 19,000 m of drilling.

Exhibit 4: Drilling and Trenching Summary at Dachang

Drill Holes Metres Trenches Metres

2004 (Sep-Dec) 15 3,623 7 467 2005 (Aug-Nov) 22 2,487 101 23,710 2006 (May-Dec) 101 15,300 175 14,300 Total 138 21,410 283 38,477


2006 drilling results consistent along 2.4 km. Gold was encountered in 96 of the 101 drill holes. Drilling extended the main zone by 25%. Most of the zone was drilled with 3-5 holes on lines spaced at 120 metres, with some sections drilled on 40 metre lines. Selected principal composites as reported in the Company’s press releases were calculated to average 4.12 g/t gold over 9.02 metres. This ranged from 0.80-20.41 g/t over intersections of 1.0 to 31.0 metres.

2006 trenching discovers five new mineralized zones. The cost-effective trenching used as an exploration tool has been very effective on the Dachang property. Last week, Inter-Citic reported the 2006 trenching results and the discovery of five new zones, three of which are at Dachang East:

• Placer Valley zone currently 720 metres of gold mineralization, located 600 metres southeast of the Dachang main zone; surface trenching results included 10.59 g/t over 7.5 m and 4.28 g/t over 17.0 m;

• DMZ Offset zone currently 360 metres in length, located beyond the eastern edge of the main zone; results included 2.40 g/t over 17.0 m and 7.35 g/t over 5.5 m;

• Little Ruby zone currently 200 metres in length, located 2.0 km northeast of the DMZ Offset; results included 5.11 g/t over 22.0 m and 3.18 g/t over 16.6 m;

• DC-8 in the Dachang Central area; results include 7.91 g/t over 12.5 m;

• DN-5 in the Dachang North area; results include 0.96 g/t over 9.5 m and 3.82 g/t over 1.10 metres.



Estimating potential strike length expansion at Dachang East. The exploration programs outlined above will be used to update the March 2004 Dachang East main zone inferred resource of 1.3 million ounces. Since then, the length of the zone has increased 20% to 2.4 km, and the depth of the zone by 30% to about 200 metres. The total strike length of mineralized zones identified in the Dachang East area is 3.68 km, including the 1.28 km from three new zones (Exhibit 4). These latter zones will likely not be drill-tested until later this year.

Exhibit 5: Proximity of New Gold Zones




We estimate near and long term potential for 3-5 million ounces. The average gold grade from principal intersections calculated from the 2006 drilling is about 4.5 g/t gold, and the average intercept width was approximately 9.0 metres. Using these variables implies a total of 19.3 million tonnes or 2.8 million ounces. By adding the inferred resource outlined in Dec. 2005 at Dachang North of 239,000 ounces, our near-term resource estimate for Inter-Citic is 3.0 million ounces. We believe there is good potential to expand the resource at depth and across untested areas of the property over the longer term, to approximately 5.0 million ounces.

Property potential suggests bringing in an operating partner. The Dachang property has mainly been explored at surface and across only a small portion of the prospective land package. Longer term upside for a 3-5 million ounce resource could justify open pit mining of 250,000-500,000 oz/year – a sizeable operation. Due to the location, the elevation and the potential scale of the project, an experienced operating partner could be appropriate to joint venture or acquire an interest in the Dachang Project. Likely candidates could range from Eldorado Gold, working in the same province, to GoldFields (GFI-N) or Newmont Mining (NEM-N), with equity holdings in China and open pit mining expertise.

OTHER EXPLORATION PROJECTS Inter-Citic is focusing their attention and resources at the Dachang Project, but also has an interest in the Zaluntun gold property. The 125 km2 Zaluntun gold property is an 85% joint-venture (with an option to increase to 90%) with the Beijing Institute of Geology for Mineral Resources located in Inner Mongolia. Due to administrative delays to organize the joint venture, the project is currently inactive, with Inter-Citic’s attention focused at Dachang.

The Zaluntun property is located in northeastern China in the same geological belt that hosts Ivanhoe Mines (IVN-T) Oyu Tolgoi copper/gold project in southern Mongolia. Porphyry copper/gold deposits have been identified immediately to the east and west of Zaluntun, including the Tuanjiegou deposit with an estimated 650,000 ounces grading 2-8 g/t gold and the copper/molybdenum Duobaoshan deposit.

The Project consists of four exploration licences encompassing three known gold anomalies. A regional mapping survey was completed by the Ministry of Geology and Minerals in the 1950’s, and in the 1980’s a regional silt sediment survey was done over the Zaluantun area, with limited follow-up mapping and sampling. The results were encouraging and indicate a favourable geological terrain for future exploration.



VALUATION Junior gold exploration valuation. Inter-Citic is a junior gold explorer that does not currently generate revenues. The valuation methods used herein focus on the Company’s potential to expand the current outlined resource, both in the short term and over a longer exploration and evaluation period. Further upside exists in drilling and delineating the numerous known gold anomalies and targets across the large prospective land package. Due to the location, the elevation and the potential scale of the project, an experienced operating partner could be appropriate to joint venture or acquire an interest in the Dachang Project. Three valuation methods indicate a range of values for the Dachang Project of $1.21-$4.00, averaging $2.24 per share.

• Resource multiple applied to potential resource - $2.41 per share;

• Comparable transactions (current resource) - $2.18 per share;

• Average value of companies active in China - $1.62 per share.

The shares are rated BUY with a one-year target price of $2.25 per share.

Exhibit 6: Net Asset Valuation Summary

Total To ICI(000 oz) (000 oz) US$/oz US$000 C$ 000 C$/sh



(2) Comparable Transactions 3,024 2,510 U$45 U$112,944 $132,875 $2.18

(3) Comparable Companies U$84,187 $99,043 $1.62

Average $136,592 $2.24

Potential Market Value

Source: WWCM Estimates.

Resource Market Multiple Fifteen selected companies working in China or Asia are shown in Exhibit 7, with a total enterprise value of US$3.0 billion and their respective measured, indicated and inferred resources. Based on the total mineralization, the average market value is US$81/oz resource. Excluding the three senior producers, the average value reduces to US$29/oz. Inter-Citic is currently trading at US$50/oz based only on the previous 1.5 million ounces of inferred resource outlined in 2004 and 2005. As shown in Exhibit 6 above, US$25-$50/oz is applied to our near-term estimate of 3.0 million ounces and longer term potential of 5.0 million ounces. This implies a potential trading value for Inter-Citic of $1.21-$4.00, averaging $2.41 per share.



Comparable Transactions In December 2006, Continental Minerals (KMK-V) completed a merger with joint venture partner Great China, in order to acquire 100% interest in the Xietongmen deposit, which contains a measured and indicated resource of 4.3 million ounces. The purchase of the remaining 40% interest in the project was made for 36.11 million shares of Continental Minerals valued at $2.15 per share or $77.6 million at the time of closing. This equates to US$38/oz resource.

Eldorado Gold (ELD-T) acquired Afcan Minerals in September 2005 which held a majority interest in the TJS with contained measured, indicated and inferred resource of 1.4 million ounces. Afcan was acquired by issuing 23.05 million Eldorado shares valued at the time at $3.70 per share or $85.3 million in total. This equates to US$52/oz resource.

The average of the two transactions is US$45/oz. The multiple is in line with other companies’ current valuations. Applying this market multiple to our estimate of 3.0 million ounces implies a potential market value of $2.18/share.

Comparable Companies There are a growing number of North American and Australian producers and explorers forming joint ventures and exploring in China. Selected mining companies with most of their assets in China are listed in Exhibit 7. Their assets include gold, silver and base metal mines and projects. Excluding the three largest companies, the average enterprise value is US$83.50 million or US$40/ounce. Presuming this is representative of what the market will pay for a foreign mining company active in China, applying a similar value to Inter-Citic projected resource of 3 million ounces implies a market value of $1.61/share. Details on some of these companies follows, including a map showing their principal project locations in China - Exhibit 8.

Eldorado Gold (ELD-T) recently started production at the Tanjianshan gold mine (90% interest), in the same province as Inter-Citic Minerals’ Dachang Project. The company expects to recover about 130,000 ounces in the first full year of operation, rising to 155,000 oz in 2008. Operating costs are forecast by management to average US$250/oz over the eleven year mine life. Capital costs to develop the open pit, conventional leach operation were only US$63.4 million. The market value shown in Exhibit 7 of US$320 million is 15% of the current corporate enterprise value. This is the average of the reserve, resource and estimated profit contribution of their China interest (the TJS mine) to the company.

Australian-listed Sino Gold Ltd. (SGX-ASX) has the Jinfeng mine which is their flagship project. The mine is on track to produce 180,000 ounces of gold for 2007. Underground mining is accessing deeper high grade material, and a second mine is being evaluated. Sino Gold appears to have a market value more related to their exploration potential and future throughput upside, rather than the current production. The Company holds a large land package not dissimilar in targets to Inter-Citic’s, with the potential for multi-million ounce deposits. GoldFields Ltd. (GFI-N) holds a 14% equity interest in Sino Gold.



The market value for Ivanhoe Mines (IVN-T) is attributed to their world-class sized Oyu Tolgoi copper/gold project in southern Mongolia, just north of the Chinese border. Ivanhoe has strategic relationships and holds equity interests in several Canadian companies actively exploring and developing in China. The most advanced is Jinshan Mines (JIN-T), which is looking at a mid-2007 startup at 117,000 oz for their Chang Shan Hao (CSH 217) mine in Inner Mongolia. Cash costs for the open pit operation are forecast to average US$253/oz over the nine year mine life. At a 5% discount rate and US$600/oz gold, the consultants project a net present value of US$212 million, with modest initial capital costs.

One of the earliest junior Canadian companies active in China has been Southwestern Resources (SWG-T). The Company’s Boka deposit in southern Yunnan Province was the subject of much speculation by market observers since October 2002. The company has spent about $40 million and announced in late 2006, a measured and indicated resource of 31.2 million tonnes grading 3.05 g/t gold or 3.1 million ounces. Newmont Mining (NEM-N) holds an equity interest in Southwestern, and is a joint venture partner at the Liam project in Peru.

Mundoro Mining Inc. (MUN-T) has a joint venture to explore in China, and plans to expand resources outlined by their Chinese partners. Mundoro’s interest is about 4.4 million ounces. A 2005 pre-feasibility study for Zone 1 estimated annual output of 328,000 ounces over an eight year mine life. Mundoro’s stock has been negatively impacted by the Company’s difficulty in renewing their business license.

Exhibit 7: Comparable Resource Market Multiples

Company Price EV (US$ 000) "Resource"* EV/Ounce

Eldorado Gold ELD.T $6.94 $314,310 1,427 $220Sino Gold Corporation SIOGF.O U$5.60 $864,360 3,900 $222Silvercorp Metals SVM.T $19.00 $735,549 1,620 $454Southwestern Resources SWG.T $7.38 $248,477 3,510 $71Jinshan Gold Mines JIN.T $1.79 $230,080 3,380 $68Continental Minerals KMK.V $1.62 $131,819 4,310 $31Gobimin Inc. GMN.T $2.15 $125,539 -- -- Inter-Citic Minerals ICI.T $1.43 $70,637 1,538 $46Minco Silver MSV.T $2.75 $55,005 1,882 $29Minco Mining & Metals MMM.T $1.73 $47,490 2,900 $16Mundoro Mining MUN.T $1.66 $42,910 9,200 $5Silk Road Resources SIL.V $1.06 $19,364 -- -- Dynasty Gold Corporation DYG.V $0.28 $15,486 274 $57Sparton Resources SRI.V $0.25 $10,863 -- -- Asia Now Resources NOW.V $0.22 $4,518 -- --

Average $194,427 $111Average (excluding producers) $83,516 $40

Source: PC Quote, Company Reports, Eldorado EV China only.



Exhibit 8: Project Locations in China

Minco Mining:Gobi Project

2. BYC ProjectMinco Mining:

White Silver Mountain ProjectAniba Project

Yangshan Project

Minco Mining:Changkeng Project

Southwestern Resources:Boka Project

2. Boka Project

Sino Gold:Sanijianfang Project

Dong'an Project

Sino Gold:White Mountain

Project

Sino Gold:Shandong Project

Sino Gold:Jianchaling

Project

Sino Gold:Jinfeng Mine

Silk Road:Bulagou ProjectLaerma ProjectXiahe Project

Jinshan:Dadiangou Project

Jinshan:Chang Shan Hao

Project

Continental Minerals Corp:

Xietongmen Project

Mundoro Mining:Maoling Project

Inter-Citic:Zalantun Project

Inter-Citic:Dachang Project

Eldorado:Tanjianshan Mine Eldorado Gold:

Shandong Project

Georgia Ventures:Towerstone Copper Project

Bogutu Project

Gobimin:Xinjiangshan Mine

Source: Company Reports, Wellington West Capital Markets.

CORPORATE AND FINANCIAL

Inter-Citic Minerals has been focused on gold exploration since late 2003. The Company entered into the Dachang joint venture agreement with the QGSI in November 2003. The Company has successfully raised $11.8 million in private placements and warrant and option exercise from 2003-2005. The Company currently has $4.7 million in working capital, no long term debt, and a book value of $17.0 million or $0.28 per share. There are 3.7 million options outstanding, at an average exercise price of about $0.090, plus 7.2 million share purchase warrants which combined could bring in a total of approximately $11.9 million to the Company. Inter-Citic is sufficiently financed for their next stage of exploration at Dachang, however, the Company will likely require additional funds for future programs. These may be sourced through equity placements and/or through industry participation through option or joint venture.

Positive Chinese shareholdings. James Moore, President and CEO, has worked to build Inter-Citic’s presence and relationships in China for almost ten years, most recently with Lou Pasubio, CFO. Several investment groups and families



have held equity investments in Inter-Citic for several years including the Ho Family of Hong Kong and Macau, owners of the Tai Fung Bank of Macao (www.taifungbank.com) in partnership with the Bank of China; the Lee Family of Hong Kong, involved with the Henderson Land Group of Companies (www.hld.com); the Hong Family of Taiwan and the Xu Family of Shanghai.

Technical ability and Advisory Board. Inter-Citic acquired two drill rigs and subcontracts drilling from Cyr Drilling of Winnipeg giving Inter-Citic the ability to leverage local Chinese drillers’ efficiency. The creation of an Advisory Board for the Company brings technical, political and international financial experience for management and the board.

Officers and Directors (Date Appointed Director) James Moore, President, CEO, Director (1997): Financier with 13 years

experience in emerging markets, including the last ten years in China. He has worked closely with the investor groups and developed important relationships within the mineral industry in China.

Lou Pasubio, C.A., VP Finance and CFO: Mr. Pasubio has been with Inter-Citic for five years and is the responsible for the joint venture contracts and management of all business affairs with partners and suppliers.

Garth Pearce, VP Exploration: Over 30 years of global exploration and project management experience including 17 years with Hemlo Gold Mines (Noranda). Mr. Pierce has also managed advanced gold projects in the United States and Norway.

Stephen Lautens, VP Corporate Communications, Corporate Secretary, and General Counsel: Over 25 years legal, investor relations and media communications experience. In 1997 he served as president of Toronto's prestigious Lawyers Club. Prior to the practice of law, Mr. Lautens worked for two years as a Special Assistant to a federal Cabinet Minister in Ottawa, Canada.

Mark Frederick, Chairman (1997): Lawyer with Miller Thomson, a Canadian-based law firm, specializing in commercial litigation, insurance and mining law. He has appeared before the Ontario Mining Commissioner on numerous occasions, as well as in all levels of Ontario and British Columbia courts.

Scott Dorey, Director (2003): VP and investment banker with Lehman Brothers. Prior to joining Lehman Brothers, Mr. Dorey was a corporate lawyer at the Wall Street firm, Paul Weiss Rifkind Wharton & Garrison.

Adrian Pedro Ho, Director (2004): Investment banker with Kuentai Investors Limited, a Hong Kong based company. Mr. Ho is also currently the Director of a Hong Kong based medical products distribution company.



Carlos Ho, Director (2002): Since 2000, Mr. Carlos Ho has been an executive director in Kuentai Securities (Kam Ngan) Company Ltd., a member of the Stock Exchange of Hong Kong.

Sherman Hong, Director (2002): Industrialist in Taipei.

Abe Schwartz, Director (2004): President, CEO, Director of Cedara Software. Over 25 years experience in building and managing companies, including Polaris Technology and Schwartz Technologies.

Peter Tang, Director (1993): Mr. Tang has over 25 years experience with Pricewaterhouse Coopers, focused on mining companies. Mr. Tang has been a controller with SSAB Swedish Steel Ltd. (formerly Q & T Plate Sales Ltd.) since 1989 and as a company director since 1998.

Rick Van Nieuwenhuyse, Director (2004): President, CEO of NovaGold Resources Inc. (NG-T). Previously VP Exploration for Placer Dome Inc. Also a director of Alexco Resource Corp, Etruscan Resources Inc. and Ivana Ventures Inc.

Advisory Board: Harry Burgess, P.Eng: Professional mining and mechanical engineer with over

30 years experience in international mining operations in China, Africa, North America and Australia. VP of Micon International Limited, well-regarded international mining industry consultants.

Chris Hodgson: Ontario provincial cabinet minister since 1994, including holding positions as Minister of Natural Resources and Northern Development and Mines; and Minister of Municipal Affairs and Housing. Previously Chairman of the Management Board of Cabinet and Deputy House Leader.

Rene Jackman: Senior gold metallurgist with SGS Lakefield, with over 20 years international mining experience.

Dr. Henry Jarecki: Founder of Mocatta Metals, bullion dealer. Chairman of Falconwood Corporation, past Director of the National Futures Association and Director of the Commodity Exchange (COMEX), the Chicago Board of Trade, and the Futures Industry Association.

Don McKinnon: Over 40 years of mineral exploration, prospecting and mine discovery experience, including the Hemlo gold camp. Mr. McKinnon received the Order of Canada in 1996 and the Queen’s Golden Jubilee Medal in 2002.

Rt. Hon. John Turner: Lawyer and former Prime Minister of Canada and member of House of Commons for 25 years. Director with Empire Life Insurance, the Dominion of Canada General Insurance Company, Northland Power Income Fund and Q9 Networks Inc.



CHINA Gold production rising in China, falling in major producing countries. Over the last ten years, gold output from the largest gold producers (South Africa, United States, Australia and Canada) fell 26.5% to 939 tonnes. In the same period, Chinese production rose 41.4% to 224 tonnes. China hosts large mineral deposits but these resources were relatively undeveloped. The historical lack of western economics and availability of capital markets restricted the size of the domestic mining industry, to mainly smaller, discrete operations. Changing rules, the continuation of a fast-growing economy and improved opportunities for foreign-domestic partnerships indicates that the investment climate is improving.

Exhibit 9: Selected Gold Producing Countries (Tonnes)

1996 2005 Chg.

China 159 224 41.4%

South Africa 495 296USA 329 262Canada 165 119Australia 290 263Total 1,278 939 -26.5%

China as % of Other 12.4% 23.9%

Source: GoldFields Mineral Services.

China’s Gross Domestic Product (GDP) has grown at an average annual rate of 10% since 2002. According to the International Monetary Fund’s World Economic Outlook, the next two years are forecast to continue to outpace the North American and world economies. The country has the largest population in the world. China’s relatively young population of 1.3 billion people is well-educated and includes study of the English language. The growing middle class is fuelling domestic demand. There are approximately 300 million Chinese entering the workforce each year. Canada has a population of 33.1 million or only 3% that of China. The need for job creation motivated the government to encourage private enterprise, while minimizing the role of State Owned Enterprises (SOE) in the economy.

Exhibit 10: GDP Annual Percentage Change (Y-O-Y)

2004 2005 2006e 2007e

China 10.1 10.2 10.0 10.0Canada 3.3 2.9 3.1 3.0United States 3.9 3.2 3.4 2.9World 5.3 4.9 5.1 4.9

Source: International Monetary Fund, September 2006.



China became part of the World Trade Organization in 2001. This was an important catalyst for the Country’s successive capture of a large portion of global investment. China is one of the largest consumers of most major commodities, and the third largest importer in the world. Capital infrastructure projects continue at an unprecedented pace, including extensive roads and railways in western China. The Qinghai-Tibet railway is the world’s highest, running almost 2,000 km from the capital of Qinghai to Llasa. The Three Gorges Dam is the world’s most powerful hydroelectric project. China is preparing to host the 2008 Olympics and the 2010 World Expo.

Business relationships are specifically important in China, to move through the legal system in a trustworthy and thus expeditious process. Since 2002, mining companies are able to sell their gold, and foreign companies are able to repatriate profits, from China. Exploration licences are renewable and held for a maximum of three years. Positive legal reforms to encourage foreign investment have occurred in recent years.

China is becoming wealthy and prosperous. Dramatic stimulating measures taken by the Country’s leaders strengthened the economy to the point of envy of the world. It appears most economists are wary of a large forthcoming “collapse”. Rising and increasingly sophisticated industrial production is contributing to higher household incomes. This is propelling internal consumption and demand.

China has the third largest land area in the world. China has 23 provinces (including Taiwan), five autonomous regions, four municipalities and two Special Administrative Regions (Hong Kong and Macau). The more populous eastern and southern regions are at low elevation, whereas the more rural western region includes the mountainous Himalayas in the southwest. Three major river systems start in Qinghai province, including the Yangtze, Yellow, and Mekong.

Exhibit 11: Map of China

Source: CIA World Factbook.



Disclaimers

The particulars contained herein were obtained from sources that we believe to be reliable, but are not guaranteed by us and may be incomplete or inaccurate. The opinions expressed are based upon our analysis and interpretation of these particulars and are not to be construed as a solicitation of offer to buy or sell the securities mentioned herein. Wellington West Capital Markets Inc. (“WWCM”) may act as financial advisor, fiscal agent or underwriter for certain of the companies mentioned herein, and may receive remuneration for its services. WWCM and/or its principals, officers, directors, representatives, and associates may have a position in the securities mentioned herein and may make purchases and/or sales of these securities from time to time in the open market or otherwise. This report may not be reproduced in whole or in part, or further distributed or published or referred to in any manner whatsoever nor may the information, opinions or conclusions contained herein be referred to without in each case the prior written consent of WWCM.

U.S. Institutions may conduct business through our affiliate Wellington West Capital Markets (USA) Inc. Wellington West Capital Markets (USA) Inc. accepts the contents of this research report, however, the company that prepared this report may not be subject to U.S. rules regarding the preparation of research reports and the independence of research analysts.

This report will be forwarded to our affiliate Wellington West Capital Inc. (“WWCI”). Subject to WWCI management review and approval, this report may be distributed to clients of WWCI. WWCI and WWCM are members of the Canadian Investor Protection Fund (“CIPF”).

Wellington West Capital Markets Stock Rating System The rating system is based on the stock’s expected absolute total return over the next 12 months. Generally, Strong Buy rating is expected to produce a total return of 25% or more, Buy a total return of 10% to 25%, Market Perform a total return of 0% to 10% and Underperform a negative total return. Speculative Buy rating is expected to produce a total return of 25% or more, but is based on factors and forecasts that have high degrees of uncertainty. The distribution of the recommendations for the last three-month period and their relationship with investment banking business are available on request by emailing to [email protected].

Analyst Compensation Research analysts receive compensation based on a number of factors as determined by WWCM’s management. Compensation is affected by all of the firm’s business activities, including revenue generated from capital markets and investment banking. No part of the compensation of the analyst who authored this report is based on the specific recommendation or views expressed in this report.



Analyst Trading WWCM permits analysts to own and trade in the securities and/or derivatives of those companies under their coverage, subject to the following restrictions: no trades can be executed in anticipation of the initiation of coverage; no trades can be executed for five days after dissemination of launching coverage or a material change in recommendation; and no trades can be executed against an analyst’s recommendation. Exceptions require prior approval of the Head of Research and can only be executed for a reason unrelated to the outlook of the stock.

Dissemination of Research WWCM endeavors to make all reasonable efforts to provide research, simultaneously and electronically to all eligible clients and potential clients.

Company Name Ticker Symbol Applicable Disclosure Inter-Citic Minerals Inc. ICI-TSX 2

Applicable Disclosure Details 1) In the last 12 months, WWCM, or its affiliates, have managed or co-managed

an offering of securities by the subject issuer. 2) In the last 12 months, WWCM, or its affiliates, have received compensation

for investment banking and related services from the subject issuer. 3) The research analyst or a member of the research analyst’s household, or any

associate or individual preparing the report, has a long position in the shares and/or the options of the subject issuer.

4) The research analyst or a member of the research’s household, or any associate or individual preparing the report, has a short position in the shares and/or the options of the subject issuer.

5) WWCM or its affiliates is a market maker, or is associated with the specialist that makes a market in the securities of the subject issuer.

6) WWCM or its affiliates own more than 1% of any class of common equity of the subject issuer.

7) WWCM has a conflict of interest with the subject issuer. 8) The research analyst(s) has a conflict of interest with the subject issuer. 9) Over the last 12 months, the research analyst has received compensation based

on a specific investment banking transaction relative to the subject issuer. 10) The research analyst or a member of the research analyst’s household serves as

a Director or Officer or Advisory Board Member of the subject issuer. 11) The research analyst(s) has viewed the material operations of the issuer. 12) A portion of the travel expenses of the analyst were paid or reimbursed by

the issuer.

Analyst Certification Each analyst of WWCM whose name appears in this research report hereby certifies that (i) the recommendations and opinions expressed in the research report accurately reflect the research analyst’s personal views about any and all of the securities or issuers discussed herein that are within the analyst’s coverage universe and (ii) no part of the research analyst’s compensation was, is, or will be, directly or indirectly related to the provision of specific recommendations or views expressed by the research analyst in the research report

Documents

Inter-Citic Minerals Inc. (ICI-TSX, C$1.43) · Catherine Gignac (416) 847-2790; [email protected] February 13, 2007 – 2 INVESTMENT SUMMARY Inter-Citic Minerals is a gold explorer