ASX/ MEDIA RELEASE                                                                               07 JULY 2008

MONARCH ADVANCES WITH $30M GO FORWARD FUNDING

Monarch Gold Mining Company (ASX /DIFX:MON) is pleased to announce a clear go forward funding package has been put in place to underpin the operations of the Mount Ida and Mount Magnet gold projects.

As part of the funding package, the Board of Monarch will undertake a $25 million capital raising at 25 cents per share with a one-for-one attaching free 25 cent option. As part of the $25 million raising, the founding Chairman and major shareholder Michael Kiernan?s family will provide an interest free $15 million loan which subject to shareholder approval will be converted to equity on the same terms of the capital raising.  The balance of the capital raising of $10 million will be underwritten, at no cost, by the Kiernan family.

In addition, Monarch expects to raise $5 million from the sale of the Minjar gold asset.

Monarch Managing Director Michael Kiernan thanked all shareholders for their ongoing commitment to the Company.

?Recent times have proved to be difficult for Monarch, and on behalf of the Board, I?d like to express our thanks and gratitude for the people who have supported our company. Securing a significant funding package is a serious achievement for shareholders and we look forward to operating our two gold projects ? Mt Ida and Mt Magnet ? in the robust gold market of the future,? Mr Kiernan said.

?Following an equity placement, Harmony Gold Mining Company ? from which Monarch acquired the Mt Magnet Gold Project - will retain a 23 % interest in Monarch. It is testament to the quality of Monarch?s management, gold assets and strength of the gold market that a company the size of Harmony will retain a large shareholding in Monarch.?

Mt Ida Gold Project

Going forward, Monarch expects Mt Ida to produce 50,000 oz per year, at an average grade of 16g/t, with projected cash costs below AUD$500.  

Over the next 12 months, it is proposed to sink another shaft (at an approximate cost of $5 million) to increase the annual production to a projected 75,000 ounces per year. Monarch plans to treat the Mt Ida ore at a third party?s plant.

Mt Magnet Gold Project

Since taking over the Project, Monarch has identified 30 prime targets, optimised 23 and prioritised seven for a closer geological analysis. All targets are based on open pit models.

Monarch plan to recommence operations mid 2009 to produce 100,000oz per year with a projected cash cost below AUD$600..

A break down of the revised transaction terms as agreed with Harmony are set out below:

Cash deposit (paid)                                                                   $5 million

Settlement payment (following shareholder approval)                  $10 million

Deferred payment (three years)                                                  $10 million

Monarch equity (100 m shares at 25 cents)                                 $25 million

3 year 5% convertible note (convertible at 25 cents)                    $15 million

                                                                                                $65 million

A shareholder?s meeting is proposed to be held at the end of August to ratify the share issue and capital raising. In addition, shareholders will be asked to approve the acquisition of the Mount Magnet Project, the issue of shares to Harmony and the Kiernan family.

Monarch?s securities will remain suspended until after the meeting of shareholders.

For further information, please contact:

Michael Kiernan                                                                                               Warrick Hazeldine

Managing Director - Monarch Gold                                           Purple Communications

Tel: +61 8 9324 7002                                                                 Tel: +61 (0)8 9485 1254

Mob: 0417 944 616       

So far as it relates to ore and mineralisation, this report is based on information compiled by John Davis, who is a Member of the Australian Institute of Mining and Metallurgy and the Australian Institute of Geoscientist. Mr Davis has sufficient experience which is relevant to the style of the mineralisation and type of deposit under consideration and to the activity which he is undertaking, to quality as a Competent Persons as defined in the 2004 Edition of the Australasian Code for Reporting for Exploration Results, Minerals Resources and Ore Reserves. Mr Davis is a full time employee of the Company. This report accurately reflects the information complied by Mr Davis. Mr Davis has consented to the inclusion of this information in the form and context in which is appears in this report.

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Issued by

Purple Communications

Level 3, 28 Kings Park Road, WEST PERTH WA 6005

Ph: 08 9485 1254     Fax: 08 6263 0455

purple@purplecom.com.au