Majors Creek Project

The Majors Creek Project 100% CRC (EL6003, EL6462, EL6548 and ML103) is located 60km southeast of Canberra and 16km south of Braidwood in the southern tableland region of NSW. The project area, positioned in the eastern most section of the Lachlan Fold Belt, covers a significant portion of the Majors Creek Goldfield, the largest historical alluvial goldfield in New South Wales, with historic production of 1.25Moz.

The Dargues Reef underground mine, the principal exploration target, was mined between 1870-91 and 1914-16 with numerous shafts to a maximum depth of 70m. The high grade structurally controlled primary gold mineralisation at Dargues Reef discovered in the “roof zone” of the prospective Braidwood granodiorite host rock represents one of the potential sources of the regions extensive alluvial gold deposits.

The region contains numerous historic hard rock mines displaying typical ore grades ranging from ¼ to 4ozs. The majority of reef gold deposits in the Majors Creek area occur within or in close proximity to the western margin of the Braidwood granodiorite. Mineralisation appears to be developed close to the roof margin of the intrusion. Gold mineralisation, usually in the form of free gold, is often contained within altered hydrothermally generated quartz-sericite-calcite-pyrite mineralised lodes displaying pyritic overprinting and occasional quartz/calcite veining. Gold is frequently associated with sulphides and the higher grade mineralisation (+1oz/t) is usually restricted to discrete shoots, between 5 and 10 metres wide, surrounded by a lower grade envelope.

Drilled intercepts include contained sectional grades of up to 25g/t Au over widths of 3m. Interpretation of the data indicates an extensive greenschist facies orogenic multi-lode system ranging from 20m to 55m true thickness comprising high-grade gold bearing lodes that remain open not only at depth but also along strike.

Gold mineralisation at Dargues Reef occurs as steeply dipping, fracture controlled lode systems within zones of intense alteration within the host Braidwood Granodiorite. The lodes follow a well developed fracture system adjacent to two dolerite dykes. The two main lodes thicken where they intersect creating a broad steep easterly plunging ore shoot. Several smaller lodes have also been intersected in the adjacent wall rocks and potential for duplication of similar shoot convergence also presents as a possibility.

Historic diamond drill results include the following intersections:

• 24m @ 7.9g/t Au in DREX007 from 148m
• 70.2m @ 2.7g/t Au in DREX028 from 300m
• 77m @ 3.6g/t Au in DREX027 from 212m

The Indicated and Inferred resource (JORC compliant) at Dargues Reef currently stands at

• 1,444,000t @ 6.2g/t Au for 286,000oz Au (>2g/t cut-off).

Recent drill results east of Dargues Reef, below Plums, reveal new highly anomalous zones that may represent a duplication of the high-grade lodes intersected under Dargues. The latest drill result, 100m below and 125m east of the Dargues resource envelope returned a significent intersection.

• 28.7m @ 5.88g/t Au from 195.5m in DREX119
    including 10.5m @ 8.17g/t Au and 11.2m @ 6.98g/t Au

Indicating the potential to significantly increase the recently announced up-graded resource estimate. Cortona have focused on confirming shallow, near surface mineralisation during the year and recently (October 2008) up-graded the known resource by almost doubling the grade from 3.4g/t Au to 6.2g/t Au.

An on going diamond/RC drill programme, budgeted at $2M, commenced last year. Significant results from diamond drilling during the period returning the following intersections:

• 13m @ 5.53g/t Au and 12m @ 6.27g/t Au in DREX040.
• 9m @ 6.63g/t Au and 4m @ 7.01g/t Au in DREX039.
• 16m @ 3.38g/t Au and 4m @ 7.04g/t Au in DREX038.
• 2m @ 7.40g/t Au and 5m @ 3.75g/t Au in DREX041.
• 3.2m @ 15.4g/t Au, 3m @ 8.87g/t Au, 3.5m @ 18.7g/t Au, 1.5m @ 15.8g/t Au in DREX042.
• 13m @ 8.33g/t Ai in DREX043.
• 8.2m @ 5.2g/tAu in DREX083.
• 11m @ 7.2g/t Au in DREX085.

During 2008 RC drilling targeting the top 150m with the objective of extending the existing resource further east and increasing the ounces per vertical metre. Recent drilling (DREX119) has confirmed the eastern lode extensions at Plums, and RC drilling during the year has returned the following significant intersections (only intercepts >15gram-metres quoted).

• 3m @ 8.87g/t Au and 7m @ 2.90g/t Au in DREX048.
• 16m @ 11.0g/t Au in DREX050.
• 2m @ 8.55g/t Au in DREX051.
• 5m @ 16.2g/t Au in DREX054.
• 10m @ 7.64g/t and 7m @ 7.25g/t Au in DREX059.
• 12m @ 6.80g/t Au in DREX071.
• 6m @ 9.9g/t Au in DREX079.
• 7m @ 6.44g/t Au and 5m @ 9.94g/t Au in DREX094.
• 14m @ 8.11g/t in DREX095.
• 7m @ 10g/t Au and 4m @ 10.8g/t Au and 3m @ 6.2g/t Au in DREX100.
• 4m @ 10.3g/t Au in DREX102.
• 17m @ 6.34 g/t Au and 8m 3.40g/t Au in DREX106.

Cortona are now targeting a 500,000oz resource at Dargues Reef.

Mining scoping studies commenced in March 2008 with initial metallurgical test work on a typical mineralised section of Main lode, with encouraging results. The scoping evaluation process will include metallurgical studies, flow sheets analysis, design criteria, mining method, mining rate and operating costing. A preliminary economic assessment is now underway as the basis for a full Feasibility Study. The gold deposit is at a ’mid’ stage of appraisal and geological analysis remains ongoing, nonetheless, Dargues Reef is shaping up to represent a substantial gold resource with grades, widths and near vertical orientation of the lodes suggesting that they would be eminently suitable for underground mining.

Cortona now control unfettered access to all areas within the Dargues mining lease following the purchase of 319Ha of freehold farmland. The land acquisition will allow greater flexibility for infrastructure planning and the ability to target the resource with precise rig positioning.

Exploration of Dargues Reef and the surrounding Majors Creek project area continues with several exploration programs currently being planned to advance identified prospective targets.

The Majors Creek project has been actively explored in recent years including regional geological mapping, rock chip sampling programs, diamond drilling, extensive soil geochemistry programs as well as compilation of a comprehensive heli-magnetic survey, gravity surveys, downhole induced polarisation and remote sensing imagery. Several structural repetitions displaying similar characteristics to Dargues Reef were highlighted in the recent exploration phase. Data interpretation presents numerous exploration targets outside the immediate Dargues Reef area (see aeromagnetic image).

A regional target such as Exeter Farm, which displays a chargeability anomaly and an extensive mineralised alteration zone, presents a follow up drill target. Together with Copper Ridge, a line of historic workings that have never been drill tested, which recently returned significant gold and silver rock chip values peaking at 5.7 g/t Au and 185g/t Ag. In addition numerous other primary gold anomalies have been identified from regional soil sampling, mapping and rock chip assays within 3km of Dargues Reef..

Recent drilling at Exeter Farm (Tory Boy prospect), 2km North of Dargues, returned a significant intersection from the first hole drilled into the new prospect. EXEX007 returned 19m @ 5.6g/t Au from 47m including 2m @ 1.3% Cu from 55m and 2m @ 5.0g/t Au from 71m within a broader mineralized envelope of 37m @ 3.32g/t Au from 43m. The mineralisation and alteration is reminiscent of the ore zones identified at Dargues Reef.

An additional 16 drillholes targeted four of the eight selected targets at Exeter Farm during the first quarter of 2008 for an advance of 1,885m. The drilling intersected numerous broad, low grade gold intercepts including 31m@ 0.46g/t Au (EXEX021), 9m @ 1.92g/t Au (EXEX014), 12m @ 0.26g/t Au (EXEX016) and 12m @ 0.24g/t Au (EXEX012). The intersections confirm a large gold mineralising system displaying similar alteration characteristics and mineralisation widths to Dargues Reef. Further exploration drilling at Exeter Farm and Copper Ridge is planned for later this year following a geological review aimed at identifying the structural controls on the distribution of the higher gold grades.

Although exploration at Exeter Farm is at an early stage the discovery of a broad Dargues Reef style lode, close to surface, is viewed as very encouraging and CRC intend to increase its level of regional exploration activity by further investigate the mineralisation potential of not only Exeter Farm and Copper Ridge but also the immediate area surrounding the Dargues Reef deposit .

The Majors Creek project presents numerous exploration targets in a historic goldfield that to this day remains under explored. Cortona are extremely positive with the results received to date and believe that the project hosts areas that will eventually reveal considerable wealth.