Cortona Resources Limited : Deutsche Bank $42M Credit Approved Commitment 28.03.2012

15 October 2010

ASX/Media Release - 28 March 2012

Credit Approved Commitment for $42M Financing Package received from Deutsche Bank Construction set to start by year-end, with first production scheduled in 2013 Key Points:

• Deutsche Bank provides credit approved commitment for

A$42M financing package

• Overall development financing package targeted for completion in Q3 2012, with development planned to follow soon thereafter

Australian gold company Cortona Resources Limited (ASX: CRC) is pleased to advise that it is on track to begin development of its flagship Dargues Reef Gold Project in NSW, having signed a credit approved commitment letter with Deutsche Bank AG ("Deutsche Bank"), Sydney Branch, in respect of an A$42 million financing package to underpin project construction.
This important milestone follows extensive due diligence conducted by Deutsche Bank since it was mandated to provide the financing package in August last year, as well as the receipt of key State and Federal environmental approvals for the Dargues Reef Gold Project last month.
The financing package remains subject to a number of conditions precedent customary for financing arrangements of this nature, including final regulatory approval for the transport of gold concentrate off-site to the mothballed London Victoria treatment plant located at Parkes. Cortona will operate this plant, which is now on care and maintenance, but was previously owned and operated by BHP Billiton.
The Dargues Reef Gold Project, which is located near Braidwood approximately 60km south-east of Canberra in NSW, is expected to be one of the few Australian gold projects which this year will move from feasibility to development, and into production next year.

COMPANY DETAILS Principal and Registered Office

Cortona R esources Limited Level 5, 72 Kings Park R oad W est Perth, W A 6005

Postal Address

PO Box 86, W est Perth W A 6872

Website

www.cort onaresources.com.au

Email

admin@cort onar esources.com. au

Phone

[phone]

Facsimile

[phone]

ABN: 98 117 848 790 ASX CODE: CRC Corporate Information

(29 February 2012)

Shareholders ~2,300

Shares on Issue 221M Options (Unlisted) 17M

PROJECTS Majors Creek (NSW) Eugowra (NSW) Christmas Gift (NSW) Booths Reward (NSW)

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Cortona's Managing Director, Peter van der Borgh, said receipt of the commitment from Deutsche Bank represented a key milestone for the Company, effectively laying the foundations for completing the overall financing package and the commencement of mine development and construction.
"This key development should enable us to move ahead with completion of an overall debt and equity financing package." Mr van der Borgh commented.
The timetable to production for the Dargues Reef Gold Project is now forecast to be:
• Receipt of Environmental Protection License - Q2 2012
• Grant of Mining Lease by NSW State Government - Q2 2012
• Council approval for transportation of gold concentrate off-site to Parkes - Q2 2012
• Approval to utilise paste-fill in underground mine - Q2/Q3 2012
• Completion of overall project financing package - Q3 2012
• Commencement of construction - Q4 2012
The Dargues Reef Gold Project will be an underground mine feeding a 330,000tpa on-site plant, with forecast production ramping up to a peak rate of ~65,000oz per annum, and averaging 50,000ozpa over the life of mine, at a forecast C1 unit cash operating cost of A$697/oz. This operating cost includes a 10 per cent contingency.
The mine is forecast to generate free cash flow of ~A$125 million over its initial 6-year mine life, using a gold price of A$1,550 per ounce. The robust economics of the project are underpinned by the high grade of the deposit, which has an undiluted grade of 7.25g/t Au.
Ore will undergo crushing and grinding at the Dargues Reef site, with 50 per cent of the gold recovered via gravity methods on site and the balance recovered from a pyrite-gold concentrate (grading ~25g/t Au). The concentrate will be transported approximately 400km to the London Victoria gold treatment plant near Parkes which Cortona will operate to recover gold bars.
"We are targeting financing to be completed during the third Quarter of 2012, once we satisfy the conditions precedent including receipt of the outstanding regulatory approvals, which are largely procedural" Peter van der Borgh said.
The Financing Package includes a prepaid gold forward and requires Cortona to commit to a gold hedging program ("Hedging Program"). The total quantum of gold ounces committed under the Financing Package will be dependent upon the prevailing spot price at financial close but is expected to represent approximately 30% of the existing proven and probable reserves at Dargues Reef. The Hedging Program will secure the Company's repayment obligations whilst providing Cortona with significant exposure to the spot price in this very strong gold market.
Yours faithfully
Peter van der Borgh
Managing Director

For further information, please contact: Peter van der Borgh

Managing Director

[phone] or Nicholas Read

Read Corporate

[phone]

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