ISLA CRISTALINA BELT

SAN GREGORIO DISTRICT

District Description: The Minas de Corrales goldfield, hosts the San Gregorio district which is located at the northwest end of the Isla Cristalina Belt, 450 kilometres from Montevideo. This district includes the historical deposits of San Gregorio, and Santa Teresa which is located two kilometres northwest of the San Gregorio mine, and the Arenal deposit. Arenal, which is the dominant production source, is located three kilometres southeast of San Gregorio. Several smaller deposits occur between these larger deposits, and the most important are the shear-hosted, "Veta A" and "Veta Sur" deposits.

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Approximately 860,000 ounces of gold have been produced from the Minas de Corrales goldfield since 1998, of which 514,458 ounces have been mined from San Gregorio and three small pits at Santa Teresa. Arenal and the Vetas have produced 309,989 and 37,010 ounces respectively since production commenced during mid-2004.

Geology: The Isla Cristalina Belt is an erosional window of Proterozoic granites and greenstones, and is approximately 110 by 40 kilometres. The metamorphic grade of the greenstones ranges from greenschist through to amphibolite facies. Anomalous gold mineralization is present along the entire 110 kilometre strike length of the belt, and it is spatially associated with the Rivera Shear Zone. The principal alteration assemblage associated with the mineralization comprises chlorite-carbonate-sericite-silica-pyrite.

Air Photograph Image of Santa Teresa, San Gregorio and Arenal Pits

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Reserves and Resources: A mineral reserve and resource summary is presented in the table below.

San Gregorio / Santa Teresa / Arenal Deposits Mineral Reserve and Resource Summary (as at June 1, 2007)
	San Gregorio			Santa Teresa			Arenal
	Tonnes ('000)	Grade (g/t)	Ounces ('000)	Tonnes ('000)	Grade (g/t)	Ounces ('000)	Tonnes ('000)	Grade (g/t)	Ounces ('000)
Proven and Probable Reserves	2,312	1.20	89,100	1,056	1.17	39,100	3,104	1.95	194,600
Measured and Indicated Resources	8,792	1.06	298,800	1,931	1.10	68,400	6,354	1.62	329,500
Inferred Resources	3	1.0	88	7	0.8	160	2,932	1.1	105,000

Veta A / Veta Sur Deposits Mineral Reserve and Resource Summary (as at June 1, 2007)
	Veta A			Veta Sur
	Tonnes ('000)	Grade (g/t)	Ounces ('000)	Tonnes ('000)	Grade (g/t)	Ounces ('000)
Proven and Probable Reserves	127	2.23	9,100	34	1.91	2,100
Measured and Indicated Resources	507	2.07	34,000	492	1.65	26,000
Inferred Resources	33	1.5	1,600	160	1.3	7,000

Exploration Results: At San Gregorio exploration has focused on targets in the footwall to add incremental resource as well as depth extension to the deposit. Intercepts from three down dip holes completed to date are encouraging, although thin, and indicate that the mineralized structure is continuous at depth. Two holes were completed in the Rieles sector of the San Gregorio deposit in March 2008. The results are reported in the accompanying table.

At Arenal exploration is currently focused on depth extension of the Arenal deposit. Ten holes have been completed to date, and the results from these holes have been encouraging, but are not considered economic due to limited thickness and/or grade. The results have however confirmed that mineralization does continue down dip. The structure in Arenal continues to be wide, up to 90 metres, and could host a significant mineralized body at depth. The best results received from this program during the February 2008 quarter are presented in the accompanying table.
The most important near mine targets are the shear-hosted, Veta A and Veta Sur deposits. Additional targets include Polvorín and Cross Hill. Exploration success continues to be achieved at both Vetas, and drilling will continue along the Veta Sur structure. Prospect drilling has been completed at Polvorin, and the most significant results are reported in the accompanying table. No further exploration is planned at Cross Hill.

A summary of exploration results for the various deposits in the San Gregorio District is presented.

Arenal Deep Drilling - Holes ALD089 and ALD090

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Arenal Section with Recent Deep Drilling Results

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San Gregorio Section with Recent Deep Drilling Results

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San Gregorio (Rieles) with Recent Deep Drilling Results

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SAN GREGORIO DEPOSIT Exploration Activities & Results Summary (as of March 31, 2008)
CALENDAR YEAR	ACTIVITY	RESULTS
CURRENT RESULTS
2007/2008	Footwall drilling - 2,659 m (18 RC) Down dip/strike drilling 1,500 m Rieles Sector	Moderate grades (1 - 2 g/t) over narrow widths have been encountered. SGD002 from 434.3 - 2.65m @ 3.23 g/t SGD003 from 656.75 - 3.65m @ 4.19 g/t including 0.45m @ 21.94 g/t SGD005 from 319.8 - 5.9 m @ 2.39 g/t. SGD006 from 304.8 - 2.95m @1.59 g/t.
Drill hole intercepts, not true thickness.

ARENAL DEPOSIT Exploration Activities & Results Summary (as of March 31, 2008)
CALENDAR YEAR	ACTIVITY	RESULTS
CURRENT RESULTS
2007/2008	Drilling -4,142m (10 DDH)	ALDD075 from 312.7m - 2.3m @ 1.47 g/t ALDD075 from 316.3m - 4.3m @ 1.24 g/t ALDD075 from 333.5m - 2.75m @ 1.10 g/t ALDD075 from 386.1m - 3.5m @ 0.83 g/t ALDD075 from 393.5m - 2.4m @ 1.92 g/t ALDD076 from 319.4m - 1.3m @ 6.31 g/t ALDD076 from 321.7m - 3.45m @ 1.67 g/t ALDD076 from 326.5m - 7.7m @ 0.84 g/t ALDD076 from 377.3m - 5.85m @ 1.48 g/t ALDD077 from 422.4m - 1.5m @ 6.98 g/t ALDD077 from 429.8m - 10.7m @ 1.15 g/t ALDD077 from 442.1m - 3.3m @ 1.62 g/t ALDD077 from 448.7m - 12.55m @ 1.38 g/t ALDD077 from 473.6m - 8.2m @ 1.25 g/t ALDD078 from 273.4m - 1.55m @ 1.71 g/t ALDD080 from 238.2m - 2.35m @ 5.59 g/t ALDD081 from 296.3m - 2.0m @ 1.66 g/t
Drill hole intercepts, not true thickness.

NEAR MINE TARGETS Exploration Activities & Results Summary (as of March 31, 2008)
CALENDAR YEAR	ACTIVITY	RESULTS
CURRENT RESULTS
2007/2008	Veta A Resource Definition	See Mineral Reserve and Resource Summary table.
	Veta Sur Resource Definition	In-house revised indicated resource of 645,000 tonnes at 2.2 g/t and an inferred resource of 57,000 tonnes at 1.6 g/t at a cut off grade of 0.5 g/t. (as of November 30, 2007).
	Polvorin Drilling - 3,757m ( 21 RC)	PORC003 from 129m - 1m @ 0.92 g/t PORC004 from 52m - 8m @ 2.00 g/t PORC006 from 33m - 2m @ 1.34 g/t PORC006 from 116m - 3m @ 19.61 g/t including 1m @ 55.56g/t. PORC011 from 123m - 2m @ 1.26 g/t PORC017 from 177m - 1m @ 4.05 g/t PORC018 from 168m - 1m @ 1.51 g/t PORC020 from 76m - 5m @ 5.80 g/t
Drill hole intercepts, not true thickness.

Planned Activities: At Santa Teresa, definition and step-out drilling is expected to take place during calendar year 2008. A follow-up drill program is in progress at Arenal to test for higher grade mineralised zones. Mining of the Veta deposits is ongoing and supplies important feed to the plant. Exploration drilling will continue to search for more resources related to this type of structural setting. Follow-up drilling is planned at Polvorin to define a mineralised body.