CITIGOLD CORPORATION LIMITED — Proxy Solicitation & Information Statement 2008

Oct 1, 2008

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1 October 2008

Dear Shareholder,

Meeting of Shareholders 5 November 2008 in Brisbane

We have recently made the important announcement that Citigold Corporation, your Company, has obtained the strategic long term funding for the expansion of our gold mining operations at Charters Towers.

This $35 million capital raising is being done in a safe manner in keeping with the No 1 gold asset that Citigold shareholders own. Following on from our listing on the Dubai stock exchange in 2007 the strong and leading investment group of the region, the Dubai Group, will be investing up to $35 million in Citigold to acquire an 18% equity interest.

As long term shareholders we can be proud to have the Dubai Group as a strategic shareholder who, like us, believe gold is a fundamental backbone of the financial services sector and a key safe haven.

With the recent strong interest in gold I believe it is the right time to push forward with strength to expand our gold operations. I believe our Citigold has the asset, people, skills and clarity of purpose to complete the task of producing strong long term value for shareholders through expanded gold production.

A Notice of Meeting is enclosed herewith to complete the important ASX formalities. Myself and other Director's recommend shareholders vote in favour of the Resolutions to approve the share and options issues. I look forward to seeing you at the meeting.

Kindest regards

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Mark Lynch Managing Director and Shareholder

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Shareholder Name:____________

Company Name (if applicable) _______________

Account Designation:___________

Address: ______________

Suburb: ______ State: ___ Post Code: ______

Appointment of Proxy

I/We being a member/s of Citigold Corporation Limited and entitled to attend and vote hereby appoint:

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The Chairman of the Meeting �� (mark with an ‘X’)

Name of proxy - If you are not appointing the Chairman of the Meeting as your proxy please write here the full name of individual or body corporate (excluding the registered Security holder) you are appointing as your proxy.

or failing the individual or body corporate named, or if no individual or body corporate is named, the Chairman of the meeting, as my/our proxy to vote in accordance with the following directions or, if no directions have been given, as the proxy sees fit at the General Meeting of the Company to be held on Wednesday, 5 November 2008 commencing at 11 am, at Christie Corporate Centre and at any adjournment of the meeting. The chairperson intends to vote undirected proxies in favour of all resolutions.

Voting directions to your proxy – please mark X to indicate your directions

ORDINARY RESOLUTIONS

1. To ratify the Issue of Shares and Options

2. To approve the Issue of Options

For		Against	Abstain
(	)	( )	( )
(	)	( )	( )

* If you mark the abstain box for a particular item you are directing your proxy not to vote on that item on a show of hands or on a poll and that your shares are not to be counted in computing the required majority on a poll.

PLEASE SIGN HERE This section must be signed in accordance with the instructions below to enable your directions to by implemented

Individual or Security holder 1

Security Holder 2 Security Holder 3

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Individual/ Sole Director

Company Secretary/ Director

Director

PROXY INSTRUCTIONS

1. Any appointed proxy must be a natural person.

2. A member who is entitled to cast 2 or more votes may appoint 1 or 2 proxies to attend and vote at a meeting. If you appoint another proxy you should insert the proportion or number of your voting rights given to the proxy named in this form. If you do not insert this proportion or number then each proxy may exercise half of your votes. An additional proxy form for the other proxy will be supplied on request.

3. Joint holders should all sign this form. Companies should execute this form under common seal or by an officer or attorney duly authorised. If this form is executed under Power of Attorney, a certificate of non-revocation of Power of Attorney should be completed. The Power of Attorney should be sent with this form if it has not already been noted by the Company.

4. To be effective the proxy form must be received by the Company at least 48 hours before the meeting. The proxy form will be received by the Company if received at Citigold Corporation Limited, Level 15, 348 Edward Street, BRISBANE QLD 4000 or faxed to: Attention: Company Secretary, Citigold Corporation Limited, Fax: (07) 3834 0011 from outside Australia fax +61 7 3834 0011 .

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����������������������������� NOTICE OF GENERAL MEETING OF SHAREHOLDERS

Notice is hereby given that a General Meeting of shareholders of Citigold Corporation Ltd (ABN 30 060 397 177) (the ‘Company’) will be held on :-

Wednesday, 5 November 2008 commencing at 11 am, at Christie Corporate Centre, Level 1 320 Adelaide St, Brisbane, Queensland, Australia.

BUSINESS

RESOLUTION 1– Ratification of Issue of Shares and Options

To consider and if thought fit pass the following resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 7.4 and for all other purposes shareholders ratify the issue to Dubai Ventures Group Limited (being an investor who falls within one or more of the classes of exemptions specified in Section 708 of the Corporations Act 2001) ( Investor ) of:

• (a) 50,000,000 fully paid ordinary shares ( Placement Shares ) via a placement; and

• (b) 15,384,615 options to acquire fully paid ordinary shares ( Round 1 Options ).”

Voting Exclusion

The Company will disregard any votes cast on this resolution by the Investor issued with Placement Shares or the Round 1 Options (or both) and any associate of the Investor who was issued with Placement Shares or the Round 1 Options (or both).

However the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

RESOLUTION 2– Approval for the Issue of Options

To consider and if thought fit pass the following resolution as an ordinary resolution:

“That for the purposes of ASX Listing Rule 7.1 and for all other purposes the Company be authorised to issue up to 23,076,923 options to acquire fully paid ordinary shares ( Round 2 Options ) to Dubai Ventures Group Limited (being an investor who falls within one or more of the classes of exemptions specified in Section 708 of the Corporations Act 2001) ( Investor ).”

Voting Exclusion

The Company will disregard any votes cast on this resolution by the Investor who will be issued with Round 2 Options and any associate of the Investor who will be issued with Round 2 Options.

However the Company need not disregard a vote if it is cast by a person as a proxy for a person who is entitled to vote, in accordance with the directions on the proxy form; or it is cast by the person chairing the meeting as proxy for a person who is entitled to vote, in accordance with a direction on the proxy form to vote as the proxy decides.

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Proxies

Please note that:

• (a) a member of the Company entitled to attend and vote at the General Meeting is entitled to appoint not more than two proxies;

• (b) a proxy need not be a member of the Company; and

• (c) a member of the Company entitled to cast two or more votes may appoint two proxies and may specify the proportion or number of votes each proxy is appointed to exercise, but where the proportion is not specified each proxy is entitled to cast half of the number of votes.

The enclosed proxy form provides further details on appointing proxies and lodging proxy forms.

To be effective the Proxy Form must be received at the Company’s registered office or by the Company’s Share Registry no less than 48 hours before the time for holding the meeting.

Corporate Representative

In order to vote on behalf of a company that is a shareholder in the Company, a valid Appointment of Corporate Representative form must be either lodged with the Company prior to the General Meeting or be presented at the meeting before registering on the Attendee Register for the General Meeting.

Dated 1 October 2008. By Order of the Board.

Matthew Martin Company Secretary

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Explanatory Statement

Purpose of this Explanatory Statement

This Explanatory Statement has been prepared for the information of shareholders in relation to the business to be conducted at the Company’s General Meeting to be held at Christie Corporate Centre, 320 Adelaide St, Brisbane, Queensland on Wednesday 5 November 2008 commencing at 11 am.

The purpose of this Explanatory Statement is to provide shareholders with information that is reasonably required by shareholders to decide how to vote upon the resolutions to be considered by the meeting.

The Directors recommend that shareholders read this Explanatory Statement before determining whether to support the resolutions or otherwise.

Other than as contained in the Notice of General Meeting and Explanatory Statement, the Directors believe that there is no other information known to the Company or the Directors that is reasonably required by shareholders to decide whether or not it is in the Company’s best interests to pass any of the resolutions.

Background

On 22 September 2008 the Company announced that it had entered into a capital raising deal ( Agreement ) with Dubai Ventures Group Limited (Dubai Ventures). Pursuant to the terms of the Agreement Dubai Ventures agreed to subscribe for the following issues of securities ;

• (a). a placement of 50 million shares at A$ 0.20 per share to raise A$10 Million;

• (b) the issue of 38,461,538 options to acquire Citigold shares exercisable at A$ 0.26 per share within 2.5 years and if the Company reaches certain profit levels during the terms of the Options the Company can require Dubai Ventures to exercise the Option. Exercise of these options will raise an additional A$10 Million; and

• (c) the issue of a A$15 Million Convertible Security convertible into shares in the Company at A$ 0.26 per share within a 2.5 year term and carrying an interest rate of 9% p.a. This Loan will be secured to the value of $30 million against to be agreed project assets.,

The Placement Shares and Round 1 Options were issued to Dubai Ventures on 24 September 2008 .

It is expected that the convertible note will be issued within 7 days of obtaining of shareholder approval to the resolutions the subject of this meeting.

Dubai Ventures is the private equity arm of Dubai Group which in turn is the leading diversified financial services company of Dubai Holding.

Resolution 1: Ratification of issue of Securities

This resolution seeks the ratification of shareholders for the previous issue of:

• (a) 50,000,000 fully paid ordinary shares; and

• (b) 15,384,615 options to acquire fully paid ordinary shares.

which was completed on 24 September 2008.

Under ASX Listing Rule 7.1, the Company is limited to issuing up to 15% of its issued capital in any 12 month period without shareholder approval, subject to certain exceptions.

An issue of securities made without specific approval under ASX Listing Rule 7.1 is treated as having been made with approval for the purpose of ASX Listing Rule 7.1 if the original issue did not breach ASX Listing Rule 7.1 and is subsequently approved by ordinary shareholders pursuant to the provisions of ASX Listing Rule 7.4.

Pursuant to the provisions of ASX Listing Rule 7.5, the following information is supplied to shareholders in respect of Resolution 1.

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Number of Securities Allotted:	(a) 50,000,000 fully paid ordinary shares; and (b) 15,384,615 options to acquire fully paid ordinary shares.
Price at which the Securities were issued:	(a) 20 cents per fully paid ordinary share; and (b) 0 cents per option.
Terms of the Securities:	(a) Fully Paid Ordinary Shares; (b) Options are exercisable by the Investor at any time at the exercise price of 26 cents per share. Full terms of the options are set out at Schedule A to this notice.
Use of the funds:	The proceeds will be used by the Company to underpin the development of the Charters Towers goldfield and as working capital
Date of Allotment	(a) 26 September 2008 for 50,000,000 fully paid ordinary shares; and (b) 26 September 2008 for 15,384,615 options

Resolution 2: Authorisation for the issue of Options

Under the Agreement the Company is required to issue to Dubai Ventures 23,076,923 options with each option having an exercise price of 26 cents.

Under ASX Listing Rule 7.1, the Company is limited to issuing up to 15% of its issued capital in any 12 month period without shareholder approval, subject to certain exceptions. An issue of securities made with the approval of shareholders under ASX Listing Rule 7.1 does not need to be counted towards the 15% limit specified under Listing Rule 7.1. Shareholders are now being asked to authorise the issue of 23,076,923 options as set out in Resolution 2.

Pursuant to the provisions of ASX Listing Rule 7.3, the following information is supplied to shareholders in respect of Resolution 2.

options as set out in Resolution 2. Pursuant to the provisions of ASX respect of Resolution 2.	Listing Rule 7.3, the following information is supplied to sh
Number of Securities to be issued:	23,076,923 options
Timing:	It is expected that the options will be issued at the same time as the Convertible Security being within 7 days of obtaining of shareholder approval to the resolutions the subject of this meeting. The options will be issued and allotted not later than 3 months from the date of this General Meeting.
Price at which the Securities are to be issued:	0 cents per option
Terms of the Securities:	Options are exercisable by the Investor at any time at the exercise price of 26 cents per share. Full terms of the options are set out at Schedule A to this notice.
Use of the funds:	The proceeds will be used by the Company to underpin the development of the Charters Towers goldfield and as working capital

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Schedule A – Option Terms

The following is a summary of the material terms of the options ( Options ) to be issued in the Company:

1. Each Option allows the Option holder to subscribe for one fully paid ordinary share in the Company and will expire at 5:00pm on that day which is 30 months from the date of issue of the Option.

2. Each Option has an exercise price of 26 cents per share.

3. Options will be issued free.

4. The Options may be exercised at any time after their issue.

5. The Options may be exercised wholly or in part by notice in writing to the Company received at any time during the exercise period together with a cheque for the exercise price and the option certificate (if any).

6. The Company will not apply for official quotation of any Options.

7. Shares issued as a result of the exercise of Options will rank equally with the Company’s issued fully paid ordinary shares at the time. Application to list the new shares will be made.

8. Option holders may only participate in new issues of securities by first exercising their Options.

9. Option holders have no entitlement or right to any variation in the Option exercise price or to the number of underlying securities over which the Option can be exercised.

10. If there is a reorganisation of the issued capital of the Company, unexercised Options will be reorganised in accordance with the ASX Listing Rules.

11. In the event that either:

12. ��� the Company’s audited Financial Year 2009, Profit After Tax exceeds AUD$22 million excluding any extraordinary income; or

13. �$� the Company’s audited Financial Year 2010, Profit After Tax exceeds AUD$44 million excluding any extraordinary income;

the Company may at any time during the exercise period issue a notice in writing ( Notice ) to the Option holder requiring the Option holder to exercise all Options not otherwise exercised at that time and pay to the Company the exercise price for all outstanding Options held by the Option holder.

1. The Options shall be deemed to be cancelled as at the date cleared funds equal to the amount specified in the Notice are received by the Company and fully paid ordinary shares allotted to the Option holder.

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