CORAZON MINING LIMITED — Capital/Financing Update 2005

Dec 11, 2005

Level 2, 22 Oxford Close WEST LEEDERVILLE WA 6872 T: +61 8 9381 1436 F: +61 8 9381 1068 PO Box 1681 WEST PERTH WA 6872 www.graynicmetals.com.au

ASX Release 12 December 2005

GRAYNIC TO ACOUIRE NEW PROJECTS IN NSW AND RAISE \$0.5M WORKING CAPITAL

• Acquisition of four base metal and tungsten projects in New South Wales.
• Yanco Glen Project contains identified tungsten resources with possibility of early production. Further potential with shear-hosted gold mineralisation.
• Wertago Project contains historic Cu-Ag production with head grades up to 30% Cu. Project has had little modern exploration and is adjacent to the same regional structure as the Grasmere deposit (0.55mt @ 2.5% Cu) located about 30km to the southeast. Potential for a large polymetallic deposit in the area. Previous gold exploration results included 12.2m @ 4.6 g/t Au not followed up.
• Gulf Creek also has limited modern exploration and comprises three Cu-Zn lodes with some existing Cu-Zn resources. Historic copper production at high Cu grades reported.
• Copper Ridge project comprises a zone of Cu potential 3.5km long in a sheeted vein system. System is untested by modern exploration, no drilling in 125 years, and contains historic copper mining.
• Placement of shares raises \$500,000 working capital.

Acquisition of projects in NSW

Graynic Metals Ltd is pleased to announce that it has entered into an agreement with a private company, Resource Investment Group Pty Ltd, to acquire three high quality projects near Broken Hill and at another at Gulf Creek near Tamworth in New South Wales. The projects, which are described in more detail below, include an identified scheelite (tungsten) resource with the possibility of early production, as well as two highly prospective copper projects. Other targets include Cu-Pb-Zn-Ag mineralization in a Broken Hill setting, porphyry copper, tin, and shear zone hosted gold.

The Company will issue to Resource Investment Group 10 million Graynic shares and 4 million options exercisable at 30 cents, together with a payment of \$50,000 in cash. The deal is subject to shareholder approval and an Extraordinary General Meeting will be held in January 2006 to seek ratification.

The Company believes that these projects are a substantial and exciting addition to its existing portfolio, and that evaluation drilling at the scheelite prospect could well lead to an early cash flow for the Company in the current buoyant tungsten market. The chart below shows the prices for ammonium paratungstate (APT) which is the key quotation for the metal.

Placement of shares to raise working capital

The Company has organized a placement of 2,500,000 shares to private sophisticated investors at 20c each to raise \$500,000 of working capital. The money will be used mainly to fund exploration in NSW, and drilling is planned at three of the projects within the first quarter of 2006.

NSW PROJECTS

Tenure

The four projects are Yanco Glen (EL application 2453), Wertago (EL 6424), and Copper Ridge (EL 6435) in the Broken Hill area, and Gulf Creek (EL application 2556) in the Tamworth area. The Yanco Glen and Gulf Creek applications have been recommended for approval.

Yanco Glen Project

Highlights

• Identified scheelite resources with possibility of early production
• Potential for shear-hosted gold

Scheelite is calcium tungstate (CaWO4) and is one of the two main ores of tungsten metal. Tungsten is used in the manufacture of certain hard steels and alloys and is in great demand at the moment due to the upsurge of steelmaking in China. Scheelite is often sold as a concentrate produced on site in a relatively cheap and straightforward process.

The identified scheelite resources at Yanco Glen occur in the south of the tenement at a distance of about 30km north of Broken Hill. Scheelite was mined on a small scale in the 1930s and the small workings define the line of lode over a distance of about 2km. Between 1980 and 1984 CRA Exploration (CRAE) investigated the scheelite potential and estimated that there could be a substantial scheelite resource present.

Indications from the geology and data available suggest that an exploration target in the range of 1 to 2Mt at average grades of around 0.5%W could be present. This is based upon detailed geological mapping. UV lamping (scheelite fluoresces under ultraviolet light), rock chip sampling and some drilling over the 2km long extent of workings. This potential quantity and grade of mineralisation is only conceptual in nature as there is insufficient exploration data currently available to define a Mineral Resource and it is uncertain if further exploration will result in the determination of a Mineral Resource.

A second line of workings occurring about 1 km further east was not tested by CRAE but lies within the Yanco Glen tenement, providing additional upside to the project. The two target zones are well defined and a drill out of the scheelite resource will commence early in 2006.

A line of small gold workings including the historic Anaconda mine occur in the northern part of the tenement. They have not been explored in recent times and will be investigated in 2006.

Wertago Project

Highlights

• Historic Cu-Ag production with head grades up to 30% Cu
• Modern exploration has been limited in scope
• $\blacksquare$ Previous diamond drilling intersected 2m @ 4.6% Cu below historic workings at Eclipse
• Zn is known to be present in exploration drill core but was never assayed Prospects lie adiacent to the same regional structure as the Grasmere deposit about 30km to the southeast (0.55mt @ 2.5% Cu, Black Range Minerals Ltd)
• Previous gold exploration results included 12.2m @ 4.6 g/t Au, not followed up

The copper mineralization at Wertago is evident within numerous historic workings which occur along structures linked to the Koonenberry Fault. The presence of a major fault is important, as in general large deposits occur near large fault structures. The shears hosting the known mineralization are targets in themselves and will be drill tested in early 2006 to identify high grade copper resources which might lead to early production. However the general setting, including the occurrence of Ag. Pb, and Zn as well as Cu suggests that a large polymetallic deposit could be present in the area. There is also potential for Cu-Au porphyry deposits and Century-style zinc deposits within the Koonenberry belt.

Copper Ridge Project

Highlights

• Historic small-scale copper mining
• A zone of Cu potential 3.5km long
• Copper mineralization could be in a sheeted vein system
• Untested by modern exploration no drilling in 125 years

There is little published information on this prospect because it has never previously been held as an exploration licence. Previous work has been confined to small-scale copper mining for which there are no production records. The mineralization occurs as narrow individual lodes which repeat as parallel reefs, and may be a sheeted vein system. Alternatively the mineralization could relate to an intrusion of Cu porphyry style.

Gulf Creek Project

Highlights

• Historic copper production at high Cu grades $\bullet$
• Three-lode system with some existing Cu-Zn resources
• Limited modern exploration $\bullet$

The Gulf Creek copper mine represents the largest copper mine of its type in the New England region of NSW and was primarily mined between 1889 and 1912. Over 35,000 tonnes of Cu ore was mined at an average grade of 5% Cu over the mine life. Higher grades were recovered from some areas such as the Fishers Mine, with head grades exceeding 15% Cu. Mine records estimate that ore reserves up to 50,000 tonnes of ore grading 2.7% copper, and 4.5% zinc could remain in the known ore lenses.

The deposit is considered to be a Cyprus pyrite style and has not been properly explored since mining ceased almost 100 years ago, creating an exceptional modern exploration opportunity.

The mine reached a depth of 150m, had a strike length of 400m and the ore channel was 30m in width. The ore channel hosts 3 parallel lodes known as the Cornish Lode (2m wide at 6-6.5% Cu). Middle Lode (1.5-2m wide at 3-3.5% Cu), and the Big Lode (7m wide at 2-2.5% Cu). Records indicate Zn credits amount to nearly twice the Cu in the estimated ore reserves, but this will be verified by drilling.

The Company is currently formulating extensive exploration plans for all the Company's proiects and intends to commence drilling in early 2006. Data from a recently completed aeromagnetic survey at Quartz Circle is currently being processed whilst an electromagnetic survey is planned for Jutson Rocks once access agreements have been negotiated.

Ron Thom Managing Director

The information in this report that relates to Exploration Results, Mineral Resources or Ore Reserves was compiled by R Thom, who is a Member of the AuslMM. R Thom has sufficient experience which is relevant to the style of mineralization and type of deposit under consideration and to the activity which he is undertaking to qualify as a Competent Person as defined in the 2004 Edition of the 'Australasian Code for Reporting of Exploration Results, Mineral Resources and Ore Reserves'. R Thom, who is an employee of Graynic Metals, consents to the inclusion in the report of the matters based on his information in the form and context in which it appears.