New resource and reserve estimations at Medusa Mining"s Co-O mine in the Philippines have significantly increased the contained ounces of gold at the project.

The resource estimation has increased contained ounces by 446,000 ounces, or 266%, to 713,000 ounces using a lower cut of 3 grams/tonne gold. The reserve estimation has increased the contained ounces by 162,000 ounces, or 272%, to 256,000 ounces using a lower cut of 3 grams/tonne gold.

Medusa managing director Geoffrey Davis says: "These extremely robust resource and reserve numbers are quite exceptional. We are confident that, with additional drilling over the coming months, we can achieve a target resource of one million ounces, at a similar grade. The directors have a high expectancy of converting a large proportion of the Inferred Resources into reserves."

A deep diamond drilling program began in December 2006 with the aim of extending the known Co-O vein system to depth and along strike. A total of 25 drill holes have been completed of which 20 have been used in the resource estimation in conjunction with available underground sampling data. The 5 holes not used are outside the resource area.