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Re: Tuesday, May 20, 2008

Cornerstone Update

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Dear Subscriber;

Thursday's report on the drilling on the Little Deer Copper project, located in the Green Bay mining district in central Newfoundland, was very positive news. See http://www.cornerstoneresources.com/...

When we formed the Little Deer JV, of particular interest was the potential to outline new copper resources in the area immediately beneath the old mine workings extending from approximately 250 m to a minimum of 600 m below surface and extending from L14000 E to L13400 E, a distance of 600 m. The drilling to date has successfully demonstrated this potential. We expect results from the ongoing directional drilling to be available regularly over the next few weeks and months. We are excited also about the untested targets identified by the geophysical survey conducted on the property.

For some background information, the Little Deer copper deposit was discovered in 1952 by Falconbridge Nickel Mines Limited. Copper ore was mined from the Little Deer deposit during two campaigns in the 1970's.

The first extraction was conducted by British Newfoundland Exploration Company ("BRINEX") from 1970 to 1972. Access to the deposit was achieved via a 1,144 m long drift on the 244 m level from the adjacent Whalesback Mine, which lies north of the Little Deer deposit on Mineral License 12196M. BRINEX ceased mining operations at Little Deer in 1972 with the closure of the Whalesback Mine. In 1973, Green Bay Mining Company ("Green Bay") leased the property and mined the Little Deer deposit via a 329 m decline. Green Bay ceased mining operations in 1974 due to low copper prices. Reserves at the cessation of mining were quoted as 210,200 tonnes grading 1.53% Cu above the 245 m level (Kean, B. F., Evans, D. T. W., and Jenner, G. A., Report 95-2, Department of Natural Resources, Government of Newfoundland and Labrador, 1995).

These reserves are not NI 43-101 compliant as they are historical in nature and therefore should not be relied upon. An independent qualified person has not audited or classified this historical reserve as current reserves.

An historic exploration program was undertaken on the Little Deer property from 1998 to 2000 by Mutapa Gold Corp. ("Mutapa"). Their work consisted of geological mapping, surface and borehole geophysical surveys and 6,815 metres of diamond drilling. Mutapa's 12 drill holes, together with other historic BRINEX drill holes, indicate that there is the potential to outline a significant resource of economic grade copper mineralization below and along strike from the areas of the Little Deer deposit that were mined previously.

(see Table 1 and Figure 2:

http://www.cornerstoneresources.com/... )

RECENT NEWS

Recently we've announced a couple of new properties, a Potash property in NL, and a Uranium property in New Brunswick. See http://www.cornerstoneresources.com/... . There are other potentially significant properties that we are working on that will be announced in due course. We are also in discussion with potential JV partners on several of our properties.

On May 14th we announced a $3M non brokered private placement financing. ( See http://www.cornerstoneresources.com/...

) We have received a number of expressions of interest by phone and by email. Any who would like to receive more information on the financing may do so by contacting our VP Finance, David Lovey's, at loveys@crigold.com or 1-877-277-8377 or our President & CEO, Colin McKenzie at mckenzie@crigold.com or 1-877-277-8377.

OTHER

The enthusiasm that was generated over our Shyri project in Ecuador reflects the perception that CGP had indeed discovered a potentially significant project in Ecuador. That project is just one of several that we had generated, some not yet publicly announced. While things are still unclear as to the outcome of the mining mandate and the new mining law we are hopeful that we will be able to recommence exploration on our various projects of merit there.

It is still a waiting game in Ecuador but during the moratorium we have stepped up ongoing efforts to identify / acquire projects of merit in other areas of South America. With the co-operation of our joint venture partners in Ecuador we have maintained our key personnel and ensured that our operational platform there is ready to go when conditions are right. In the meantime we are hopeful that during this period we will be able to use our Ecuador base to launch new projects of merit in other jurisdictions.

JV MODEL

Our website states: "Cornerstone Capital Resources Inc. has a strong and dedicated technical team who are focused on generating new projects that have great potential for discovery. Cornerstone leverages its own exploration funding through joint venture and strategic partnerships, providing shareholders with potential for success at lower risk.

Cornerstone has a diversified portfolio of gold, silver, copper, nickel, VMS, and uranium properties in Canada and Ecuador."

There is quite a difference between a mining company and an exploration company. As an explorer, Cornerstone looks to mining companies to earn into our projects by funding the early stage exploration and then, if such work is successful, by taking over management of the project to apply its technical skills, human resources and financial strengths to move the project through to production. Cornerstone will continue to focus on project generation, following the JV model. While we look forward to the day when Cornerstone will be an equity participant in one or several mines, we do not foresee at this time Cornerstone becoming a mine operator. We would leave that responsibility to our partners who have all the necessary technical, human and financial abilities to advance a discovery through to mine production.

Using OPM (other partner's money) to explore mitigates the significant downside risks and allows us to share in potential rewards that come with discoveries that are developed into mines. Significantly, most of our projects are in politically stable, mining friendly jurisdictions.

We are active in four distinctly different regions; Labrador, the Island of Newfoundland, New Brunswick and Ecuador and are working to develop projects in a fifth region. We are building project portfolios in each of these high potential regions and we encourage investors and shareholders to take a closer look at them.

Best regards.

Glen

Glen H. McKay, Chairman

Cornerstone Capital Resources Inc.

Excellence in Mineral Exploration

"People, Process, Projects"

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Email: ghmckay@crigold.com

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www.cornerstoneresources.com

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