Encore Renaissance Resources Corp V.EZ

RE: RE: Sedars are out

[nelson11]

Sidon International Resources Corporation

Management’s Discussion and Analysis of Results of

Operations and Financial Condition of Sidon International Resources Corporation

For The Nine Month Ended January 31, 2011

(Expressed In Canadian Dollars)

This management discussion and analysis has been prepared as of March 31, 2011 and

should be read in conjunction with the unaudited interim consolidated financial statements

of the Company for the nine months ended January 31, 2011 and the subsequent

management discussion and analysis March 31, 2011. All dollar figures stated herein are

expressed in Canadian dollars, unless otherwise specified.

Description of Business:

Sidon International Resources Corporation is a publicly traded mineral exploration

company listed on the TSX Venture Exchange, Tier 2, trading under the symbol: SD.and

on the Frankfurt Exchange under the symbol SY7. The Company is primarily focused on

exploring mineral properties in Canada and the USA.

The Company is a junior exploration company involved in the acquisition and exploration

of precious metal mineral properties. The Company has an option agreement to acquire

an undivided 50% interest in the DEF1 claim in the Northwest Territories, Canada.

On October 11, 2007, The Company received approval from the TSX regarding the

agreements relating to the Dolly Varden properties located in Elko, Nevada and the

Saskatchewan Coal Mine in Canada.

In addition, the Company has also assembled a portfolio of properties comprised of

extremely promising Coal (final permits received), Copper and Potash (permits received)

properties with select Diamond, Gold and Base metal properties located in BC, Alberta

and Saskatchewan.

DEF 1 Claim, Northwest Territories, Canada:

On July 21, 2004, the Company entered into an Option Agreement (“Agreement”) to

acquire a 50% interest in the DEF 1 Claim (the “Property”) located in Drybones Bay,

Northwest Territories, Canada.

Under the terms of the Agreement, the Company would earn a 50% undivided interest in

the Property in consideration of a cash payment of $50,000 and 750,000 treasury shares

(deemed value of $52,500) and $400,000 of work expenditure commitment as follows:

Option Exercise Schedule

Issue

Shares

Payment Exploration

Expenditures

5 days following TSX Approval Date (March 15, 750,000 $50,000 -

2005)

On or before the first anniversary of the TSX

Approval Date

- - $ 50,000

On or before the second anniversary of the TSX

Approval Date

- - $150,000

On or before the third anniversary of the TSX

Approval Date

- - $200,000

Total 750,000 $50,000 $400,000

(1) Shares have been delivered and $50,000 paid.

The Property is subject to 1.5% gross over-ride royalty in perpetuity on the net appraised

value of all diamonds that are produced from the Property.

As at January 31, 2011, the Company has not met its exploration expenditure

commitment on the DEF1 project. This may result in a reduction of the earn-in-interest as

described in the option agreement.

Dolly Varden, Southwest Nevada

The Company has optioned a 51-per-cent interest in the North Dolly Varden claims,

southeast of Elko, Nevada. The Dolly Varden property is a copper gold skarn property

located just south of the old Kennecott Victoria mine that produced over two million tons

of high-grade copper in the 1960s.

The exclusive 51-per-cent interest of the right, title and interest are formed from the

MinQuest Claims and the Cardigan-West Claims.

Under the terms of the Agreement, the Company would earn a 51% undivided interest in

the Property in consideration of a cash payment of $200,000; 3,000,000 treasury shares

(deemed value of $435,000) and $850,000 of work expenditure commitment.

In 2008, the Company paid $200,000; and issued 2 million common shares with a

deemed value of $290,000.

In August 2010, the Company issued 1 million common shares with a deemed value of

$145,000.

All required expenditure payments have been made.

Option Exercise Schedule

Issue

Shares

Cash

Payment

Exploration

Expenditures

5 days following TSX Approval Date (October 11,

2007)

1,500,000 $ 125,000 US$ -

On or before the first anniversary of the TSX

Approval Date

500,000 25,000 100,000

On or before the second anniversary of the TSX

Approval Date

1,000,000 50,000 250,000

On or before the third anniversary of the TSX

Approval Date

- - 500,000

Total 3,000,000 $200,000 US$850,000

COAL AND POTASH

COAL

The Company has received a 'Comfort Letter' from the Government of Saskatchewan in

regards to the coal application submitted by the company in June 2008. The 'letter of

comfort' states that the Company has priority status on 100% of the applications

submitted.

In January 2009, the Company received 24 coal permits covering 18,432 hectares of coal

permits in Saskatchewan (approximately 45,546 acres) and in east-central Alberta in the

area of the recent Goldsource Mines Inc. coal discovery.

POTASH

The company has applied for a number of metallic mineral permits from the Department

of Alberta Energy, Mineral Development Division in Edmonton, Alberta in the Vermillion

area on the Saskatchewan-Alberta border, which includes the rights to subsurface

potash, totaling over 200,000 acres.

The potash minerals are found in the Prairie Evaporite section of the Middle Devonian Elk

Point Basin. The carnallite minerals lie on top of a thick 400 foot section of common salt

(halite). A thickness of twelve feet of carnallite was reported to be present and the pinkish

and greyish mineral, in all probability sylvite, occurs through the first 80 feet of the Prairie

Evaporite.

Potash occurs over the upper 150 feet at Esterhazy and in the Saskatoon area. The

potash minerals are of the same composition and depositional sequence and depth as

the potash at Unity, Saskatchewan, the location of Canada's first Potash Mine. A possible

potash bed occurs at 2600 feet in the Prairie Evaporite which could be an extension of the

Unity deposit. The lower deposits are separate but occur at 3500 feet similar to the

Saskatoon deposits.

In December 2008, the Company received ten (10) metallic & industrial mineral permits

from the Alberta Energy Mineral Development & Strategic Resources Division.

The permits comprise a total area of 87,088 hectares located in the Vermilion region of

Alberta.

Stewart Mining Region of British Columbia

TSX Venture Exchange has accepted for filing an option agreement dated October 01,

2009 between Sidon International Resources Corporation (the ‘Company’) and 0862373

BC Ltd, whereby the Company will acquire acquire a 100% interest in six claim blocks

consisting of 2,668 hectares located in the Stewart Mining Region of British Columbia.

Total consideration consists of $50,000 in cash payments, 4,000,000 shares of the

Company, and $500,000 in work expenditures over a two year period.

In addition, there is a 3% net smelter return relating to the acquisition. The Company may

at any time purchase 1% of the net smelter return for $1,000,000 in order to reduce the

total net smelter return to 2%.

As of January 31, 2011, the $50,000 payment outstanding is included in accounts

payable.

Alberta

On August 31, 2009, the Company entered into an Option Agreement dated, and

amended on January 19, 2010 with MGK Consulting Inc., pursuant to which the Company

acquired 100% interest in 8 mineral claims located in Alberta. Total consideration consists

of $75,000 in cash payments, 3,000,000 shares of the Company, and $500,000 in work

expenditures ($250,000 in each of year 1 and 2 of the agreement).

In January 2010, the Company issued 3,000,000 shares with a deemed value of

$150,000 and paid $75,000.

MEG Gold Property, Tanzania

On May 10, 2010 an agreement was executed between Kokanee Placer Ltd (Laurence

Stephenson). and the Company. The Company has agreed to acquire an option to earn

an 80% interest in the MEG Gold Property located in the Morogoro Rural District of

Tanzania. In consideration, the Company will pay US$1,500,000 and issue 7,000,000

shares to Kokanee Placer Ltd. and spend US$1,500,000 on exploration of the property as

follows:

• US$350,000 cash and 3,000,000 shares within 5 days of Exchange acceptance;

US$100,000 cash and US$350,000 of exploration within 90 days of Exchange

acceptance;

• US$350,000 cash and US$500,000 of exploration within 180 days of Exchange

acceptance;

• US$350,000 cash and 3,000,000 shares within 270 days of Exchange acceptance;

and;

• US$350,000 cash, 1,000,000 shares and US$650,000 exploration by the second

anniversary of Exchange acceptance.

Upon earning its 80% interest the Company has the right to acquire a further 15% interest

in exploration and development expenditures by paying US$3,000,000 and issuing

3,000,000 shares to Kokanee and spending US$5,000,000 over 3 years.

The Company may convert the remaining 5% to a 3% NSR Royalty in favor of the

Morogoro Regional Mining Group Limited by paying an additional US$1,500,000.

If the Company exercises the option to acquire the additional 15% or 20% before the

thirtieth day following the second anniversary of the acceptance of the agreement, the

Company is not required to spend the additional US$5,000,000 in exploration

expenditures.

In July 2010, the Company issued 3,000,000 for an aggregate deemed consideration of

$195,000.

The Company anticipates that the capital requirements for the twelve months ending

January 31, 2012 will be as follows: (Canadian Dollars)

DEF 1

Property

Dolly

Varden

Property

Potash

&

Coal

mine

Stewart

Mining Alberta

MEG

Gold

Property

Total

Exploration Cost:

Consulting Fees $ 25,000 $ 35,000 $ 80,000 $25,000 $ 50,000 $100,000 $215,000

Drilling & Exploration Costs 125,000 500,000 200,000 100,000

80,000 450,000 1,455,000

Field Supplies, Maintenance &

Miscellaneous 35,000 120,000 100,000 40,000

50,000 150,000 495,000

Geological & Analysis 50,000 80,000 180,000 40,000 40,000 50,000 440,000

Property Maintenance 5,000 25,000 40,000 15,000 50,000 50,000 185,000

Travel & Accommodation 50,000 50,000 70,000 35,000 35,000 50,000 290,000

Total $ 290,000 $810,000 $670,000 $255,000 $305,000 $850,000 $3,080,000

Overall Performance

• Capitalized mineral property costs incurred for the period ended January 31, 2011

totaled $3,005,067 that included 3,000,000 shares issued for the Morogoro with a

deemed value of $195,000 and 1,000,000 shares issued for Dolly with a deemed

value of $145,000). (2010- $832,299)

• General and administrative expenses for the period ended January 31, 2011

totaled $1,352,778 (2010 - $404,711), in which $1,045,983 (2010 - $151,249) was

stock based compensation.

• The Company raised $3,598,341 (2010 - $967,958) in cash through issuing

shares, and the exercise of warrants and options for the period ended January 31,

2011. Cash used in operations was $427,640 (2010 -$235,389) and cash used in

investing activities was $2,666,367 (2010 -$832,299). The Company maintains a

positive cash position and is expected to be able to continue operations for the

coming year.

Market Trends

In 2011 & 2010 the price of gold increased, continuing an overall up-trend. The average

price of gold was $1,436 and 1,093 per ounce on March 25, 2011 and 2010, respectively.

Selected Annual Information

The following selected financial data should be read in conjunction with the company’s

financial statements:

Year Ended Year Ended Year Ended

Apr. 30, 2010 Apr. 30, 2009 Apr. 30, 2008

(restated) (restated) (restated)

Financial Results

Interest & Other Income $ Nil $ Nil $ Nil

Operating Expenses 676,520 585,704 640,515

Net Loss 676,520 585,704 640,515

Loss per Share (0.01) (0.01) (0.02)

Weighted average number of outstanding

shares 62,945,517 43,406,921 34,074,730

Total Assets 3,600,906 2,363,935 2,105,360

Working Capital (Deficiency) (restated) (1,012,517) (947,446) (699,902)

Mineral Properties 3,509,303 2,324,924 2,026,453

Long-Term Liabilities $ Nil $ Nil $ Nil

Total Liabilities (restated) 1,087,655 962,679 744,373

Share Capital 7,780,052 6,298,345 5,492,720

(Deficit) (restated) (5,695,749) (4,961,037) (4,368,333)

Restatement Details:

April 30, 2010

As Previously

Reported

$

Adjustment

$ Notes

April 30, 2010

As Restated

$

Consolidated Balance Sheets

Working Capital (Deficiency) (849,325) (163,192) (a),(b) &

(c) (1,012,517)

Total Liabilities 924,463 163,192 a),(b) &

(c) 1,087,655

(Deficit) (5,532,557) (163,192) a),(b) &

(c) (5,695,749)

April 30, 2009

As Previously

Reported

$

Adjustment

$ Notes

April 30, 2009

As Restated

$

Consolidated Balance Sheets

Working Capital (Deficiency) (842,446) (105,000) (a) & (b) (947,446)

Total Liabilities 857,679 105,000 (a) & (b) 962,679

(Deficit) (4,856,037) (105,000) (a) & (b) (4,961,037)

April 30, 2008

As Previously

Reported

$

Adjustment

$ Notes

April 30, 2008

As Restated

$

Consolidated Balance Sheets

Working Capital (Deficiency) (601,902) (98,000) (a) (699,902)

Total Liabilities 646,373 98,000 (a) 744,373

(Deficit) (4,270,333) (98,000) (a) (4,368,333)

RESTATEMENT ADJUSTMENTS RELATING TO FLOW THROUGH SHARES

In the 2006 calendar year, the Company issued flow through shares for proceeds of

$675,850 resulting in an obligation and commitment to spend the proceeds on Canadian

exploration and development. The Company has renounced these expenditures to the

investors and spent $138,018 of the flow through share proceeds on exploration and

development, leaving a remaining balance of $537,832 to be spent. When issuing flow

through shares the Company is required to incur the applicable amount of eligible

expenses within a prescribed period of time (December 2007) and renounce the

expenditures in prescribed form as required by Canada Revenue Agency.

The Company did not incur all of the required expenditures within the prescribed period

and has not filed all the applicable forms required under the flow through share program

administered by Canada Revenue Agency. As a result the Company has incurred

additional tax under Part XII.6 of the Income Tax Act, penalties and interest in current and

prior periods for which the Company has not previously accrued. As a result of the

foregoing, the Company has recorded the following additional liability and corresponding

corrections:

a) Recorded a liability of $98,000 as at April 30, 2008 with a corresponding adjustment to

deficit for tax under Part XII.6 of the Income Tax Act, penalties and interest

b) Recorded an additional liability of $7,000 as at April 30, 2009 (bringing the total liability

to $105,000) for additional interest charges on unpaid amounts

c) Record an additional liability of $58,192 as at April 30, 2010 (bringing the total liability

to $246,000 as the Company had already accrued $82,808) for additional penalties

and interest charges on unpaid amounts

d) Reclassified previously recorded penalties and interest from office, rent and

miscellaneous to interest and penalties from flow through shares on the consolidated

statement of operations for the year ended April 30, 2010

Results of Operations

The total loss for period end January 31, 2011 was $1,352,778 (2010 - $404,711). During

the last nine months, the Company recorded $1,045,983 stock based compensation

expense on stock option granted to two directors. These were recorded in consulting and

management fees as described below.

During the period ended January 31, 2011, the Company paid $810,844 (in which

$732,219 was paid by stock based compensation) for consulting fees (2010 - $120,625).

During the period ended January 31, 2011, the Company recorded $359,636 (in which

$313,764 was paid through stock based compensation) for management fees (2010 -

$169,635).

The increase of operational expenses related to filing and transfer agent fees and investor

relations expense.

During the period ended January 31, 2011, a total of $9,480 interest and penalties was

accrued on the flow through share.

Filing and transfer agent fees increased by 124% compared to last year. These expenses

related to the Company completing a private placement of 15.3 million units and 11.4

million financing, shares issuance for property acquisitions, warrants and options

exercised.

During the period ended January 31, 2011, the Company retained a consulting firm to

provide investor relations services to the company. This increased the investor relations

fees by approximately $9,000.

Professional fees increased by 166%. This increase was incurred through legal activity on

property acquisitions and private placements.

Capitalized mineral property costs:

Capitalized deferred exploration costs incurred during the period ended January 31, 2011

totaled $3,005,067 that included 3,000,000 shares issued for the Morogoro with a

deemed value of $195,000 and 1,000,000 shares issued for Dolly with a deemed value of

$145,000). (2010- $832,299)

Dolly

Varden

Property

Tanzania

Morogoro

Total

Acquisition Costs:

Additions: $ 145,000 $ 1,010,225 $ 1,155,225

Balance, January 31, 2011 145,000 1,010,225 1,155,225

Exploration Cost:

Additions:

Consulting Fees - 346,700 346,700

Drilling & Exploration Costs - 513,532 513,532

Field Crew - 347,500 347,500

Field Supplies, Maintenance &

Miscellaneous - 297,378 297,378

Geological & Analysis - - -

IT Support - - -

Property Maintenance - 244,700 244,700

Travel & Accommodation - 100,032 100,032

- 1,849,842 1,849,842

Balance, January 31, 2011 145,000 1,849,842 1,994,842

Additional Resource Properties and

Deferred Exploration Costs as of

January 31, 2011

$ 145,000 $ 2,860,067 $ 3,005,067

During the third quarter, the Company was starting the drilling program on the Company's

MEG Property southeast of Morogoro in east-central Tanzania.

The Company retained a contractor, AFGF (Tanzania) Ltd. for $346,700 to conduct the

first 6 holes drilling program. The drilling program has been started, for which incurred

$513,532 and $347,500 of drilling costs and field crew costs.

The program confirmed of the anticline association with the gold mineralization was

indicated in the first 2 drill holes (MLAFD 001 and 002) that were drilled between 75-100

m and 150 m, respectively, southeast of the workings and intersected the south limb of

the anticline mineralization.

Selected Quarterly Results

The following financial information has been derived from various audited and interim

financial statements, prepared in accordance with Canadian generally accepted

accounting principles (“GAAP”). While these statements follow the same accounting

policies and methods of application as the January 31, 2011 financial statements, they do

not contain all the information presented in the annual audited financial statements and

should, therefore, be read in conjunction with same.

3 Month 3 Month 3 Month 3 Month 3 Month 3 Month 3 Month 3 Month

Ended Ended Ended Ended Ended Ended Ended Ended

Jan 31,

2011

Oct 31,

2010

Jul 31,

2010

Apr 30,

2010

Jan 31,

2010

Oct 31,

2009

Jul 31,

2009

Apr 30,

2009

(Restated) (Restated)

(Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited) (Unaudited)

Financial Results

Interest & Other Income $ Nil $ Nil $ Nil $ Nil $ Nil $ Nil $ Nil $ Nil

Operating Expenses $109,927 $526,719 $716,132 $271,809 $84,020 $105,607 $215,084 $354,675

Restated - - - $58,192 $7,000

Total restated operating

expenses $109,927 $526,719 $716,132 $330,001 $84,020 $105,607 $215,084 $361,675

Recovery of future income

tax assets - - - - - - - -

Net Loss (income) and

comprehensive loss $109,927 $526,719 $716,132 $330,001 $84,020 $105,607 $215,084 $361,675

Loss per Share $(0.001) $(0.006) $(0.009) $(0.001) $(0.001) $(0.002) $(0.004) $(0.008)

The Company does not derive revenue from its operations. Its primary focus is in the

acquisition and exploration of resource properties.

The Loss for the accounting period has fluctuated widely, depending on the Company’s

activity level. Some periodic items may or may not have been incurred in each period,

including stock based compensation, write-downs, and other intermittent items.

The major increase in the net loss was write-down costs for the Harrison Lake property in

the amount of $267,500 – this was recorded in the 4th quarter of fiscal year 2009.

In the 1st quarter ended July 31, 2009, the major increases of the net loss were due to

stock based compensation expenses of $151,249.

In the 4th quarter ended April 30, 2010, the major increases of the net loss were as

following:

The Company paid Geofin Geological & Financial consulting firm (Laurence Stephenson)

$100,000 for general mining expenses, consultation and a preliminary property study for

property(s) in Tanzania.

The Company accrued approximately $83,000 (Restated - $141,000)) in office rent and

miscellaneous expenses for interest charged on the unspent balance of the flow through

share proceeds for exploration and development renounced effective December 2006.

During the 1st quarter ended July 31, 2010, the major increase in the net loss was due to

stock based compensation expenses of $627,528.

During the 2nd quarter ended October 31, 2010, the major increase in the net loss was

due to stock based compensation expenses of $418,445.

Liquidity and Capital Resources

The Company does not have any cash flow from operations. The Company receives

funds for use in its operations primarily from issuing common shares in the Company and

from funds advanced by Directors. At January 31, 2011 the Company had cash of

$12,979 (Jan 2010 - $4,842). The Company has a working deficiency of $411,924 (Jan

2010: $954,767 (Jan 2010: $1,059,767 (restated))

On July 20, 2010, a total of 15,300,000 units were issued at
.05 per unit for gross

proceeds of $765,000. Each unit comprises one common share of the company and one

share purchase warrant exercisable into one common share in the capital of the company

for two years at the exercise price of 10 cents per share on or before the first anniversary

of the date of the issuance of the warrant, and 15 cents thereafter until expiry. In

connection with this private placement, the Company paid $3,250 in cash and issued

65,000 shares at
.075 per share with a deemed value of $4,875 as a finder’s fee.

On September 21, 2010, a total of 11,400,000 units were issued at
.10 per unit for

gross proceeds of $1,140,000. Each unit comprises one common share of the company

and one share purchase warrant exercisable into one common share in the capital of the

company for two years at the exercise price of 15 cents per share on or before the first

anniversary of the date of the issuance of the warrant, and 20 cents thereafter until expiry.

In connection with this private placement, the Company paid $8,000 in cash and issued

50,000 shares at
.10 per share with a deemed value of $5,000 as a finder’s fee.

During the nine months ended January 31, 2011, a total of 10,350,000 warrants were

exercised at
.05 for gross proceeds of $517,500 and a total of 4,050,000 warrants were

exercised at
.10 for gross proceeds of $405,000.

During the nine months ended January 31, 2011, a total of 8,000,000 options were

exercised at
.10 for gross proceeds of $800,000 and a total of 3,549,500 options were

exercised at
.12 for cash proceeds of $354,450, and $71,490 was charged to due to

related party. A total of $1,045,983 of contributed surplus was reclassified to common

shares.

On May 10, 2010, the Company issued 3,000,000 shares at
.065 per share, a total

deemed value of $195,000 to acquire a beneficial interest in claims located in the

Morogoro Regional Mining District of the United Republic of Tanzania.

On August 10, 2010, the Company issued 1,000,000 shares at
.145 per share, a total

deemed value of $145,000 to the acquisition cost of Dolly property.

On February 17, 2011, a total of 2,000,000 warrants were exercised at
.10 for gross

proceeds of $200,000.

On February 23, 2011, a total of 892,857 units were issued at
.14 per unit for gross

proceeds of $125,000. Each unit comprises one common share of the company and one

share purchase warrant exercisable into one common share in the capital of the company

for five years at the exercise price of 15 cents per share.

The Company’s working capital requirements vary with its activity level. Financial

instruments are all or substantially held in cash or cash equivalence.

There has been no material changes in the Company’s contractual obligations or mineral

property option payments during the period that are outside the ordinary course of the

Company’s business.

Risk and Uncertainties

Mineral exploration and development involves a high degree of uncertainty and risk. The

Company is active in acquisition and exploration of properties and concessions that have

not yet been determined to contain economic mineralization. In addition, certain

jurisdictions in which the Company operates can be subject to environmental and politcal

disturbance, which may affect the Company’s mineral tenure and access.

Although the Company endeavours to work utilizing Best Management Practices,

changes to environmental regulations can negatively affect the Company’s ability to

access, explore and develop its properties.

Off-Balance Sheet Items

The Company does not have any off-balance sheet items.

Related Party Transactions

As at January 31, 2011 and April 30, 2010, the balance in due to related parties

comprises the following:

(a) The amounts owing to officers and directors are unsecured, non-interest bearing and

due on demand.

In the normal course of operations, the Company has entered into certain related party

transactions, which have been measured at the respective exchange amounts, being the

consideration established and agreed by the related parties.

The Company had the following transactions with parties related:

2011 2010

Consulting fees (b) $ 782,542 $ 120,624

Management fees (c) 359,636 124,636

Rent (d) 13,820 14,703

Office expenses (e) 8,544 5,770

Travel and promotion (f) 393 754

$ 1,164,935 $ 266,487

(b) The Company has an agreement with a director to provide consulting services for a

fee of $5,000 per month. During the nine months ended in January, 2011, the

Company paid $45,000, an additional financial consulting fee of $5,323 and 7,549,500

stock options (note 8d) valued as $732,219 for the consulting services (2010:

$120,624).

(c) The Company has an agreement with another director to provide management and

administrative services for a fee of $5,000 USD per month. During the nine months

ended in January, 2011, the Company paid $45,872 plus 4,000,000 stock options

(note 8d) valued at $313,764 for the management and administrative services. (2010:

$124,636).

January 31, 2011 April 30, 2010

Officers and Directors (a) $ 80,951 $ $ 695,852

$ 80,951 $ $ 695,852

(d) The Company has a rental agreement with a director to provide office space for a fee

of $1,500 USD per month. During the nine months ended in January, 2011, the

Company paid $13,820 for rent (2010: $14,730).

(e) During the nine months ended in January, 2011, the Company reimbursed the

Company’s CEO $8,544 for various office expenses (2010: $5,770).

(f) During the nine months ended in January, 2011, the Company reimbursed to the

Company CEO of $393 for travel to the mining site and general administration

purpose (2010: $754)

(g) A total of 8,000,000 options were exercised at
.10 for gross proceeds of $800,000

and a total of 3,549,500 options were exercised at
.12 for a cash proceeds of

$354,450, and $71,490 was charged to due to related party.

Critical Accounting Estimates

By definition the Company is a venture issuer and as such utilizes limited critical

accounting estimation. The Company’s recoverability of the recorded value of its mineral

property costs is dependent upon many factors beyond the Company’s control. The

Company is engaged in an industry that is dependent on a number of conditions including

property tenure, environmental and permitting risks, legal and political risks and the

Company’s ability to obtain necessary financing to maintain, explore and develop its

mineral properties.

The preparation of financial statements in conformity with Canadian Generally Accepted

Accounting Principles requires management to establish accounting policies and to make

estimates that affect both the amount and timing of the recording of assets, liabilities and

expenses. Some of these estimates require judgment about matters that are inherently

uncertain. Note 2 to the consolidated financial statements for the year ended April 30,

2010 includes a summary of the significant accounting policies adopted by the Company.

The following policy is considered to be the critical accounting policies as they involve the

use of significant estimates.

Mineral properties and deferred costs

Mineral property acquisition costs and related exploration and exploration overhead

expenditures are capitalized in the accounts of the Company. The Company defers these

costs until the property is placed into production, abandoned, sold or it is determined that

there has been an impairment and the carrying values may not be recovered. At that

time, the deferred costs are amortized on a unit-of-production basis, or written-down, as

appropriate. Costs applicable to abandoned properties are charged to operations in the

year of abandonment. The carrying values of these properties are periodically assessed

by management and if management determines that the carrying values may not be

recovered, the unrecoverable amounts are written off against operations in the year such

determination is made. The amounts shown for mineral properties and deferred costs

represent costs incurred to date, less write-downs, and do not necessarily reflect present

or future values.

Changes in Accounting Policy

Recent pronouncements in accounting standards (not yet adopted)

In January 2009, the Accounting Standards Board ("AcSB") issued CICA Handbook

Section 1582, “Business Combinations”, which replaces Section 1581, “Business

Combinations”. The AcSB also issued Section 1601, “Consolidated Financial

Statements”, and Section 1602, “Non-Controlling Interests”, which replace Section 1600,

“Consolidated Financial Statements”. These new sections are based on the International

Accounting Standards Board’s (“IASB”) International Financial Reporting Standard 3,

“Business Combinations”. These new standards replace the existing guidance on

business combinations and consolidated financial statements.

These new standards require that most assets acquired and liabilities assumed, including

contingent liabilities, to be measured at fair value and all acquisition costs to be

expensed. These new standards also require non-controlling interests to be recognized

as a separate component of equity and net earnings to be calculated without a deduction

for non-controlling interests. The objective of these new standards is to harmonize

Canadian accounting for business combinations with the international and U.S.

accounting standards. The new standards are to be applied prospectively to business

combinations for which the acquisition date is on or after the beginning of the first annual

reporting period beginning on or after January 1, 2011, with earlier application permitted.

Assets and liabilities that arose from business combinations whose acquisition dates

preceded the application of the new standards will not be adjusted upon application of

these new standards. The Non-Controlling Interests standard should be applied

retrospectively except for certain items. The Company does not expect that the adoption

of this standard will have a material impact on its consolidated financial statements.

International financial reporting standards

In January 2006, the CICA Accounting Standards Board ("AcSB") adopted a strategic

plan for the direction of accounting standards in Canada. As part of that plan, accounting

standards in Canada for public companies will converge with International Financial

Reporting Standards ("IFRS"). On February 13, 2008, the AcSB confirmed that the

standards will become effective for all publicly accountable enterprises in interim and

annual consolidated financial statements for fiscal years beginning on or after January 1,

2011. The Company continues to monitor and assess the impact of convergence of

Canadian GAAP and IFRS.

FINANCIAL INSTRUMENT

Financial instruments

All financial instruments are classified into one of the following five categories: held-fortrading,

held-to-maturity, loans and receivables, available-for-sale financial assets or

other financial liabilities. All financial instruments are originally measured at fair value,

subsequent measurement depends upon the initial classification. The Company

classifies its financial instruments as follows:

• Cash and cash equivalents are classified as “held-for-trading” and are measured at

fair value with any changes in fair value recognized in earnings of the period.

• Other receivables and due from related party are classified as “loans and

receivables” and are measured at amortized cost which management has

determined approximates their fair value due to their short-term nature.

• Accounts payable and accrued liabilities and due to related parties are classified as

“other financial liabilities” and are measured at amortized costs which management

has determined approximates fair value due to their short term nature.

Effective May 2009, the Company has adopted the updated recommendations of CICA

Handbook Section 3862, “Financial Instruments – Disclosures” to include additional

disclosure requirements about fair value measurement for financial instruments and

liquidity risk disclosures. These amendments require a three level hierarchy that reflects

the significance of the inputs used in making the fair value measurements. Fair values of

assets and liabilities included in Level 1 are determined by reference to quoted prices in

active markets for identical assets and liabilities. Assets and liabilities in Level 2 include

valuations using inputs other than quoted prices for which all significant outputs are

observable, either directly or indirectly. Level 3 valuations are based on inputs that are

unobservable and significant to the overall fair value measurement. The adoption of this

new standard has had no impact on the reported results of the Company.

Fair Value Measurement

CICA 3862 “Financial Instruments – Disclosures”, requires an entity to maximize the use

of observable inputs and minimize the use of unobservable inputs when measuring fair

value. CICA 3862 establishes a fair value hierarchy based on the level of independent,

objective evidence surrounding the inputs used to measure fair value. A financial

instrument’s categorization within the fair value hierarchy is based upon the lowest level

of input that is significant to the fair value measurement. CICA 3862 prioritizes the inputs

into three levels that may be used to measure fair value:

Level 1 – Unadjusted quoted prices in active markets that are accessible at the

measurement date for identical unrestricted assets or liabilities.

Level 2 – Inputs that are observable, either directly or indirectly, but do not qualify as

Level 1 inputs (i.e. quoted prices for similar assets or liabilities).

Level 3 – Prices or valuation techniques that are not based on observable market data

and require inputs that are both significant to the fair value measurement and

unobservable.

The fair values of the Company’s financial assets and liabilities as of January 31, 2011

were calculated as follows:

Quoted Prices

in Active Markets

Significant

Other

Significant

Unobservable

for

Identical Assets

(Level 1)

Observable

Inputs

(Level 2)

Inputs

(Level 3)

Financial Assets:

Cash 12,979

Other receivables 16,620

Due from related parties 20,000

Financial liabilities:

Accounts payable and accrued

liabilities

380,572

Due to related parties 80,951

The Company believes that the recorded value of accounts payable, loan payable and

notes payable approximate their current fair values because of their nature and relatively

short maturity dates or durations.

The carrying value of cash, other receivables, due from related party, account payable

and accrued liabilities and due to related parties approximate their fair value because of

their short term nature.

Risk Disclosures

The Company’s financial instruments are exposed to foreign currency risk, credit risk,

liquidity risk and commodity price risk.

Foreign currency risk

The Company does conduct some of its business in US dollars and is therefore exposed

to variations in the foreign exchange rate. The Company does not use foreign currency

hedges to manage this risk.

Credit risk

Credit risk reflects the risk that the Company may be unable to recover contractual

receivables. The Company does not have significant receivables and no one account

represents a concentration of credit risk. The Company employs established credit

approval practices to further mitigate this risk.

Interest Rate Risk

Interest rate risk is the risk that the fair value or future cash flows of a financial instrument

will fluctuate because of changes in market interest rates. As the Company’s cash is

currently held in non-interest bearing bank account, management considers the interest

rate risk to be minimal.

Liquidity risk

Liquidity risk is the risk that the Company will not be able to meet its financial obligations

as they come due or can do so only at excessive cost. The Company has significant

financial liabilities outstanding including accounts payable and accrued liabilities and loan

payable. The Company is exposed to the risk that it may not have sufficient liquid assets

and meet its commitments associated with these financial liabilities.

The Company’s approach to managing liquidity is to ensure, as far as possible, that it will

always have sufficient liquidity to meet its liabilities when due, without incurring

unacceptable losses or risking damage to the Company’s reputation. To the extent that

the Company does not believe it has sufficient liquidity to meet these obligations,

management will consider securing additional funds through equity transactions. The

Company manages its liquidity risk by continuously monitoring forecast and actual gross

profit and cash flows from operations.

Commodity Price Risk

The ability of the Company to finance the exploration and development of its properties

and the future profitability of the Company is directly related to the market price of the

primary minerals identified in its mineral properties. Mineral prices fluctuate on a daily

basis and are affected by a number of factors beyond the Company’s control. A

sustained, significant decline in the prices of the primary minerals could have a negative

impact on the Company’s ability to raise additional capital. Sensitivity to price risk is

remote since the Company has not established any reserves or production.

Stock-based compensation

The Company grants options in accordance with the policies of TSX Venture Exchange.

Effective April 1, 2003, the Company adopted on a prospective basis the new CICA

Handbook Section 3870 “Stock-Based Compensation and Other Stock Based Payments”,

which recommends a fair value-based methodology for measuring compensation costs.

All stock options granted are accounted for as a capital transaction at the time of grant

and are reflected as contributed surplus in the shareholders’ equity. The fair value of

options granted is estimated at the date of grant using a Black-Scholes option pricing

model incorporating assumptions regarding risk-free interest rates, dividend yield,

volatility factor of the expected market price of the Company’s stock, and a weighted

average expected life of the options. The estimated fair value of the options is recorded

over the options’ vesting period; any consideration paid on the amounts attributable to

stock options is credited to share capital.

On April 30, 2007, the Company granted a total of 3,144,382 stock options. The Company

recorded stock-based compensation expense totaling $155,212 on account of these stock

options in 2008. The fair value of the options granted was estimated at the date of

granting using the Black-Scholes option pricing model with the following assumptions: risk

free interest rate of 3.13%, dividend yield of 0%, volatility factor of 231%, and a life of 5

years.

On May 1, 2009, the Company granted a total of 4,375,488 stock options to two directors

at the exercisable price of
.10 per share for a five year term. The fair value of the

options granted was estimated at the date of granting using the Black-Scholes option

pricing model with the following assumptions: risk free interest rate of 2.071%, dividend

yield of 0%, volatility factor of 238%, and a life of 5 years. A total amount of $151,249 was

contributed to Contributed surplus.

Flow-through Shares

In March 2004, the CICA issued Emerging Issue Committee Abstract No. 146, “Flowthrough

Shares” and the Company has adopted the recommendation for flow-through

shares issued after March 19, 2004, whereby the Company recognizes the tax effect

related to the renounced deductions as a reduction of income tax expense in the

statement of operations and the shareholders’ equity, on the date that the Company files

the renouncement documents with the tax authority to renounce the tax credits

associated with the expenditures, provided there is reasonable assurance that the

expenditures will be made. As a result, in fiscal year 2005, the Company recorded a

recovery of a future income tax asset with a corresponding reduction to share capital of

$17,850 with respect to flow-through shares issued totaling $50,000.

In the fiscal year 2007, the Company issued 4,239,001 common shares on a flow through

basis for gross proceeds of $675,850; which were fully renounced in the period. The

renunciation resulted in a future tax recovery of $230,465 and a charge against share

capital.

Industry Trends & Risk Factors

The Company operates within the context of the exploration, development and mining

industry. This industry involves substantial risk and is considered a highly cyclical

industry. The Company’s current focus is primarily on the exploration of prospective gold

and base metals properties and the development of such properties to a feasibility or prefeasibility

phase, and is therefore highly dependent on the raising of risk or venture capital

by way of equity issuances to fund exploration activities. Complex factors and competitive

forces including commodity trends, inflation, interest rates, supply and demand of metals

and minerals, as well as economic cycles and their respective expansion or contraction

periods influence the business of the Issuer. Furthermore, the Industry is especially

dependant on the price of precious and base metals in the global commodities market.

Strong precious and base metals prices make it substantially easier for the Issuer to raise

funds by way of equity in the capital markets. During the past financial year the price of

gold and copper has been strong. If this strengthening commodity trend continues, the

Company anticipates that it will be able successfully raise equity to fund all of the

exploration and development activities over the foreseeable future. In addition, the prices

of commodities such as copper, zinc and molybdenum have increased based on the

increasing demand for minerals from Asia, specifically China that is experiencing robust

growth. This atmosphere bodes well for the future outlook of the Company as it currently

depends on equity financing.

Outstanding Share Data at March 31, 2011:

a) Authorized Capital – unlimited common shares without par value

b) Issued and Outstanding Capital: 136,937,725 shares outstanding

Outstanding shares as of January 31, 2011 134,044,868

Warrants exercised at
.10 2,000,000

Private Place at
.14 892,857

Total outstanding as March 31, 2011 136,937,725

c) Stock Options Outstanding at March 31, 2011:

Expiry

Price

($)

Average

Remaining

Life (years)

Outstanding

May 01, 2010 Granted Exercised Expired

Outstanding

March 31, 2011

July 13, 2015 0.1 4.70 - 8,000,000 (8,000,000) - -

Sept 28, 2015 0.12 4.91 - 3,549,500 (3,549,500) - -

- 11,549,500 (11,549,500) - -

d) Share Purchase Warrants Outstanding at March 31, 2011:

Expiry Price($)

Outstanding

May 01, 210 Granted Exercised Expired

Outstanding

March 31, 2011

Jan. 13, 2014 0.05/0.10 (i) 1,250,000 - - - 1,250,000

Aug. 26, 2014 0.05/0.10 (i) 10,350,000 - (10,350,000) - -

April 28, 2012 0.10/0.15(ii) - 15,300,000 (5,900,000) - 9,400,000

Aug. 26, 2012 01.5/0.20(iii) - 11,400,000 - - 11,400,000

Feb 23, 2016 0.15 - 892,857 - - 892,857

11,600,000 27,592,857 (16,250,000) - 22,942,857

(i) The exercise price of these warrants is
.05 in the first year and
.10 for remaining four years

(ii) The exercise price of these warrants is
.10 in the first year and
.15 for the remaining second year.

(iii) The exercise price of these warrants is
.15 in the first year and
.20 for the remaining second year.

Subsequent Events

a) On February 17, 2011, a total of 2,000,000 warrants were exercised at
.10 for gross

proceeds of $200,000.

b) On February 23, 2011, a total of 892,857 units were issued at
.14 per unit for gross

proceeds of $125,000. Each unit comprises one common share of the company and

one share purchase warrant exercisable into one common share in the capital of the

company for five years at the exercise price of 15 cents per share.

c) The Company is required to file restatement adjustments relating to flow through

shares for their audited financials dated April 2010, and subsequent quarterlies dated

July 2010 and October 2010. The restatement adjustments covering these periods

have been inserted into this quarterly filing to reflect the changes required. During

early April the company will be re-filing restated adjustments on the financials for April

2010 and the subsequent two quarters.

Outlook

Financing efforts will be continued for the near future.

Disclosure Controls

Management has designed disclosure controls and procedures, or has caused them to be

designed under its supervision, to provide reasonable assurance that material information

relating to the Company, is made known to management by others within the Company,

particularly during the period in which the annual filings are being prepared.

Management has also designed such internal controls over financial reporting, or caused

it to be designed under management’s supervision, to provide reasonable assurance

regarding the reliability of financial period ended January 31, 2011 in accordance with

Canadian generally accepted accounting principles (“GAAP”). Canadian GAAP has

become very complex and, as a venture issuer, the Company has limited personnel and

resources. Therefore, despite management’s efforts, there is a risk that interim financial

statements may not conform to Canadian GAAP.

There has been no change in the Company’s disclosure controls and procedures or in the

Company’s internal control over financial reporting that occurred during the most recently

completed quarter that has materially affected, or is reasonably likely to materially affect,

the Company’s disclosure controls and procedures or internal control over financial

reporting.

Addition Information

Additional information related to the Company is available on SEDAR’s website at

‘www.sedar.com’.

Date: March 31, 2011