2

                 UNITED STATES SECUITIES AND EXCHANGE COMMISSION
                             WASHINGTON, D.C.  20549

                                    FORM 20-F

[  ]    REGISTRATION  STATEMENT  PURSUANT  TO  SECTION  12(b)  OR  (g)  OF  THE
        SECURITIES  EXHANGE  ACT  OF  1934

[X]     ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE
        ACT  OF  1934.  For  the  Fiscal  Year  Ended  FEBRUARY  28,  2003
                                                       -------------------

[  ]    TRANSITION  REPORT  PURSUANT  TO SECTION 13 OR 15 (d) OF THE SECURITIES
        EXCHANGE  ACT  OF  1934.  For  transition  period  from  ____ to ______

    Commission  File  Number:  0-26566

                              DONNER MINERALS LTD.
                              --------------------
             (Exact name of Registrant as specified in its charter)

                                 NOT APPLICABLE
                                 --------------
                 (Translation of Registrant's name into English)

                                     CANADA
                                     ------
                 (Jurisdiction of Incorporation or Organization)

      SUITE 1360 - 605 ROBSON STREET, VANCOUVER, BRITISH COLUMBIA  V6B 5J3
      --------------------------------------------------------------------
                     (Address of Principal executive office)

Securities  registered or to be registered pursuant to Section 12(b) of the Act:
NOT  APPLICABLE

Securities  registered or to be registered pursuant to Section 12(g) of the Act:
COMMON  SHARES,  WITHOUT  PAR  VALUE

Securities  for  which there is a reporting obligation pursuant to Section 15(d)
of  the  Act:  NONE

Number  of  outstanding  shares  of  each of the Company's classes of capital or
common  stock  as  of  September 30, 2003: 73,980,541 COMMON SHARES, WITHOUT PAR
VALUE

Indicate by check mark whether the Registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding  12  months  (or  for such shorter period that the Registrant was
required  to  file  such  reports),  and  (2)  has  been  subject to such filing
requirements  for  the  past  90  days:  NOT  APPLICABLE

Indicate by check mark which financial statement item the Registrant has elected
to  follow:
Item  17    X  Item  18  ___
          ---

(APPLICABLE  ONLY  TO  ISSERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST
FIVE  YEARS)

Indicate  by  check  mark  whether  the  Registrant  has filed all documents and
reports  required  to  be  filed  by  Section  12, 14 or 15(d) of the Securities
Exchange  Act  of 1934 subsequent tot he distribution of securities under a plan
confirmed  by  court.  NOT  APPLICABLE


<PAGE>
                             CURRENCY EXCHANGE RATES

     The  Company's accounts are maintained in Canadian dollars.  In this Report
all  dollar  amounts  are  expressed  in Canadian dollars except where otherwise
indicated.

     The rate of exchange means that noon buying rate in New York City for cable
transfer  in  Canadian  dollars as certified for customs proposed by the Federal
Reserve  Bank  of  New York.  The average rate means the average of the exchange
rates  on  the  last  date  of  each  month  during  a  year.

                                2002      2001       2000       1999       1998

                     High    $1.6125    $1.6034    $1.5583    $1.4849    $1.5770
                      Low     1.5122     1.4935     1.4318     1.4420     1.4100
       Average for Period     1.5702     1.5494     1.4854     1.4857     1.4894
            End of Period     1.5776     1.5928     1.4995     1.4433     1.5375

The  exchange  rate  on  February  28,  2003  was  1.4840.

The  high  and low exchange rates for the most recent six months are as follows:

               April      May        June       July       August     September
                2003      2003       2003       2003       2003        2003

     High     1.4785     1.4197     1.3695     1.4163     1.4072     1.3918
      Low     1.4334     1.3507     1.3350     1.3354     1.3795     1.3470

                       MEASUREMENT CONVERSION INFORMATION

     In this Report, metric measures are used with respect to mineral properties
described  herein.  For  ease of reference, the following conversion factors are
provided:

1  mile       =  1.609 kilometers 2,204  pounds             =  1  tonne
1  yard       =  0.9144  meter    2,000 pounds/1 short  ton =  0.907 tonnes
1  acre       =  0.405  hectare   1  troy  once             =  31.103  grams
1 U.S. gallon =  3.785  litres    1  imperial  gallon       =  4.546 litres

<PAGE>
                                    GLOSSARY

THE  FOLLOWING  ARE  ABBREVIATIONS AND DEFINITIONS OF TERMS COMMONLY USED IN THE
MINERAL  INDUSTRY  AND  THIS  REPORT.

Airborne  Geophysical
Survey		A  geophysical  technique  carried  out  from  a  plane  or
		helicopter.

Anomaly		A  deviation  from  the  typical  geological  pattern.

Anorthosite	A  type  of  igneous  rock.

Basalt		A  type  of  Igneous  Rock

Chalcopyrite	A  mineral  containing  copper,  iron and sulphur and is an ore
		mineral  of  copper.

Co		The  chemical  symbol  for  cobalt.

Cobalt		A  tough  shiny  silver-white  magnetic  metallic  chemical
		element commonly  associated  with  iron  and  nickel.

Copper		A  malleable  reddish  metallic  chemical  element.

Craton		A  major  structual  unit  of the earth's crust consisting of a
		large stable  land  mass.

Cu		The  chemical  symbol  for  copper.

Cut-off  grade	The  minimum  grade  of  ore used to establish reserves.

Disseminated	Fine  particles of a mineral dispersed throughout the host
		rock.

Dyke		A  tabular  body  of  igneous  rock  that  cuts across the
		structure of adjacent  rocks.

EM Survey	A  type of geophysical survey that measures the conductivity of
		a rock  unit.

Erosion		The  wearing  away  of  land  by  mechanical  action.  (i.e.
		wind, glaciers,  rivers).

Erosional  Remnant The portion of land remaining after erosion has occurred.

Fault		A  fracture in rock along which there has been displacement of
		the two sides.

Fire  Assay	The  assaying  of  metallic  ores,  usually  gold and silver, by
		methods  requiring  furnace  heat.

Fracture		Breaks  in  rocks  due  to intensive folding or faulting.

Gabbro		A  type  of  igneous  rock.

Geophysical
Surveys		The  use  of  one  or  more  geophysical  techniques in
		geophysical  exploration.

Glaciated Terrain	An  area previously and or actively covered by a glacier.

Gneiss		A  term applied to banded rocks formed during metamorphism.

Gossan 		An  iron-bearing  weathered  product  overlying  a  sulfide
		deposit.

Grab  Samples	A  sample  of rock taken more or less indiscriminately at
		any  place.

Granite		A  type  of  igneous  rock.

Gravity  Survey	A  type of geophysical survey that measures the density
		of  rock.

Horizon		A  time-plane recognizable in rocks by some characteristic
		feature

Igneous  Rock	A  rock  formed  by the crystallization of magma or lava.

Intrusion	A  body  of  igneous  rock  which  has  forced  itself  into
		pre-existing  rocks.

Iron		A  heavy  magnetic  metallic  chemical  element.

Joint		A fracture in a rock between the sides of which there is no
		observable relative  movement.

Km		A  measure  of  distance  known  as  a  kilometre.

Limonitic	Consisting of, or resembling, limonite in appearance, an
		important ore  of  iron.

Magma		Liquid or molten rock material formed deep within the earth and
		called lava  when  it  reaches  the  surface.

Massive Sulphide	A  rock  comprised  entirely of metallic minerals of which
		iron  and  sulphur  are  always  present.

Metamorphism	The  processes  by  which  changes  are  brought about in rocks
		within  the  earth's  crust  by  the  agencies  of  heat.

Mineralization	The  concentration  of  metals  and  their chemical compounds
		within  a  body  of  rock.

Mineralized zone	A  specific  area in a host rock where mineralization
		occurs.

Mineral Resource	Consists  of  a  deposit  or  concentration  of  a  solid,
		inorganic  or  organic  fossilized  substance  of  potential
		economic interest, accessible  from  the  surface  of  the
		earth,  and  delimited at the measured, indicated,  or  inferred
		levels.

Mg		The  chemical  symbol  for  magnesium.

Mafic Intrusive	The  type  of  igneous rock that has intruded (forced) into
		another  pre-existing  rock.

Ni		The  chemical  symbol  for  nickel.

Nickel		A  hard  silver  white  metallic  chemical  element.

Norite		A  type  of  igneous  rock.

NSR		Net  Smelter  Returns.

Olivine		A  type of silicate mineral containing iron and magnesium.

Ore		A  natural  aggregate of one or more minerals which, at a
		specified time and  place,  may  be  mined and sold at a profit,
		or from which some part may be profitably  separated.

Ore  Reserve	Consists  of  the  portion  of a measured and indicated mineral
		resource  which  can  be  extracted  or  produced  legally  and
		profitably,  at conditions  established  in  a  production
		feasibility  study.

Pentlandite	A  mineral  containing  nickel, iron and sulphur and is a common
		ore  mineral  of  nickel.

Petrographic
Examination	Simply  a description of the rock in hand specimen and thin
		section.

Peridotite	A  type  of  Igneous  rock

Pluton		Large  scale  mass  of  an  igneous  rock.

ppb              Parts  per  billion.

ppm              Parts  per  million.

Pyroxene		A  common  group  of minerals characterized by short stout
		crystals and good prismatic cleavage in two directions
		intersecting at angles of about 87 degrees  and  93  degrees.

Pyrrhotite	An  iron  sulphide  mineral.

Sedimentary Rock	Rocks formed from material derived from pre-existing rocks

Shear 		A  fracture  in  rock  similar  to  a  fault.

Sill		A  tabuler or sheet like body of igneous rock that is injected
		parallel to  the  structure  of  adjacent  rocks.

Strike		The  course  or  bearing  of  a  bed  or  layer  of  rock.

Stringer		A  narrow  vein  or irregular filament of mineral traversing a
		rock mass  of  different  material.

Troctolite	A  type  of  igneous  rock.

Ultramafic Rock	A  type  of  igneous  rock

Vein		A  vein  is  a  tabular  or  sheet-like body of minerals which
		has been intruded  into  a  joint  or  fissure  in  a  rock.

Volcaniclastic 	A  type  of sedimentary rock which is composed primarily
		of  volcanic detritus

<PAGE>
                                     PART I

ITEM  1.  IDENTITY  OF  DIRECTORS  SENIOR  MANAGEMENT  AND  ADVISERS

     Information  called  for  in  Item  1  is not required in an Annual Report.

ITEM  2.  OFFER  STATISTICS  AND  EXPECTED  TIMETABLE

     Information  called  for  in  Item  2  is not required in an Annual Report.

ITEM  3.  KEY  INFORMATION

A.  SELECTED  FINANCIAL  DATA
-----------------------------

     The  Company  has a limited history of operations and has not generated any
operating  revenues.  The  following  table  sets  forth, for the period and the
dates  indicated,  selected  financial and operating data for the Company.  This
information  should  be  read  in  conjunction  with  the  Company's  Financial
Statements  and Notes thereto and "Operating and Financial Review and Prospects"
included  elsewhere  herein.  The selected financial data provided below are not
necessarily  indicative  of  the  future  results  of  operations  or  financial
performance of the Company.  To the best of management's knowledge, to date, the
Company  has  not paid any dividends on the Common Shares and it does not expect
to  pay  dividends  in  the  foreseeable  future.

     The  Consolidated  Financial Statements of the Company have been audited by
Deloitte & Touche LLP, independent chartered accountants, and have been prepared
in accordance with accounting principles generally accepted in Canada ("Canadian
GAAP").  These  principles,  as applied to the Company, do not differ materially
from those generally accepted in the United States ("U.S. GAAP"), except for the
differences  outlined  in  note  15  of the consolidated financial statements in
"Item  17.  Financial  Statements."

<TABLE>
<CAPTION>

<S>                          <C>     <C>         <C>      <C>           <C>

Year Ended February 28 (29)  2003   2002        2001     2000          1999
--------------------------------------------------------------------------------
                                 (restated)  (restated)  (restated)  (restated)
Amounts in Accordance with
Canadian GAAP:
Total assets. . . .. $ 5,475,227 $ 4,372,531 $ 4,620,376 $ 4,869,164 $ 7,318,903
Net working capital  $ 2,561,943 $ 1,551,049 $ 2,102,276 $2,055,988  $ 3,747,674
Share capital . . .  $35,971,592 $32,230,487 $31,888,637 $31,558,637 $29,965,337
Shareholders' equity $ 4,850,725 $ 3,858,282 $ 4,611,125 $ 4,826,234 $ 6,619,865
Loss. . . . . . . . $(2,865,222)$(1,094,693)$  (545,109)$(3,347,143)$(7,148,951)
Loss per share. .  . $   (0.05) $   (0.02)  $     (0.01)$     (0.08)$     (0.22)
Weighted average number of
common shares . . .   56,255,479  46,261,873 44,196,164   41,708,273  32,136,703

Amounts in Accordance with
U.S. GAAP:
Total assets. . . . $ 2,880,521  $ 1,734,025 $ 2,478,725 $ 2,746,016 $4,772,579
Net working capital $ 2,570,878  $ 1,555,984 $ 2,136,167 $ 2,055,988 $3,747,674
Share capital . .. .$35,977,272  $32,086,667 $31,744,817 $31,414,817 $29,821,517
Shareholders' equity$ 2,256,019  $1,219,776  $ 2,469,474 $ 2,703,086 $4,073,541
Loss. . . . . .    $(3,502,846) $(2,335,074) $ (539,430)$(3,145,142)$(8,280,781)
Loss per share. . ..$    (0.06) $     (0.05) $    (0.01) $   (0.08)  $   (0.26)
Weighted average number of
common shares . . . 56,255,479   46,261,873  44,196,164   41,708,273 32,136,703


</TABLE>

(i)     Effective  February  28,  2003,  the  Company  changed  its  method  of
accounting  for  mineral exploration expenditures, from deferring them until the
viability  of  a  project  was  determined,  to  charging  them to operations as
incurred.  Under  the  new  policy,  only  expenditures  incurred  on properties
identified as having substantial evidence that a commercial body of ore has been
located  are  capitalized  and  accounted  for  in accordance with the Company's
accounting  policy  for  mineral  properties.

     The  new  policy  is  consistent  with current reporting practices in the
mining industry  and  management  considers  the  change will appropriately
present the Company's  operations  and  financial  position.  This  change,
which  has been applied retroactively with restatement of prior years, increased
(decreased) net loss by $926,699 for 2003 (2002 - $222,767; 2001 - ($784,162)).
Loss per share increased by $(0.02) for 2003 (2002 - $Nil) and decreased by 0.02
for 2001. As at  February  28,  2003, advances for exploration increased by
$480,173, deficit increased  by  $13,531,230,  mineral  properties  decreased by
$16,557,177 and non-controlling  interest  decreased  by  $2,544,910.

B.  CAPITALIZATION  AND  INDEBTEDNESS
-------------------------------------

     As  of  September  30,  2003,  the  Company  had  73,980,541  common shares
outstanding  with  a  market  capitalization  of  $15,535,914.

     The Company does not currently have any debt obligations or indebtedness in
the  form  of  guaranteed or unguaranteed, secured or unsecured, and/or indirect
contingent  indebtedness.

C.  RISK  FACTORS
-----------------

     The  following  risks  relate  specifically  to  the Company's business and
should be considered carefully.  The Company's business, financial condition and
results  of  operations could be materially and adversely affected by any of the
following  risks.

(1)     The  mineral properties of the Company are in the exploration stage only

The property interests owned by the Company or in which it has an option to earn
an  interest  are  in  the  exploration stages only, are without known bodies of
commercial  mineralization  and  have  no  ongoing  mining  operations.  Mineral
exploration involves a high degree of risk and few properties which are explored
are  ultimately  developed  into  producing  mines. Exploration of the Company's
mineral  exploration  properties may not result in any discoveries of commercial
bodies  of  mineralization.  If  the  Company's  efforts  do  not  result in any
discovery  of  commercial mineralization, the Company will be forced to look for
other  exploration  projects  or  cease  operations.

(2)     The  Company  has  no  significant  source  of  operating  cash  flow

The  Company's  properties are currently being assessed for exploration and as a
result,  the  Company  has  no  source  of operating cash flow.  The Company has
limited  financial means and there is no assurance that if additional funding is
required  that  it  will  be  available  to  the Company on terms and conditions
acceptable  to it.  Failure to obtain additional financing could result in delay
or  indefinite  postponement of further exploration and the possible, partial or
total  loss  of  the  Company's  interest  in  some  or  all  of its properties.
Accordingly,  its  success  and  commercial viability depends upon the Company's
ability  to  obtain  financing  through  any  or  all  of the joint venturing of
projects,  debt financing, equity financing and/or a combination thereof.  There
is  no  assurance  that the Company will be successful in obtaining the required
financing.

(3)     The  possibility  of any of the Company's mineral properties ever having
ore  reserves  is  extremely  remote

The  Company has no known ore reserves.  The possibility of any of the Company's
mineral  properties  ever  having ore reserves is extremely remote and any funds
spent  on  exploration will probably be lost. The Company's success depends upon
finding ore reserves. If the Company does not find an ore reserve either because
it  does  not have the money to do so or because it is not economically feasible
to  do  it,  the  Company  will  cease  operations.

(4)     Government  expropriation  or  regulation  may  prevent  or  restrict
exploration  of  any  of  the  Company's  mineral  properties

Factors such as governmental expropriation or regulation may prevent or restrict
exploration  of  the Company's mineral properties. Exploration activities may be
affected  in  varying degrees by government policies and regulations relating to
mineral  exploration.  Any  changes  in  regulations  or  shifts  in  political
conditions  are  beyond  the control of the Company and may adversely affect its
business.  Operations  may  be  affected  in  varying  degrees  by  government
regulations  with  respect  to  income  taxes,  expropriation  of  property,
environmental  legislation  and  safety  regulations.

(5)     The  Company  has  a  history  of  operating  losses

The  Company  sustained  operating  losses  for  each  of the fiscal years ended
February  28/29  2003,  2002,  2001,  2000,  and 1999 of $2,865,222, $1,094,693,
$545,109,  $3,347,143,  and  $7,148,951  respectively.

(6)     As  the  Company  is  a  Canadian  company  it may be difficult for U.S.
shareholders  of  the  Company to effect service on the Company or to realize on
judgements  obtained  against  the  Company  in  the  United  States

The  Company  is  a Canadian corporation.  All of its directors and officers are
residents  of  Canada  and  a  significant  part  of its assets are, or will be,
located  outside  of  the  United  States.  As a result, it may be difficult for
shareholders  resident  in the United States to effect service within the United
States upon the Company, directors, officers or experts who are not residents of
the United States, or to realize in the United States judgments of courts of the
United  States  predicated upon civil liability of any of the Company, directors
or  officers  under the United States federal securities laws.  If a judgment is
obtained  in  the  U.S.  courts  based on civil liability provisions of the U.S.
federal  securities  laws  against  the Company or its directors or officers, it
will  be  difficult  to  enforce the judgment in the Canadian courts against the
Company  and  any  of  the  Company's  non-U.S.  resident  executive officers or
directors.  Accordingly,  United  States  shareholders  may  be  forced to bring
actions  against  the  Company  and  its respective directors and officers under
Canadian law and in Canadian courts in order to enforce any claims that they may
have  against the Company or its directors and officers. Nevertheless, it may be
difficult  for  United  States  shareholders  to bring an original action in the
Canadian courts to enforce liabilities based on the U.S. federal securities laws
against  the  Company  and  any  of  the  Company's  non-U.S. resident executive
officers  or  directors.

(7)     The  mineral  exploitation  industry is intensely competitive in all its
phases and the Company competes with many companies possessing greater financial
resources  and  technical  facilities  than  itself

The mineral resources industry is intensely competitive and the Company competes
with  many companies that have greater financial means and technical facilities.
Significant  competition  exists  for  the limited number of mineral acquisition
opportunities available.  As a result of this competition, the Company's ability
to  acquire  additional  attractive  mineral  properties  on  terms it considers
acceptable  may  be  adversely  affected.

The  Company  may,  in the future, be unable to meet its share of costs incurred
under agreements to which it is a party and the Company may have its interest in
the  properties subject to such agreements reduced as a result.  Furthermore, if
other  parties  to  such  agreements  do not meet their share of such costs, the
Company  may be unable to finance the costs required to complete the recommended
programs.

(8)     The  Company  does  not  presently  have  insurance,  in any significant
amounts, covering any of its mineral properties and as a consequence could incur
considerable  costs

Mineral  exploration  involves  risks,  which  even a combination of experience,
knowledge  and  careful  evaluation  may not be able to overcome.  Operations in
which  the  Company  has a direct or indirect interest may be subject to all the
hazards and risks normally incidental to mineral exploration, any of which could
result in work stoppages, damage to property, and possible environmental damage.
The  Company  does  not  presently  have  insurance, in any significant amounts,
covering  its  mineral  properties  and  does  not  presently  intend  to obtain
liability insurance in an amount which it would consider adequate; the nature of
the  risks  associated  with  the  Company's activities is such that liabilities
might  exceed  policy limits, the liabilities and hazards might not be insurable
against,  or  the  Company  might  not  elect  to  insure  itself  against  such
liabilities  due  to  high  premium  costs  or other reasons, in which event the
Company  could  incur  significant  costs  that  could have a materially adverse
effect  upon  its  financial  condition  and  even  cause  the  Company to cease
operations.

To  date,  the  Company  has  not experienced any material losses due to hazards
arising  from  its  operations.

(9)     The  Company's  mineral  properties may be subject to prior unregistered
agreements  or  transfers  or  native  land  claims and title may be affected by
undetected  defects

Although the Company has sought and received such representations as it has been
able to achieve from vendors in connection with the acquisition of or options to
acquire  an  interest  in  its  mineral  properties  and  has  conducted its own
investigation  of  legal title to each such property, the mineral properties may
be  subject  to prior unregistered agreements or transfers or native land claims
and  title  may  be  affected  by  undetected  defects.

(10)     The  Company's  mineral  properties  located in Labrador are subject to
native  land  claims  which  may  affect  the  ability of the Company to exploit
mineral  properties  in  Labrador

The  Newfoundland  Department  of  Natural  Resources,  has  notified holders or
potential  holders  of  mineral  rights in Northern Labrador that mineral rights
issued  by  the  department in Northern Labrador, which are situated within both
the  Labrador  Inuit  and  Innu  Nation claim areas, may be subject to "interest
granted  to the Labrador Inuit and/or Innu Nation under any land claim agreed to
by  the Government".  The claims of the Innu Nation and the Labrador Inuit could
materially  and  adversely  affect the ability of the Company to exploit mineral
properties  in Labrador.  In addition, notice has been received from the Nunavik
Inuit,  through  their legal counsel, of certain land claims made by the Nunavik
Inuit in Labrador.  The Nunavik Inuit are separate and distinct from the LIA and
their  land  claims are in addition to those of the LIA.  The Nunavik Inuit have
requested  that certain agreements be entered into with respect to activities to
be undertaken on lands where they claim an interest.  As with land claims of the
Innu  Nation and the Labrador Innuit, the land claims of the Nunavik Inuit could
materially  and  adversely  affect the ability of the Company to exploit mineral
properties  in  Labrador  and  may  prevent  any  exploitation  of  the  mineral
properties  in  Labrador  on  an  economic  basis.

(11)     All  phases  of  the  Company's  operations  in  Canada  are subject to
environmental  regulations  which  may  cause  the  Company  to  invoke stricter
standards

All  phases  of  the Company's operations in Canada are subject to environmental
regulations.  Environmental  legislation in Canada is evolving in a manner which
may  require  stricter  standards and enforcement, increased fines and penalties
for  non-compliance,  more  stringent  environmental  assessments  of  proposed
projects  and  a  heightened  degree  of  responsibility for companies and their
officers,  directors  and employees.  Legislation and regulations implemented by
the Government of Newfoundland and Labrador directly affect the mineral industry
in  the  Province of Newfoundland and Labrador, the location at the South Voisey
Bay  Properties  and  the  Labrador  Regional  Properties.  Legislation  and
regulations  implemented  by the Manitoba Government directly affect the mineral
industry  in  the  Province  of  Manitoba,  the  location  of  the Stephens Lake
Property.  In  particular,  the  Company  must  provide  prior  notice  and  a
description of the planned exploration work before the commencement of the work.

Although  compliance with such laws is not presently a significant factor in the
Company's  operations, there is no assurance that compliance with future changes
in  environmental  regulation,  if  any, will not adversely affect the Company's
operations.

(12)     Fluctuating  mineral  prices

The  Company's  ability  to  raise  additional  funds  for  exploration, and the
commercial  viability  of  a  mineral  project,  are  affected  by  the price of
minerals.  Factors  beyond  the  control  of  the Company affect mineral prices,
including  international  economic  and  political  trends,  expectations  of
inflation,  currency  exchange  fluctuations  (specifically,  the  U.S.  dollar
relative to other currencies), interest rates and global or regional consumption
patterns, speculative activities and increased production due to improved mining
and  production  methods.  The  effect of these factors on the price of minerals
and  therefore  the  impact  on  the  Company  cannot  accurately  be predicted.

(13)     The  Company's  future  performance  is  dependent  on  key  personnel

The  Company's  performance  is  substantially  dependent on the performance and
continued  efforts  of the Company's executives and its Board of Directors.  The
loss  of  the  services of any of the Company's executives or Board of Directors
could  have  a  material  adverse  effect  on  the  Company business, results of
operations  and  financial  condition.  The Company currently does not carry any
key  person  insurance  on  any  of  its officers or the members of the Board of
Directors.

(14)     No  dividends  declared  or  any  likely  to  be declared in the future

To  the  best  of  Management's  knowledge,  the  Company  has  not declared any
dividends  since  its inception, and has no present intention of paying any cash
dividends  on  its  common  stock in the foreseeable future.  The payment by the
Company  of  dividends,  if  any,  in the future, rests on the discretion of the
Company's  Board  of  Directors  and  will  depend, among other things, upon the
Company's earnings, its capital requirements and financial condition, as well as
other  relevant  factors.

(15)     The  possible issuance of additional shares may impact the value of the
Company  stock

As  at  February 28, 2003, the Company had reserved 25,139,858 Common Shares for
issuance  upon  the  exercise  of stock options, the exercise of warrants and in
connection  with  its  property  acquisition  commitments.  Such  Common  Shares
represent  a  potential  equity  dilution  of  approximately 27%, based upon the
number  of  outstanding  Common  Shares  of  68,255,541 as at February 28, 2003.
Furthermore,  the  Company  may enter into commitments in the future which would
require  the issuance of additional Common Shares and may grant additional stock
options  and/or issue additional warrants.  As at February 28, 2003, the Company
had 6,604,601 authorized but unissued and unreserved Common Shares.  Issuance of
additional  shares  would  be  subject  to  certain  regulatory  approvals  and
compliance with applicable securities legislation.  The Company currently has no
plans  to  issue Common Shares other than for the purposes of raising funds, for
property  acquisition  and  general  working capital requirements which issuance
would  be  subject  to  regulatory  approval.

<PAGE>

(16)     Forward  Looking  Statements

This  Form  20-F  includes  "forward-looking  statements"  A  shareholder  or
prospective  shareholder  should  bear this in mind when assessing the Company's
business.  All  statements,  other than statements of historical facts, included
in  this  registration  statement, including, without limitation, the statements
under  and  located  elsewhere  herein  regarding  industry  prospects  and  the
Company's  financial  position  are  forward-looking  statements.  Although  the
Company  believes  that  the  expectations  reflected  in  such  forward looking
statements  are  reasonable, it can give no assurance that such expectation will
prove  to  have been correct. There is significant risk that actual results will
vary,  perhaps  materially  from  results projected depending on such factors as
general  economic conditions, financial markets, mineral prices, technology, and
exploration  hazards.

(17)     Conflicts  of Interest of certain directors and officers of the Company

Certain directors of the Company are also directors, officers or shareholders of
other  companies  that  are  similarly  engaged  in  the  business of acquiring,
developing  and  exploiting  natural resource properties.  Such associations may
give  rise to conflicts of interest from time to time.  In particular, directors
of  the  Company  who  also  serve  as  directors of other companies in the same
industry  may  be presented with business opportunities which are made available
to  such  competing  companies  and  not  to  the Company.  The directors of the
Company are required by law to act honestly and in good faith with a view to the
best  interests  of the Company, to disclose any interest which they may have in
any  project  or  opportunity of the Company, and to abstain from voting on such
matter.

(18)     The  value  and  transferability of the Company shares may be adversely
impacted by the limited trading market for the Company's common stock, the penny
stock  rules  and  futures  share  issuance.  There  is a limited market for the
Company's  common  stock  in  the  United  States

No  assurance  can be given that a market for the Company's common stock will be
quoted  on  an  exchange  in the U.S. or on the NASD's Over the Counter Bulletin
Board.

The  sale  or transfer of the Company common stock by shareholders in the United
States  may  be  subject  to  the  so-called  "penny  stock  rules."

Under  Rule  15g-9 of the Exchange Act, a broker or dealer may not sell a "penny
stock" (as defined in Rule 3a51-1) to or effect the purchase of a penny stock by
any  person  unless:

(a)     such  sale  or  purchase  is  exempt  from  Rule  15g-9;

(b)     prior  to  the  transaction  the broker or dealer has (1)  approved  the
person's  account  for transaction in penny stocks in accordance with Rule15g-9,
and  (2)  received  from  the  person  a  written  agreement  to the transaction
setting  forth the identity and quantity of the penny stock to be purchased; and

(c)     the  purchaser  has been provided an appropriate disclosure statement as
to  penny  stock  investment.

The SEC adopted regulations that generally define a penny stock to be any equity
security  other  than  a  security excluded from such definition by Rule 3a51-1.
Such exemptions include, but are not limited to (1) an equity security issued by
an  issuer  that  has  (i)  net  tangible assets of at least $2,000,000, if such
issuer  has  been  in  continuous operations for at least three years,  (ii) net
tangible  assets  of  at least $5,000,000, if such issuer has been in continuous
operation  for  less  than  three  years,  or  (iii) average revenue of at least
$6,000,000  for  the  preceding three years;  (2) except for purposes of Section
7(b)  of  the Exchange Act and Rule 419, any security  that has a price of $5.00
or more;  and (3) a security that is  authorized  or approved for  authorization
upon  notice  of  issuance  for  quotation  on  the NASDAQ Stock Market,  Inc.'s
Automated  Quotation  System.  It  is likely that shares of the Company's common
stock, assuming a market were to develop in the US therefore, will be subject to
the  regulations  on  penny  stocks;  consequently, the market liquidity for the
common  stock may be adversely affected by such regulations limiting the ability
of  broker/dealers  to  sell  the  Company's  common  stock  and  the ability of
shareholders  to  sell  their  securities  in  the  secondary  market in the US.

Moreover,  the  Company  shares  may  only be sold or transferred by the Company
shareholders  in  those  jurisdictions  in the US in which an exemption for such
"secondary  trading"  exists  or  in  which the shares may have been registered.

ITEM  4.  INFORMATION  ON  THE  COMPANY

A.  HISTORY  AND  DEVELOPMENT  OF  THE  COMPANY
-----------------------------------------------

     Donner  Minerals  Ltd.  (the  "Company")  was  incorporated  as a specially
limited  company  under  the Companies Act (British Columbia) on April 25, 1966,
under the name Swim Lake Mines Ltd. (N.P.L.).  Effective September 11, 1974, the
Company  converted  to a limited company under the same name.  Effective October
30,  1978,  the  Company  changed  its  name  to  Karma  Ventures  Incorporated.
Effective  December  21,  1982, the Company changed its name to Donner Resources
Ltd.,  and  effective  November  7, 1997, the Company changed its name to Donner
Minerals  Ltd.

     The  Company's  office  is situated at 1360 - 605 Robson Street, Vancouver,
British  Columbia,  V6B  5J3.  The Company's telephone number is (604) 683-0564.
The  Company  is  a  reporting  issuer  in the Provinces of British Columbia and
Alberta, Canada.   The Company's common stock has been listed for trading on the
TSX  Venture  Exchange  since June 6, 1989.  The Company's common stock has been
listed for trading on the Frankfurt stock exchange since February 18, 2002.  See
"Item  9(A)  -  Listing  Details  and  Markets."

     The  Company  has spent $1,417,855 over the past 3 years on acquisitions of
mineral  properties  and  exploration  expenditures.

     In  April,  2001,  the  Company  and certain of its partners, contributed a
significant  portion  of  its  South Voisey Bay Properties to a new company, SVB
Nickel  Company  Ltd.  ("SVBN"), which company is majority owned by the Company.
See  "SVB  Nickel  Company  Ltd."

     In  September 2001, the Company, together with SVBN, and other South Voisey
Bay  Properties  interest holders, entered into an option earn-in agreement with
Falconbridge  Limited  ("Falconbridge"),  whereby  Falconbridge  can  earn a 50%
interest  in  the  South  Voisey  Bay  Properties  by  spending  $23  million on
exploration.  See  "Falconbridge  Option  Agreement."

     In  March 2003, the Company acquired, through a private placement 8,000,000
shares and warrants of Knight Resources Ltd. ("Knight").  The Company and Knight
have  common  officers  and  directors.  At September 30, 2003, the Company owns
approximately  23%  of  Knight.

B.  BUSINESS  OVERVIEW
----------------------

     The  Company  is  engaged  in  the location, acquisition and exploration of
mineral  resources  properties.

     The  Company  has since September 1995 acquired varying interest in mineral
claims  in  Labrador, Newfoundland, referred to (collectively, the "South Voisey
Bay  Properties").  In  September  1996,  the  Company  granted  to  TeckCominco
("Teck")  the  exclusive  right and option to acquire up to 50% of the Company's
interest  in  any or all of the Company's property interests in the South Voisey
Bay  Properties.  In  April,  2001,  the  Company  and  certain of its partners,
contributed  a  significant  portion of its South Voisey Bay Properties to a new
company,  SVB  Nickel  Company Ltd. ("SVBN"), which company is majority owned by
the  Company.  In  September  2001,  the  Company, together with SVBN, and other
South  Voisey  Bay  Properties  interest holders, entered into an option earn-in
agreement  with  Falconbridge Limited ("Falconbridge"), whereby Falconbridge can
earn  a  50% interest in the South Voisey Bay Properties by spending $23 million
on  exploration.  See "Item 4(D) - Property, plants and equipment - South Voisey
Bay  Project,  Labrador."

<PAGE>

     In  January  2002,  the  Company  and  Falconbridge  Limited entered into a
separate  agreement  (the 'Labrador Regional Agreement') to explore for Voisey's
Bay  type  nickel-copper-cobalt deposits in Labrador outside of the Voisey's Bay
and South Voisey Bay areas.  Under the Labrador Regional Agreement, the partners
have  agreed  to  each  spend  a  minimum  of $200,000 per year, over a two year
period.  Any properties acquired will form part of a Joint Venture in which both
the  Company  and  Falconbridge  will  have  a  50%  interest.  See "Item 4(D) -
Property,  plants  and  equipment  -  Labrador  Regional  Agreement."

     In February 2002 the Company entered into an agreement with Falconbridge to
earn  a  50%  participating joint venture interest in the Stephens Lake Property
located  in  Manitoba  by  incurring  a  total  of $5,000,000 of expenditures by
December  31, 2006.  The Company is required to incur a minimum of $1,000,000 of
expenditures  per  calendar  year to keep the option in good standing. See "Item
4(D)  -  Property,  plants  and  equipment  -  Stephens Lake Project, Manitoba."

     The  Company  is  in  the  exploration  stage on its mineral properties and
therefore  has  no  regular  cash flow.  The Company is, therefore, dependent on
raising  funds  by  the  issuance  of  shares  in  order  to  finance  further
acquisitions,  undertake  exploration of mineral properties and meet general and
administrative  expenses.  There  can  be  no assurance that the Company will be
successful  in  raising the required financing.  See "Item 3(B) - Risk Factors."

C.  ORGANIZATIONAL  STRUCTURE
-----------------------------

     The  Company  has  a  76.69%  interest in SVB Nickel Company Ltd. ("SVBN").
SVBN  is a Yukon company, incorporated on March 14, 2001.  SVBN holds certain of
the  South  Voisey  Bay  Properties.

D.  PROPERTY,  PLANTS  AND  EQUIPMENT
-------------------------------------

     The  Company  is  engaged  in  the location, acquisition and exploration of
mineral  resources properties.  The Company currently holds varying interests in
mineral  claims  located  in  Manitoba  (the  "Stephens  Lake  Property") and in
Labrador,  Newfoundland  (the  "South  Voisey  Bay  Properties"),  and  mineral
prospects  the Company is currently investigating in Labrador, Newfoundland (the
"Labrador  Regional  Properties"),  as  more  particularly  described  below.

<PAGE>

SOUTH  VOISEY  BAY  PROJECT,  LABRADOR

PROPERTY  DESCRIPTION  AND  LOCATION
------------------------------------



                               [GRAPHIC  OMITED]



                               [GRAPHIC  OMITED]


Figure  1.  Location  map  of  the  SVB  property  in  Labrador.

     The  South Voisey Bay Property is located 260 kilometres north-northwest of
Goose  Bay and about 90 kilometres south of the Voisey's Bay nickel, copper, and
cobalt deposits. The property encompasses portions of NTS sheets 13 M/08, and 09
as  well  as  13N/05  and  12 (Figure 1).  The main base camp for the project is
located  on  the  west  shore  of a large northwest-trending lake referred to as
Pants  Lake  (location,  6145450  N,  559250  E).

     Mapped  staked  licences  are  issued  under  the  Mineral  Act  from  the
Newfoundland government.  Assessment requirements in the first year are $200 per
claim,  and  the  assessment requirement escalates by $50 per claim per year for
the  first  five  years reaching $400 per claim in year five.  Years six through
ten  require $600 in annual assessment.  Also in year six, a licence renewal fee
of $50 per claim is charged.  A summary of the titles comprising the property is
shown  in  Table  1.

                        Table 1: Mineral Licence Summary

LICENCE # AGREEMENT     DATE ISSUED     EXPIRATION DATE  UNITS  HOLDER
1081M     Falconbridge  March  16,  1995   2011/03/16     80     SVBN
-----     ------------  ----------------   ----------     --     ----
3304M     Falconbridge  May  10,  1995     2004/06/12     157    SVBN
-----     ------------  --------------     ----------     ---    ----
5518M     Falconbridge  May  12,  1995     2010/02/12     158    Donner
-----     ------------  --------------     ----------     ---    ------
6077M     Falconbridge  April  14,  1998   2004/05/15     155    SVBN
-----     ------------  ----------------   ----------     ---    ----
7915M     Falconbridge  January  25,  2001 2010/02/26     12     SVBN
-----     ------------  ------------------ ----------     --     ----
7934M     Falconbridge  June  12,  1995    2008/06/12     192    SVBN
-----     ------------  ---------------    ----------     ---    ----
8001M     Falconbridge  April  13,  1995   2012/04/13     218    SVBN
-----     ------------  ----------------   ----------     ---    ----
8002M     Falconbridge  May  29,  1995     2011/05/29     178    SVBN
-----     ------------  --------------     ----------     ---    ----
8049M     Falconbridge  May  9,  2001      2004/06/11     172    SVBN
-----     ------------  -------------      ----------     ---    ----
8110M     Falconbridge  May  26,  1995     2008/05/26     6      SVBN
-----     ------------  --------------     ----------     -      ----
8111M     Falconbridge  May  26,  1995     2010/05/26     150    SVBN
-----     ------------  --------------     ----------     ---    ----
8190M     Falconbridge  May  18,  1995     2011/05/18     142    Commander
-----     ------------  --------------     ----------     ---    ---------
8192M     Falconbridge  May  9,  2001      2005/09/21     24     SVBN
-----     ------------  -------------      ----------     --     ----
8193M     Falconbridge  August  21,  2001  2003/09/21     56     SVBN
-----     ------------  -----------------  ----------     --     ----
8213M     Falconbridge  August  30,  2001  2003/10/01     208    SVBN
-----     ------------  -----------------  ----------     ---    ----
8431M     Falconbridge  January  18,  2002 2005/02/18     80     SVBN
-----     ------------  ------------------ ----------     --     ----
8050M     Falconbridge  May  9,  2001      2006/06/11     18     SVBN
-----     ------------  -------------      ----------     --     ----
8194M     Falconbridge  August  21,  2001  2003/09/21     56     SVBN
-----     ------------  -----------------  ----------     --     ----
5698M     Falconbridge  May  12,  1995     2007/09/08     24     SVBN
-----     ------------  --------------     ----------     --     ----
8195M     Falconbridge  August  21,  2001  2005/09/21     16     SVBN
-----     ------------  -----------------  ----------     --     ----
8214M     Falconbridge  August  30,  2001  2003/10/11     154    SVBN
-----     ------------  -----------------  ----------     ---    ----
8769M     Falconbridge  May  26,  1995     2005/05/26     147    SVBN
-----     ------------  --------------     ----------     ---    ----
8771M     Falconbridge  May  19,  1995     2005/05/19     175    SVBN
-----     ------------  --------------     ----------     ---    ----

     Since  1995,  the  Company acquired through staking, direct acquisition and
option  earn-in  agreements  with  various junior resource exploration companies
varying  interests  in  mineral  claims  in  the  South  Voisey  Bay  Property.

     In  September  1996,  the  Company  granted  to  TeckCominco  ('Teck')  the
exclusive right and option to acquire up to 50% of the Company's interest in any
or  all  of the Company's property interests in the South Voisey Bay Properties.
Teck  can  earn  this  interest  by financing the Company's share of feasibility
costs  and  arranging  the  Company's  share  of  production  financing.

     In  April  2001,  the  Company  entered  into  an  agreement  with  Cypress
Development  Corporation,  NDT  Ventures  Ltd., Rcom Ventures Ltd., UC Resources
Ltd.  ('UC'),  (collectively  the  'Participants')  to  merge  certain  of  the
Participant's  interest  in  the South Voisey Bay Properties into a new company,
SVB Nickel Company Ltd. ('SVBN').  Subsequently, UCR acquired Rcom's interest in
the  SVBN  mineral  licences.

     All  of  the  Company's  interest  in  the  South  Voisey  Bay Property was
transferred  to  SVBN,  except  for  its  interest in the DNA (Donner / Northern
Abitibi)  mineral  licences  and  DMG  mineral  licences (Donner/Commander) (see
Figure  2).  All of the other Participants transferred all of their interests in
the  South  Voisey Bay Properties to SVBN. SVBN's initial land holdings included
twenty mineral licenses covering approximately 549.5 square kilometres held 100%
by SVBN, with the exception of a 37.5 square kilometres portion in which Pallaum
has  a  25%  interest.  SVBN's  current land holdings include twenty one mineral
licenses  covering  569.2  square  kilometres  (the  'SVBN  Property').

     The initial interest of the Participants was calculated on the basis of one
common  share  of  SVBN  for  every  $1.00  of  assessment  work  filed with the
Newfoundland  Department  of  Mines  and Energy on the subject mineral licenses,
taking  into  account  each  Participant's interest in the mineral licenses. The
current  interests  in  SVBN  are  as  follows:

     The  Company  76.69%,  Cypress  11.36%,   NDT  6.55%,  UC  5.40%

     In  September  2001, an option earn-in agreement ('Falconbridge Agreement')
was  signed  between SVBN, the Company, Northern Abitibi, Commander and Pallaum,
whereby  Falconbridge  can  earn  a 50 % interest in the entire South Voisey Bay
Property.  In  order to vest its 50% interest in the SVBN property, Falconbridge
is  required  to  incur  $14  million  of expenditures. In order to vest its 50%
interest  in  the  Donner/Northern  Abitibi  ('DNA')  property,  Falconbridge is
required  to incur $5 million of expenditures. In order to vest its 50% interest
in  the  Donner/Commander ('DMG') property, Falconbridge is required to incur $4
million  of  expenditures.  In  order  to  keep  the  option  in  good standing,
Falconbridge  will  incur  a total of at least $2 million of expenditures on the
combined properties on or before December 31, 2002 and in each of the subsequent
calendar  years  during the option. Falconbridge will be the operator during the
option  period.  Teck is also a signatory to the agreement and retains its right
to  earn  50% of the Company's interest in any deposits discovered and developed
in the combined property, after adjusting for Falconbridge's 50% interest in the
property.  Teck  can  earn  this  interest  by  financing the Company's share of
feasibility  costs  and  arranging  the Company's share of production financing.

<PAGE>

     The  South  Voisey  Bay  property  comprises the following mineral licences
(Figure  2):

(SVBN  Property):  21  licences covering 569 square kilometres held 100% by SVBN
with  the exception of a 37.5 square kilometres portion (8111M) in which Pallaum
has  a  25%  interest.  Includes  the  following  licences: 5698M, 7934M, 7915M,
1081M,  8110M, 8111M, 5517M, 8108M, 8049M, 8001M, 8002M, 3304M, 6077M, 8050M and
new  licences,  8195M,  8194M,  8193M,  8192M  and  8213M,  8214M,  8431M.

(DNA  Property): One licence (5518M) covering about 39.5 square kilometres owned
52.38%  by  Donner  and  47.62  %  by  Northern  Abitibi  ('NA').

(DMG  Property): One licence (8190M) covering 35.5kilometres and owned 51.68% by
Donner  and  48.32%  by  Commander.

The  following  Properties  have  Royalty  interests,  as  follows:

SVBN       1%  NSR  payable  to Thistle Creek Resources Inc. on 4483 and
           original  claims 4492M, 4493M, 4495M, 4365M, and 4377M now forming
           part of 7934M

           0.375% NSR payable to Prior Resources Ltd. on 2663M, 3311M, 5670M
           and  5517M 0.019% NSR payable to Taurus Explorations Ltd. on
           2663M, 3311M, 5670M and  5517M

           3% NSR payable to Newfoundland Mining & Exploration Ltd. on 1081M.
           Up to 2% percentage  points  may  be  bought  at  $1,000,000  per
           percentage  point.

           3%  NSR payable to Lawrence Barry on 1456M.  Up to 2% percentage
           points may be  purchased  at  $1,000,000  per  percentage  point.

           3%  NSR  payable to Don Hawco on 6624M, obligation to be shared
           75% by SVBN and  25%  by  Pallaum Minerals Ltd.  Up to 2%
           percentage points may be bought at $750,000  per  percentage
           point.

           2.5%  NSR  payable  to  Carl  von  Einsiedel  on  4264M

DNA        3.0%  NSR  payable  to Newfoundland Mining and Exploration Ltd. on
           5518M

     The  Newfoundland  Department  of Natural Resources has notified holders or
potential  holders  of  mineral  rights in Northern Labrador that mineral rights
issued  by  the  department in northern Labrador, which are situated within both
the  Labrador  Inuit  and  Innu  Nation claim areas, may be subject to "interest
granted  to the Labrador Inuit and/or Innu Nation under any land claim agreed to
by  the  Government". The claims of the Innu Nation and the Labrador Inuit could
materially  and adversely affect the ability of the Company to exploit the South
Voisey  Bay  Properties.  In addition, notice has been received from the Nunavik
Inuit,  through  their legal counsel, of certain land claims made by the Nunavik
Inuit  in  the  area  of  the South Voisey Bay Properties. The Nunavik Inuit are
separate  and  distinct  from  the  LIA and their land claims are in addition to
those  of  the  LIA. The Nunavik Inuit have requested that certain agreements be
entered  into  with  respect  to activities to be undertaken on lands where they
claim  an  interest.  As  with  land  claims of the Innu Nation and the Labrador
Inuit,  the  land  claims  of  the  Nunavik Inuit could materially and adversely
affect the ability of the Company to exploit the South Voisey Bay Properties and
may  prevent  any exploitation of the South Voisey Bay Properties on an economic
basis.

     In land rights and self-government negotiations, the Innu Nation represents
the  Innu.  It  is  currently  negotiating  an  Agreement-In  Principle with the
governments  of  Canada  and  Newfoundland and signed a Framework Agreement, the
first major step towards a land rights settlement, in March 1997.  On June 25th,
2001,  the  Labrador Inuit signed an Agreement - In - Principal ('AIP') with the
government  of  Newfoundland  and  Labrador,  a  major step towards a final land
claims  agreement.

     On  September  21st  2001, Falconbridge and the Company signed an agreement
with the Innu Nation, which defines the terms under which exploration activities
will  be  carried out at South Voisey Bay, including archaeological and wildlife
studies,  environmental  monitoring,  and  providing  Innu  jobs  and  business
opportunities.  This  agreement  is  in place until such time as there is a land
claims  settlement.  If it is mutually acceptable to both parties, the agreement
can  be  modified  on  a  yearly  basis.

     It  is  understood that there are no Labrador Inuit land claims in the SVBN
area  at this stage of land claims negotiation, and accordingly, it has not been
necessary  to  have  an  agreement  with  the Labrador Inuit.  There are several
environmental  sensitivities  that  are  mainly  addressed in the agreement that
Falconbridge  and  the  Company  signed  with  the  Innu Nation.  Guidelines and
actions  to  be undertaken by Falconbridge and the Company in the next few years
are  as  follows:

     A Stage 1 Historic Resources Overview Assessment ('HROA') in the Pants Lake
area,  Labrador  was  done  in  2001.  The  Stage  1  HROA involved a background
research,  a  field  survey, data analysis and the preparation of a report.  The
primary  objectives were to: identify and assess historic resources potential or
sensitivity  within  the  specified  development  area(s)  and  to recommend the
appropriate mitigation measures and methodology and scope for further assessment
if  indicated.  Other  archaeological  surveys  must  be undertaken if doing any
further  exploration  work  near  lakes and rivers.  The designated archeologist
cleared  the  2002  drill  sites.

     Habitat  or  community  zones that may be sensitive to exploration activity
are designated as sensitive areas.  Areas identified as sensitive include Canada
goose  and harlequin duck staging areas, active seabird colonies, harlequin duck
breeding  habitat,  archeological  lands  and  proposed  parklands.

     The  estuaries  along  the coast and the mouths of rivers into the Labrador
Sea  and the small bays along the coast are known breeding and staging areas for
waterfowl  and  seabirds.  Aircraft moving through these areas should maintain a
minimum  altitude  of  500  m  above  ground  level.

     In  addition,  the South Voisey Bay Property is located between calving and
wintering  grounds  of  the George River Caribou herd.  Northward passage of the
herd  can  be expected in early June and then in October when they come south to
the  wintering  grounds.

     Wildlife  encounters  pose  a  risk  for  stress  and  injury  to both site
personnel and wildlife. As a standard policy, a no hunting policy is in force at
the camp.  As per the letter agreement between Falconbridge, the Company and the
Innu  Nation,  a  no-fishing  policy  is  also in place at the camp.  A wildlife
reporting  program  was  instituted  in  2002  where  employees  and contractors
maintained  a  log  of  wildlife  observations  and encounters.  The most common
animals  reported  were  black  bears.

     An  environmental  monitor assigned by the Innu Nation closely follows each
exploration  campaign  in  order  to  make  sure  that  safety and environmental
guidelines  are  followed.

     Falconbridge  has  also  completed  an Environmental Health and Safety Plan
which  has  been  reviewed  and  accepted  by  the  Innu  Nation.

     The  Department  of  Mines  and  Energy,  Mineral  Lands  Division requires
exploration  approval  for  carrying  out mineral exploration in the province of
Newfoundland  and  Labrador.  All  exploration programs have to be in compliance
with  Section  5(4) of the Mineral Act.  All field personnel have to be familiar
with and observe the "Guidelines for Exploration and Construction Companies" and
the  Mineral  Regulations, sections 41-46.  In addition, all permit applications
are  reviewed by the following departments: Mineral Claims Recorder; Exploration
Monitor  Geologist;  Mines and Energy; LIA; Wildlife Division; Cultural Heritage
Division;  Labrador  Aboriginal  Affairs;  DFO;  Canadian  Wildlife  Services;
Environment  Canada;  Government  Service  Centre;  Environment;  MHA  Torngat
Mountains;  Innu  Nation;  and  Crown  Lands  Division.

ACCESSIBILITY,  CLIMATE,  LOCAL  RESOURCES,  INFRASTRUCTURE  AND  PHYSIOGRAPHY
------------------------------------------------------------------------------

     Access  to  the property is primarily gained via fixed-wing floatplane from
Goose Bay.  A gravel airstrip (LUC Strip) was established near the Adlatok River
in  the  southwest  part  of  the  property on a naturally flat treeless area of
glacial  gravel  deposits  located  north  of  the  river.  The  airstrip  is
approximately  500  m  long and allows access from nearby coastal communities by
fixed  wing  aircraft.  Helicopters are used for transportation on the property.

     Topographic  relief on the property ranges from 150 to 500 m above mean sea
level.  The  terrain  is generally rugged with lower elevations characterized by
till-covered  valleys  forested  with black spruce, tamarack and shrubs.  Higher
ground  is  open  with  low shrubs, grassy meadows and barren outcrop.  Numerous
outcrops  at  higher elevations are striated and polished on their west side and
plucked to the east.  Striations and roche moutone  indicate a prominent west to
east  glaciation.

     Typical  seasonal  variation  includes long snowy winters from mid-November
until  April.  Temperatures are consistently below zero and often reach minus 30
degrees  Celsius.  Lakes  typically don't break up until the first week of July.
The  short  summer  is  usually  quite  hot,  with temperatures reaching plus 30
degrees  Celsius.

HISTORY
-------

     Reconnaissance  geological  and  geochemical  surveys  were  conducted  by
provincial  and  federal government agencies.  The northern part of the property
was  mapped  by  Hill  (1982)  and  the  southern  part  by  Thomas and Morrison
(1989&1991). There is no record of previous ownership or of previous exploration
work  on  the property prior to its acquisition by the Company and its partners.

GEOLOGICAL  SETTING
-------------------

     Regionally,  the  South Voisey Bay property covers an area immediately west
and  including  the  tectonic boundary between the Churchill structural province
and  the Nain structural province.  These provinces are interpreted to represent
vestiges  of  two cratonic masses known as the Rae (Churchill Province) and Nain
cratons that converged and collided during the Paleoproterozoic (Torngat Orogen-
1.86  Ga).  The  Churchill gneisses are dominated by amphibolite-facies gneisses
and include pelitic to semipelitic variably sulphidic and graphitic paragneisses
that  are  compositionally  equivalent  to  the  Tasiuyak  gneisses.  Granitic
garnet-bearing  orthogneiss  form  kilometre-scale  units  interleaved  with the
paragneisses.  There  is  a  regional  NE-SW  trending  sub-vertical  regional
foliation.

     Superimposed  upon  the  two  main  gneissic  terranes  are  several
Mesoproterozoic, anorogenic intrusive complexes including rocks of both the Nain
Plutonic  Suite  ('NPS') and the Harp Lake Complex ('HLC').  The NPS is a large,
batholithic  igneous complex (approximately 200 kilometres long) composed mainly
of  anorthosite  and  granite ranging in age from 1.34 to 1.29 Ga.  The HLC is a
roughly  circular  igneous  complex  approximately  100  kilometres in diameter,
composed  mainly  of anorthosite mantled by granite.  The HLC ranges in age from
1.45  to  1.46  Ga.

     In  the  area,  younger  olivine diabase dykes (Harp dykes) form a parallel
series  trending NE that cuts through all rock types.  East of the property, the
Flowers  River Complex (1.27 Ga) consists of peralkaline granites intruding Nain
and  Churchill  gneisses  as  well  as  anorthositic  rocks  of  the  NPS.

     The South Voisey Bay property covers a large area underlain by rocks of the
Churchill  structural  province  and  the  western  edge  of the Nain geological
province.  The  Churchill  gneisses  mostly  comprise interdigitated horizons of
granitic to tonalitic orthogneisses, garnet-bearing felsic orthogneisses, garnet
paragneisses  and  sulphide  and/or  graphite-bearing paragneisses (Fitzpatrick,
1998,  1999),  all  at  amphibolite  facies.  The  Nain  gneisses  consist  of
structurally  complex  paragneisses  and  mafic  to  felsic  orthogneisses.

     Undeformed  rocks  of  the  NPS  are  present  in  the northern part of the
property  and  leucotroctolite,  anorthosite and rapakivi granite of the HLC are
recognized  in  the  southwest  part  of  the  property.

     The  Mesoproterozoic  Pants  Lake  mafic  intrusive complex outcrops in the
central  part  of  the  property.  It  was  initially  recognized  by Thomas and
Morrison  (1991),  but  its  full extent was outlined during mineral exploration
between  1995  and  1999  (Fitzpatrick,  1998,  1999).



                               [GRAPHIC  OMITED]



                               [GRAPHIC  OMITED]


Figure  2.  Revised  simple  geological  map  of  the  South Voisey Bay property
--------------------------------------------------------------------------------

     The  Pants  Lake intrusive complex intrudes the gneissic rocks of Churchill
age  and  also the anorthositic rocks and the rapakivi granites of the Harp Lake
complex. The basal contacts with the underlying rocks are sharp, shallow dipping
and at an angle with the enclosing gneisses.  They are also marked by a variable
thickness  of hornfels in which the garnets in the paragneisses are partially or
totally transformed to either cordierite or orthopyroxene as previously noted by
Kerr  (1999).  The complex has been divided into two units based on geochemistry
and  on  age:  the  North Gabbro (1322   2 Ma; Smith et al., 2001) and the South
Gabbro  (1338   2  Ma; Connelly, 2001). Internal relationships in the intrusions
are  complex  as  several  gabbroic  phases  intrude one another and a number of
authors have suggested that the different gabbroic phases may represent multiple
intrusions  rather  than  being  part  of  one  layered  intrusion  (Figure  4).

     The  North  Gabbro  is  formed  of several lobes (Mineral Hill, Worm, Happy
Face, North, NDT) of a complex nature that may represent different intrusions of
the  same  composition.  This  intrusive complex appears to be a sheet-like body
gently  dipping to the NW in the NDT and North lobes with probably an abrupt end
at  the  west  margin.  It dips to the N and NE in the Happy Face lobe.  A large
occurrence  of  gneiss,  with  an  adjacent  actinolite  altered gabbro, halfway
between  the  NDT  and  North  lobe,  is  believed  to be a portion of the upper
contact.  At  this point the intrusion thickness is approximately 350 m.  A long
thin  intrusion  referred  to  as  the  'Worm Gabbro' is found between the North
Gabbro and South Gabbro.  The eastern contact of the Worm Gabbro was observed in
the  field  as  almost subvertical, but was interpreted as dipping at 35  to the
east  (Kerr,  1999)  below the gneisses.  Gravity profiles suggest a subvertical
body  of  shallow  (<150  m)  depth extent. A number of magnetic and topographic
lineaments  are  coincident  with  the  Worm  Gabbro, suggesting that either its
emplacement  or  current  exposure  level  was  controlled by a fault structure.

     The  North Gabbro has been described as consisting of an upper sequence and
a  lower  sequence  (Kerr,  1999).  The upper sequence contains a coarse grained
gabbro  to  leucogabbro,  an actinolite altered variant when close to the gneiss
contact,  the  'Black  Gabbro'  which  is  also an altered variant of the coarse
grained  gabbro  and  olivine  gabbros.  All of these rocks are formed mainly of
plagioclase,  clinopyroxene,  minor  orthopyroxene  and  olivine  in  varying
proportions  defining mainly a subophitic texture with clinopyroxene and olivine
oikocrysts  and  locally  small  olivine phenocrysts.  The lower sequence can be
seen  in  sharp  contact with the upper unit and is defined mainly by an olivine
gabbro to troctolite with local variable amounts of gneissic inclusions that are
partly  assimilated  (previously  called  the  contaminated  gabbro).

     The  South  Gabbro consists of two lobes oriented along a NE-SW axis.  This
intrusion  gently  dips to the WNW and, in the Mineral Hill area, is overlain by
two intrusions that are part of the North Gabbro. It is formed mostly of olivine
gabbro  on  surface with melanogabbro and peridotite observed in drill holes.  A
few  gabbro  outcrops  were  observed  on  surface  in  the southern lobe. Crude
layering  and  intrusive  breccias  were  observed  in  the  field.

EXPLORATION
-----------

     The  Company  and  Partners  carried out the following work on the Property
from  1995  to  2003:

1995:  Stream  sediment  geochemistry,  prospecting,  airborne  geophysics (High
Sense)  and  3  diamond  drill  holes  ('DDH')  for  a total of 303.1metres. The
drilling  targeted EM conductors (Wares, 1997).  The work was carried out by Ram
Explorations Ltd. under contract to the Company as operator of the various joint
ventures.

1996:  Additional  prospecting, ground geophysical surveys (HLEM, mag, IP, large
loop  TDEM)  and 51 DDH for a total of 4,096 metres (Wares, 1997).  The work was
carried  out  by Ram Explorations Ltd. under contract to the Company as operator
of  the  various  joint  ventures.

1997:  Regional  geological mapping at 1:20,000 scale along kilometre spaced E-W
traverses.  A  total  of  617.5 kilometres of grid, including 72.7 kilometres of
GPS  surveyed tie lines, were established.  These grids were mapped in detail on
topographical maps produced by Delta Aerial Surveys that were created from 1968,
1:50,000  air photos.  Gravity ground surveys (425 line kilometres) were done by
Geoterrex-Dighem.  Magnetic  and  horizontal loop EM surveys were carried out on
250  kilometres  of  line grid.  The HLEM was collected using a MaxMin II system
with  a  coil  separation  of 100 metres.  Borehole (18 DDH) and limited surface
time  domain electromagnetic ('TDEM') surveys were conducted over selected areas
(limited  to licence 5518).  A total of 44 holes were completed totalling 12,419
metres  (97-54 to 97-097) and concentrated on 3 main areas on the north grid and
selected  areas  over the south grid.  Highlights from drilling the North Gabbro
includes: 1.93% Ni, 1.07% Cu and 0.26% Co over 0.6metres in DDH 97-67; 1.13% Ni,
0.78%  Cu, 0.2% Co over 15.7metres in DDH 97-96; and 11.9% Ni, 9.6% Cu, 0.43% Co
over  1.1metres  in hole 97-75 (Fitzpatrick et al., 1998).  The work was carried
out  by  Teck  under  contract to the Company, the operator of the various joint
ventures.

1998:  Systematic  regional  1:20,000  scale  geological  mapping  was  expanded
throughout  the  South Voisey Bay project in 1998.  A total of 367 kilometres of
cross  lines  and  87  kilometres  of  GPS-surveyed tie lines were cut. Detailed
mapping  was  completed  on  all  grid  extensions.  A  total  of  40 holes were
completed  totalling  12,621  metres  (98-098 to 98-136) with the deepening of 5
holes  initially  drilled  in  1997 (97-073,079, 089, 091,092) for an additional
2,588  metres.  The  program  tested  geological,  electromagnetic,  and gravity
targets  outlined  throughout the property. The highlight of the drilling was in
the  North Gabbro, where drill hole 98-131, located 600 metres northeast of hole
97-96,  intersected  0.2  metres  of  massive sulphide grading 4.5% Ni, 2.6% Cu,
0.28%  Co,  and  a  0.3  metre  interval 10 metres below the base of the gabbro,
assaying  3.4%  Ni,  0.5%  Cu  and  0.46%  Co.

Detailed  and  regional gravity surveys were done beyond the coverage of surveys
conducted  in  1997.  Regional gravity surveys were completed using a helicopter
gravity  system  (heligrav)  as  well  as  traditional  ground traverses.  These
surveys  were  designed  to  detect  buried  accumulations of prospective gabbro
beneath  thin  gneiss cover (adjacent to exposed gabbro), while detailed surveys
were  designed  to  detect  massive  sulphide  accumulations  at the base of the
gabbro,  or  prospective  areas  of  increased  gabbro  thickness  (i.e.,  basal
depressions or feeders).  Numerous problems arose during the heligrav production
survey  culminating  with  the  gravity  meter being irreparably damaged and the
survey  being  abandoned  with  595  gravity  stations  surveyed.  Upon
Geoscott/Scintrex  abandoning  the  regional  gravity  surveys,  Geoterrex  was
contracted  to  complete the remaining 1174 gravity stations of the planned 1769
station  survey.  Gravity  readings  were collected at intervals of 50 metres on
lines  spaced  200 metres apart for a total of 7353 stations.  Extending surveys
completed in 1997, the 1998 surveys completed gravity coverage between the north
and south grid areas as well as over minor extensions to the north and west ends
of  the  north  grid  and  the  south  end  of  the  south  grid.

Several  electromagnetic  survey  techniques  were  contracted  during  the 1998
program,  including  deep seeking large loop surface and borehole surveys (i.e.,
UTEM, Crone, and Protem) as well as more conventional shallow-seeking horizontal
loop  Maxmin ('HLEM') surveys.  Lamontagne Geophysics Ltd., of Kingston, Ontario
were  contracted  to  complete surface UTEM 3 and borehole BHUTEM 4 surveys over
select  areas  of  the project during April and May. It was further decided that
Crone  would  complete  surface  surveys measuring only the z component on lines
spaced  200  metres  apart  with  readings  collected  at  50  metres intervals,
considering  that  a  second  receiver  would be required to measure the x and y
component.  Surface  production  surveys  included  surveying  of  613.6  line
kilometres  within  76  loops  ranging  in  size  from 1 to 2 square kilometres,
numbered  from  1  to 42 in the north grid area and 101 to 134 in the south grid
area.  Borehole  surveys  consisted  of  reading 43 drill holes with x, y, and z
directional  component  measured  at  10  metre intervals and reduced to 5 metre
intervals  within anomalous sections of the hole.  Collar loop sizes were varied
according  to  hole  depth,  to  maximum dimensions of 500 metres by 500 metres.
Eastern  Geophysics completed all on-site data collection, while Crone completed
advanced  data  processing  and  interpretation  off-site.

Geoterrex  Ltd.,  of Ottawa, Ontario were contracted to complete both fixed loop
and  moving  loop  surface PROTEM surveys over select portions of the south grid
between  June  18 and June 28, 1998.  Surveys were conducted at base frequencies
of  3  Hz  and  30  Hz  in  two  areas  including  both  fixed  and  moving-loop
configurations  over  the  area  surrounding drill hole 97-079, and a fixed-loop
survey in the area of drill hole 97-089 (South Gabbro, central and southern grid
areas).

Upon  completion  of  Geoterrex  fixed-loop  PROTEM  surveys in the area of hole
97-89,  Labrador  Exploration  Services  Ltd.,  of  Goose  Bay,  Labrador,  were
contracted  to  complete  7  kilometres  of  HLEM surveys to further examine the
shallow anomaly detected in this area. A single line anomaly was detected within
the  immediate  area  of drill hole 97-089.  This anomaly could not be traced to
the  west  as  severe  topography  prevented establishment and surveying of grid
lines.  Due  to  limited  survey  coverage  of  the  anomaly,  a  definitive
interpretation  of  the  conductor's  orientation  and  attitude  could  not  be
established  (Fitzpatrick  et  al.,  1999), (Appendix II & III).  The 1998 field
program  was  carried out by Teck under contract to the Company, the operator of
the  various  joint  ventures.

1999:  In  June  1999,  the  Company  and  its  joint venture and option/earn-in
partners  approved a $2.75 million 1999 Exploration Program for the South Voisey
Bay  Property.  The approved 1999 program was to consist of airborne, ground and
borehole  geophysics  and  diamond  drilling.

Due  to poor market conditions, the Company's joint venture partners elected not
to  contribute  their  cost  share of the 1999 Exploration Program.  The Company
decided  to  fund  at least the first stage of the 1999 program thereby diluting
certain  joint  venture  partners interests as provided for in the various joint
venture  agreements.

The  first  stage  was  to  consist  of  limited  detailed surface UTEM surveys,
borehole  UTEM surveys and 2,000 metres of diamond drilling.  The estimated cost
of  the  first  stage  of  exploration  was  $1  million.

In  July  1999, the Innu Nation prevented the Company from carrying out its 1999
Exploration  Program.  The  Company  was  presented  with  the option of signing
onerous  agreements  with  the Innu Nation or having the program physically shut
down  by  the  Innu  Nation  at  the  field  camp.

Management was not prepared to enter these agreements or to risk a confrontation
at  the  camp.  After numerous attempts to meet with the Innu Nation failed, the
Company  decided to demobilize the drill rig and most of the camp and equipment.
Consequently,  the  1999  Exploration  Program  was  not  carried out.  The 1999
program  was  to be carried by Teck, under contract to the Company, the operator
of  the  various  joint  ventures.

2000:  Commander  proposed  a  2000  Program  (DMG property only) of $726,000 to
consist  of ground geophysics and 1,800 metres of diamond drilling.  The Company
decided  not  to  participate in this program and to dilute it's interest in the
DMG  Property  accordingly.  The  Company also agreed to Commander operating the
2000  Program.

In September 2000, Commander began an initial three-hole, 1,800 metre program on
the  DMG property (8190M).  The program targeted a strong gravity anomaly with a
source  interpreted  to  measure  600  metres  by 1,200 metres.  The Company and
Commander  planned  to  drill  the  same  gravity  anomaly  in  the aborted 1999
exploration  program.  In late September, Commander advised the Company that the
first hole of the planned three hole program was completed and that drilling had
commenced on the second hole located approximately 320 metres south of the first
hole,  which  was  stopped  in  gabbro  at 560 metres.  No visible nickel-copper
mineralization  was  encountered in the first hole.  In early October, Commander
advised  the  Company  that  drilling on the second hole was stopped, due to the
limitations  of  the  drilling  equipment at 750 metres within a highly altered,
hybridized,  contaminated,  graphitic  gabbro containing disseminated sulphides.
Assay  results  were  insignificant.  Both  hole  1  and  2  were cased to allow
re-entry  at  a  future  date.  Commander  decided not to drill the contemplated
third  hole in 2000.  The Company did not operate a program on any other part of
the  South  Voisey  Bay  Properties.

2001:  Exploration  at  South  Voisey  Bay resumed in October of 2001 with a two
month geological and geophysical program.  Falconbridge carried out field checks
of gravity anomalies, verified portions of the Teck field mapping, re-logged and
sampled  existing  drill  core for whole rock data, and carried out measurements
for  magnetic  susceptibility  and  density  across  the  property.  Linecutting
consisted  of  142  line-kilometres  of  new grid, and 58 line-kilometres of old
grid.  Low  frequency  UTEM  surface  surveys  were  carried  out  by Lamontagne
Geophysics  over  5 of 8 proposed loops that were laid out over areas where line
cutting  took  place.  The  2001  program  was  carried  out  by Falconbridge as
operator.

2002:  Exploration in 2002 consisted of 46.65 line kilometers of gravity, 164.10
line  kilometers  of low frequency UTEM surface surveys by Lamontagne Geophysics
in  8  large  loops,  21 kilometers of new linecutting, a detailed Heavy Mineral
Concentrate ('HMC') stream sediment survey over the property, geological mapping
and  1970 meters of diamond drilling and borehole surveys in 5 holes, all in the
South  Gabbro.  The highlights of the 2003 program were in hole DDH 02-138 which
intersected  a  massive sulphide vein in paragneiss, below the base of the South
Gabbro,  which  assayed 1.37% Ni, 0.64% Cu and 0.10% Co over 0.77 m, and in hole
DDH  02-140 which intersected 1.57% Ni and 0.6% Cu in semi-massive sulphide near
the  base  of  the  gabbro.  The 2002 program was carried out by Falconbridge as
operator.

2003:  The  2003  exploration  program  began  in  April  with  a  MegaTEM  deep
penetrating  airborne  electromagnetic  and magnetic survey.  The MegaTEM survey
identified nine conductive trends for ground geophysical follow-up to select and
accurately locate targets for diamond drilling.  The ground geophysics consisted
of  widely  spaced AMT electromagnetic ground geophysics, followed by large loop
EM  surveys.

As  a  result  of the geophysical surveys, three high priority target areas were
selected  for  diamond  drilling.  The  geophysical  targets  are  located in an
east-west  trending  structure  in  an  area predominated by northwest-southeast
features.  The  targets  also  coincide  with  residual  east-west  gravity  and
magnetic  features.  An initial phase of 1,200 metres of drilling began in early
September.

All  exploration on the property has been carried out by either Ram Explorations
Ltd.,  by Teck under contract to the Company, or by Falconbridge as operator and
by  well  recognized  and reputable geophysical and diamond drilling contractors
and assay laboratories.  The Company is confidant of the reliability of all data
and  is  not  aware  of  any  uncertainty  in  any of the data that has not been
addressed  during  the  normal  course  of  the  exploration  programs.

MINERALIZATION
--------------

     On  The  South  Voisey  Bay  Property,  Ni-Cu  sulphide  mineralization  is
associated  with  both  the  North  Gabbro  and  the  South  Gabbro.

South Gabbro:  Disseminated, interstitial sulfides and locally, semi-massive and
massive  sulphide associated with an inclusion-bearing olivine gabbro located at
the  base  of  the  intrusion.  The  mineralized gabbro contains numerous partly
digested  inclusions  of  paragneiss  locally with spinel-rich rims (Kerr, 1999,
2000).

North  Gabbro:  A 5 to 60 metre thick unit is located at or just above the basal
contact.  The  upper  part of this unit consists of inclusion-bearing rock, with
gneissic,  troctolitic  and  gabbroic  fragments.  Sulphide  contents  increase
downward.  This heterogeneous unit passes into a homogeneous fine-grained gabbro
with 'leopard texture'. The contact with the gneisses is often a chill.  Massive
sulphides  when  present  are  located  at the contact and within the underlying
gneissic  rocks.

     The  mineralization intersected by previous drilling can be classified into
the  following  categories  (Fitzpatrick,  1998,  1999):

Sulphide  rich  paragneiss:  low  metal  tenors,  Ni/Co=3,  Ni/Cu=1.5.

Disseminated  and  blebby  sulphides  in the basal inclusion bearing gabbros and
troctolites:
     North  Gabbro:  Ni/Co=5.2,  Ni/Cu=1.8
     South  Gabbro:  Ni/Co=9,  Ni/Cu=1.7

Massive  sulphide  veins  in  the  paragneiss  and  gabbros:  high Ni, Co and Cu
tenors,  Ni/Co=15,  Ni/Cu=3.

     Overall the mineralized rocks have on average a low Ni/Co ratio (except for
the  veins),  typical  of  either  a more evolved magma composition or a low 'R'
factor  (Li  et  al.,  2000;  Kerr,  1999,  2000)

DIAMOND  DRILLING
-----------------

     Between 1995 and 2002, a total of 35,307 metres of diamond drilling
in  145 holes have been carried out on the South Voisey Bay property as follows:
1995  -  303  metres  in  3 holes; 1996 - 4,096 metres in 5 holes; 1997 - 12,419
metres  in  44 holes; 1998 - 12,261 metres in 40 new holes and 2,588 metres in 5
deepened  1997  holes;  2000 - 1,310 metres in 2 holes; 2002 - 1,970 metres in 5
holes.

     All  of  the  diamond drilling targeted geological, electromagnetic
and  at  times  gravity  targets  located  throughout  the property.  All of the
targets were at or near the basal contacts of the Pants Lake gabbro in a setting
very  similar  to  the  Voisey Bay deposits.  All of the electromagnetic targets
were  explained  by  sulphides, including semi- massive and massive sulphides at
the  base  of  the  Pants  Lake  gabbro  or in veins immediately below the basal
contacts  or  by  sulphides  and  graphite  in  the  underlying  and surrounding
paragneiss.  The gravity targets were explained by thicker portions of the Pants
Lake  gabbro  rather  than  large  accumulations  of  semi-massive  and  massive
sulphides.  One  of the objectives of the diamond drill programs and exploration
programs  in  general  was  to locate any feeders to the Pants Lake intrusion, a
potential  location  of concentration of semi-massive and massive sulphides.  To
date  no  feeders have been located, a possible explanation as to why only small
accumulations  of  semi-massive  and  massive  sulphide, with grades of economic
interest,  have  been  intersected  by  diamond  drilling.

     Disseminated  sulphide mineralization is almost ubiquitous near the
basal  contacts  of  Pants  Lake  gabbro,  but semi-massive and massive sulphide
mineralization  is  less  abundant.  Highlights  of  previous  drilling programs
include: 1.93% Ni, 1.07% Cu and 0.26% Co over 0.6 metres in DDH 97-67; 1.13% Ni,
0.78% Cu, 0.2% Co over 15.7 metres in DDH 97-96; and 11.9% Ni, 9.6% Cu, 0.43% Co
over 1.1 metres in hole 97-75; 4.49% Ni, 2.6% Cu and 0.28% Co over 0.2 metres in
DDH 98-131; 4.5% Ni, 2.6% Co, 0.28% Co over 0.2 metres and 3.44% Ni, 0.5% Cu and
0.46%  Co  over  0.3  metres in DDH 98-131; 1.37% Ni, 0.64% Cu and 0.16% Co over
0.77  metres  in DDH 02-138; and 1.57% Ni, 0.60% Cu, 0.09% Co over 0.8 metres in
DDH  02-140.  Significant  intersections  are  all  from  massive  sulphide  and
semi-massive  sulphide.

SAMPLING  AND  ANALYSIS
-----------------------

     The  South  Voisey  Bay  diamond  drilling  programs from 1995 to 1998 have
obtained  standard  BQ  and BTW size core. The majority of the core is stored at
the Pants Lake Camp.  Diamond Drill hole SVB-97-67 is stored at the Newfoundland
Government  core  storage facility in Torbay, Newfoundland.  Significant massive
sulphide  intersections  from  SVB-97-67,  SVB-97-75, SVB-97-98 & SVB-98-131 are
stored  at the company's office in Vancouver.  Core maintained at the Pants Lake
Camp  has  all  been  labeled  by drill hole number with attached metal tag, and
includes  meterage.  All  core is cross-piled on large logs.  No pile is greater
than  four feet high.  The core field has a master key available to make finding
specific  drill  holes  easier.

     All  samples of drill core have been obtained by splitting the core using a
standard  core splitter or diamond core saw.  Half of the core has been retained
for inspection and reference.  Sample length for assay is totally dependent upon
the  geology  and  mineralization  and  was left to the discretion of the Senior
Geologist,  although,  generally,  one-metre  splits  are  the  norm.

     The  Company's qualified person spent a good deal of the 1998 drill program
in  the Pants Lake camp, and was able to inspect the sample collection procedure
by  Teck, who was general contractor for the project at the time.  In all cases,
standard  industry  practices  were used to mark, split, record, and bag samples
for assay.  The core saw was continuously cleaned to minimize contamination from
sample  to  sample.  Rock  quality  data for the gabbros is generally excellent.

     All  samples submitted for assay by Teck have been sent to a registered and
certified Canadian assay lab, XRAL Laboratories of Mississauga, Ontario.  All of
these  labs  use  standard  processing techniques to crush, screen and split the
sample pulp.  Standard assaying procedures have been used, and all of these labs
routinely  use  standards  and  blanks  to  detect systematic analytical errors.
Duplicates  are  routinely  run  to  detect  batch  analytical  errors.

     The  Company's qualified person was able to visually inspect all high-grade
cores  obtained  from the project.  Large pentlandite crystals could be observed
in  many samples, and visual estimation of the core would indicate that there is
no  need  to  suspect the analytical procedure.  The qualified person is able to
draw  on  experience  of  visual  estimations  with  respect  to analytical data
obtained  from several hundred holes that were logged by him at the Voisey's Bay
Ni-Cu-Co  deposit.

     There  were  no  samples  collected by the qualified person during the July
2002  property  visit.  He  has however collected several samples for whole rock
and  high  precision  trace  element  geochemistry  from  previous  trips to the
property.  He  has  found  through  past experience that non-commercial labs are
best  suited  for  high precision data.  Both Teck and the qualified person have
used  the  services  of  Tony Naldrett (world renowned nickel specialist), Derek
Wilton  and  Mark  Wilson  (Memorial  University of Newfoundland) to analyze for
trace elements (1997 - 2001).  Both laboratories have done extensive analyses on
the  Voisey's  Bay  Ni-Cu-Co  deposit,  and  are thus best suited to analyze and
compare  South Voisey Bay data with Voisey's Bay data.  The qualified person can
find  no  evidence of misrepresentation of analytical data, either accidental or
deliberate.

     The  South  Voisey  Bay  diamond  drilling program for 2002 collected 1,970
metres  of  NQ  size  core.  Core maintained at the Pants Lake Camp has all been
labeled  by  drill  hole  number with attached metal tag, and includes meterage.
All  core is cross-piled on large logs.  No pile is greater than four feet high.
The  core  field has a master key available to make finding specific drill holes
easier.

     All  samples of drill core have been obtained by splitting the core using a
standard  diamond  core  saw.  Half of the core has been retained for inspection
and  reference.  Sample  length  for assay is totally dependent upon the geology
and  mineralization  and  was  left  to  the discretion of the Senior Geologist,
although,  generally,  one-metre  splits  are  the  norm.

     The  qualified person was not onsite during the drill program, and was thus
unable  to inspect the sample collection procedure by Falconbridge.  Discussions
however  with  Falconbridge staff indicate that standard industry practices were
used  to  mark,  split,  record,  and  bag  samples for assay.  The core saw was
continuously  cleaned  to  minimize  contamination  from sample to sample.  Rock
quality  data  for  the  gabbros  is  generally  excellent.

     All  samples  submitted  for  assay  by  Falconbridge  have  been sent to a
registered  and certified Canadian assay lab, Chimitec - Bonder Clegg, Val d'Or,
Quebec.  All  of  these labs use standard processing techniques to crush, screen
and split the sample pulp.  Standard assaying procedures have been used, and all
of these labs routinely use standards and blanks to detect systematic analytical
errors.  Duplicates  are routinely run to detect batch analytical errors.  Table
2  shows  analytical  methods  used  for  assaying  of  drill  core.

                                     Table 2
                                     -------

Element Detection  Limit  Extraction            Method

Ni      2  ppm            HF-HNO3-HCLO4-HCL     AA
Cu      1  ppm            HF-HNO3-HCLO4-HCL     AA
--      ------            -----------------     --
Co      3  ppm            HF-HNO3-HCLO4-HCL     AA
--      ------            -----------------     --
Au      1  ppb            PYRO-ANALYSE          PYROANALYSE-DCP
--      ------            ------------          ---------------
Pt      5  ppb            PYRO-ANALYSE          PYROANALYSE-DCP
--      ------            ------------          ---------------
Pd      1  ppb            PYRO-ANALYSE          PYROANALYSE-DCP
--      ------            ------------          ---------------
S     . 02  PCT                                 LECO
-       -------                                 ----


SECURITY  OF  SAMPLES
---------------------

     At  no  time during the 1997-1998 drill programs have samples of drill core
sections  been prepared for assaying by any employee, director or officer of the
Company.  Teck  acted  as  the  general contractor, and Teck staff conducted all
preparation.  Analytical  samples  were submitted to the lab by Teck and results
were  submitted  by  the  lab to Teck Corporation directly.  Analytical data was
then  passed  on  to  the  Company, and the Company would then pass the relevant
information  on  to  its  joint  venture  partners.

     At  no  time  during  the  2002  drill  program  have samples of drill core
sections  been prepared for assaying by any employee, director or officer of the
Company.  Falconbridge staff conducted all preparation.  Analytical samples were
submitted  to  the  lab by Falconbridge and results were submitted by the lab to
Falconbridge  directly.  Analytical  data was then passed on to the Company, and
the  Company  then  passed  the  relevant  information  on  to its joint venture
partners.

STEPHENS  LAKE  PROJECT,  MANITOBA



                               [GRAPHIC  OMITED]



                               [GRAPHIC  OMITED]


                         Figure 1 - General Location Map

PROPERTY  DESCRIPTION  AND  LOCATION
------------------------------------

     The  Stephens  Lake  property  (the  'Property'),  is  centered  on
latitude  5621'N and longitude 9422'W, approximately 250 kilometres northeast of
Thompson  and  20  kilometres  east  of  Gillam,  Manitoba  (Figure  1).

     In  February 2002, the Company began participating in the Stephens
Lake  Project.  The  Company  has  the  option to earn a 50% participating joint
venture  interest  in  the  Property  with  cumulative  minimum  expenditure
requirements  of  $5,000,000  over  five  years.

     Following  a  2002  GEOTEM survey, SP01-03, SP01-07, P218 and P232
were  reduced in size to remove areas to the north that contained few conductors
of  interest.  Additional  permits were acquired directly (MEL 53-56) or through
option agreement (P232, MEL 49) to the south along conductive trends detected by
the  airborne  survey.

     The  entire  Stephens  Lake  Project now encompasses three special
exploration  permits,  three  regular  exploration  permits,  and  five  mineral
exploration  licences.  Recent  changes to the Manitoba Mining Act have replaced
the  special  permits  and  regular exploration permits with mineral exploration
licences,  with  work  assessment  requirements similar to those of the previous
special  permits. Special and regular permits will automatically be converted to
exploration licences on their renewal dates. All permits are held in the name of
Falconbridge.  Work  requirements  are  $0.50  per  hectare in year 1, $1.00 per
hectare  in  year  2,  $1.50 per hectare in year 3, $3.00 per hectare in year 4,
$4.00  per  hectare in years 5 to 7, $5.00 per hectare in years 8 to 9 and $6.00
per  hectare  in  year  10.  The  property  status  is  shown  in  Table  1:

Table  1  -  Stephens  Lake  property  status  and  renewal  dates
------------------------------------------------------------------
PERMIT       NAME          HECTARES   DATE ACQUIRED  TERM     RENEWAL DATE
----       --------       ---------   -------------  ----     ------------
SP01-03  2  Stephens  Lake   53 457   15-Feb-2001     5 years 15-Feb-2006
SP01-07  2  Long  Spruce     46 315   27-Feb-2001     5 years 27-Feb-2006
SP02-01     Angling  River   40 753   21-Feb-2001     5 years 21-Feb-2004
P218  2     Hayes  River     47 313   15-Feb-2001     3 years 15-Feb-2004
P232  2     Pennycutaway     5 109    21-Feb-2002     3 years 21-Feb-2005
P222  1                      18 082   18-Apr-2001     3 years 18-Apr-2004
MEL49  1                     14 061   02-Nov-2002     5 years 02-Nov-2007
MEL53                        19 639   13-Nov-2002     5 years 13-Nov-2007
MEL54                        18 042   13-Nov-2002     5 years 13-Nov-2007
MEL55                        64 ,523  13-Nov-2002     5 years 13-Nov-2007
MEL56                        53 590   13-Nov-2002     5 years 13-Nov-2007

     1  Optioned  from  4378831  Manitoba  Ltd.
     2  Reduced  18-Feb-2003.

     On  February  20th,  2002,  the  Company  entered  into  an  agreement with
Falconbridge,  for  the  exploration of an interpreted extension of the Thompson
Nickel  Belt.

     The  Company  has  the  option  to  earn  a 50% participating joint venture
interest  in  the Property by incurring a total of $5 million of expenditures on
exploration and related work on or before the end of December 2006.  The Company
is  required  to incur a minimum of $1,000,000 of expenditures per calendar year
to  keep the option in good standing.  These expenditures may be accelerated, at
the  Company's  option,  and  applied to future years' expenditure requirements.

<PAGE>

     Upon  the  Company  deciding  to  incur  each  $1,000,000  of expenditures,
Falconbridge  will contribute to exploration funding by participating in private
placements  in  the  Company  as  follows:

     $250,000  of  the  first  million  dollars  in  expenditures
     $300,000  of  the  second  million  dollars  in  expenditures
     $350,000  of  the  third  million  dollars  in  expenditures
     $400,000  of  the  fourth  million  dollars  in  expenditures
     $450,000  of  the  fifth  million  dollars  in  expenditures

     All  private  placements will be priced in accordance with Canadian Venture
Exchange  policy.

     Exploration  will  be carried out by Falconbridge, under the direction of a
Management  Committee  comprised  of one representative from each of the Company
and Falconbridge.  Falconbridge will be entitled to charge an administrative and
overhead  charge  of  10%  of  direct  project  costs  during the option period.

     As  long  as  Falconbridge  has  at  least  a 30% interest in the Property,
Falconbridge  will  be entitled to designate the treatment facilities to be used
for  processing the ore and other mineral products, and market such products for
the  Joint  Venture,  at  rates, charges and costs competitive for the industry.

     Provided  Falconbridge  has  at  least  30%  interest in the Joint Venture,
Falconbridge  will be entitled to designate all or any part of the Property as a
Specific  Project, and will have the right to earn an additional 20% interest in
the  Specific  Project  by  carrying out a Bankable Feasibility Study, and to be
operator  on  the Specific Project. Falconbridge shall have the right to earn an
additional  5% interest by arranging debt financing and bank guarantees for both
parties  for  the  development  of  the  Specific  Project through to commercial
production.

     The Company and Falconbridge both have a right of first refusal to purchase
all  or  any  part  of  the  other  party's  interest  in  the  Joint  Venture.

ACCESSIBILITY,  CLIMATE,  LOCAL  RESOURCES,  INFRASTRUCTURE  AND  PHYSIOGRAPHY
------------------------------------------------------------------------------

     The  Stephens Lake property is partly accessible by an all-season road that
traverses  SP01-03  and  the  western half of SP01-07. From late January to late
March,  the  remaining portions of the Property can be accessed by a winter road
established  between  the communities of Gillam and Shamattawa.  The winter road
cuts  through  SP01-07  and  parallels  the southern edge of the Property to its
easternmost  extent.  Access  to  SP01-03  and  portions  of  SP01-07  can  be
accomplished  by  boat  and  to  all  permits  by  helicopter  from  Gillam.

     Topography  on  SP01-03  is  relatively  flat  with gently rolling
hills,  likely due to eskers, and contains a large lake, known as Stephens Lake,
that  developed  following  flooding  on  the  Nelson River due to hydroelectric
development.  Topography  on  SP01-07, SP02-01, P218 and P232 is relatively flat
with  numerous  rivers,  streams,  swamps  and  bogs.  The  region  shows strong
evidence  of  glacial  modification  as  indicated  by  eskers.  Drainage on all
permits  is  northeast  to  Hudson Bay via the Nelson and Hayes rivers.  Locally
these  rivers  have deeply incised valleys into glacial cover.  The Nelson River
contains  three  hydroelectric  generating  stations; the Kettle and Long Spruce
Generating  Stations  which  are located on SP01-07 and the Limestone Generating
Station  which  is  located  just  north  of  SP01-07.

     Regional  infrastructure  in  the area includes a 57,000 ton vessel size (4
deep  sea  berths)  port at Churchill, 270 kilometres north of Gillam, and daily
railway  service  between  Gillam  and  Churchill.  Gillam  is  an  established
hydroelectric  town,  and  supports  a  production  of  about  70% of Manitoba's
hydroelectric  power  from  3  stations  -  Kettle,  Long  Spruce, and Limestone
Generating  Stations  (Manitoba Hydro 2001 Annual Report). Further expansions to
generating  capacity  on  the  Nelson  River are under consideration at present.

HISTORY
-------

     Exploration  efforts  in the Stephens Lake area began in the late 1920s and
1930s  and  involved  prospecting  for precious metals.  No significant economic
deposits  were  discovered.  Following the major nickel discovery in Thompson in
1956,  exploration interest in the area was renewed.  Exploration for nickel was
extended  to  cover  most of the Churchill-Superior boundary zone, including the
Lower  Nelson  River  area  (Corkery,  1985).  Most of this exploration occurred
between  1965  and  1970.  Several  drill programs were initiated in the general
Stephens  Lake  area  and three airborne geophysical surveys were conducted over
the  area  during  this  time.

     Amax  Exploration  conducted an airborne AFMAG and magnetic survey
during  the  summer  of  1966  over most of NTS 054D (Airborne Permit #60).  The
survey  was  executed by Hunting Survey Corporation and covered an area of about
10,810  square  kilometres.     Lines  were  flown  in  a N-S direction and were
typically  spaced  3  kilometres  apart  and  locally 1.5 kilometres apart.  The
survey  was  performed  using  a  Beaver  L-20  aircraft  equipped with an AFMAG
apparatus  as  well  as  a  Varian Proton Precession Magnetometer, Model V4937A.

     Selco  Exploration  initiated  a small drill program in the winter
and  spring  of  1967,  south  of  present day Stephens Lake.  Selco Exploration
tested a number of conductive zones with 3 drill holes totaling about 494 metres
(maximum  drillhole  depth:  198  metres).  The  conductive  zones  that  were
intersected  reported several graphitic horizons.  Sulfides, such as pyrrhotite,
pyrite,  and  rare  chalcopyrite, were reported in paragneiss.  No corresponding
assay  results  were  reported.

     In  the winter of 1968, Selco Exploration initiated a second small
drill  program  south  of Stephens Lake.  Selco Exploration tested two anomalies
with  two  drill  holes  totaling a depth of about 390 metres (maximum drillhole
depth:  221  metres).  Drillhole #68-2 intersected a number of pyrite-pyrrhotite
zones.  Assays  show  minor  amounts  of copper, nickel, and cobalt.  Drill hole
#68-1 intersected a number of weakly mineralized zones with minor assay results.

     The  Canadian Nickel Company conducted an airborne electromagnetic
survey  during  the  spring  of  1968  over the southeastern portion of NTS 054D
(Airborne  Permit  #69).  The  survey  covered an area of about 4870 kilometres.
Lines  were  flown in a N-S direction, spaced at either 400 metres or 800 metres
apart,  at a flight height of 152 metres (500 ft) above surface.  The survey was
performed  using  a Mark V. Anson aircraft equipped with an International Nickel
airborne  electromagnetic  instrument.  The results of the survey suggested that
conductivity in the Gillam area occurs in a few isolated instances with no major
trends  indicated.

     Shortly  after  the  completion of Airborne Permit #69 geophysical
survey,  the  Canadian Nickel Company tested one of the geophysical anomalies in
the  early  summer of 1968.  The first hole drilled was abandoned in overburden.
The  second hole intersected several sulfide bearing zones containing pyrite and
pyrrhotite  with  minor  sphalerite.

     Sherritt  Gordon  Mines Ltd. completed an airborne electromagnetic
and  magnetic  survey in the spring of 1970 over the central-southern portion of
NTS  54D  and the central northern portion of NTS 53M (Airborne Permit#65).  The
survey  was  flown  by  Canadian Aero Services Ltd. and covered an area of about
3716  kilometres.  The  survey  was  performed  using a Sherritt Gordon aircraft
equipped  with  a Hunting-type 2 quadrature system and a Newmont design - proton
precession  magnetometer.

     Between  1968  and  1975, several geological mapping projects were
initiated  by  the  government  of Manitoba in an attempt to map portions of the
Lower Nelson River that would later be affected by Manitoba Hydro's Nelson River
hydroelectric  projects  (Table  2).

     The  first geological mapping project was done in 1968 by I. Haugh
(1968)  and  was designed to recover maximum geological information prior to the
extensive flooding related to the construction of the Kettle Generating Station.
The  Kettle  Generating Station was completed in 1971.  Flooding of the fore bay
formed  what  is  now  known as Stephens Lake.  At this time, almost all outcrop
exposures  studied  by  Haugh  and Elphick (1968) have been covered by flooding.
Haugh and Elphick's mapping area extended from the present day Kettle Generating
Station,  west  to  Gull Rapids and from the north-western tip of Stephens Lake,
formerly  known  as Moose Bay, southwards to the Nelson River.  The project took
two  months  to  complete.

     In  1974,  Frolinger (1974) conducted a three week mapping project
along  the  Nelson River downstream from the newly constructed Kettle Generating
Station  to  the  proposed site of the Long Spruce Generating Station.  Outcrops
along  the  Nelson  River  were  examined  prior  to flooding of the Long Spruce
Generating Station fore bay.  In 1975, Frolinger, Corkery and Hubretse continued
mapping  from the Long Spruce Generating Station site downstream to the boundary
between  the  Precambrian  basement  and  the  Paleozoic  cover located near the
SP01-07 - P218 property boundary. The downstream portion of this mapping project
covered  outcrops  that  were  soon  to  be  flooded  by the construction of the
Limestone  Generating  Station  (Corkery,  1975;  Corkery  and  Lenton,  1980).

<PAGE>

Table  2  -  Summary  of  previous  Manitoba Geological Survey mapping in region

YEAR TITLE                             NATURE OF WORK   REFERENCE
--------------------------------------------------------------------------------
1968 Kettle Rapids - Moose Lake Area   bedrock mapping  Haugh and Elphick,  1968
1974 Geology of the Kettle Rapids-Long bedrock mapping  Frohlinger, 1974
     Spruce  Rapids Area
1975 Nelson River-Ilford Area        bedrock mapping  Corkery and Hubregtse 1975
1975 Lower  Nelson  river  Project    bedrock  mapping Corkery,  1975
1980 Lower  Churchill  River  Project:bedrock mapping  Corkery and Lenton, 1980
     South  Half
1985 Limestone  River  Compilation    bedrock mapping  McRitchie,  1985
1985 Surficial Geology of the Kettle  surficial geology Klassen  and
     Rapids Area                      map              Netterville,  1985
1985 Geology of the Lower Nelsona     bedrock mapping  Corkery,  1985
     River Project Are
1992 Kettle  Rapids (NTS 54D)         Compilation of   Corkeryet  al.,  1992
                                      bedrock mapping
--------------------------------------------------------------------------------

     In 1985, McRitchie (1985) mapped the Limestone River area north of
Moose  Bay,  Stephens Lake.  Also in 1985, Klassen and Netterville (1985) mapped
and  compiled  the  surfical  geology  of  the area.   During this time, Corkery
(1985)  compiled  a detailed open file report of the area describing the geology
and  the  potential  economic  significance  of  the  area.

     Since  the  construction of the Kettle, Long Spruce, and Limestone
Generating  Stations,  short  term field trips have been made to revisit some of
the  outcrops mapped during these earlier programs.  In 1992, Corkery compiled a
geological  map  that  incorporated  all  previous  mapping projects in NTS 054D
(Corkery  et  al.,  1992).

     In  2000, M.T. Corkery of the Geological Survey of Manitoba and C.
Bohm  of the University of Alberta returned to the Gull Rapids Area and Stephens
Lake  to map and sample new outcrops that had recently been exposed. The results
of  the  sampling  are  not  yet  published,  as  some  of the samples are being
age-dated.  This  recent  return  to Stephens Lake was also prompted by Manitoba
Hydro's proposal of constructing another hydroelectric generating station at the
Gull  Rapids  site.  Manitoba  Hydro  has  recently agreed to fund three related
geological  graduate  research  projects  in  the  Gillam-Assean Lake-Split Lake
region.

GEOLOGICAL  SETTING
-------------------

     Ultramafic  rocks  along  the  Circum-Superior  Boundary are similar in age
(1.88  Ga)  and  composition  to  the rocks hosting major nickel deposits of the
Thompson  Nickel  Belt  in  Manitoba and the Cape Smith Belt in northern Quebec.
Special  Exploration  Permits  2001-03,  2001-07,  and  2002-01, and Exploration
Permits  218  and  232,  all  of  which  occur  near  the northern margin of the
Circum-Superior  Boundary  in  northeastern  Manitoba,  covers  part of a poorly
exposed  paragneiss  belt that flanks the northern margin of the Fox River Belt.
This  paragneiss  belt has been previously described as the Northern Gneiss Belt
(e.g.,  R.F.J.  Scoates,  1990), and has also been interpreted to be correlative
with  the Kisseynew Domain of the Trans-Hudson Orogen (e.g., Manitoba Geological
Survey  1:1,000,000  scale Bedrock Geology of Manitoba map).   However, regional
gravity  and  magnetic  data indicate that the parts of the paragneiss belt that
underlie  the three Falconbridge permits are dissimilar to most of the Kisseynew
Belt, which typically lacks the magnetic intensity observed on the property. The
magnetically  intense/complex  parts  of  the paragneiss belt extending due east
from  Stephens  Lake  is  now  referred  to  as  the  Stephens  Lake  Belt.

     The  bedrock  geology of the property is not well documented because of the
lack  of  outcrop  and limited, previous geological mapping. However, rocks that
are  exposed are composed of psammitic, pelitic, migmatitic, and tonalitic rocks
(Figure  2).  Also,  the  regional  airborne  magnetic  survey  data  (e.g., see
Manitoba  Geological  Survey  -  Geological  Survey  of  Canada joint release of
digital  geophysical database for Manitoba, OF99-12) clearly defines a number of
strong, linear, convoluted magnetic anomalies within the Stephens Lake Belt that
may represent buried mafic-ultramafic intrusions and associated iron formations.



                               [GRAPHIC  OMITED]


Figure 2 - Geology map of the Stephens Lake area (modified after Corkery et al.,
1992)

EXPLORATION
-----------

     The  spring  2002  GEOTEM  survey was carried out by Fugro Airborne Surveys
using  a  frequency  of  25 Hz, line spacing of 250 metres, and nominal receiver
height  above ground of 75 metres. Data collected included total field magnetics
(one  reading  per  0.2  second),  three-component  electric field data (dBx/dt,
dBy/dt  and  dBz/dt) and three-component time-integrated electric-field data (to
approximate the secondary magnetic field, Bx, By, and Bz). Fugro also calculated
the  vertical  magnetic  field  gradient  from  the  total  field  data.

     The  advantage  of  collecting  or  deriving  B-field  data  in  off-time
time-domain  EM  surveys  is  that  it  provides  a  substantially  better
signal-to-noise  ratio  for  highly  conductive targets. [Such conductors are of
prime  interest to nickel exploration.] The theoretical upper limit of detection
for  a dB/dt off-time survey is ~1000 Seimens, whereas that for a B-field survey
is  ~10,000  Seimens.

     Fugro  provided  Falconbridge  with  a list of automated conductive anomaly
picks  using  dBx/dt  channels.  These  included bedrock conductors with B-field
responses of varying strength concentrated at the southern margins of the survey
block,  surficial conductors concentrated in the north half of the survey block,
and  strong cultural responses from the major power-lines (both DC and 60 Hz AC)
running  SW  from  Manitoba  Hydro  generating  stations  on  Stephens  Lake.

     Falconbridge  Chief  Geophysicist Tony Watts examined the multichannel data
on  a line-by-line basis, concentrating on late-time Bx and Bz channels. Most of
the  conductors  detected  had  substantial  strike  lengths  (5-25 kilometres),
relatively  uniform  conductivity,  and were either not associated with magnetic
features  or  were  associated  with  relatively  long,  uniform features. These
characteristics  are  commonly  associated  with  formational conductors, either
graphitic  or  sulfidic  metasedimentary  units  or  graphitic  shear  zones. No
extremely  conductive  anomalies  were  detected  over  the  flown  areas of the
Stephens  Lake  permits,  but  a  number  of  anomalies were selected for ground
follow-up. These anomalies were prioritized based on high estimated conductance,
local  variations  in  conductivity and correlation with total magnetic field or
vertical  gradient  anomalies.

     Ground geophysical surveys (HLEM and mag) were carried out between November
2002  and  March  2003  on  eleven  (11) grids over prioritized conductors. Four
targets  (SL-12B,  SL-13B,  SL-16A  and  SL-25B)  were  selected for drilling to
collect lithostratigraphic information and to determine the possible presence of
sulfide  iron  formation,  considered a key requirement for Thompson-type nickel
deposits.  The  lowest  priority  target  (SL-25A) was eventually dropped due to
delays  in  mobilizing  drill  equipment  on  site.

     The  fixed-wing  magnetic and electromagnetic airborne survey was performed
over  SP01-03,  SP01-07,  SP02-01, P218, and P232 during the period of March 22,
2002  to  April  23,  2002.

     The  winter  2002-03 ground surveys were designed to follow up and
localize  prioritized  conductors  from  the  GEOTEM  survey.  Most  of the many
anomalies  detected by the survey are of moderate conductance, possess extensive
strike length (>10 kilometres), and many lack obvious magnetic correlations, all
typical  signs  of  usually  barren  formation conductors caused by graphite +/-
pyrite  along  shear zones or graphitic/sulfidic metapelites. Prioritization was
given  to  anomalies  of higher conductance, correlating with magnetic features,
and  showing  rapid  variation  along  strike  length.

     A total of ten grids were cut in November and December 2002 and surveyed by
horizontal  loop  (MaxMin)  and  proton-precession  magnetometer.  In March, one
additional  grid was cut and surveyed, two grids were extended and surveyed, and
three reconnaissance geophysical traverses were carried out without a grid being
cut.

     All  exploration  work  was  carried  out by Falconbridge as operator.  The
Company is confident of the reliability of all data and does not consider any of
the  data  to  be  uncertain.

MINERALIZATION
--------------

     No  mineralization  of  economic  significance  is  known  on the Property.
However  the  occurance  of sulphide iron formation in one of the drill holes is
considered  crucial  to  the  development  of  nickel  sulphides  similar to the
Thompson  mine.

DIAMOND  DRILLING
-----------------

     Four  targets across the property were selected for drill testing. However,
a  late  mobilization  date  and  equipment  problems  led  to  a  tighter  than
anticipated  schedule,  and warm weather in mid-March led Falconbridge to cancel
the second and lowest-priority hole (coincidentally also the farthest from camp,
and  the  one  that  would  require  the  longest  winter road). All three holes
explained  the  conductor  sources,  graphitic  metasediments  in SL-2003-01 and
SL-2003-03,  and  sulfide  iron  formation  (locally  strongly  graphitic)  in
SL-2003-04.

     No  samples returned any assays of economic interest, but the occurrence of
a  thick  sequence  of  sulfide iron formation in a belt also hosting ultramafic
intrusions  is considered highly significant for exploration for a Thompson-type
nickel  deposit.


<PAGE>

Table  3  -  2003  drill  hole  summary

Drillhole            SL-2003-01         SL-2003-03       SL-2003-04
Grid  number         SL-16A             SL-13B           SL-12A/12B
Grid  coordinates    L1200E/400N        L1000E/800N      L1200E/850N
UTM  (NAD27  z15)   468406E 6220925N    423855E 6228743N 418291E 6231114N
Dip                 -50                 -50              -50
Azimuth              180                180              180
Length               350  m             293  m           349  m
Conductor            2.5 m graphitic    12  m  graphitic 73 m pyrrhotite,
                     interval           interval         pyrite,  graphite-
                                                         bearing  interval
Lithology            metagreywacke,     metagreywacke,   graphitic sulfide
                     minor  granite     minor  granite   iron  formation,
                                                         semipelite  and
                                                         psammite  (possibly
                                                         metagreywacke), granite
Significance         Low                Low              High

SAMPLING  AND  ANALYSIS
-----------------------

     All  samples  (economic  or  whole-rock)  were  cut  lengthwise  with  a
water-cooled  diamond  core saw blade. Whole-rock samples were selected to be as
homogeneous  and  representative of a given rock type as possible, with 15 to 30
centremetres  of  split  NQ  size  core  considered  a reasonable sample size. A
representative  sample  was kept for future reference, petrographic examination,
microprobe  analysis,  etc.  Economic  samples  were up to 1.5 metres in length,
chosen  to  be  relatively  homogeneous  or  representative  of  a  mineralized
intersection.

     Samples  were  analyzed  by ALS Chemex Laboratories (an ISO 9002 accredited
facility)  in  Val  d'Or,  Quebec.  One  of two standard Falconbridge analytical
packages were employed, a whole-rock analysis using XRF and including Ni, Cu, Co
via  AA,  S  via  LECO fusion, and Au, Pt, Pd by fire assay with AA finish, or a
35-element  ICP  package  with  multi-acid  (total)  digestion.

     Four  samples of a Falconbridge internal standard were submitted along with
the Stephens Lake core samples, two for each type of analysis. The standard is a
mixture  of  powdered  Raglan  ore  blended  with  powdered  Raglan  gabbro, and
approximates  a  mineralized  mafic  rock.  The  standard  is  used  to  monitor
laboratory  accuracy  and  precision,  as  well  as  long-term  variation.  The
laboratory  is not aware of the accepted values for the standard, but given that
it  is  usually the only powdered sample submitted with core or rock samples the
lab  will  be  aware  that  it  is  a  standard.  It is considered somewhat less
important  in  grass-roots  projects  which are generally characterized by small
batches  of  unmineralized  to  weakly  mineralized  samples.

SECURITY  OF  SAMPLES
---------------------

     Falconbridge  followed  standard  company  and industry standards in sample
handling  and  there  is  no  need  for  concern.

MINERAL  RESOURCES  AND  MINERAL  RESERVE  ESTIMATE
---------------------------------------------------

     There  are  no  mineral  resources or mineral reserves on the Stephens Lake
property.

MINING  OPERATIONS
------------------

     There  are  no  mining  operations  on  the  Stephens  Lake  property.


<PAGE>

LABRADOR  REGIONAL  AGREEMENT

     In  January  2002,  the  Company  and  Falconbridge Limited entered into an
agreement  (the  'Labrador Regional Agreement') to explore for Voisey's Bay type
nickel-copper-cobalt  deposits in Labrador outside of the Voisey's Bay and South
Voisey  Bay  areas.  Under  the  Labrador  Regional Agreement, the partners have
agreed  to  each  spend  a minimum of $200,000 per year, over a two year period.
There  are  currently  no  mineral  claims  held  under  the  Labrador  Regional
Agreement.  However,  any  properties acquired will form part of a Joint Venture
in  which  both  the  Company  and  Falconbridge  will  have  a  50%  interest.

     In  the  first  year  of  the  agreement,  a  field  program  consisting of
geochemical,  geological  and  geophysical  surveys, and property evaluation was
carried  out in July and August 2002.  The Company and Falconbridge are carrying
out  follow-up work in 2003 on areas of interest identified by the 2002 program.
As of the date of this report, the results of this work have not resulted in the
acquisition  of  any  ground.

     Pursuant  to  the  Teck  Agreement, Teck will have the option to earn a 50%
interest  in  the  Company's  interest  in  the  Labrador  Regional  Properties.

ITEM  5.  OPERATING  AND  FINANCIAL  REVIEW  AND  PROSPECTS

     This  discussion  should  be read in conjunction with the audited financial
statements  of  the  Company  and  related  notes  included  therein.

     The  Report  includes  "forward-looking  statements"  within the meaning of
Section 27A of the Securities Act and Section 21E of the Securities and Exchange
Act  of  1934,  as  amended  (the  "Exchange  Act").  All  statements other than
statements  of  historical  facts  included  in  this Report, including, without
limitation, the statements under "Operating and Financial Review and Prospects,"
"Information  on  the Company," and "Property, plants and equipment" and located
elsewhere  herein  regarding  industry  prospects  and  the  Company's financial
position are forward-looking statements.  Although the Company believes that the
expectations reflected in such forward-looking statements are reasonable, it can
give  no  assurance  that  such  expectations  will  prove to have been correct.
Important  factors that could cause actual results to differ materially from the
Company's  expectations  ("Cautionary Statements") are disclosed in this Report,
including,  without  limitation,  in  conjunction  with  the  forward-looking
statements  included  in  this  Report  under  "Item  3  -  Risk  Factors."  All
subsequent written and oral forward-looking statements attributed to the Company
or persons acting on its behalf are expressly qualified in their entirety by the
Cautionary  Statement.

A.  OPERATING  RESULTS
----------------------

UNITED  STATES  GENERALLY  ACCEPTED  ACCOUNTING  PRINCIPLES

     See  note  15  to the Consolidated Financial Statements for a comparison of
Canadian  GAAP and United States GAAP as applicable to the Company's operations.

CRITICAL  ACCOUNTING  POLICIES

     The  Company  prepares  its Consolidated Financial Statements in conformity
with  Canadian  GAAP,  which  conform  in all material respects to United States
GAAP,  except  for  those  items  disclosed  in  note  15  of  the  Notes to the
Consolidated  Financial  Statements.  For United States readers, the Company has
detailed  the  differences  and  has  also  provided  a  reconciliation  of  the
differences  between  the  United States and Canadian GAAP, where applicable, in
note  15,  as  referred  to  above.

     The preparation of the Company's Consolidated Financial Statements requires
it  make  estimates  and  judgments  that affect its reported amounts of assets,
liabilities,  revenues  and  expenses.  The  amounts  recorded  for valuation of
non-producing  mineral  properties, future income taxes, useful lives of capital
assets  and  valuation  of  long-term  investments  are  based  on  estimates.
Furthermore, on an ongoing basis, the Company evaluates its estimates, including
those  related  to  asset  impairment and contingencies. These estimates are all
based  on  information that is currently available to the Company and on various
other assumptions that it believes to be reasonable under the circumstances.  By
their  nature,  these  estimates  are subject to measurement uncertainty and the
impact  on  the  consolidated  financial  statements  of future periods could be
material.  Actual  results  could  vary  from  those  estimates  under different
assumptions  and  conditions.

     The  Company  lists all of its significant accounting policies in note 2 to
its  Consolidated Financial Statements. Of those significant accounting policies
listed  in  note  2  to  the  Consolidated Financial Statements, the Company has
identified the following critical accounting policy, which is believed to be the
most  critical  in  fully  understanding  and  evaluating the reported financial
results:

ACCOUNTING  FOR  EXPLORATION  EXPENDITURES AND MINERAL PROPERTY ACQUISITION
     All  direct  costs related to the acquisition of mineral property interests
are  capitalized by property. Exploration costs are charged to operations in the
period  incurred  until  such time as it has been determined that a property has
economically  recoverable  reserves,  in which case subsequent exploration costs
and  the  costs  incurred  to  develop  a  property  are  capitalized.

     Gains  and losses are recognized on property dispositions when the value of
the  consideration received exceeds and is less than, respectively, the carrying
value  of  the property. Partial dispositions or option proceeds with respect to
undeveloped  properties  are  credited  against the cost of the related property
except  that,  when  the  proceeds  exceed  the  cost, the excess is credited to
operations.  The  aggregate costs related to abandoned properties are charged to
operations.

     The  Company regularly reviews the carrying values of mineral property
interests on  a  regular basis by reference to the project economics, including
the timing of  the  exploration  and/or development work, the work programs and
exploration results  experienced  by  the  Company and others. When the carrying
value of a property exceeds  its estimated net recoverable amount, an impairment
provision is  made  for  the  other  than  temporary  decline  in  value.

YEAR  ENDED  FEBRUARY  28,  2003  ("FISCAL  2003") COMPARED TO FEBRUARY 28, 2002
("FISCAL  2002")

     The  Company  incurred  a  loss  of  $2,865,222  (2002  -  $1,094,693). The
Company's  loss  per  share  was  $0.05 for 2003 compared to a loss per share of
$0.02  for  2002.

     Effective  February  28, 2003, the Company changed its method of accounting
for mineral exploration expenditures, from deferring them until the viability of
a  project was determined, to charging them to operations as incurred. Under the
new  policy,  only  expenditures  incurred  on properties identified as having a
commercial  body of ore will be capitalized and accounted for in accordance with
the  Company's  accounting  policy  for  mineral  properties.

     The new policy is consistent with current reporting practices in the mining
industry  and  management  considers  the  change will appropriately present the
Company's  operations  and  financial  position.  This  change,  which  has been
applied retroactively with restatement of prior years, increased (decreased) net
loss  by  $926,699 for 2003 (2002 - $222,767; 2001 - ($784,162)). Loss per share
increased  by $(0.02) for 2003 (2002 - $Nil) and decreased by $0.02 for 2001. As
at  February  28,  2003, advances for exploration increased by $480,173, deficit
increased  by  $13,531,230,  mineral  properties  decreased  by  $16,557,177 and
non-controlling  interest  decreased  by  $2,544,910.

     The  Company  expended  $925,622  (net  of  $92,679 received in the form of
government grants) on its Stephens Lake Project (2002 - $11,285) and $241,518 on
its  Labrador  Regional  Project (2002 - $nil). The Company expended only $1,077
(2002  -  $211,482)  on  its South Voisey Bay properties because Falconbridge is
incurring  the  bulk of the exploration costs in order to earn a 50% interest in
the  South  Voisey  Bay Project. The Company has spent $241,518 (2002 - $nil) on
general  exploration  pursuant  to  the  Labrador  Regional Project (see above).

     Effective March 1, 2002, the Company has adopted the recommendations of the
new  CICA  Handbook section 3870, Stock-based Compensation and Other Stock-based
Payments.  This  section  establishes standards for the recognition, measurement
and  disclosure  of stock-based compensation and other stock-based payments made
in  exchange  for goods and services. The standard requires that all stock-based
awards made to non-employees be measured and recognized using a fair value based
method.  The  standard  encourages  the use of a fair value based method for all
awards  granted  to  employees,  but only requires the use of a fair value based
method  for  direct  awards of stock, stock appreciation rights, and awards that
call  for  settlement  in  cash  or  other  assets.

     Awards  that  a  company has the ability to settle in stock are recorded as
equity,  whereas  awards  that  the  entity  is required to or has a practice of
settling  in  cash  are  recorded  as  liabilities.

     Compensation  expense  is  recognized  when  stock  options  are  issued to
employees  and  directors  for the excess, if any, of the quoted market price at
the  date  of grant over the exercise price. Any consideration paid by employees
and  directors  on  exercise  of  stock options is credited to share capital. If
stock  options  are  repurchased,  the  excess  of  consideration  paid over the
carrying  amount  of  the  stock  option  is  charged  to  deficit.
Compensation  expense  is  determined  when  stock  options  are  issued  to
non-employees  and  is  recognized  over  the  vesting period of the option. The
compensation  expense  is determined as the fair value of the option at the date
of  grant  using  an  option  pricing  model.

     The  Company recorded stock-based compensation of $116,560 for 2003 (2002 -
$nil).  The  Company  follows the intrinsic value based method of accounting for
stock  based  awards.  The  expense  is  the result of granting stock options to
certain  employees  with exercise prices less than the market price of the stock
on  the  day  of  grant.  This  is  a  non-cash  transaction.

     If  the  Company had used the fair value based method, pro forma loss would
have  amounted  to $3,988,842 (an increase of $1,123,620) and pro forma loss per
share  would  have been $0.07 (an increase of $0.02) for the year ended February
28,  2003.

     Most  of  the line items on the 2003 statement of operations have increased
significantly  in  2003  as  a  result  of  increased  exploration  and business
activity.

     Promotion has increased by $197,205 due to Management travelling throughout
Canada  and  Europe  promoting  the  new  exploration  being  carried out on the
Company's  projects.  The  Company revised and updated its internet web site and
printed  significantly  more  promotional  material. Management attended several
additional mineral exploration and investment conferences during the 2003 fiscal
year  compared to 2002. Incurring these extra costs have resulted in the Company
raising  net proceeds of $3,323,300 from private placements (see below) in order
to  fund  future  exploration  programs  and  for  general  working  capital.

     The  Company's  filing  fees  and  transfer agent fees more than doubled to
$29,953  during  2003  compared  to 2002. These fees have increased because more
shares  were  issued  from  treasury during 2003, the Company filed its 2001 and
2002  Annual  Information  Form,  and the Company paid four separate TSX Venture
Exchange  private  placement  filing  fees.

     The  Company's administration and management fees were $676,500 during 2003
compared  to  $244,500  for  2002.  However,  during  2002,  the Company charged
$222,500 of management fees to the exploration properties. This was done because
Management  had  spent a considerable amount of time reorganizing and evaluating
the  properties  in  order to attract third party exploration on the properties.
The  Company  paid $230,000 (2002 - $160,000) to the President, $192,000 (2002 -
$24,000)  to  the  CEO and $120,000 (2002 - $120,000) to the exploration manager
for  management  and  technical  services.

     The  Company paid an arms-length private company $136,000 (2002 - $163,000)
for  accounting,  secretarial  and  general administrative services and paid the
same  company  $48,000 (2002 - $12,000) for rent. The rent has increased in 2002
because  the  Company has increased the amount of office space that it is using.

     The  Company  has  earned  less  interest  income  in 2003 because of lower
interest  rates  and  less  cash on hand throughout most of the year compared to
2002.

     The  Company  wrote  down  the  carrying value of the convertible debenture
investment  by  $43,254  during  the  second quarter ended August 31, 2002.  The
value  of  the  underlying  shares  of  the  convertible  debenture  declined
significantly  over  the  six  month  period  ending  August  31,  2002 and thus
necessitated  a  write  down  of the carrying value. Due to the events discussed
above  in  regards  to  the  Company's  investment  in  Knight  Resources,  the
convertible debenture plus accrued interest was repaid in full subsequent to the
year  end  and  before  the  date  of  this  report.

     The  Company  has  accrued  capital taxes in the amount of $159,412 (2002 -
$nil).  This  amount has been included in the office and miscellaneous line item
on  the  statement of operations. This amount relates to federal large corporate
tax  and  British  Columbia  capital  tax  on  the  Company's  net assets. It is
anticipated that the Company will not owe any tax for fiscal 2004 and beyond due
to  the  elimination  of  the  British  Columbia  capital  tax and the increased
threshold  of  the  federal  large  corporate  tax.

YEAR  ENDED  FEBRUARY  28,  2002  ("FISCAL  2002") COMPARED TO FEBRUARY 28, 2001
("FISCAL  2001")

     The  Company  incurred a loss of $1,094,693 (2001 - $545,109) and operating
expenses were $852,544 (2001 - $410,321) excluding write-downs of $248,217 (2001
-  $94,958).

     The  Company's  2002  loss doubled compared to 2001 mainly due to increased
exploration expenditures and a write down of investment.  The Company wrote down
the  carrying  value of its convertible debenture investment in Knight Petroleum
Corp.  ("Knight")  by $231,963 due to uncertainty of realizing the entire asset.
Knight  paid  all  of the scheduled interest payments up to February 28, 2002 in
full.

     Operating  expenses  have  increased  in 2002 because of increased business
activity.  In  particular, management of the Company traveled significantly more
during  2002  compared  to 2001. Management attended several mineral exploration
and  investment  conferences  in  Canada  as well as performing due diligence in
Brazil  and  Canada on potential projects, such as the Stephens Lake Project and
the  Labrador  Regional  Project  discussed above. Management also made numerous
trips  to  Newfoundland  and  Labrador  and  Montreal  as part of its efforts to
finalize  the  option  earn-in  agreement  with  Falconbridge.

     The  Company  hired  several  consultants in 2002 and paid $70,957 in fees.
These  costs  were  for  financial  consulting services in regards to increasing
investor  awareness  in  Europe  and  for  listing  the  Company's shares on the
Frankfurt  Stock Exchange in Germany, where the Company's shares were listed for
trading  in  mid-February.

     The  Company  spent $79,243 more on promotion in 2002 compared to 2001. The
Company  re-worked  and updated its Multimedia Presentation, advertised its 2002
exploration  program  and  paid  for  German  investor  relations.

     The  Company also updated its contact database during the period which cost
the  Company  $7,615  in casual labor. This amount is grouped in with office and
miscellaneous. Telephone and communications increased by $9,675 primarily due to
increased  news  releases  dissemination  costs  in  2002.

     The  Company's  professional  fees were higher in 2002 because of the South
Voisey Bay reorganization and new exploration agreements entered into. Also, the
Company  paid  its  U.S.  counsel  and  its auditors more in 2002 because of new
Securities  and  Exchange  Commission  requirements.  In  general, the Company's
compliance  costs  have  increased  because  of its expanding operations and the
changing reporting and compliance rules that have been implemented over the past
year.

     The  Company paid $160,000 (2001 - $146,667) to the President for technical
consulting and management services. Of the $160,000, $110,000 was charged to the
various  properties.  The  Company  paid  $120,000  (2001  -  $110,000)  to  the
exploration  manager  for  technical  consulting and management services. Of the
$120,000,  $112,500  was  charged  to  the  various properties. The Company paid
$24,000  (2001  -  $5,000)  to  the  CEO  for  management  services.

     The  Company  paid  a  private  company  $163,000  (2001  -  $109,500)  for
accounting,  secretarial  and  general administrative services and paid the same
private  company  $12,000  (2001  -  $13,500)  for  rent.


<PAGE>

B.  LIQUIDITY  AND  CAPITAL  RESOURCES
--------------------------------------

     The  Company's working capital position at February 28, 2003 was $2,561,943
compared  to $1,551,049 at February 28, 2002. The increase in working capital is
mainly  due  to  the Company receiving $3,741,105 through the issuance of shares
upon  the  exercise  of  stock options, warrants and private placement proceeds.

     During  the  year,  the  Company  issued  15,841,667  common shares for net
proceeds  of  $3,323,300 pursuant to private placements, 2,118,050 common shares
for  proceeds  of  $217,805  pursuant to exercise of stock options and 1,666,667
common  shares  for  proceeds  of $200,000 pursuant to the exercise of warrants.

     Of  the total amount of funds raised through private placements, $1,030,000
was  raised  pursuant to the issuance of flow-through shares. As at February 28,
2003,  the  Company  has  spent  approximately  $530,000 on Canadian Exploration
Expenditures  and  expects  to  spend the remainder of the flow-through funds on
Canadian  Exploration  Expenditures  during  the rest of the 2003 calendar year.

     Subsequent  to  the  fiscal  2003,  the  Company  completed  its  $800,000
investment  in Knight Resources Ltd.  The Company has allocated $100,000 for its
remaining  calendar  2003  contribution  to  the Labrador Regional Project.  The
Company  has  also  allocated  $500,000  for  its remaining calendar 2003 option
earn-in  requirement  for  the  Stephens  Lake  Project.

     It  is anticipated that the Company will have the necessary funds available
to  meet  its  fiscal  2004  operating  costs  and its calendar 2003 exploration
commitments.

     The  Company  believes  that  the  operating  expenditures for 2004 will be
comparable  or  less  than  2003.

ITEM  6.  DIRECTORS,  SENIOR  MANAGEMENT  AND  EMPLOYEES

A.  DIRECTORS  AND  SENIOR  MANAGEMENT
--------------------------------------

     The following table sets forth certain information as of September 30, 2003
about  the  Company's  current  directors  and  senior  management:

<TABLE>
<CAPTION>

<S>              <C>  <C>                       <C>                     <C>

Name. . . . . .Age  Position                    Other Reporting Companies

                                                Company                Position
-------------------------------------------------------------------------------
Harvey Keats.   57  President, CFO & Director   Knight Resources Ltd. President
                                                                     & Director
                                                Terra Nova Gold Corp. President
                                                                     & Director
-------------------------------------------------------------------------------
David Patterson 49  Chief Executive Officer     Knight Resources Ltd.  CEO
                    & Director                                       & Director
                                                Terra Nova Gold Corp.  Chairman
                                                                     & Director
                                                Orsa Ventures Corp.   Secretary
                                                Springbank Ventures    Director
                                                Inc.
                                                Bayswater Ventures     Director
                                                Corp.
-------------------------------------------------------------------------------
Kerry Sparkes  40  Director                     Knight Resources Ltd.  Director
                                                Tyner Resources Inc.   Director
                                                Terra Nova Gold Corp.  Director
                                              Bayswater Ventures Corp. Director
-------------------------------------------------------------------------------
Rex Gibbons .  57  Director                     Terra Nova Gold Corp.  Director
-------------------------------------------------------------------------------
Andrew Stewart.30  Secretary                     N/A                        N/A
===============================================================================

</TABLE>

<PAGE>

B.  EXECUTIVE  COMPENSATION
---------------------------

     The  following table sets forth the compensation paid, and benefits in kind
granted  to  the  Directors  and  members  of  the  Company's  administrative,
supervisory  or  management  bodies  for  the financial year ending February 28,
2003.

<TABLE>
<CAPTION>

<S>                          <C>           <C>             <C>

                               Annual Compensation
----------------------------------------------------------------------
                                                         Other
Name and                                                 Annual
Principal                                              Compensation
Position . . .             Salary ($)    Bonus ($)         ($)
----------------------------------------------------------------------

Harvey Keats (1) .           nil          nil           230,000
President, CFO
and Director

Kerry Sparkes (2). .         nil          nil           120,000
Exploration Manager
and Director

Rex Gibbons. . . . .         nil          nil               nil
Director

David Patterson (3).         nil          nil           192,000
CEO and Director

Andrew Stewart . . .         nil          nil               nil
Secretary




<S>                         <C>              <C>           <C>          <C>

                                  Long Term Compensation

                                          Restricted
                          Securities      Shares or
Name and . .  . .         Under           Restricted           . .  All Other
Principal. .         . .  Option/SARs     Share           LTIP . .  Compensation
Position . . . .          Granted (#)     Units ($)      Payouts ($)   ($)
--------------------------------------------------------------------------------

Harvey Keats (1) . .      1,005,000         nil           nil            nil
President, CFO
and Director

Kerry Sparkes (2). .        215,000         nil          nil             nil
Exploration Manager
and Director

Rex Gibbons. . . .          100,000         nil          nil.            nil
Director

David Patterson (3).        555,000         nil          nil             nil
CEO and Director

Andrew Stewart . . .        150,000         nil          nil             nil
Secretary

</TABLE>


(1)  Paid  to  Keats  Consulting  Inc.,  a  private company controlled by Harvey
Keats.
(2)  Paid  to  Sparkes  Consulting  Ltd.,  a private company controlled by Kerry
Sparkes.
(3)  Paid  to  Elysian  Enterprise  Inc.,  a  Patterson  family private company.

COMPENSATION  OF  DIRECTORS

     The  Company  has no arrangements, standard or otherwise, pursuant to which
directors are compensated by the Company for their services in their capacity as
directors, or for committee participation, involvement in special assignments or
for  services  as  consultant  or  expert  during  the  most  recently completed
financial  year.

     None  of  the  Company's directors have received any manner of compensation
for  services  provided in their capacity as directors during the Company's most
recently completed financial year with the exception of stock options granted to
certain  of the directors of the Company (See "Share Capital - Options and Other
Rights  to  Purchase  Shares").  The Company has a stock option plan in order to
attract,  retain  and  motivate  directors,  officers,  employees,  dependent
contractors  and  consultants.  The  plan  provides  the Company a share-related
mechanism  to  reward the above named individuals for their contributions toward
the  long-term goals of the Company and to enable and encourage such individuals
to  acquire  shares  as  long  term  investments.

LONG  TERM  INCENTIVE  PLAN  (LTIP)  AWARDS

     The  Company  does  not have LTIP awards pursuant to which cash or non-cash
compensation  is  intended  to  serve  as  an  incentive for performance whereby
performance is measure by reference to financial performance or the price of the
Company's  securities,  was  paid  or  distributed.

DEFINED  BENEFIT  OR  ACTUARIAL  PLAN  DISCLOSURE

     The  Company  has  no  defined  benefit  or  actuarial  plans.

C.  BOARD  PRACTICES
--------------------

     The  Board  of  Directors  of  the Company is currently comprised of Harvey
Keats,  David  Patterson,  Kerry  Sparkes and Rex Gibbons.  Each director of the
Company  is  elected  annually  and  holds  office until the next Annual General
Meeting  of  the Members unless that person ceases to be a Director before then.
The  Board  of  Directors currently has one committee; the Audit Committee.  The
Audit  Committee  is  comprised  of  Messrs.  Keats,  Sparkes and Gibbons.  This
committee  is  responsible  for  reviewing  the  Company's  financial  reporting
procedures,  internal  controls  and  the  performance of the Company's external
auditors.  The  committee  is also responsible for reviewing quarterly financial
statements  and  the  annual  financial  statements.

TERMINATION  OF  EMPLOYMENT,  CHANGES IN RESPONSIBILITY AND EMPLOYMENT CONTRACTS

     Except  as described below, the Company does not have any compensatory plan
or  arrangement  which  will  result  from  the resignation, retirement or other
termination  of  employment  of  any  Directors  and/or  member of the Company's
administrative,  supervisory or management bodies or from a change of control of
the  Company  or  a  change in any of such persons' responsibilities following a
change  of  control.

     Pursuant to an agreement (the "Keats Agreement") dated November 26, 1997 as
amended,  Keats  Consulting  Inc.,  a  corporation  owned  by  Harvey Keats, the
Company's President and a director, is engaged by the Company and paid a monthly
fee  of  $13,333.33.  Mr. Keats is also paid a bonus in the amount of $70,000 in
years  in  which  $2,000,000  of  exploration  expenditures  are incurred on the
Company's  properties.  The term of the Keats Agreement commenced on December 1,
1997  and  expires  on  November  30,  2004,  subject  to earlier termination as
provided  therein.

     The  Keats Agreement includes a "golden parachute" provision which provides
that  if the Keats Agreement is terminated as a result of a change of control of
the  Company,  the Company shall pay Keats Consulting Inc. an amount equal to 24
months  remuneration.

     Pursuant  to  an agreement (the "Sparkes Agreement") dated March 3, 1998 as
amended,  Sparkes  Consulting  Inc.,  a  corporation  owned  by Kerry Sparkes, a
director  of  the  Company,  is engaged by the Company and paid a monthly fee of
$10,000.  The  term  of  the  Sparkes  Agreement  commenced on March 1, 1998 and
expires  on  February  28,  2004,  subject  to  earlier  termination as provided
therein.

     The  Sparkes  Agreement  includes  a  "golden  parachute"  provision  which
provides  that if the Sparkes Agreement is terminated as a result of a change of
control  of the Company, the Company shall pay Sparkes Consulting Inc. an amount
equal  to  24  months  remuneration.

D.  EMPLOYEES
-------------

     The  Company  has  a  director  and a director and officer who are party to
service  agreements with the Company.  See "Item 6(C) Termination of Employment,
Changes  in  Responsibility  and  Employment Contracts."  In addition, the Chief
Executive  Officer  of  the  Company,  David Patterson, received remuneration of
$192,000  for  the  financial  year  ending February 28, 2003.  The Company also
retains  the  services  of  independent  geologists,  geological  engineers  and
administrative  consultants  on  a  contract  basis.

<PAGE>

E.  SHARE  OWNERSHIP
--------------------

     The  following table lists as of September 30, 2003, the share ownership of
all  of  the  Company's Directors and members of its administrative, supervisory
and management bodies.  The Company has only one class of shares, common with no
par  value  and  all  of  the  common  shares  have  the  same  voting  rights.

<TABLE>
<CAPTION>

<S>              <C>          <C>           <C>           <C>        <C>
                              Percentage
                              of Common
                 Number of    Shares        Number of
                 Common       Outstanding   Stock         Exercise
Name. . . . . .  Shares Held       (%) (1)  Options Held  Price ($)  Expiration Date
---------------  -----------  ------------  ------------  ---------  -----------------

Harvey Keats. .   280,886      0.38         44,000       0.10  February 3, 2008
                                           300,000       0.10  July 14, 2008
                                           225,000       0.10  November 22, 2008
                                         1,100,443       0.10  November 16, 2009
                                           135,000       0.10  February 1, 2011
                                           425,000       0.43  June 16, 2012
                                           580,000       0.12  November 14, 2012

David Patterson    53,000      0.07      2,260,000       0.12  January 16, 2012
                                           159,583       0.43  June 16, 2012
                                           130,000       0.12  November 14, 2012

Kerry Sparkes .       nil       nil         55,050       0.10  February 1, 2011
                                           285,000       0.10  August 10, 2011
                                           215,000       0.12  November 14, 2012

Rex Gibbons . .     6,000      0.01        100,000       0.10  February 3, 2008
                                            50,000       0.10  July 14, 2008
                                            30,000       0.10  November 22, 2008
                                           170,000       0.10  February 1, 2011
                                            50,000       0.10  August 10, 2011
                                           100,000       0.12  November 14, 2012

Andrew Stewart.    60,000      0.08        155,000       0.10  November 16, 2009
                                           350,000       0.10  February 1, 2011
                                            50,000       0.10  August 10, 2011
                                           150,000       0.12  November 14, 2012

</TABLE>

(1)  The  percentage  ownership  is based on 73,980,541 shares outstanding as of
September  30,  2003.

ITEM  7.  MAJOR  SHAREHOLDERS  AND  RELATED  PARTY  TRANSACTIONS

A.  MAJOR  SHAREHOLDERS
-----------------------

     As  of  September  30,  2003,  the Company is unaware of any party that has
ownership  of  5%  or  greater  of  the  Company's  common  shares.


<PAGE>

B.  RELATED  PARTY  TRANSACTIONS
--------------------------------

     Except as set forth in note 11 to the Consolidated Financial Statements, no
key  management personnel of the Company or any shareholder holding of record or
beneficially,  directly  or  indirectly,  more than 10 percent of the issued and
outstanding  Common  Shares (including warrants) of the Company, or any of their
respective  associates  or  affiliates,  had  any material interest, directly or
indirectly, in any transaction with the Company, or in any proposed transaction,
since  the  beginning  of  the  Company's last fiscal year up to the date of the
Report.

     The  Company  believes  that  all  payments made for services rendered were
comparable  to  those  that  would  be  made to an unaffiliated provider of such
services.

ITEM  8.  FINANCIAL  INFORMATION

A.  CONSOLIDATED  STATEMENT  AND  OTHER  FINANCIAL  INFORMATION
---------------------------------------------------------------

     See  Item  17  for  the  Company's  Consolidated  Financial  Statements.

     The  Company knows of no pending legal or arbitration proceedings including
those  relating  to  bankruptcy, governmental receivership or similar proceeding
and those involving any third party against it, nor is the Company involved as a
plaintiff  in  any  material  pending  litigation.

     The  Company  knows of no pending proceedings to which any director, member
of  senior  management, or affiliate is either a party adverse to the Company or
its  subsidiaries  or  has  a  material  interest  adverse to the Company or its
subsidiaries.

     To  the  best  of the Management's knowledge, the Company has not since the
date of its incorporation, declared or paid any dividends, nor does it intend to
declare  any  dividend  for  the  foreseeable  future.

B.  SIGNIFICANT  CHANGES
------------------------

     None.

<PAGE>

ITEM  9.  THE  LISTING

A.  LISTING  DETAILS  AND  MARKETS
----------------------------------

     The  Common  Shares  of  the Company are listed on the TSX Venture Exchange
under  the symbol DML and the Frankfurt Stock Exchange under the symbol DNL. The
Company's  primary  listing  is on the TSX Venture Exchange. The following table
sets out the market price range of the closing price of the Common Shares on the
TSX  Venture Exchange for each full quarterly period within each of the calendar
years  indicated:

<TABLE>
<CAPTION>

<S>                 <C>            <C>
                    High ($)     Low ($)
                    --------    -------

a) Recent 5 Years
------------------

2002 . . . . . . .      0.65     0.10
2001 . . . . . . .      0.19     0.06
2000 . . . . . . .      0.22     0.07
1999 . . . . . . .      0.50     0.10
1998 . . . . . . .      2.90     0.23

b) Recent 2 Years
------------------

2003 - 3rd Quarter      0.25     0.15
2003 - 2nd Quarter      0.22     0.14
2003 - 1st Quarter      0.25     0.17

2002 - 1st Quarter      0.44     0.22
2002 - 2nd Quarter      0.65     0.36
2002 - 3rd Quarter      0.57     0.10
2002 - 4th Quarter      0.26     0.10

2001 - 1st Quarter      0.14     0.06
2001 - 2nd Quarter      0.18     0.11
2001 - 3rd Quarter      0.18     0.11
2001 - 4th Quarter      0.19     0.13

c) Recent 6 Months
------------------

April 2003 . . . .      0.18     0.14
May 2003 . . . . .      0.22     0.15
June 2003. . . . .      0.22     0.16
July 2003. . . . .      0.18     0.15
August 2003. . . .      0.22     0.17
September 2003 . .      0.25     0.18
</TABLE>


     The  Company's Common Shares were listed on the Frankfurt Stock Exchange in
mid-February  2002.

     There  is  no  active  trading  market  for the Common Shares in the United
States,  although  United  States residents may purchase Common Shares in Canada
and  Germany.

ITEM  10.  ADDITIONAL  INFORMATION

A.  EXCHANGE  CONTROLS
----------------------

     There  is  no  law  or  governmental  decree  or  regulation in Canada that
restricts  the  export  or  import  of  capital,  or  affects  the remittance of
dividends, interest or other payments to a non-resident holder of Common Shares,
other  than  withholding  tax  requirements.  See  "Item  10(D)  -  Taxation."

     There  is  no  limitation  imposed  by  Canadian  law or by the constituent
documents  of  the Company on the right of a non-resident to hold or vote Common
Shares,  other  than  are  provided  in the Investment Canada Act (Canada).  The
following  summarizes  the  principal  features  of  the  Investment  Canada Act
(Canada).

     The  Investment  Canada  Act  (Canada)  requires  certain  "non-Canadian"
individuals,  governments,  corporations or other entities who wish to acquire a
"Canadian  business"  (as  defined in the Investment Canada Act), or establish a
"new Canadian business" (as defined in the Investment Canada Act) to file either
a  notification or an application for review with a governmental agency known as
"Investment  Canada".  The  Investment  Canada  Act  requires  that  certain
acquisitions  of  control  by  a  Canadian  business by a "non-Canadian" must be
reviewed  and approved by the Minister responsible for the Investment Canada Act
on  the  basis that the Minister is satisfied that the acquisition is "likely to
be  of  net  benefit  to  Canada",  having  regard  to criteria set forth in the
Investment Canada Act.  Only acquisitions of control rules for the determination
of  whether  control  has  been  acquired  and,  pursuant  to  those  rules, the
acquisition  of  one-third or more of the voting shares of a corporation may, in
some  circumstances,  be  considered  to  constitute  an acquisition of control.
Certain  reviewable  acquisitions of control may not be implemented before being
approved  by  the  Minister;  if  the  Minister  does  not  ultimately approve a
reviewable  acquisition which has been completed, the acquired Canadian business
would  be  divested.  Failure  to  comply  with  the  review  provisions  of the
Investment  Canada  Act  could result in, among other things, an injunction or a
court  order  directing  disposition  of  assets  or  shares.

D.  TAXATION
------------

     The  following  is  a  general  discussion of certain possible Canadian and
United  Sates  federal  income  tax  consequences,  under current law, generally
applicable  to  a  U.S. Holder  (as hereinafter defined) of common shares of the
Company.  This  discussion  does  not  address  all potentially relevant federal
income  tax  matters  and  it  does not address consequences peculiar to persons
subject to special provisions of federal income tax law, such as those described
below  as  excluded  from  the  definition  of a U.S. Holder.  In addition, this
discussion  does  not  cover  any  state,  local,  or  foreign tax consequences.

     THE  DISCUSSION  IS  FOR GENERAL INFORMATION ONLY AND IT IS NOT INTENDED TO
BE,  NOR  SHOULD  IT  BE  CONSTRUED  TO BE, LEGAL OR TAX ADVICE TO ANY HOLDER OR
PROSPECTIVE  HOLDER  OF  COMMON  SHARES  OF  THE  COMPANY  AND  NO  OPINION  OR
REPRESENTATION  WITH RESPECT TO THE CANADIAN OR UNITED STATES FEDERAL INCOME TAX
CONSEQUENCES  TO  ANY  SUCH  HOLDER OR PROSPECTIVE HOLDER IS MADE.  ACCORDINGLY,
HOLDERS  AND  PROSPECTIVE HOLDERS OF COMMON SHARES OF THE COMPANY SHOULD CONSULT
THEIR  OWN  TAX  ADVISORS  ABOUT  THE  FEDERAL,  STATE,  LOCAL,  AND FOREIGN TAX
CONSEQUENCES  OF  PURCHASING,  OWNING  AND  DISPOSING  OF  COMMON  SHARES OF THE
COMPANY.

U.  S.  HOLDERS

     As  used  herein,  a  "U.S.  Holder" means a holder of common shares of the
Company  who is a citizen or individual resident of the United States, a company
or partnership created or organized in or under the laws of the United States or
of  any  political subdivision thereof or a trust whose income is taxable in the
United  States  irrespective  of  source.  This summary does not address the tax
consequences  to,  and U.S. Holder does not include, persons subject to specific
provisions  of  federal  income  tax  law,  such  as  tax-exempt  organizations,
qualified  retirement  plans,  individual  retirement  accounts  and  other
tax-deferred  accounts, financial institutions, insurance companies, real estate
investment  trusts, regulated investment companies, broker-dealers, non-resident
alien  individuals,  persons or entities that have a "functional currency" other
than the U.S. dollar, shareholders who hold common shares as part of a straddle,
hedging  or a conversion transaction, and shareholders who acquired their common
shares  through  the  exercise  of  employee  stock  options  or  otherwise  as
compensation  for  services.

     A  "U.S.  Resident" means a U.S. Holder who (i) is a resident of the United
States  for the purposes of the Canada-United States Income Tax Convention, 1980
(the "Convention"); (ii) is not currently, nor has previously been a resident of
Canada  or  deemed to be a resident of Canada for the purposes of the Income Tax
Act  (Canada) (herein referred to as the "Canada Tax Act") at any time while the
holder  has  held common shares; (iii) holds his or her common shares as capital
property;  (iv)  deals  at arm's length with the Company for the purposes of the
Canada Tax Act; and (v) does not use or hold, and is not deemed under the Canada
Tax  Act to use or hold, such common shares in carrying a business or performing
independent  services  in Canada.  Common shares will generally be considered to
be  capital property to a U.S. Resident unless they are held as inventory in the
course of carrying on a business or were acquired in a transaction considered to
be  an  adventure  or  concern  in  the  nature  of  trade.

     This  summary  is  limited to U.S. Holders who own common shares as capital
assets.  This  summary  does  not address the consequences to a person or entity
holding  an  interest  in  a  shareholder or the consequences to a person of the
ownership,  exercise  or disposition of any options, warrants or other rights to
acquire  common  shares.

CANADIAN  FEDERAL  INCOME  TAX  CONSEQUENCES

     The following discussion is based upon the current provisions of the Canada
Tax  Act  and  the  regulations (the "Regulations") enacted thereunder as at the
date hereof, the Company's understanding of the current published administrative
and  assessing  policies  of the Canada Customs and Revenue Agency, all specific
proposals  to amend the Canada Tax Act and the Regulations publicly announced by
the  Minister  of Finance before the date hereof (the "Proposed Amendments") and
the  provisions  of the Convention as at the date hereof.  This summary does not
take  into  account provincial, territorial or foreign income tax considerations
(see  "United  States Federal Income Tax Consequences" below), and does not take
into account or anticipate any changes in law, whether by judicial, governmental
or  legislation  decision  or  action  except  to  the  extent  of  the Proposed
Amendments.  No  assurance can be given that any of the Proposed Amendments will
be  enacted  into law or that legislation will implement the Proposed Amendments
in  the  manner  now  proposed.

DISTRIBUTION  ON  COMMON  SHARES  OF  THE  COMPANY

     Under  the  Convention, dividends which are paid or credited, or are deemed
to  be paid or credited, to a U.S. Resident in respect of the common shares will
generally  be  subject  to Canadian withholding tax at a rate of 5% of the gross
amount  of  the  dividends if the beneficial owner of the dividends is a company
which  owns  at least 10% of the voting stock of the Company or 15% of the gross
amount  of  the  dividends if the beneficial owner of the dividends is any other
U.S.  Resident  (other  than certain exempt organizations referred to in Article
XXI  of  the  Convention).

DISPOSITION  OF  COMMON  SHARES  OF  THE  COMPANY

     A  U.S.  Resident will generally not be subject to tax under the Canada Tax
Act  in  respect  of  any  capital  gain  realized  on the disposition or deemed
disposition  of  common  shares  unless such common shares are "taxable Canadian
property",  as  defined in the Canada Tax Act, to the U.S. Resident.  The common
shares  will  not  generally  constitute  taxable  Canadian  property  to a U.S.
Resident  unless  either  (i) at any time during the five -year period ending at
the  time  of the disposition of the common shares by such U.S. Resident, 25% or
more  of  the  issued  shares (and in the view of the Canada Customs and Revenue
Agency, taking into account any rights to acquire shares) of any class or series
of  the  capital  stock of the Company were owned by such U.S. Resident, persons
with  whom  the U.S. Resident did not deal at arm's length or such U.S. Resident
together  with  such  persons,  or  (ii)  the  U.S. Resident's common shares are
otherwise deemed to be taxable Canadian property.  Capital gains realized on the
disposition of common shares that constitute taxable Canadian property to a U.S.
Resident  will  nevertheless, by virtue of the Convention, not be subject to tax
under  the  Canadian  Tax Act, provided that shares of the Company do not derive
their  value  principally from real property, including the right to explore for
or  exploit  natural  resources  and  rights to amounts computed by reference to
production,  situated  in  Canada  at  the  time  of  disposition.

UNITED  STATES  FEDERAL  INCOME  TAX  CONSEQUENCES

     The following discussion is based upon the sections of the Internal Revenue
Code  of 1986, as amended (the "Code"), Treasury Regulations, published Internal
Revenue  Service  ("IRS") rulings, published administrative positions of the IRS
and  court decisions that are currently applicable, any or all of which could be
materially  and adversely changed, possibly on a retroactive basis, at any time.
This  discussion  does  not  consider  the  potential  effects, both adverse and
beneficial,  of  any  recently  proposed legislation which, if enacted, could be
applied,  possibly  on  a  retroactive  basis,  at  any  time.

DISTRIBUTION  ON  COMMON  SHARES  OF  THE  COMPANY

     U.S.  Holders  receiving  dividend  distributions  (including  constructive
dividends)  with respect to common shares of the Company are required to include
in  gross  income for United States federal income tax purposes the gross amount
of  such  distributions  equal to the U.S. dollar value of such dividends on the
date of receipt (based on the exchange rate on such date) to the extent that the
Company  has  current or accumulated earnings and profits, without reduction for
any  Canadian  income  tax  withheld from such distributions.  Such Canadian tax
withheld  may  be  credited,  subject  to  certain limitations, against the U.S.
Holder's  federal  income  tax  liability  or, alternatively, may be deducted in
computing  the  U.S.  Holders'  federal  taxable  income  by  those  who itemize
deductions.  (See  more  detailed discussion at "Foreign Tax Credit" below).  To
the extent that distributions exceed current or accumulated earnings and profits
of the Company, they will be treated first as a return of capital up to the U.S.
Holder's  adjusted  basis  in  the common shares and thereafter as gain from the
sales  of  exchange  of the common shares.  Preferential tax rates for long-term
capital  gains are applicable to a U.S. Holder which is an individual, estate or
trust.  There  are  currently  no  preferential  tax rates for long-term capital
gains  for  a  U.S.  Holder  which  is  a  corporation.

     In  the  case  of  foreign  currency  received  as  a  dividend that is not
converted  by  the  recipient  into  U.S. dollars on the date of receipt, a U.S.
Holder  will  have  a tax basis in the foreign currency equal to its U.S. dollar
value  on  the  date  of receipt.  Generally, any gain or loss recognized upon a
subsequent  sale  or  other  disposition  of the foreign currency, including the
exchange  for  U.S.  dollars,  will  be  ordinary  income  or loss.  However, an
individual  whose  realized  gain  does  not exceed $200 will not recognize that
gain,  to  the extent that there are no expenses associated with the transaction
that  meet  the  requirement  for  deductibility  as a trade or business expense
(other than travel expenses in connection with a business trip) or as an expense
for  the  production  of  income.

     Dividends  paid  on  the common shares of the Company will not generally be
eligible  for  the  dividends received deduction provided to companies receiving
dividends  from  certain  United  States  companies.  A  U.S.  Holder which is a
company  may, under certain circumstances, be entitled to a 70% or 80% deduction
of  the  United  States  source  portion  of dividends received from the Company
(unless  the  Company  qualifies  as  a  "foreign personal holding company" or a
"passive foreign investment company", as defined below) if such U.S. Holder owns
shares  representing  at least 10% or 20%, respectively, of the voting power and
value  of the Company.  The availability of this deduction is subject to several
complex  limitations  which  are  beyond  the  scope  of  this  discussion.

     Under  current  temporary  Treasury  Regulations,  dividends  paid, and the
proceeds  of  a  sales  of  Company's  common  shares,  will  be subject to U.S.
information  reporting  requirements  and  may  also  be subject to the 31% U.S.
backup  withholding  tax, unless the Company or paying agent is furnished with a
duly  completed and signed Form W-9.  Any amounts withheld under the U.S. backup
withholding  tax  rules will be allowed as a refund or a credit against the U.S.
Holder's U.S. federal income tax liability, provided the required information is
furnished  to  the  IRS.

FOREIGN  TAX  CREDIT

     A U.S. Holder who pays (or has withheld from distributions) Canadian income
tax  with  respect  to  the  ownership  of  common  shares of the Company may be
entitled,  at  the option of the U.S. Holder, to either receive a deduction or a
tax  credit  for  such foreign tax paid or withheld.  Generally, it will be more
advantageous  to  claim  a credit because a credit reduces United States federal
income  taxes on a dollar-for-dollar basis, while a deduction merely reduces the
taxpayer's income subject to tax.  This election is made on a year-by-year basis
and  applies  to  all  foreign  taxes paid by (or withheld from) the U.S. Holder
during  that year.  There are significant and complex limitations which apply to
the credit, amount which is the general limitation that the credit cannot exceed
the proportionate shares of the U.S. Holder's United States income tax liability
that  the  U.S.  Holder's  foreign  sources income bears to his or its worldwide
taxable income.  In the determination of the application of this limitation, the
various  items  of  income  and  deduction  must  be classified into foreign and
domestic  sources.  Complex  rules  govern  this  classification  process.  In
addition,  this  limitation  is  calculated  separately with respect to specific
classes  of  income  such  as "passive income", "high withholding tax interest",
"financial  services  income",  "shipping  income",  and  certain  other
classifications  of income.  Dividends distributed by the Company will generally
constitute  "passive income" or, in the case of certain U.S. Holders, "financial
services income" for these purposes.  The availability of the foreign tax credit
and the application of the limitations on the credit are fact specific, and U.S.
Holders  of  common  shares of the Company should consult their own tax advisors
regarding  their  individual  circumstances.

DISPOSITION  OF  COMMON  SHARES  OF  THE  COMPANY

     A  U.S. Holder will recognize a gain or loss upon the sale of common shares
of  the  Company equal to the difference, if any, between (i) the amount of cash
plus  the fair market value of any property received, and (ii) the shareholder's
tax  basis  in  the  common  shares of the Company.  This gain or loss will be a
capital  gain  or  loss if the common shares are a capital asset in the hands of
the  U.S.  Holder,  which  will  be long-term capital gain or loss if the common
shares  of the Company are held for more than one year.  Lower long-term capital
gain  rates  will apply if the U.S. Holder is an individual, estate or trust and
such  U.S.  Holder  has  held  the  common shares for more than eighteen months.
Deduction for net capital loss may be carried over to be used in later tax years
until  such  net  capital  loss is thereby exhausted.  For U.S. Holders that are
corporations  (other  than corporations subject to Subchapter S of the Code), an
unused net capital loss may be carried back three years and carried forward five
years  from  the  loss  year  to  be offset against capital gains until such net
capital  loss  is  thereby  exhausted.

OTHER  CONSIDERATIONS

     In  the  following circumstances, the above sections of this discussion may
not  describe  the  United States federal income tax consequences resulting from
the  holding  and  disposition  of  common  shares:

FOREIGN  PERSONAL  HOLDING  COMPANY

     If  at  any  time during a taxable year more than 50% of the total combined
voting  power  or  the total value of the Company's outstanding shares is owned,
directly  or  indirectly,  by  five  or  fewer  individuals  who are citizens or
residents  of  the  United States and 50% (60% in the first year) or more of the
Company's  gross  income  for such year was derived from certain passive sources
(e.g.,  from  dividends  received  from  its  subsidiaries),  the Company may be
treated  as  a  "foreign personal holding company".  In that event, U.S. Holders
that  hold  common  shares would be required to include in gross income for such
year  their  allocable portions of such passive income to the extent the Company
does  not  actually  distribute  such  income.

FOREIGN  INVESTMENT  COMPANY

     If 50% or more of the combined voting power or total value of the Company's
outstanding shares are held, directly or indirectly, by citizens or residents of
the  United  States,  United  States  domestic  partnerships or corporations, or
estates  or  trusts other than foreign estates or trusts (as defined by the Code
Section  7701(a)(31)),  and  the Company is found to be engaged primarily in the
business  of  investing,  reinvesting, or trading in securities, commodities, or
any  interest  therein,  it  is  possible  that  the Company may be treated as a
"foreign investment company" as defined in Section 1246 of the Code, causing all
or  part  of  any  gain  realized  by a U.S. Holder selling or exchanging common
shares  to  be  treated  as  ordinary  income  rather  than  capital  gain.

PASSIVE  FOREIGN  INVESTMENT  COMPANY

     Certain  United  States  income  tax  legislation  contains rules governing
"passive  foreign  investment companies" ("PFIC") which can have significant tax
effects  on  U.S.  Holders of foreign corporations.  These rules do not apply to
non-U.S. Holders.  Section 1297 of the Code defines a PFIC as a corporation that
is  not  formed in the United States and, for any taxable year, either (i) 7% or
more of its gross income is "passive income", which includes interest, dividends
and  certain  rents and royalties or (ii) the average percentage, by fair market
value  (or, if the Company is a controlled foreign Company or makes an election,
adjusted tax basis) of its assets that produce or are held for the production of
"passive  income"  is  50% or more.  The Company believes that it qualified as a
PFIC  for the current fiscal year and may qualify as a PFIC in subsequent years.
There  can  be no assurance that the Company's determination concerning its PFIC
status  will  not  be  challenged or that it will able to satisfy record keeping
requirements  which  will be imposed on a Qualified Electing Fund ("QEF").  Each
U.S. Holder of the Company is urged to consult a tax advisor with respect to how
the  PFIC  rules  affect  their  tax  situation.

     A  U.S.  Holder who holds stock in a foreign corporation during any year in
which  such Company qualifies as a PFIC may elect to be subject to United States
federal  income taxation under one of two alternative tax regimes.  In the event
that  no  such  election is made, the PFIC rules will apply.  The following is a
discussion  of  the  two  alternative  elective tax regimes applied to such U.S.
Holders  of  the  Company.  In  addition,  special  rules  apply  if  a  foreign
corporation  qualifies  as  both  a  PFIC and a "controlled foreign Company" (as
defined  below)  and  a  U.S.  Holder owns, directly and indirectly, ten percent
(10%)  or  more  of the total combined voting power of classes of shares of such
foreign  corporation  (See  more  detailed  discussion  at  "Controlled  Foreign
Company"  below).

     Assuming  that  the  Company  satisfies record-keeping requirements, a U.S.
Holder who elects in a timely manner to treat the Company as a QEF (an "Electing
U.S.  Holder")  will  be  subject,  under  Section  1293 of the Code, to current
federal income tax for any taxable year in which the Company qualifies as a PFIC
on his pro rata share of the Company's (i) "net capital gain" (the excess of net
long-term capital gain over net short-term capital loss), which will be taxed as
long-term  capital gain to the Electing U.S. Holder and (ii) "ordinary earnings"
(the  excess of earnings and profits over net capital gain), which will be taxed
as  ordinary  income  to  the  Electing  U.S.  Holder,  in  each  case,  for the
shareholder's  taxable  year in which (or with which) the Company's taxable year
ends,  regardless  of  whether  such  amounts  are  actually  distributed.

     The  effective  QEF  election  also  allows the Electing U.S. Holder to (i)
generally  treat  any  gain realized on the disposition of Company common shares
(or  deemed  to  be  realized on the pledge of his shares) as capital gain; (ii)
treat  his share of the Company's net capital gain, if any, as long-term capital
gain  instead  of  ordinary  income;  and  (iii)  either  avoid interest charges
resulting  from  PFIC  status altogether, or make an annual election, subject to
certain  limitations,  to  defer  payment  of  current taxes on his share of the
Company's  annual  realized  net  capital  gain  and  ordinary earnings subject,
however,  to  an  interest  charge.  If  the  Electing  U.S.  Holder  is  not  a
corporation,  such  an  interest  charge would be treated as "personal interest"
that  is  not  deductible.

     The  procedure  a  U.S.  Holder must comply with in making an effective QEF
election  will  depend  on whether the year of the election is the first year in
the  U.S.  Holder's  holding period in which the Company is a PFIC.  If the U.S.
Holder  makes  a  QEF  election in such first year, i.e., a timely QEF election,
then  the U.S. Holder may make the QEF election by simply filing the appropriate
documents  at the time the U.S. Holder files his tax return for such first year.
If,  however,  the Company qualified as a PFIC in a prior year, then in addition
to filing documents, the U.S. Holder must elect to recognize (i) under the rules
of  Section 1291 of the Code (discussed below), any gain that he would otherwise
recognize if the U.S. Holder sold his stock on the qualification date or (ii) if
the  Company  is  a  controlled  foreign corporation, the U.S. Holder's pro rata
share  of  the  Company's post-1986 earnings and profits as of the qualification
date.  The  qualification  date is the first day of the Company's first tax year
in  which  the  Company qualified as a "qualified electing fund" with respect to
such  U.S. Holder.  The elections to recognize such gain or earnings and profits
can  only  be made if such U.S. Holder's holding period for the common shares of
the Company includes the qualification date.  By electing to recognize such gain
or  earnings  and  profits, the U.S. Holder will be deemed to have made a timely
QEF  election.  A  U.S.  Holder who made elections to recognize gain or earnings
and  profits  after  May  1, 1992 and before January 27, 1997 may, under certain
circumstances,  elect  to  change  such  U.S. Holder's qualification date to the
first  day  of  the  first  QEF  year.  U.S.  Holders are urged to consult a tax
advisor  regarding  the  availability of and procedure for electing to recognize
gain  or  earnings  and profits under the foregoing rules.  In addition, special
rules  apply if a foreign corporation qualifies as both a PFIC and a "controlled
foreign  corporation"  (as  defined  below) and a U.S. Holder owns, directly and
indirectly,  ten  percent  (10%)  or  more of the total combined voting power of
classes  of  shares of such foreign corporation (See more detailed discussion at
"Controlled  Foreign  Corporation"  below).

     If the Company no longer qualifies as a PFIC in a subsequent year, a timely
QEF  election will remain in effect, although not applicable, during those years
that  the  Company  is  not  a PFIC.  Therefore, if the Company requalifies as a
PFIC,  the  QEF  election previously made is still valid, and the U.S. Holder is
required  to  satisfy  the  requirements  of  that election.  Furthermore, a QEF
election  remains  in  effect  with  respect to a U.S. Holder, although dormant,
after  a  U.S.  Holder disposes of its entire interest in the Company.  Upon the
U.S. Holder's reacquisition of an interest in the Company, the QEF election will
apply  to  the  newly  acquired  stock  of  the  Company.

     Effective  for tax years of U.S. Holders beginning after December 31, 1997,
U.S. Holders who hold (actually or constructively) marketable stock of a foreign
corporation  that  qualifies as a PFIC, may annually elect to mark such stock to
the  market  (a  "mark-to-market  election").  If such an election is made, such
U.S.  Holder  will  not be subject to the special taxation rules of Section 1291
described  below  for  the taxable year for which the mark-to-market election is
made.  A  U.S.  Holder who makes such an election will include in income for the
taxable  year  for which the election was made in an amount equal to the excess,
if  any,  of the fair market value of the common shares of the Company as of the
close  of  such  tax  year over such U.S. Holder's adjusted basis in such common
shares.  In  addition,  the U.S. Holder is allowed a deduction for the lesser of
(i)  the  excess, if any, of such U.S. Holder's adjusted tax basis in the common
shares  over  the  fair  market  value of such shares as of the close of the tax
year, or (ii) the excess, if any, of (A) the mark-to-market gains for the common
shares  in  the  Company  included  by  such  U.S.  Holder  for prior tax years,
including  any  amount which would have been included for any prior tax year but
for  Section 1291 interest on tax deferral rules discussed below with respect to
Non-Electing  U.S.  Holders,  over (B) the mark-to-market losses for shares that
were  allowed  as  deductions  for  prior tax years.  U.S. Holder's adjusted tax
basis  in  the  common  shares  of  the Company will be increased to reflect the
amount  included  or  deducted  as  a  result  of  a mark-to-market election.  A
mark-to-market  election  only applies to the taxable year in which the election
was made.  A separate election must be made by a U.S. Holder for each subsequent
taxable  year.  Because  the  Internal  Revenue  Service  has  not  established
procedures  for  making  a  mark-to-market election, U.S. Holders should consult
their  tax  advisor  regarding  the  manner  of  making  such  an  election.

     If  a  U.S.  Holder  does  not make a timely QEF or mark-to-market election
during  a  year  in  which  it  holds  (or is deemed to have held) the shares in
question  and the Company is a PFIC (a "Non-electing U.S. Holder"), then special
taxation  rules  under Section 1291 of the Code will apply to (i) gains realized
on  the  disposition  (or  deemed  to be realized by reasons of a pledge) of his
Company  common  shares and (ii) certain "excess distributions", as specifically
defined,  by  the  Company.

     A  Non-electing  U.S.  Holder  generally  would be required to pro rate all
gains  realized  on  the disposition of his Company common shares and all excess
distributions  on  his  Company common shares over the entire holding period for
the  Company.  All gains or excess distributions allocated to prior years of the
U.S.  Holder  (other  than  years prior to the first taxable year of the Company
during such U.S. Holder's holding period and beginning after January 1, 1987 for
which  it was a PFIC) would be taxed at the highest tax rate for each such prior
year  applicable to ordinary income.  The Non-electing U.S. Holder also would be
liable  for  interest  on  the  foregoing tax liability for each such prior year
calculated  as  if  such  liability had been due with respect to each such prior
year.  A  Non-electing  U.S.  Holder  that  is not a corporation must treat this
interest  charge  as  "personal  interest"  which, as discussed above, is wholly
nondeductible.  The  balance  of  the  gain  or  the excess distribution will be
treated  as  ordinary income in the year of the disposition or distribution, and
no  interest  charge  will  be  incurred  with  respect  to  such  balance.

     If  the  Company is a PFIC for any taxable year during which a Non-electing
U.S.  Holder  holds  Company common shares, then the Company will continue to be
treated  as  a PFIC with respect to such Company common shares, even if it is no
longer  definitionally  a  PFIC.  A  Non-electing U.S. Holder may terminate this
deemed  PFIC  status  by electing to recognize a gain (which will be taxed under
the  rules  discussed  above  for  Non-electing U.S. Holders) as if such Company
common  shares  had been sold on the last day of the last taxable year for which
it  was  a  PFIC.

     Under  Section 1291(f) of the Code, the IRS has issued proposed regulations
that, subject to certain exceptions, would treat as taxable certain transfers of
PFIC  stock by Non-Electing U.S. Holders that are generally not otherwise taxed,
such as gifts, exchanges pursuant to corporate reorganizations, and transfers at
death.  Generally,  in  such cases the basis of the Company common shares in the
hands  of  the transferee and the basis of any property received in the exchange
for those common shares would be increased by the amount of gain recognized.  An
Electing U.S. Holder would not be taxed on certain transfers of PFIC stock, such
as  gifts,  exchanges  pursuant  to  corporate reorganizations, and transfers at
death.  The  transferee's  basis  in  this case will depend on the manner of the
transfer.  In  a transfer at death, for example, the transferee's basis is equal
to  (i)  the fair market value of the Electing U.S. Holder's common shares, less
(ii)  the  excess  of the fair market value of the Electing U.S. Holder's common
shares  reduced  by  the  U.S. Holder's adjusted basis in these common shares at
death.  The  specific  tax effect to the U.S. Holder and the transferee may vary
based  on  the  manner  in  which  the common shares are transferred.  Each U.S.
Holder  of the Company is urged to consult a tax advisor with respect to how the
PFIC  rules  affect  their  tax  situation.

     Certain  special,  generally  adverse,  rules  will  apply  with respect to
Company  common  shares while the Company is a PFIC whether or not it is treated
as  a  QEF.  For example under Section 1298(b)(6) of the Code, a U.S. Holder who
uses PFIC stock as security for a loan (including a margin loan) will, except as
may  be provided in regulations, be treated as having made a taxable disposition
of  such  shares.

CONTROLLED  FOREIGN  COMPANY

     If  more than 50% of the voting power of all classes of shares or the total
value  of  the  shares  of  the  Company  is  owned, directly and indirectly, by
citizens  or residents of the United States, United States domestic partnerships
and companies or estates or trusts other than foreign estates or trusts, each of
whom own 10% or more of the total combined voting power of all classes of shares
of  the Company ("United States shareholder"), the Company could be treated as a
"controlled  foreign Company" under Subpart F of the Code.   This classification
would  effect  many  complex  results  one  of which is the inclusion of certain
income  of  a  CFC  which  is  subject  to  current U.S. tax.  The United States
generally taxes a United States shareholder of a CFC currently on their pro rata
shares of the Subpart F income of the CFC.  Such U.S. shareholders are generally
treated  as  having  received  a current distribution out of the CFC's Subpart F
income  and are also subject to current U.S. tax on their pro rata shares of the
CFC's  earnings  invested  in  U.S.  property.  The foreign tax credit described
above may reduce the U.S. tax on these amounts.  In addition, under Section 1248
of the Code, gain from the sale or exchange of shares by a U.S. Holder of common
shares  of  the  Company  who  is or was a United States shareholder at any time
during  the  five-year  period  ending  with  the sale or exchange is treated as
ordinary  income  to  the  extent  of  earnings  and  profits  of  the  Company
attributable  to the shares sold or exchanged.  If a foreign corporation is both
a  PFIC and CFC, the foreign corporation generally will not be treated as a PFIC
with  respect to United States shareholders beginning after 1997 and for taxable
years of foreign corporations ending with or within such taxable years of United
States  shareholders.  Special rules apply to United States shareholders who are
subject  to  the  special taxation rules under Section 1291 discussed above with
respect  to PFIC.  Because of the complexity of Subpart F, and because it is not
clear  that  Subpart  F  would  apply  to  U.S.  Holders of common shares of the
Company,  a  more detailed review of these rules is outside of the scope of this
discussion.

E.  DOCUMENTS  ON  DISPLAY
--------------------------

     The  Documents  concerning the Company which are referred to in this Report
are  either  annexed hereto as exhibits (See Item 19) or may be inspected at the
principal  offices  of  the  Company.

F.  DIVIDENDS  AND  PAYING  AGENTS
----------------------------------

     N/A

G.  STATEMENTS  BY  EXPERTS
---------------------------

     The  Company's  statements for the last three fiscal years included in this
Form 20-F have been audited by Deloitte & Touche, LLP as stated in their reports
appearing  herein,  and  are  included in reliance upon the reports of such firm
given  upon  their  authority  as  experts  in accounting and auditing and their
consent  and  authorization.  Such  firm's address is Suite 2800 - 1055 Dunsmuir
Street,  Vancouver,  British  Columbia,  Canada,  V7X  1P4.

ITEM  11.  QUANTITATIVE  AND  QUALITATIVE  DISCLOSURES  ABOUT  MARKET  RISK

A.  QUALITATIVE  INFORMATION  ABOUT  MARKET  RISK
-------------------------------------------------

CURRENCY  EXCHANGE  RATE  SENSITIVITY

     The  results  of  the  Company's  operations  are  subject  to  currency
transnational  risk  and  currency  transaction  risk.  Regarding  currency
transnational  risk, the operating results and financial position of the Company
and  Company's  subsidiaries  are  reported in Canadian dollars in the Company's
consolidated financial statements.  The fluctuation of the US dollar in relation
to  the  Canadian dollar will therefore have an impact upon the profitability of
the Company and may also affect the value of the Company's assets and the amount
of  shareholders'  equity.

     In  regards  to  transaction risk, the Company's functional currency is the
Canadian dollar and its activities are predominantly executed using the Canadian
dollar.  The  Company  incurs a relatively small portion of its expenses in U.S.
dollars.  The Company's common shares are listed on the TSX Venture Exchange and
the  Frankfurt  Stock  Exchange  and are bought and sold in Canadian dollars and
Euros.  The  Company  has  not  entered  into  any  agreements  or purchased any
instruments  to  hedge  any  possible  currency  risks  at  this  time.

INTEREST  RATE  SENSITIVITY

     The  Company  currently  has  no  significant  short term or long term debt
requiring  interest payments.  As a result, the Company has not entered into any
agreement  or  purchased  any instrument to hedge against possible interest rate
risks  at  this  time.

COMMODITY  PRICE  SENSITIVITY

     The commercial viability of the Company will be dependent, to a significant
extent,  upon  prevailing  spot market prices for minerals.  In the past mineral
prices  have been volatile.  Prices are subject to wide fluctuations in response
to  changes  in  supply  of  and  demand  for minerals, market uncertainty and a
variety  of  additional  factors that are beyond the control of the Company.  No
futures  or  forward  contracts  have  been  entered  into  by  the  Company.

                                     PART II

ITEM  12.  DESCRIPTION  OF  SECURITIES  OTHER  THAN  EQUITY  SECURITIES

     Information  called  for  in  Item  12 is not required in an Annual Report.

ITEM  13.  DEFAULTS,  DIVIDEND  ARREARAGES  AND  DELINQUENCIES

     None

ITEM  14.  MATERIAL  MODIFICATION  TO  THE RIGHTS OF SECURITY HOLDERS AND USE OF
           PROCEEDS

     None

ITEM  15.  CONTROLS  AND  PROCEDURES

     Within  the  90-day  period  prior  to  the filing of this report ("Date of
Evaluation"),  an  evaluation was carried out under the supervision and with the
participation of the Company's management, including the Chief Executive Officer
("CEO"),  of the effectiveness of our disclosure controls and procedures.  Based
on  the evaluation, the CEO has concluded that the Company's disclosure controls
and procedures are effective to ensure that information required to be disclosed
by the Company in reports that it files or submits under the Securities Exchange
Act  of  1934  is  recorded,  processed, summarized and reported within the time
periods  specified  in  Securities  and  Exchange  Commission  rules  and forms.

     The  Company's  disclosure  controls  and  procedures  operate  such  that
important information flows to appropriate collection and disclosure points in a
timely  manner  and are effective to ensure that such information is accumulated
and  communicated  to  the Company's management, and made known to the Company's
CEO,  including  during  the period in which this Annual Report on Form 20-F was
prepared,  as  appropriate  to  allow  timely  decision  regarding  the required
disclosure.

     There  have  been no significant changes in the Company's internal controls
or  the  occurrence  of  events or other factors that could significantly affect
these  controls,  subsequent  to the Date of Evaluation, nor have there been any
corrective  actions  with  regard  to  significant  deficiencies  or  material
weaknesses.

                                    PART III

ITEM  17.  FINANCIAL  STATEMENTS

     The  consolidated financial statements of the Company have been prepared on
the  basis of Canadian GAAP.  A reconciliation to U.S. GAAP is included therein.

     The  auditors'  report,  financial  statements and notes thereto, schedules
thereto as required under Item 17 are found immediately below.  The Audit Report
of  Deloitte  & Touche LLP, Chartered Accountants is included herein immediately
preceding  the  respective  financial  statements,  notes,  schedules,  etc.

     FINANCIAL  STATEMENTS:

     Auditors'  Report  dated  May 9,  2003			F-1

     Audited  Consolidated  Balance  Sheets  as  of  February  28,  2003
     and  February  28,  2002					F-2

     Audited  Consolidated  Statements  of  Operations  for  the  Years  ended
     February  28,  2003,  February  28,  2002,  February  28,  2001  and  the
     Period  from  March  1,  1994  to  February  28,  2003		F-3

     Audited  Consolidated  Statement  of  Cash  Flows  for  the  Years  ended
     February  28,  2003,  February  28,  2002,  February  28,  2001  and  the
     Period  from  March  1,  1994  to  February  28,  2003		F-4

     Audited  Consolidated Statement of Shareholder's Equity for the Period from
     March  1,  1994  to  February  28,  2003			F-5-F-6

     Notes  to  the  Audited  Consolidated  Financial  Statements	F-7-F-26

     Audited  Schedule  of  Exploration  Expenditures  for  the  Years  Ended
     February  28,  2003  February  28,  2002  and
     February  28,  2001						F-27

     All other financial statement schedules are omitted because the information
is  not  required,  is not material or is otherwise included in the consolidated
financial  statements  or  related  notes  thereto.

ITEM  18.  FINANCIAL  STATEMENTS

     The  Company  has  elected  to  report  under  Item  17.

ITEM  19.  EXHIBITS

Certificate  of  Incorporation - Province of British Columbia (previously filed)

Certificate  of  Name  Change  to Karma Ventures Incorporated (previously filed)

Certificate  of  Name  Change  to  Donner  Resources  Ltd.  (previously  filed)

Certificate  of  Name  Change  to  Donner  Minerals  Ltd.  (previously  filed)

Participation  Agreement  dated  May  21,  1997  between  the  Company  and Teck
Corporation  (previously  filed)

Agreement  dated  March  27,  1998  between  the  Company  and  Mr.  Alex Turpin
(previously  filed)

Agreement  dated  February  27,  1998  between  the  Company  and  Thistle Creek
Resources  Inc.  (previously  filed)

Shareholders  Agreement  dated  April  3, 2001, between SVB Nickel Company Ltd.,
Donner Minerals Ltd., Cypress Development Corp., NDT Ventures Ltd., Rcom Venture
Corp.,  and  Curion  Ventures  Ltd.  (previously  filed)

Agreement  dated April 3, 2001, between SVB Nickel Company Ltd., Donner Minerals
Ltd.,  Cypress  Development  Corp.,  NDT  Ventures Ltd., Rcom Venture Corp., and
Curion  Ventures  Ltd.  (previously  filed)

Agreement  dated  September  6,  2001,  between  SVB Nickel Company Ltd., Donner
Minerals  Ltd.,  Northern  Abitibi Mining Corp., Teck Corporation, Major General
Resources  Ltd.,  Pallaum  Minerals  Inc.,  and Falconbridge Limited (previously
filed)

Section  302  Certification  of  Harvey  Keats                         E-1

Section  302  Certification  of  David  Patterson                      E-2

Section  906  of  the  Sarbanes-Oxley  Act  of 2002 of Harvey Keats    E-3

Section  906  of  the Sarbanes-Oxley Act of 2002 of David Patterson    E-4

                                   SIGNATURES


     The  registrant  hereby certifies that it meets all of the requirements for
filing  on  Form 20-F and that it has duly caused and authorized the undersigned
to  sign  this  annual  report  on  its  behalf.


Dated  October  10,  2003                              Donner  Minerals  Ltd.



                                                By: /s/David  Patterson
                                                     ---------------------
                                                    David  Patterson,  CEO

<PAGE>

                                   Exhibit E-1

                    SECTION 302 CERTIFICATION OF HARVEY KEATS

I,  Harvey  Keats,  certify  that:

1.   I  have  reviewed  this Annual Report on Form 20-F of Donner Minerals Ltd.;

2.  Based  on  my  knowledge,  this  Annual  Report  does not contain any untrue
statement  of a material fact or omit to state a material fact necessary to make
the  statements  made, in light of the circumstances under which such statements
were  made,  not  misleading  with respect to the period covered by this report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
information  included  in  this  Annual  Report,  fairly present in all material
respects  the  financial  condition, results of operations and cash flows of the
registrant  as  of,  and  for,  the  period  presented  in  this  report;

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-15(e)  and  15d-15(e))  for  the  company  and  have:

     a)   Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls  and  procedures  to  be designed under our supervision, to
ensure  that  material  information  relating  to  the registrant, including its
consolidated  subsidiaries, is made known to us by others within those entities,
particularly  during  the  period  in  which  this  report  is  being  prepared;

     b)   Evaluated  the  effectiveness  of the registrant's disclosure controls
and  procedures  and  presented  in  this  report  our  conclusions  about  the
effectiveness  of  the  disclosure controls and procedures, as of the end of the
period  covered  by  this  report  based  on  such  evaluation;

     c)  Disclosed  in  this  report  any  change  in  the registrant's internal
control  over financial reporting that occurred during the period covered by the
Annual  Report  that  has  materially  affected,  or  is  reasonably  likely  to
materially  affect, the company's internal control over financial reporting; and

5.  The  company's  other certifying officers and I have disclosed, based on our
most  recent  evaluation  of  internal  control over financial reporting, to the
company's  auditors  and the audit committee of company's board of directors (or
persons  performing  the  equivalent  function):

     a)  All  significant  deficiencies and material weaknesses in the design or
operation  of  internal  control  over  financial reporting which are reasonably
likely  to  adversely affect the company's ability to record, process, summarize
and  report  financial  information;  and

     b)  Any  fraud,  whether or not material, that involves management or other
employees  who  have  a  significant role in the company's internal control over
financial  reporting.


Date:     October  10,  2003

         Harvey  Keats
By:     /s/  Harvey  Keats, President
      -------------------------------


<PAGE>

                                   Exhibit E-2

                  SECTION 302 CERTIFICATION OF DAVID PATTERSON

I,  David  Patterson,  certify  that:

1.   I  have  reviewed  this Annual Report on Form 20-F of Donner Minerals Ltd.;

2.   Based  on  my  knowledge,  this  Annual  Report does not contain any untrue
statement  of a material fact or omit to state a material fact necessary to make
the  statements  made, in light of the circumstances under which such statements
were  made,  not  misleading  with respect to the period covered by this report;

3.   Based  on  my  knowledge,  the  financial  statements,  and other financial
information  included  in  this  Annual  Report,  fairly present in all material
respects  the financial  condition,  results of operations and cash flows of the
registrant  as  of,  and  for,  the  period  presented  in  this  report;

4.   The  registrant's  other  certifying  officers  and  I  are responsible for
establishing  and  maintaining disclosure controls and procedures (as defined in
Exchange  Act  Rules  13a-15(e)  and  15d-15(e))  for  the  company  and  have:

     a)   Designed  such  disclosure  controls  and  procedures,  or caused such
disclosure  controls  and  procedures  to  be designed under our supervision, to
ensure  that  material  information  relating  to  the registrant, including its
consolidated  subsidiaries, is made known to us by others within those entities,
particularly  during  the  period  in  which  this  report  is  being  prepared;

     b)   Evaluated  the  effectiveness  of the registrant's disclosure controls
and  procedures  and  presented  in  this  report  our  conclusions  about  the
effectiveness  of  the  disclosure controls and procedures, as of the end of the
period  covered  by  this  report  based  on  such  evaluation;

     c)   Disclosed  in  this  report  any  change  in the registrant's internal
control  over financial reporting that occurred during the period covered by the
Annual  Report  that  has  materially  affected,  or  is  reasonably  likely  to
materially  affect, the company's internal control over financial reporting; and

5.   The  company's other certifying officers and I have disclosed, based on our
most  recent  evaluation  of  internal  control over financial reporting, to the
company's  auditors  and the audit committee of company's board of directors (or
persons  performing  the  equivalent  function):

     a)   All  significant deficiencies and material weaknesses in the design or
operation  of  internal  control  over  financial reporting which are reasonably
likely  to  adversely affect the company's ability to record, process, summarize
and  report  financial  information;  and

     b)   Any  fraud, whether or not material, that involves management or other
employees  who  have  a  significant role in the company's internal control over
financial  reporting.

Date:     October  10,  2003

        David  Patterson
By:     /s/  David  Patterson, Chief  Executive  Officer
        ------------------------------------------------


<PAGE>

                                   Exhibit E-3

                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss.1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In  connection  with the Annual Report on Form 20-F of Donner Minerals Ltd. (the
"Company")  for  the period ended February 28, 2003 as filed with the Securities
and  Exchange  Commission  on  the date here of (the "Report"), I, Harvey Keats,
President  of  the  Company, certify, pursuant to 18 U.S.C.  ss.1350, as adopted
pursuant  to  Section  906  of  the  Sarbanes-Oxley  Act  of  2002,  that:

     (1)  The  Report  fully  complies with the requirements of Section 13(a) or
15(d)  of  the  Securities  Exchange  Act  of  1934;  and

     (2)  The  information  contained  in  this  Report  fairly presents, in all
material  respects,  the  financial  condition  and results of operations of the
Company.


                         /s/"Harvey  Keats"
                         --------------------
                         Harvey  Keats
                         President
                         October  10,  2003

A  signed  original  of  this written statement required by Section 906 has been
provided  to the Registrant and will be retained by the Registrant and furnished
to  the  Securities  and  Exchange  Commission  or  its  staff  upon  request.

<PAGE>

                                   Exhibit E-4

                            CERTIFICATION PURSUANT TO
                               18 U.S.C. ss.1350,
                             AS ADOPTED PURSUANT TO
                  SECTION 906 OF THE SARBANES-OXLEY ACT OF 2002


In  connection  with the Annual Report on Form 20-F of Donner Minerals Ltd. (the
"Company")  for  the period ended February 28, 2003 as filed with the Securities
and  Exchange Commission on the date here of (the "Report"), I, David Patterson,
Chief  Executive  Officer of the Company, certify, pursuant to18 U.S.C. ss.1350,
as  adopted  pursuant  to  Section  906 of the Sarbanes-Oxley Act of 2002, that:

     (1)  The  Report  fully  complies with the requirements of Section 13(a) or
15(d)  of  the  Securities  Exchange  Act  of  1934;  and

     (2)  The  information  contained  in  this  Report  fairly presents, in all
material  respects,  the  financial  condition  and results of operations of the
Company.

                         /s/"David  Patterson"
                         --------------------
                         David  Patterson
                         Chief  Executive  Officer
                         October  10,  2003


A  signed  original  of  this written statement required by Section 906 has been
provided  to the Registrant and will be retained by the Registrant and furnished
to  the  Securities  and  Exchange  Commission  or  its  staff  upon  request.

<PAGE>
F-1

Deloitte  &  Touche  LLP
P.O.  Box  49279
Four  Bentall  Centre
2800  -  1055  Dunsmuir  Street
Vancouver,  British  Columbia
V7X  1P4

Tel:  (604)  669  4466
Fax:  (604)  685  0395
www.deloitte.ca

                                                                      DELOITTE &
                                                                          TOUCHE

AUDITORS'  REPORT
To  the  Directors  of
Donner  Minerals  Ltd.  (an  exploration  stage  company)

We  have  audited  the  consolidated  balance sheets of Donner Minerals Ltd. (an
exploration stage company) as at February 28, 2003 and 2002 and the consolidated
statements  of operations and cash flows for each of the years in the three year
period  ended  February  28, 2003 and the cumulative period from commencement of
the  exploration  stage  on  March 1, 1994 to February 28, 2003. These financial
statements  are  the  responsibility  of  the  Company's  management.  Our
responsibility  is  to express an opinion on these financial statements based on
our  audits.

We  conducted our audits in accordance with Canadian generally accepted auditing
standards  and  auditing  standards  generally  accepted in the United States of
America.  Those  standards  require  that we plan and perform an audit to obtain
reasonable  assurance  whether  the  financial  statements  are free of material
misstatement.  An audit includes examining, on a test basis, evidence supporting
the  amounts and disclosures in the financial statements. An audit also includes
assessing  the  accounting  principles  used  and  significant estimates made by
management,  as well as evaluating the overall financial statement presentation.
We  believe  that  our  audits  provide  a  reasonable  basis  for  our opinion.

In  our  opinion, these consolidated financial statements present fairly, in all
material respects, the financial position of the Company as at February 28, 2003
and  2002  and  the results of its operations and its cash flows for each of the
years in the three year period ended February 28, 2003 and the cumulative period
from inception of the exploration stage on March 1, 1994 to February 28, 2003 in
accordance  with  Canadian generally accepted accounting principles applied on a
consistent  basis.

/s/"Deliotte  &  Touche  LLP"

Chartered  Accountants
Vancouver,  British  Columbia
May  9,  2003  (except  as  to  Note 14 (c), for which the date is May 13, 2003)

COMMENTS  BY  AUDITORS  ON  CANADA  -  UNITED  STATES  OF  AMERICA
REPORTING  CONFLICT

In  the  United  States of America, reporting standards for auditors require the
addition  of an explanatory paragraph to describe changes in accounting policies
that  have  been implemented in the consolidated financial statements. Effective
March  1,  2002,  the Company retroactively changed its method of accounting for
mineral  exploration  expenditures, from deferring them until the viability of a
project  was  determined, to charging them to operations as incurred. The impact
of  this  change  in  accounting policy is set out in Note 3 to the consolidated
financial  statements.

Although  we  conducted  our  audits  in accordance with both Canadian generally
accepted  auditing  standards  and  United  States of America generally accepted
auditing  standards,  our  report  to  the  Board of Directors dated May 9, 2003
(except  as  to  Note 14(c), for which the date is May 13, 2003) is expressed in
accordance  with Canadian reporting standards which do not permit a reference to
such  conditions  and  events  in the auditors' report when these are adequately
disclosed  in  the  consolidated  financial  statements.

/s/"Deliotte  &  Touche  LLP"

Chartered  Accountants
Vancouver,  Canada
May  9,  2003  (except  as  to  Note 14 (c), for which the date is May 13, 2003)

<PAGE>
F-2

<TABLE>
<CAPTION>


<S>                                                        <C>             <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED BALANCE SHEETS
(CANADIAN DOLLARS)
--------------------------------------------------------------------------------
                                                    February 28,    February 28,
                                                      2003               2002
                                                   -----------------------------
ASSETS                                                       (restated - note 3)

CURRENT
Cash and cash equivalents . . . . . . . . . . .  .  $1,229,989      $    206,693
Marketable securities and short
  term investments (note 4)                          1,037,092         1,054,345
Accounts receivable . . . . . . . . . . . . .. .        13,770            23,341
Advances for exploration. . . . . . . . . . . . ..     480,173           349,340
Deposits and prepaid expenses . . . . . . . . .  . .     4,862             5,938
--------------------------------------------------------------------------------

TOTAL CURRENT ASSETS. . . . . . . . . . . . . . .    2,765,886         1,639,657

PROPERTY, PLANT AND EQUIPMENT (NOTE 6). . . . ..        44,075            31,442

INVESTMENTS (NOTE 7). . . . . . . . . . . . . . . .     61,625            57,991

MINERAL PROPERTIES (NOTE 8) . . . . . . . . . .      2,603,641         2,643,441
--------------------------------------------------------------------------------

TOTAL ASSETS. . . . . . . . . . . . . . . . . .     $5,475,227      $  4,372,531
================================================================================

LIABILITIES

CURRENT
Accounts payable and accrued liabilities. . . . . .$   203,943      $     88,608

NON-CONTROLLING INTEREST (NOTE 4) . . . . . . . . .    420,559           425,641
--------------------------------------------------------------------------------

TOTAL LIABILITIES . . . . . . . . . . . . . . . . .    624,502           514,249
--------------------------------------------------------------------------------

SHAREHOLDERS' EQUITY

SHARE CAPITAL (NOTE 9)
Authorized - 100,000,000 common shares
without par value Issued - 68,255,541
common shares (2002 - 48,629,157) . .               35,971,592        32,230,487

CONTRIBUTED SURPLUS (NOTE 10) . . . . . . . . . . .    163,460            46,900

DEFICIT ACCUMULATED DURING THE EXPLORATION STAGE. .(31,284,327)                -
--------------------------------------------------------------------------------

TOTAL SHAREHOLDERS' EQUITY. . . . . . . . .  . .      4,850,725       32,277,387
--------------------------------------------------------------------------------

TOTAL LIABILITIES AND SHAREHOLDERS' EQUITY. . . . .$  5,475,227     $ 32,791,636
================================================================================

COMMITMENTS: NOTES 7, 8 AND 14

</TABLE>

<PAGE>
F-3


<TABLE>
<CAPTION>


<S>                                   <C>          <C>         <C>          <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
(CANADIAN DOLLARS)
-------------------------------------------
                                 Cumulative from
                                      March 1,     Year        Year         Year
                                      1994 to      ended       ended       ended
                                      Febr-        Febr-       Febr-       Febr-
                                      uary 28,     uary 28,    uary 28, uary 28,
                                      2003         2003        2002        2001
--------------------------------------------------------------------------------
                                      (restated             (restated  (restated
                                      - note 3)             - note 3)  - note 3)
EXPENSES
Administration & management fees . . $2,723,599 $  676,500 $  244,500 $  371,167
Amortization . . . . . . . . . . .      134,628     14,834     12,467     15,533
Consulting fees. . . . . . . . . .      138,557     67,600     70,957          -
Exploration expenditures
(note 3) (schedule)                  14,541,612  1,168,217     22,767   (15,549)
Filing and transfer agent fees . .      203,957     29,953     12,489     12,418
Office and miscellaneous . . . . .    1,353,879    221,539     61,373     39,096
Professional fees. . . . . . . . .    1,641,477    106,967     97,584     25,802
Promotion. . . . . . . . . . . . . .  1,474,663    285,049     87,844      8,601
Rent . . . . . . . . . . . . . . . .    337,804     49,200     16,800     17,900
Salaries and stock-based compensation.1,021,528    116,560          -          -
Telephone & communications . . . .      222,329     36,128     23,341     13,666
Travel . . . . . . . . . . . . . .  .   946,733    112,429    101,133     28,248
Less: operator's fee . . . . . . .  . (457,648)          -          -          -
Less: interest income. . . . . . .    (873,503)   (75,512)   (98,711)  (106,561)
--------------------------------------------------------------------------------
LOSS, BEFORE OTHER ITEMS . . .     (23,409,615) (2,809,464) (852,544)  (410,321)

OTHER ITEMS
Non-controlling interest . . . .         11,151       5,083     6,068          -
Loss on sale of marketable securities (231,451)           -         -   (32,597)
Loss on disposal of capital assets .   (13,129)     (5,896)         -    (7,233)
Writedown of marketable securities. . (699,230)    (11,691)  (16,254)   (94,958)
Writedown of investment. . . .      (3,791,980)    (43,254) (231,963)          -
Write-off of mineral properties.    (2,345,935)           -         -          -
Write-off of goodwill. . . . . .  .     (2,033)           -         -          -
--------------------------------------------------------------------------------
NET LOSS . . . . . . . . .    $(30,482,222) $(2,865,222) $(1,094,693) $(545,109)
================================================================================
BASIC AND DILUTED LOSS PER SHARE              $     (0.05) $   (0.02) $   (0.01)
================================================================================
WEIGHTED AVERAGE NUMBER OF
COMMON SHARES OUTSTANDING                     56,255,479  46,261,873  44,196,164
================================================================================
</TABLE>

<PAGE>
F-4

<TABLE>
<CAPTION>


<S>                                   <C>          <C>         <C>          <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF OPERATIONS
(CANADIAN DOLLARS)
-------------------------------------------
                                 Cumulative from
                                   March 1,     Year        Year         Year
                                   1994 to      ended       ended       ended
                                   Febr-        Febr-       Febr-       Febr-
                                   uary 28,     uary 28,    uary 28,   uary 28,
                                   2003         2003        2002          2001
--------------------------------------------------------------------------------
                                      (restated             (restated  (restated
                                      - note 3)             - note 3)  - note 3)
OPERATING ACTIVITIES
Net loss. . . . . . . . . . ..$(30,482,222) $(2,865,222) $(1,094,693) $(545,109)

Items not involving cash:
Amortization. . . . . . . . . .     134,628       14,834      12,467      15,533
Salaries and stock-based
compensation . . . . .              116,560      116,560           -           -
Loss on sale of marketable
securities . . . . .                231,451            -           -      32,597
Loss on disposal of capital assets.  13,129        5,896           -       7,233
Writedown of marketable securities. 699,230       11,691      16,254      94,958
Writedown of investment . . .     3,791,980       43,254     231,963           -
Write-off of mineral properties . 2,345,935            -          -            -
Accrued interest income . . . .    (33,317)     (23,363)       3,344    (13,298)
Non-controlling interest. . . .    (11,151)      (5,083)     (6,068)           -
Write-off of goodwill . . . . .       2,033            -          -            -
Changes in non-cash operating
working capital items (note 12) . (633,468)      (4,851)   (283,904)     364,763
--------------------------------------------------------------------------------
                              (23,825,212)   (2,706,284) (1,120,637)    (43,323)
--------------------------------------------------------------------------------
FINANCING ACTIVITIES
Advances to affiliated
companies. . . . . . .           (431,337)            -           -            -
Investment from non-
controlling interest. . . .         23,310            -      23,310            -
Common shares issued for cash   32,836,506    3,741,105     323,450      308,000
--------------------------------------------------------------------------------
                                32,428,479    3,741,105     346,760      308,000
--------------------------------------------------------------------------------
INVESTING ACTIVITIES
(Expenditures on) recovery
of mineral
properties acquisition. . .    (4,963,706)       39,800    (41,100)        (720)
Purchases of property,
plant and equipment. . .         (232,954)     (33,363)     (3,900)            -
Long term investments . . .      (300,000)     (20,000)           -    (280,000)
Purchase of marketable
securities and
short term investments. . . .  (3,336,916)            -           -  (1,526,144)
Sale of marketable securities and
short term investments. . . .    1,460,298        2,038     466,196      478,492
Funds in trust. . . . . .                -            -          -        56,104
--------------------------------------------------------------------------------
                                (7,373,278)     (11,525)    421,196  (1,272,268)
--------------------------------------------------------------------------------
INCREASE (DECREASE) IN CASH . .   1,229,989    1,023,296  (352,681)  (1,007,591)

CASH AND CASH EQUIVALENTS,
BEGINNING OF PERIOD.                      -      206,693    559,374    1,566,965
--------------------------------------------------------------------------------
CASH AND CASH EQUIVALENTS,
END OF PERIOD. . . .             $1,229,989   $1,229,989 $  206,693   $  559,374
================================================================================

</TABLE>

See  note  12  for  non-cash  investing  and  financing  activities.

<PAGE>
F-5


<TABLE>
<CAPTION>

<S>
   <C>         <C>               <C>         <C>         <C>           <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(CANADIAN DOLLARS)
-------------------------------------------------
FROM MARCH 1, 1994 TO FEBRUARY 28, 2002

                                Contributed           Deficit
                                Surplus and           Accumulated        Total
Common shares without par value Subscribed  Special   During the Shareholders'
      Shares      Amount        Shares      Warrants  Exploration Stage Equity
-----------------------------------------------------------------------------
                                                      (restated      (restated
                                                      - note 3)      - note 3)

Balance at March 1, 1994
  . 2,315,864  $  748,288  $   46,900  $        -  $   (802,105)  $   (6,917)
Issuance of common shares for cash
      950,000     190,000           -           -              -      190,000
Net loss
           -           -            -           -      (178,929)    (178,929)
-----------------------------------------------------------------------------
Balance at February 28, 1995
    3,265,864     938,288      46,900           -      (981,034)        4,154
Issuance of common shares for cash
    5,187,000   2,144,871          -            -              -    2,144,871
Issuance of common shares for mineral properties
     425,000      326,750          -            -              -      326,750
Issuance of common shares for finder's fee.
      77,898      107,499          -            -              -      107,499
Issuance of common shares for flow-through
private placement
   1,000,000      500,000          -            -              -      500,000
Issuance of special warrants
           -            -          -    1,588,750              -    1,588,750
Adjustment to reflect change in accounting
policy (note3)
          -             -          -            -    (1,721,949)  (1,721,949)
Net loss
          -             -          -            -      (946,448)    (946,448)
-----------------------------------------------------------------------------
Balance at February 29, 1996
   9,955,762    4,017,408     46,900    1,588,750    (3,649,431)    2,003,6270
Issuance of common shares for cash
     656,312      284,020          -            -              -       284,020
Issuance of common shares for mineral properties
     365,000      607,750          -            -              -       607,750
Issuance of common shares for finder's fee
      35,000       63,350          -            -              -        63,3500
Issuance of common shares on conversion of special warrants
   1,000,000     1,588,750         -  (1,588,750)              -              -
Subscription agreements
           -             - 3,220,000            -              -      3,220,000
Issuance of special warrants
           -             -         -    6,387,651              -      6,387,651
Adjustment to reflect change in accounting
policy (note3)
           -             -         -            -     (3,122,511)   (3,122,511)
Net loss
           -             -         -            -     (1,919,094)   (1,919,094)
-------------------------------------------------------------------------------
Balance at February 28, 1997
  12,012,074     6,561,278 3,266,900    6,387,651     (8,691,036)     7,524,793
6,387,651
Issuance of common shares for cash
   7,138,683     7,236,441         -            -               -     7,236,441
Issuance of common shares for mineral properties
     340,000       487,800         -            -               -       487,800
Issuance of common shares for flow-through
private placement
   3,050,000     3,467,500 (3,220,000)          -               -       247,500
Issuance of common shares on conversion of
special warrant
   6,548,000     6,387,651         -  (6,387,651)               -             -
Adjustment to reflect change in accounting
policy (note3)
           -             -         -            -      (2,310,692)  (2,310,692)
Net loss
           -             -         -            -      (4,810,986)  (4,810,986)
-------------------------------------------------------------------------------
Balance at February 28, 1998
  29,088,757    24,140,670    46,900            -     (15,812,714)    8,374,856

Issuance of common shares for cash
   7,048,400     4,765,667         -            -                -    4,765,667
Issuance of common shares for mineral properties
     400,000       728,500         -            -                -      728,500
Issuance of common shares for flow-through
private placement
   1,652,500       330,500         -            -                -      330,500
Adjustment to reflect change in accounting
policy (note3)
           -             -         -            -      (5,265,674)  (5,265,674)
Net loss
           -             -         -            -      (2,313,984)  (2,313,984)
-------------------------------------------------------------------------------
Balance at February 28, 1999
  38,189,657    29,965,337    46,900            -     (23,392,372)    6,619,865
Issuance of common shares for cash
   4,810,000     1,568,550         -            -                -    1,568,550
Issuance of common shares for mineral properties
      25,000        24,750         -            -                -       24,750
Adjustment to reflect change in accounting
policy (note3)
           -             -         -            -        (745,350)    (745,350)
Net loss
           -             -         -            -      (2,641,581)  (2,641,581)
-------------------------------------------------------------------------------

Balance at February 29, 2000
  43,024,657    31,558,637    46,900            -     (26,779,303)    4,826,234
-------------------------------------------------------------------------------
</TABLE>

<PAGE>
F-6

<TABLE>
<CAPTION>

<S>
   <C>         <C>               <C>         <C>         <C>           <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
CONSOLIDATED STATEMENTS OF SHAREHOLDERS' EQUITY
(CANADIAN DOLLARS)
-------------------------------------------------
FROM MARCH 1, 2002 TO FEBRUARY 28, 2003

                                Contributed           Deficit
                                Surplus and           Accumulated        Total
Common shares without par value Subscribed  Special   During the Shareholders'
      Shares      Amount        Shares      Warrants  Exploration Stage Equity
-----------------------------------------------------------------------------
                                                      (restated      (restated
                                                      - note 3)      - note 3)

Balance at February 29, 2000
  .43,024,657  $31,558,637  $   46,900  $        -  $(26,779,303)   $4,826,234
Issuance of common shares for cash
    2,000,000      308,000           -           -              -      308,000
Issuance of common shares for mineral properties
      200,000       22,000           -           -              -       22,000
Net loss
            -            -           -           -      (545,109)    (545,109)
------------------------------------------------------------------------------
Balance at February 29, 2001
  .45,224,657   31,888,637      46,900           -   (27,324,412)    4,611,125
Issuance of common shares for cash
    3,234,500      323,450           -           -              -      323,450
Issuance of common shares for mineral properties
      170,000       18,400           -           -              -       18,400
Net loss
            -            -           -           -    (1,094,693)  (1,094,693)
------------------------------------------------------------------------------
Balance at February 28, 2002
  48,629,157    32,230,487    46,900            -     (28,419,105)   3,858,282
Issuance of common shares for cash
  13,476,384     2,711,105         -            -                -   2,711,105
Issuance of common shares for flow-through
private placement
   6,150,000     1,030,000         -            -                -   1,030,000
Stock-based compensation
           -             -         -      116,560                -     116,560
Net loss
           -             -         -            -      (2,865,222) (2,865,222)
------------------------------------------------------------------------------
Balance at February 28, 2003
  68,255,541   $35,971,592  $ 163,460    $      -    $(31,284,327)  $4,850,725
------------------------------------------------------------------------------
</TABLE>

<PAGE>
F-7

1.     NATURE  OF  OPERATIONS

During  the  fiscal  year  ended February 28, 1995, the Company was reactivated,
with  its  focus being the mineral exploration and development industry. As this
included  the commencement of the Company's development stage of operations, the
cumulative  figures presented on the statements of operations and cash flows are
for  the  period  March  1,  1994  to  February  28,  2003.

The  Company  is  in  the  process  of exploring and developing its mineral
properties  and  has  not determined whether the properties contain ore reserves
that  are  economically  recoverable.  The  recoverability  of amounts shown for
mineral properties and related deferred costs is dependent upon the discovery of
economically  recoverable  reserves,  the  ability  of  the  Company  to  obtain
necessary financing to complete the development and future profitable production
from  the  property  or  proceeds  from  disposition.

2.     SIGNIFICANT  ACCOUNTING  POLICIES

These  consolidated  financial  statements have been prepared in accordance
with  Canadian  generally accepted accounting principles ("Canadian GAAP") which
in  these  circumstances  conform,  in all material respects, with United States
generally  accepted  accounting  principals  ("US GAAP"), except as described in
note  15.

(a)     Principles  of  consolidation
        The  consolidated  financial  statements  include  the accounts of the
        Company  and  its 76.69% owned subsidiary, SVB Nickel Company Ltd. (see
        note 4). Inter-company  transactions  have  been  eliminated.

(b)     Cash  and  cash  equivalents
        Cash and cash equivalents include short term money market instruments
        with terms to  maturity,  at  the  date  of  issue,  not  exceeding
        ninety  days.

(c)     Marketable  securities  and  short  term  investments
        Marketable securities consist of common shares of publicly traded
        companies. The marketable  securities are carried at lower of cost and
        market value. Short term investments  consist  of money market
        instruments with terms to maturity, at the date  of  issue,  greater
        than  ninety  days.

(d)     Property,  plant  and  equipment
        Property,  plant  and  equipment  is  recorded  at  cost  and amortized
        over the estimated  useful  lives  of  the  assets  on  the  following
        basis:

Computer  software                  100%  declining  balance  per  annum
Computer  hardware                  30%  declining  balance  per  annum
Office  furniture  and  equipment   20%  declining  balance  per  annum

The Company periodically evaluates the recoverability of its property, plant and
equipment whenever events or changes in circumstances indicate that the carrying
amount  of  an  asset  may  not  be  recoverable.  An  impairment  loss would be
recognized  when  estimates of future cash flows expected to result from the use
of  an  asset  and  its  eventual disposition are less than its carrying amount.

(e)     Mineral  properties
        All  direct  costs  related  to  the  acquisition  of mineral property
        interests  are  capitalized  by  property.  Exploration  costs  are
        charged  to operations in the period incurred until such time as it has
        been determined that a  property  has  economically  recoverable
        reserves,  in which case subsequent exploration  costs and the costs
        incurred to develop a property are capitalized.

<PAGE>
F-8

2.     SIGNIFICANT  ACCOUNTING  POLICIES  (CONT'D)

Gains  and  losses are recognized on property dispositions when the value of the
consideration  received  exceeds  and  is  less than, respectively, the carrying
value  of  the property. Partial dispositions or option proceeds with respect to
undeveloped  properties  are  credited  against the cost of the related property
except  that,  when  the  proceeds  exceed  the  cost, the excess is credited to
operations.  The  aggregate costs related to abandoned properties are charged to
operations.

The  Company regularly reviews the carrying values of mineral property interests
on  a  regular basis by reference to the project economics, including the timing
of  the  exploration  and/or development work, the work programs and exploration
results  experienced  by  the  Company  and others. When the carrying value of a
property  exceeds  its estimated net recoverable amount, an impairment provision
is  made  for  the  other  than  temporary  decline  in  value.

(f)     Investments
        Investments are carried at cost.  Where in management's opinion there
        has been a loss  in  value  that  is  other than a temporary decline,
        the carrying value is reduced  to  estimated  realizable  value.

(g)     Loss  per  share
        Basic earnings per common share is computed by dividing earnings by the
        weighted average number of common shares outstanding during the period.
        diluted per share amounts  reflect  the potential dilution that could
        occur if securities or other contracts  to  issue common shares were
        exercised or converted to common shares. The  treasury  stock  method
        is  used to determine the dilutive effect of stock options,  warrants
        and  other  dilutive  instruments.

(h)     Use  of  estimates
        The  preparation  of  financial statements in conformity with generally
        accepted accounting principles requires management to make estimates and
        assumptions that affect  the  reported  amounts  of  assets  and
        liabilities  at the date of the financial  statements  and  the reported
        amounts of revenues and expenses during the  reporting  periods.  Actual
        results  could  differ  from  those estimates.

(i)     Financial  instruments
        The  carrying  values of cash and cash equivalents, amounts receivable,
        advances for  exploration  and  accounts payable and accrued liabilities
        reflected in the balance  sheets  approximate  their  respective  fair
        values. The fair value of marketable securities and short term
        investments and investments is disclosed in notes  5  and  7,
        respectively.

(j)     Stock-based  compensation
        The  Company  has  adopted  the recommendations of the new CICA Handbook
        section 3870,  Stock-based  Compensation and Other Stock-based Payments,
        effective March 1, 2002. This section establishes standards for the
        recognition, measurement and disclosure  of  stock-based  compensation
        and other stock-based payments made in exchange  for  goods  and
        services.  The standard requires that all stock-based awards made to non
        -employees be measured and recognized using a fair value based method.
        The  standard  encourages  the use of a fair value based method for all
        awards  granted  to  employees,  but only requires the use of a fair
        value based method  for  direct  awards of stock, stock appreciation
        rights, and awards that call  for  settlement  in  cash  or  other
        assets.

Awards that a company has the ability to settle in stock are recorded as equity,
whereas  awards  that the entity is required to or has a practice of settling in
cash  are  recorded  as  liabilities.

<PAGE>
F-9

2.     SIGNIFICANT  ACCOUNTING  POLICIES  (CONT'D)

Compensation  expense  is  recognized when stock options are issued to employees
and  directors for the excess, if any, of the quoted market price at the date of
grant over the exercise price. Any consideration paid by employees and directors
on  exercise of stock options is credited to share capital. If stock options are
repurchased,  the  excess  of consideration paid over the carrying amount of the
stock  option  is  charged  to  deficit.

Compensation  expense  is  determined  when  stock  options  are  issued  to
non-employees  and  is  recognized  over  the  vesting period of the option. The
compensation  expense  is determined as the fair value of the option at the date
of  grant  using  an  option  pricing  model.

(k)     Income  taxes
        Future  income  taxes  relate  to  the  expected  future  tax
        consequences  of differences  between  the  carrying  amount  of
        balance sheet  items and their corresponding tax values.  Future tax
        assets, if any, are recognized only to the extent  that,  in the opinion
        of management, it is more likely than not that the future  income  tax
        assets  will  be  realized.  Future  income  tax assets and liabilities
        are adjusted for the effects of changes in tax laws and rates on the
        date of  enactment  or  substantive  enactment.

(l)     Comparative  figures
        The  Comparative consolidated financial statements have been
        reclassified, where applicable,  to  conform  with  the  presentation
        adopted in the current period.

3.     CHANGE  IN  ACCOUNTING  POLICY

Effective  February  28,  2003, the Company changed its method of accounting for
mineral  exploration  expenditures, from deferring them until the viability of a
project  was  determined, to charging them to operations as incurred.  Under the
new  policy,  only  expenditures  incurred  on  properties  identified as having
substantial  evidence  that  a  commercial  body  of  ore  has  been located are
capitalized and accounted for in accordance with the Company's accounting policy
for  mineral  properties.

The  new  policy  is  consistent  with current reporting practices in the mining
industry  and  management  considers  the  change will appropriately present the
Company's  operations  and  financial  position.  This  change,  which  has been
applied retroactively with restatement of prior years, increased (decreased) net
loss  for  the  year  by $926,699 (2002 - $222,767; 2001 - $(784,162)). Loss per
share  increased by $(0.02) (2002 - $Nil) and decreased by $0.02 for 2001. As at
February  28,  2003,  advances  for  exploration  increased by $480,173, deficit
increased  by  $13,531,230,  mineral  properties  decreased  by  $16,557,177 and
non-controlling  interest  decreased  by  $2,544,910.

4.     ACQUISITION  OF  SUBSIDIARY

On  April  3,  2001, the Company entered into a purchase and sale agreement with
Cypress  Development  Corp. ("Cypress"), NDT Ventures Ltd. ("NDT"), Rcom Venture
Corp.  ("Rcom")  and UC Resources Ltd. ("UC") (collectively "the Participants").
Pursuant  to  the  terms  of  the  agreement,  all  of the Participants with the
exception  of  the  Company, sold all of their respective interests in the South
Voisey Bay area to SVB Nickel Company Ltd. ("SVBN"). The Company sold all of its
South  Voisey  Bay interests to SVBN with the exception of the Major General and
Northern  Abitibi joint venture properties. Each of the Participants were issued
one  common  share  of  SVBN for each dollar of assessment credit filed with the
Department  of  Mines  and Energy of the Government of Newfoundland and Labrador
attributable  to  that  Participant.  Accordingly, SVBN issued 12,666,519 common
shares  at  a  deemed  amount  of  $12,666,519  to  the  Participants.

SVBN  is  wholly  owned  by  the Participants. The ownership of SVBN taking into
account  the  above  transaction  is  as  follows:

<PAGE>
F-10

4.     ACQUISITION  OF  SUBSIDIARY  (CONT'D)

The  Company     76.69%
Cypress          11.36%
NDT               6.55%
UC                5.40%

During  the  year ended February 28, 2002, SVBN demanded a $100,000 cash call to
its  shareholders.  The cash call was met by the shareholders contributing their
proportionate  share  of  the  $100,000.  Accordingly,  the  Company contributed
$76,690  and in turn received 76,690 shares of SVBN. As at February 28, 2002 and
2003,  SVBN  has  issued  12,766,519  common  shares  valued  at  $12,766,519.

5.     MARKETABLE  SECURITIES  AND  SHORT  TERM  INVESTMENTS

<TABLE>
<CAPTION>

<S>                  <C>       <C>      <C>         <C>         <C>         <C>
                                      Lower of                Lower of
                                      Cost and    Market      Cost and    Market
                     Type of          Market      Value       Market      Value
                     Security  Number  2003       2003        2002        2002
--------------------------------------------------------------------------------

CBX Ventures Inc. . .Common    46,250 $     -    $     -     $  4,162  $   4,625
Curlew Lake
Resources Inc.. . . .Common   200,000  10,000      16,000      12,000     12,000
Mesa Resources Inc. .Common    15,797   1,580       3,475       7,109      7,109
--------------------------------------------------------------------------------

                                       11,580      19,475      23,271     23,734
Money Market
Instrument                          1,025,512   1,025,512   1,027,549  1,027,549
--------------------------------------------------------------------------------
                                   $1,037,092  $1,044,987  $1,050,820 $1,051,283
================================================================================

</TABLE>

<PAGE>
F-10

6.     PROPERTY,  PLANT  AND  EQUIPMENT

<TABLE>
<CAPTION>



<S>                             <C>       <C>            <C>        <C>
                                    2003                             2002
                                --------                           ---------
                                          Accumulated    Net Book   Net Book
                                Cost      Amortization   Value      Value
                                --------  -------------  ---------  ---------

Computer hardware. . . . . . .  $ 65,404  $      41,054  $  24,350  $  18,936
Computer software. . . . . . .    10,342          5,171      5,171          -
Office equipment and furniture    44,321         29,767     14,554     12,506
------------------------------  --------  -------------  ---------  ---------

                                $120,067  $      75,992  $  44,075  $  31,442
                                ========  =============  =========  =========
</TABLE>

<PAGE>
F-11

7.     INVESTMENTS

<TABLE>
<CAPTION>

<S>                    <C>                        <C>      <C>      <C>
                       Type of Security           Number      2003     2002
                       -------------------------  -------  -------  -------

Knight Resources Ltd.  Common shares               35,250  $ 3,525  $ 3,525
                       Private placement          200,000   20,000        -
Knight Resources Ltd.  11% convertible debenture  280,000   38,100   57,991
---------------------  -------------------------  -------  -------  -------

                                                           $61,625  $61,516
                                                           =======  =======
</TABLE>

(a)     As at February 28, 2003, the Company owns 35,250 common shares of Knight
Resources  Ltd.  ("Knight"), formerly Knight Petroleum Corp. with a market value
of  $7,755 (2002 - $8,460). Knight has directors and officers in common with the
Company.  The  Company  has  also  subscribed  for, through a private placement,
8,000,000  units  of  Knight  at a total cost of $800,000 with a market value of
$1,760,000  at February 28, 2003. Each unit is comprised of one common share and
one  non-transferable  share  purchase warrant entitling the Company to purchase
one  additional common share of Knight at a price of $0.15 expiring on March 25,
2005.  As at February 28, 2003, the Company has advanced Knight $20,000 for this
private  placement.  See  note  11  and  14.

(b)     As  at  February  28,  2003,  the  Company  holds a $280,000 convertible
debenture  of Knight that pays interest at 11% on a semi-annual basis and is due
May  3,  2005.  Accrued interest amounts to $25,355 at February 28, 2003. Knight
has  the  right  to redeem the whole or less than the whole of the principal and
accrued  interest  at  any time before maturity. The debentures are secured by a
first charge against all of Knight's assets. The conversion price is $1.40 until
May  3,  2003  and  increases  to $1.60 until May 3, 2004 and $1.80 until May 3,
2005.

During fiscal 2003, the Company wrote down the carrying value of this investment
by $43,254 (2002 - $231,963) to better reflect its market value. Using the $1.40
conversion  price  and  the  price  of  Knight's stock at February 28, 2003, the
market  value of the investment is $47,984 (2002 - $57,991). See note 11 and 14.

8.     MINERAL  PROPERTIES

The  Company's  mineral  properties  are  comprised of wholly owned mineral
claims  and  interests in joint venture agreements in South Voisey Bay, Labrador
and an option earn-in agreement in Stephens Lake, Manitoba, Canada. Although the
Company  holds  some  interests  in  mineral  properties  through  joint venture
agreements,  none  of  the  operations  are  carried  on  through  joint venture
entities.

South  Voisey  Bay  Properties
------------------------------

The  Company's  South  Voisey  Bay  properties  (the  "Combined  Property")  are
comprised  of  the  following:
i)     Twenty  licences  covering  about  569  km2  held  100%  by SVBN with the
exception  of  a  37.5  km2  held  75%  by  SVBN  (the  "SVBN  Property");

ii)     One  licence  covering  about  39.5  km2 owned 52.38% by the Company and
47.59%  by  Northern  Abitibi  (the  "Donner/Northern  Abitibi  Property");

iii)     One Licence covering about 35.5 km  and owned 52.06% by the Company and
47.94%  by Commander, formerly Major General, (the "Donner/Commander Property").

<PAGE>
F-12

8.     MINERAL  PROPERTIES  (CONT'D)

On  September  7,  2001,  the Company announced an option earn-in agreement with
Falconbridge Limited, whereby Falconbridge can earn a 50% interest in all of the
Company's  South  Voisey  Bay properties by spending $23 million on exploration.

Falconbridge  has  the option to earn a 50% participating joint venture interest
in  each  of  the three Properties (the "Option") for a period from September 1,
2001  to  December  31,  2006  (the  "Option  Period").
Falconbridge  must  incur  the following expenditures on exploration and related
work ("Expenditures") on or before the end of the Option Period in order to earn
a  50%  interest:

i)     In  order  to vest its 50% interest in the SVBN Property, Falconbridge is
required  to  incur  $14,000,000  of  Expenditures  on  the  SVBN  Property.

ii)     In  order  to  vest  its  50%  interest  in  the Donner/Northern Abitibi
Property,  Falconbridge  is  required to incur $5,000,000 of Expenditures on the
Donner/Northern  Abitibi  Property.

iii)     In  order  to  vest  its 50% interest in the Donner/Commander Property,
Falconbridge  is  required  to  incur  $4,000,000  of  Expenditures  on  the
Donner/Commander  Property.

In order to keep the Option in good standing, Falconbridge will incur a total of
at  least  $2,000,000  of  Expenditures  on  the  Combined Property on or before
December  31,  2002  (this  commitment  was  met)  and $2,000,000 in each of the
subsequent  calendar  years  during  the Option Period on the Combined Property.
Falconbridge  may  abandon  its Option on one or more of the Properties or parts
thereof at any time during the Option Period.  Falconbridge will be the operator
during the Option Period.  A management committee has been formed comprising all
of  the  parties  to  develop  and  finalize  all  exploration  programs.

As  at  February  28,  2003, Falconbridge has spent a total of $2,340,729 on the
South  Voisey Bay properties. This amount includes $687,427 on geology, $904,834
on  geophysics,  $424,698  on  drilling  and  $323,770  on  other  miscellaneous
exploration  costs.  Included  in  the  total  number  above is a 10% operator's
overhead  charge  of  $212,794.  This amount will not be paid by the Company but
will  go towards Falconbridge's option earn-in requirements per the terms of the
agreement.

TeckCominco  Limited  ("TeckCominco")  is  also  a  signatory  to  the agreement
discussed  above  and retains its right to earn 50% of the Company's interest in
any  deposits discovered and developed on the Combined Property, after adjusting
for  Falconbridge's  50%  interest  in  the property.  TeckCominco can earn this
interest  by  funding the Company's share of feasibility costs and arranging the
Company's  share  of  production  financing.

As  at February 28, 2003, the Company has outstanding share issuance commitments
relating  to  the  South  Voisey  Bay  properties  as  follows:

(a)     A  commitment  to  issue  100,000  shares  upon  incurring $1 million in
exploration  on the Turpin claims which are now included in the property held by
SVBN.  The  Company  has  not  yet  triggered  this  commitment.

(b)     A  commitment  to  issue  250,000  shares  upon  incurring $1 million in
exploration on the Thistle II claims which are now included in the property held
by  SVBN.  The  Company  has  not  yet  triggered  this  commitment.

There  are  Net  Smelter  Royalty ('NSR') agreements on certain South Voisey Bay
mineral  licenses  ranging  up  to  3%.

<PAGE>
F-13

8.     MINERAL  PROPERTIES  (CONT'D)

Stephens  Lake  Property
------------------------

On  February 20, 2002, the Company entered into an option earn-in agreement with
Falconbridge,  whereby  the  Company  can  earn a 50% interest in Falconbridge's
Stephens  Lake  Property  by  incurring a total of $5 million of expenditures on
exploration  and  related  work  on  or before December 31, 2006. The Company is
required  to  incur a minimum of $1,000,000 of expenditures per calendar year to
keep  the option in good standing. These expenditures may be accelerated, at the
Company's  option,  and  applied  to future years' expenditure requirements. The
property  is  located  in  northeast  Manitoba, Canada, and covers approximately
4,000  square  kilometers.

As  of  February  28,  2003, the Company has advanced Falconbridge $1,500,000 of
which  $1,018,301  has  been  spent  on  exploration  activities.

Labrador  Regional  Exploration
-------------------------------

On  December  6,  2001,  the Company entered into an agreement with Falconbridge
whereby  the  two  companies  will jointly explore for nickel, copper and cobalt
throughout  Labrador  not including the South Voisey Bay properties. In order to
keep  the  agreement  in  good  standing, each company shall contribute at least
$200,000  per  year,  of  which  at least $150,000 will be allocated to regional
reconnaissance  exploration  outside  of  any acquired properties. The agreement
expires  on December 31, 2003 but may be renewed for further one-year periods if
mutually  agreed  to  by  the  companies.

As  of  February 28, 2003, the Company has expended $241,518 on general geology,
geophysics  and  geochemistry.  This  amount has been charged to operations. The
Company  and  Falconbridge  have not staked any claims and have not acquired any
properties  under  this  agreement.

<TABLE>
<CAPTION>


<S>                               <C>           <C>         <C>        <C>
                                                            Northern
                                  SVB Nickel    Commander   Abitibi
PROPERTY ACQUISITION COSTS . . . .Claims        Claims      Claims     Total
-------------------------------------------------------------------------------

Balance at February 28, 2001 . . .$1,933,441    $438,500   $212,000  $2,583,941
Common shares issued for property. .  18,400           -          -      18,400
Staking and recording fees . . . . .  41,100           -          -      41,100
-------------------------------------------------------------------------------
Balance at February 28, 2002 . . . 1,992,941     438,500    212,000   2,643,441
Refund of staking and recording fees (39,800)          -          -    (39,800)
-------------------------------------------------------------------------------
Balance at February 28, 2003 . .  $ 1,953,141   $ 438,500  $212,000  $2,603,641
===============================================================================

</TABLE>

<PAGE>
F-14

9.     SHARE  CAPITAL

(a)     During  the  year  ended  February  28,  2003, the Company completed the
following  private  placements:

(i)     The  Company issued 4,000,000 common shares at $0.40 per share for gross
proceeds  of  $1,600,000.  Along  with  the  common  shares,  the company issued
4,000,000  share  purchase  warrants  entitling  the  holder  to  purchase  one
additional  common  share  at  $0.44  per share expiring on June 4, 2004. Of the
4,000,000 common shares and warrants, 1,325,000 are flow-through. For income tax
purposes, the subscription funds of $530,000 relating to the flow-through shares
will be applied towards carrying out exploration activities and the expenditures
will be renounced in favour of the subscriber. Accordingly, the Company will not
have  available  deductions from taxable income in respect of such expenditures.
As  at  February  28,  2003,  the  $530,000  flow-through funds have been spent.

(ii)     The Company issued 1,666,667 common shares at $0.45 per share for gross
proceeds  of  $750,000 less commission of $56,800. Along with the common shares,
the  company  issued  1,666,667  share purchase warrants entitling the holder to
purchase  one additional common share at $0.70 per share if exercised by July 8,
2003  and  $0.80  per  share  if  exercised  by  July  8,  2004.

The  Company  re-priced  1,666,667 warrants, expiring July 8, 2004, to $0.12 per
share. Also, if the trading price of the Company's shares exceeded $0.15 for ten
consecutive  trading  days,  the  exercise period would be shortened to 30 days.
This  forced  exercise  provision  came  into effect during the Company's fourth
quarter  and  the  expiry date of the warrants was changed to February 17, 2003.
All  of  the  warrants  were  exercised  before  this  date.

(iii)     The  Company  issued  10,000,000  common shares at $0.10 per share for
gross  proceeds  of $1,000,000. Along with the common shares, the company issued
10,000,000  share  purchase  warrants  entitling  the  holder  to  purchase  one
additional common share at $0.12 per share expiring on December 18, 2004. Of the
10,000,000  common  shares  and warrants, 4,650,000 are flow-through. For income
tax  purposes,  the  subscription funds of $465,000 relating to the flow-through
shares  will  be  applied  towards  carrying  out  exploration activities on the
Company's Stephens Lake and Labrador Regional projects and the expenditures will
be renounced in favour of the subscriber. Accordingly, the Company will not have
available  deductions from taxable income in respect of such expenditures. As at
February  28,  2003,  the  $465,000  flow-through  funds  have  not  been spent.

(iv)     The  Company  issued 175,000 common shares at $0.20 per share for gross
proceeds  of  $35,000  less  costs  of $4,900. Along with the common shares, the
company  issued 175,000 share purchase warrants entitling the holder to purchase
one  additional common share at $0.21 per share expiring on January 9, 2005. All
of  the  175,000  common  shares  and  warrants are flow-through. For income tax
purposes,  the subscription funds of $35,000 relating to the flow-through shares
will be applied towards carrying out exploration activities and the expenditures
will be renounced in favour of the subscriber. Accordingly, the Company will not
have  available  deductions from taxable income in respect of such expenditures.
As  at  February  28,  2003, the $35,000 flow-through funds have not been spent.

<PAGE>
F-15

9.     SHARE  CAPITAL  (CONT'D)

(b)     As  at  February  28,  2003, warrants exercisable and outstanding are as
follows:

<TABLE>
<CAPTION>

<S>                <C>        <C>
                   Exercise
Expiry Date . . .  Price      Number
-----------------  ---------  ----------

June 4, 2004. . .  $    0.44   4,000,000
December 18, 2004  $    0.12  10,000,000
January 9, 2005 .  $    0.21     175,000
-----------------  ---------  ----------

                              14,175,000
                              ==========

</TABLE>

(c)     The  Company  has  one  fixed  stock option plan ("The 2002 Stock Option
Plan").  Under  The  2002  Stock  Option  Plan, the Company may grant options to
directors, officers, employees, dependent contractors or consultants. The number
of options outstanding at any time may not be more than 10,720,898. The exercise
price  associated with each grant of options is determined by the Company and is
subject  to  approval  from  the  TSX Venture Exchange. The maximum term of each
option's  life  is  10 years. The options vest immediately upon the day they are
granted.  The  following  table  summarizes  the  Company's  stock  options:

<TABLE>
<CAPTION>



<S>                           <C>          <C>               <C>
                                           Weighted-average  Weighted-average
                              Shares       exercise price    remaining life
                                                             (years)
-----------------------------------------------------------------------------

Balance at February 29, 2000    7,931,931  $     0.15          7.9
Granted. . . . . . . . . . .    3,500,000        0.10          9.9
Exercised. . . . . . . . . .  (1,600,000)        0.15
Cancelled. . . . . . . . . .  (1,170,483)        0.15
-----------------------------------------------------------------------------
Balance at February 28, 2001    8,661,448   $     0.10(i)      8.2
Granted. . . . . . . . . . .    3,542,500         0.24         9.0
Exercised. . . . . . . . . .  (3,234,500)         0.10
Cancelled. . . . . . . . . .     (45,000)         0.10
-----------------------------------------------------------------------------
Balance at February 28, 2002    8,924,448         0.16         8.3
Granted. . . . . . . . . . .    4,152,000         0.22(ii)     7.6
Exercised. . . . . . . . . .  (2,118,050)         0.10
Expired. . . . . . . . . . .     (43,540)         0.10
Cancelled. . . . . . . . . .    (300,000)         0.31
-----------------------------------------------------------------------------
Balance at February 28, 2003   10,614,858   $      0.15        7.6
=============================================================================

</TABLE>

(i)     During the year ended February 28, 2001, the exercise price on 5,161,448
options  was  changed  to  $0.10.
(ii)     During  the  year  ended  February  28,  2003,  the  exercise  price on
2,860,000  options  was  changed  to  $0.12  (note  10).

<PAGE>
F-16

9.     SHARE  CAPITAL  (CONT'D)

As  at  February  28,  2003,  stock  options  exercisable and outstanding are as
follows:

<TABLE>
<CAPTION>



<S>                <C>        <C>
                   Exercise
Expiry Date . . .  Price      Number
-----------------  ---------  ----------

February 13, 2004  $    0.12     100,000
April 3, 2004 . .  $    0.12     500,000
August 22, 2004 .  $    0.25     150,000
November 14, 2004  $    0.12     300,000
February 3, 2008.  $    0.10     184,000
July 14, 2008 . .  $    0.10     363,000
November 22, 2008  $    0.10     255,000
November 16, 2009  $    0.10   1,255,443
February 1, 2011.  $    0.10   1,212,915
August 10, 2011 .  $    0.10     832,500
January 16, 2012.  $    0.12   2,260,000
June 16, 2012 . .  $    0.33     500,000
June 16, 2012 . .  $    0.43   1,002,000
November 14, 2012  $    0.12   1,700,000
-----------------  ---------  ----------

                              10,614,858
                              ==========
</TABLE>


10.     STOCK-BASED  COMPENSATION

The  Company uses the intrinsic value based method of accounting for stock-based
awards  granted to employees and directors. Under this method, compensation cost
is  only recorded when the exercise price is below the market price of the stock
on  the  date  of  grant.  During  the year ended February 28, 2003, the Company
incurred  $116,560  of stock compensation cost, which was recorded as an expense
and  contributed  surplus,  as  follows:

<TABLE>
<CAPTION>



<S>               <C>      <C>      <C>        <C>         <C>
                  Number   Market   Exercise   Intrinsic   Compensation
Date of Grant. .  Granted  Price    Price      Value       Cost
----------------  -------  -------  ---------  ----------  -------------

April 4, 2002. .  500,000  $  0.38  $    0.28  $     0.10  $      50,000
June 17, 2002. .  500,000  $  0.43  $    0.33  $     0.10         50,000
February 3, 2003  184,000  $  0.19  $    0.10  $     0.09         16,560
----------------  -------  -------  ---------  ----------  -------------

                                                           $     116,560
                                                           =============

</TABLE>

There  were  no  stock  options  granted  to  non-employees  during the period.

If  the  Company  used the fair value based method of accounting for stock-based
awards  granted  to  employees  and  directors,  the cost of the options granted
during the year ended February 28, 2003 would have been estimated on the date of
grant  using  the  Black-Scholes  option  pricing  model,  with  the  following
assumptions  for  each  grant:

<PAGE>
F-17


10.     STOCK-BASED  COMPENSATION  (CONT'D)

<TABLE>
<CAPTION>



<S>                <C>     <C>    <C>       <C>        <C>        <C>     <C>
                                                                    Pro Forma
                          Expected Risk-free                          Compen-
                  Number  Life     Interest  Expected   Dividend Fair  sation
Date of Grant . .Granted  (years)  Rate      Volatility  Yield   Value Cost
-----------------------------------------------------------------------------
April 4, 2002 . . . 500,000  2     2.75%     99.50%    0.00%  $0.23  $115,000
June 17, 2002 . . . 500,000  10    5.37%    113.21%    0.00%  $0.41   205,000
June 17, 2002 . . 1,002,000  10    5.37%    113.21%    0.00%  $0.40   400,800
August 23, 2002 .   150,000   2    3.50%     99.50%    0.00%  $0.13    19,500
November 15, 2002 1,700,000  10    5.09%    113.21%    0.00%  $0.11   187,000
November 15, 2002   300,000   2    3.34%     99.50%    0.00%  $0.06    18,000
1November 15, 2002.2,260,000  9.2  5.09%    113.21%    0.00%  $0.11   248,600
2November 15, 2002  100,000   1.25 2.09%     88.33%    0.00%  $0.05     5,000
3November 15, 2002  500,000   1.42 2.37%     99.50%    0.00%  $0.02    10,000
February 3, 2003.   184,000   5    4.32%    113.21%    0.00%  $0.17    31,280
-----------------------------------------------------------------------------
Total fair value compensation cost                                  1,240,180
Less: intrinsic value compensation cost                             (116,560)
-----------------------------------------------------------------------------
Additional compensation cost                                       $1,123,620
=============================================================================

</TABLE>

1 2,260,000 options were repriced on November 15, 2002 to $0.12 from $0.28
2 100,000 options were repriced on November 15, 2002 to $0.12 from $0.32
3 500,000 options were repriced on November 15, 2002 to $0.12 from $0.28

If  the  Company had used the fair value based method, pro forma loss would have
amounted  to $3,988,842 (an increase of $1,123,620) and pro forma loss per share
would  have  been  $0.07  (an increase of $0.02) for the year ended February 28,
2003.

11.     RELATED  PARTY  TRANSACTIONS

Related  parties  are  directors,  officers  and  other  companies  with  common
directors  and/or  officers  of the Company.  Amounts due to related parties are
non-interest  bearing  and  without  specific  terms  of  repayment.

Related  party  transactions  are  in  the  normal  course of operations and are
measured  at  the  exchange  amount,  which  is  the  amount  of  consideration
established  and  agreed  to  by  the  related  parties.

The  following  is  a  summary  of  the related party transactions that occurred
throughout  the  year:

<TABLE>
<CAPTION>

<S>                    <C>       <C>       <C>
                        2003      2002      2001
                       --------  --------  --------

Management fees . . .  $542,000  $304,000  $261,667
Interest income . . .  $ 30,800  $ 34,143  $      -
Marketable securities  $      -  $  3,525
Investments . . . . .  $ 61,625  $ 57,991
Accounts payable. . .  $      -  $ 25,680
</TABLE>

<PAGE>
F-18

12.     SUPPLEMENTARY  CASH  FLOW  INFORMATION

<TABLE>
<CAPTION>


<S>                                                 <C>         <C>      <C>
                                                   2003        2002     2001
                                              ----------  ----------  --------
Change in non-cash operating working capital items
Amounts receivable . . . . . . . . . . . . .   $   9,571   $ (17,131)  $45,950
Advances for exploration . . . . . . . . . . . (130,833)    (349,340)   55,603
Deposits and prepaid expenses. . . . . . . . .     1,076        3,210   75,500
Accounts payable and accrued liabilities . .  .  115,335       79,357  (12,290
------------------------------------------------------------------------------
                                               $ (4,851)   $(283,904)  $364,763
==============================================================================

Non-cash financing and investing activities
Amounts receivable charged to mineral
properties . . . . .                           $       -   $        -  $118,153
Amounts receivable charged to marketable
securities. . .                             .  $       -   $        -  $ 96,764
Marketable securities transferred to
investments .                         . . . .  $   3,525   $        -  $      -
Common shares issued for acquisition of
mineral properties                             $       -   $   18,400  $ 22,000

</TABLE>

13.     INCOME  TAXES

     The  reported  income  tax  recovery  differs  from  the amount computed by
applying the Canadian basic statutory rate to the loss before income taxes.  The
reasons  for  this  difference  and  the  related  tax  effect  are  as follows:

<TABLE>
<CAPTION>

<S>                                       <C>          <C>           <C>
                                          2003         2002          2001
---------------------------------------------------------------------------
                                                     (restated    (restated
                                                     - note3)     - note3)
Canadian basic statutory tax rate. . . . 39.3%         44.6%         44.6%

Potential income tax recovery based on
 reported loss                          $1,126,032    $ 488,452   $243,119
Unrecognized tax losses. . . . . . . . . (697,265)    (423,446)  (186,636)
Temporary differences not recognized
during the year                            (5,830)      (5,560)    (6,928)
Permanent and other differences. . . .   (422,937)     (59,446)   (49,555)
---------------------------------------------------------------------------

                                        $        -    $       -   $      -
===========================================================================

</TABLE>

The Company has accumulated non-capital losses of approximately $6,400,000 which
may be deducted in the calculation of taxable income in future years. The losses
expire  on various dates to 2010. Also, the Company has approximately $4,000,000
of  capital  losses  and $13,300,000 of Canadian resource tax pools which may be
deducted  in the calculation of taxable income in future years. These losses and
pools  can  be  carried  forward  indefinitely.

     Future  income  taxes  result  primarily  from temporary differences in the
recognition  of  certain  revenue and expense items for financial and income tax
reporting  purposes.  Significant  components of the company's future tax assets
and  liabilities  are  as  follows:

<PAGE>
F-19

13.     INCOME  TAXES  (CONT'D)

<TABLE>
<CAPTION>

<S>                                                        <C>          <C>
                                                          2003         2002
--------------------------------------------------------------------------------
                                                                    (restated
                                                                     - note 3)
Canadian basic statutory tax rate. . . . . . . . . . .    . 39.3%       44.6%
Future income tax assets
Tax value of resource properties in excess of book value $5,208,762   $5,849,571
Non-capital losses carried forward . . . . . . . . . . .  2,506,234    2,443,712
Capital losses carried forward . . . . . . . . . . . . .  1,588,888    1,803,165
Tax value of property, plant and equipment in excess
of book value                                                59,727       58,537
Valuation allowance for future income tax assets . . . . (9,363,611)(10,154,985)
--------------------------------------------------------------------------------

Net future income tax assets . . . . . . . . . . .  .             -            -
Future income tax liabilities. . . . . . . . . . . . . . . . .    -            -
--------------------------------------------------------------------------------

Future income tax assets . . . . . . . . . . . . . . . . $        -   $        -
================================================================================

</TABLE>

Due  to  the  uncertainty  surrounding  the  realization of income tax assets in
future  years,  the Company has a 100% valuation allowance against its potential
future  income  tax  assets.

14.     SUBSEQUENT  EVENTS

Subsequent  to  February  28,  2003,  the  Company:

(a)     issued  1,525,000  shares  for  proceeds  of  $183,000  pursuant  to the
exercise  of  warrants.

(b)     cancelled  265,417 stock options at a price of $0.43 share and cancelled
40,000  stock  options at a price of $0.10 per share. The Company issued 400,000
stock  options  exercisable  at  a price of $0.155 per share for a period of two
years.

(c)     advanced  $780,000  to Knight in order to complete its private placement
investment  in Knight of 8,000,000 common shares at $0.10 per share as discussed
in  note  7.  Knight  issued  a further 11,950,000 common shares in two separate
private placements on May 13, 2003. The Company, as a result of these issuances,
holds  approximately 28% of the outstanding common shares of Knight at 8,160,750
common  shares. This investment will be accounted for using the equity method in
the  first  quarter  of  the  2004  fiscal  year;  and

(d)     received  proceeds  on  the  convertible  debenture  (note 7) owing from
Knight  was  repaid  in  full  including  $31,556  in  accrued  interest.

<PAGE>
F-20


15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")

These  financial statements have been prepared in accordance with GAAP in Canada
which  differs  in  some respects from GAAP in the United States of America. The
material  differences  between  Canadian  and  United States of America GAAP, in
respect  of  these  financial  statements,  are  as  follows:

<TABLE>
<CAPTION>


<S>                <C>       <C>        <C>         <C>        <C>        <C>
                              2003                             2002
--------------------------------------------------------------------------------
                   Balance per                      Balance per          Balance
                   Canadian             Balance per Canadian             per
                   GAAP     Adjustments US GAAP     GAAP     Adjustments US GAAP
--------------------------------------------------------------------------------
                                                    (restated
                                                    - note 3)
Current assets . .$2,765,886 $  8,935  $2,774,821 $1,639,657 $  4,935 $1,644,592
Property, plant
& equip               44,075        -      44,075     31,442        -     31,442
Investments. . . .    61,625        -      61,625     57,991         -    57,991
Mineral properties.2,603,641 (2,603,641)        -  2,643,441  (2,643,441)      -
--------------------------------------------------------------------------------

                $5,475,227$(2,594,706)$2,880,521$4,372,531$(2,638,506)$1,734,025
================================================================================

Current
liabilities. . .  $  203,943 $      -  $  203,943 $   88,608 $      - $   88,608
Non-controlling
interest             420,559        -     420,559    425,641        -    425,641
Shareholders'
equity           4,850,725 (2,594,706) 2,256,019 3,858,282 (2,638,506) 1,219,776
--------------------------------------------------------------------------------
              $5,475,227$(2,594,706)$2,880,521$4,372,531 $(2,638,506) $1,734,025
================================================================================
</TABLE>

<TABLE>
<CAPTION>

<S>                                           <C>               <C>        <C>
                                               2003             2002       2001
--------------------------------------------------------------------------------
                                                                               (restated - note 3)   (restated - note 3)
Loss for the year as per Canadian GAAP . . .$(2,865,222) $(1,094,693) $(545,109)
Stock-based compensation (b) . . . . . . . .   (575,178)    (975,489)    (5,492)
Fair value of trading securities (c) . . . .       4,000     (28,956)     33,891
Unrealized holding loss on available for
sale securities (d) .                             43,254      231,963          -
Share issuance discount on issuance of
flow-through shares (e)                        (149,500)            -          -
Acquisition of mineral properties (a). . .        39,800    (467,899)   (22,720)
--------------------------------------------------------------------------------
Loss for the year as per US GAAP . . . . .  $(3,502,846) $(2,335,074) $(539,430)
================================================================================
Basic and diluted loss per share - US GAAP  $     (0.06) $     (0.05) $   (0.01)
================================================================================
Other comprehensive income (loss) as per
Canadian GAAP . . . .                       $          - $          - $        -
Unrealized holding loss on available
for sale securities (d) .                       (43,254)    (231,963)          -
--------------------------------------------------------------------------------
Other comprehensive income (loss) as per
US GAAP . . . . . . .                       $   (43,254) $  (231,963) $        -
================================================================================

</TABLE>

<PAGE>
F-21

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)

<TABLE>
<CAPTION>

<S>                       <C>       <C>             <C>        <C>         <C>
                                                             Accumulated
                                                            Other Comp-
                         Share      Contributed             rehensive
                        Capital     Surplus      Deficit    Income       Total
--------------------------------------------------------------------------------
(restated - note 3)
Shareholders' equity as per
Canadian GAAP at
February 28, 2001.       $31,888,637 $   46,900 $(27,324,412) $     - $4,611,125
Cumulative stock-based
compensation.                      -  1,349,511   (1,349,511)                  -
Cumulative fair value
of trading securities.             -          -        33,891       -     33,891
Cumulative share capital
premium issuance of
flow-through shares. . .   (143,820)          -       143,820       -          -
Cumulative write-down of
mineral properties.                -          -   (2,175,542)       -(2,175,542)
--------------------------------------------------------------------------------
Shareholders' equity as per US GAAP at
February 28, 2001. . . . $31,744,817 $1,396,411 $(30,671,754) $     - $2,469,474
================================================================================
Shareholders' equity as per Canadian GAAP at
February 28, 2002. . . .$32,230,487  $   46,900 $(28,419,105) $     - $3,858,282
Cumulative stock-based
compensation. . . . .             -   2,325,000   (2,325,000)       -          -
Cumulative fair value of
trading securities.              -            -         4,935       -      4,935
Cumulative share capital
premium issuance of
flow-through shares. . ..(143,820)            -       143,820       -          -
Unrealized holding loss
on available for
sale securities. . . . . . .     -           -       231,963  (231,963)        -
Cumulative write-down of
mineral properties.              -           -   (2,643,441)       - (2,643,441)
--------------------------------------------------------------------------------
Shareholders' equity as per US GAAP at
February 28, 2002. . .$32,086,667 $2,371,900 $(33,006,828) $(231,963) $1,219,776
================================================================================
Shareholders' equity as per Canadian GAAP at
February 28, 2003. . . .$35,971,592  $ 163,460  $(31,284,327) $   -   $4,850,725
Cumulative stock-based
compensation. . . . .            -   2,900,178    (2,900,178)     -            -
Cumulative fair value of
trading securities.              -          -          8,935      -        8,935
Cumulative share capital premium issuance of
flow-through shares. . . . . 5,680          -         (5,680)     -            -
Unrealized holding loss on available for
sale securities. . . . . . .     -          -         275,217 (275,217)        -
Cumulative write-down of
mineral properties.              -          -     (2,603,641)      - (2,603,641)
--------------------------------------------------------------------------------
Shareholders' equity as per US GAAP at
February 28, 2003. . .$35,977,272 $3,063,638 $(36,509,674) $(275,217) $2,256,019
================================================================================
</TABLE>

<PAGE>
F-22

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)


<TABLE>
<CAPTION>

<S>                                              <C>          <C>         <C>
                                                 2003        2002         2001
--------------------------------------------------------------------------------
                                                         (restated    (restated
                                                         - note 3)    - note 3)
Cash provided by (used for) operating activities
as per Canadian GAAP . . . . . . . . . .  $(2,706,284) $(1,120,637) $   (43,323)
(Expenditures on) recovery of mineral
properties acquisition                           39,800     (41,100)       (720)
Purchase of marketable scurities and
short term investments.                              -             - (1,526,144)
Sale of marketable scurities and
short term investments. . .                       2,038      466,196     478,492
--------------------------------------------------------------------------------
Cash provided by (used for) operating activities
as per US GAAP . . . . . . . . . . . . . .$(2,664,446)  $ (695,541) $(1,091,695)
================================================================================

Cash provided by (used for) investing activities
as per Canadian GAAP . . . . . . . . . . .$   (11,525)  $   421,196 $(1,272,268)
(Expenditures on) recovery of mineral
properties acquisition                        (39,800)       41,100          720
Purchase of marketable scurities and
short term investments.                              -            -    1,526,144
Sale of marketable scurities and short
term investments. . .                          (2,038)    (466,196)    (478,492)
--------------------------------------------------------------------------------
Cash provided by (used for) investing activities
as per US GAAP . . . . . . . . .. . . .   $   (53,363)  $   (3,900) $  (223,896)
================================================================================
</TABLE>


(a)     Under  United  States GAAP it is preferable that all mineral exploration
and  development  property  expenditures  be expensed in the year incurred in an
exploration  stage  company.

(b)     The  Company's new accounting policy for stock options described in note
2(j)  brings  Canadian  GAAP  in line with US GAAP in accounting for stock-based
compensation.  One  outstanding  difference  relates  to  Financial  Accounting
Standards  Board ("FASB") Interpretation No. 44 (FIN 44), Accounting for Certain
Transactions  Involving  Stock  Compensation.

As  of  July  1,  2000,  FIN  44  states  that when fixed stock option awards to
employees and directors are modified, the stock options must be accounted for as
variable  from  the  date  of  modification  to  the  date the stock options are
exercised,  forfeited  or  expire  unexercised. As a result, any increase in the
market  price  over  the  reduced  exercise  price  of the stock options must be
recognized  as  compensation  cost  as  follows:

<PAGE>
F-23

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)

<TABLE>
<CAPTION>



<S>         <C>      <C>         <C>       <C>              <C>        <C>
                   Number of
                   Options
          Number of Exercised, Variable
Date of  Options  Forfeited or Options at New Exercise Market Price Compensation
Repricing.Repriced Expired     Year End   Price        at Year End  Cost
--------------------------------------------------------------------------------
02-Feb-01 5,070,948      -      5,070,948 $0.10        $0.09        $         -
--------------------------------------------------------------------------------
Total variable stock option compensation cost at February 28, 2001
================================================================================
02-Feb-01 5,070,948 (2,485,465) 2,585,483 $0.10        $0.44        $   879,064

--------------------------------------------------------------------------------
Total variable stock option compensation cost at February 28, 2002
================================================================================
02-Feb-01 5,070,948 (3,066,505) 2,004,443  $0.10       $0.23        $   260,578
15-Nov-022,860,000       -      2,860,000  $0.12       $0.23        $   314,600
--------------------------------------------------------------------------------
Total variable stock option compensation cost at February 28, 2003  $   575,178
================================================================================

</TABLE>

During the years ended February 28, 2002 and 2001, the Company issued options to
non-employees  which  under  SFAS  123  must  be  recognized  as  a  stock-based
compensation  expense.  The  amounts  were  $96,425  and  $5,492  respectively.
Including variable stock option compensation, the total stock-based compensation
for  2003  is  $575,178  (2002  -  $975,489;  2001  -  $5,492).

The  following proforma financial information presents the loss for the year and
the loss per common share had the Company adopted SFAS 123 for all stock options
issued  to  employees  and  directors.

<TABLE>
<CAPTION>

<S>                                  <C>           <C>                  <C>
                                     2003          2002                2001
-------------------------------------------------------------------------------
                                     (restated - note3)   (restated - note3)

Loss for the year as per US GAAP. .  $(3,502,846)  $(1,926,675)  $   (539,430)
Additional stock based compensation   (1,123,620)     (635,900)      (756,731)
-------------------------------------------------------------------------------

Proforma loss . . . . . . . . . . .  $(4,626,466)  $(2,562,575)  $ (1,296,161)
===============================================================================

Proforma loss per common share. . .  $     (0.08)  $     (0.06)  $      (0.03)
===============================================================================

</TABLE>

Using  the  fair  value method for stock based compensation, additional costs of
approximately $635,900 and $756,731 would have been recorded for the years ended
February  28,  2002  and  2001  respectively. This amount is determined using an
option  pricing model assuming no dividends are to be paid, vesting occurring on
the  date  of  grant,  a weighted average volatility of Company's share price of
88.33%  (110.67%  -  February  28, 2001) and a weighted average annual risk free
interest  rate  of 3.73% (5.88% - February 28, 2001). The Company used the above
data  in order to determine the stock-based compensation expense for the options
issued  to  non-employees.  Please  see  note  10  for  2003  details.

(c)     United  States  GAAP  require  trading  securities to be carried at fair
value.  Changes  in  fair value are charged against or credited to income, while
under  Canadian  GAAP  such  items are carried at cost or, where market value is
lower,  at  market  value.

<PAGE>
F-24

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)

United  States  GAAP  require cash flows from purchases, sales and maturities of
trading  securities  to  be  classified as cash flows from operating activities.
Under  Canadian  GAAP,  such  items  are  classified  as  investing  activities.

(d)     In  June 1997, the Financial Accounting Standards Board issued Statement
No.  130 (SFAS 130), Reporting Comprehensive Income, which establishes standards
for  the  reporting  and display of comprehensive income and its components in a
full  set  of  general  purpose  financial statements. The Company's convertible
debenture investment would be classified as an available-for-sale security under
United  States GAAP and any unrealized holding gains or losses would be excluded
from  earnings  and  reported  in  other  comprehensive  income.  Therefore, the
writedown  of $43,254 (2002 - $231,963) would be included in other comprehensive
income  (loss).  There  were  no  other  comprehensive  items.

(e)     Under  Canadian  income  tax  legislation, corporations are permitted to
issue  shares whereby the corporation agrees to incur qualifying expenditures as
defined  under  the Canadian Income Tax Act, and renounce the related income tax
deductions  to  the  investors.

The  Company  has  accounted  for the issue of flow-through shares in accordance
with  Canadian  GAAP  as  follows:

At  the  time  of issue the funds received are recorded as share capital.  Under
Canadian GAAP, once the qualifying expenditures are made, the carrying values of
both the mineral property and share capital are reduced by the amount of the tax
benefit  renounced,  calculated  at  the  Company's  effective tax rate.  As the
Company's  effective tax rate is 0% for 2003, 2002 and 2001, no adjustment would
be  required.

Canadian  GAAP  does  not  require  a separate allocation of the amount of funds
received by the corporation attributable to the flow-through feature at the time
of  issue. Also, in the absence of a specific restriction or requirement for the
funds  to  be held in a separate bank account, Canadian GAAP permits funds which
are  to  be  spent  within  the current period to be included with cash and cash
equivalents for purposes of classification on the balance sheet and statement of
cash  flows.  Adequate  disclosure  of  the  commitment  to  incur  qualifying
expenditures  and renounce the related tax deductions is required under Canadian
GAAP.

United  States  GAAP  requires  the  premium or discount from the market trading
price  at  the  time  an  irrevocable agreement to issue the flow-through shares
exists,  to  be  accounted for separately on the balance sheet.  At the time the
expenditures  are  made, the previously recorded premium or discount is reversed
and  offset  against the tax provision on the income statement, and the deferred
income  tax  liability  on  the  balance  sheet  recorded. Also, notwithstanding
whether  there is a specific requirement to segregate the funds, the flow-though
share  funds which are unexpended at the balance sheet date are considered to be
restricted  and  are  not considered to be cash or cash equivalents under United
States  GAAP.

The effect of the adjustments that would have been made under United States GAAP
related  to the flow-through shares issued since the reactivation of the Company
would  be  to increase share capital by $5,680 and to increase deficit by $5,680
resulting  in  no  effect  on  shareholders'  equity.

(f)     In  June  2001,  the  FASB  issued  SFAS  No.  143, Accounting for Asset
Retirement Obligations. This standard requires entities to record the fair value
of  a  liability for an asset retirement obligation in the period in which it is
incurred.  When  the  liability  is initially recorded, the entity capitalizes a
cost  by  increasing  the carrying amount of the related long-lived asset.  Over
time,  the  liability  is  accreted  to  its  present value each period, and the
capitalized cost is depreciated over the useful life of the related asset.  Upon
settlement  of  the  liability,  an entity either settles the obligation for its
recorded  amount  or  incurs  a  gain  or  loss  upon settlement.  Companies are
required  to  adopt SFAS 143 for fiscal years beginning after June 15, 2002, but
early adoption is permitted.  The Company has determined that the application of
SFAS  143 will not have a material affect on its consolidated financial position
or  results  of  operations.

<PAGE>
F-25

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)

(g)     In  June  2002, the Financial Accounting Standards Board ("FASB") issued
Statement  of Financial Accounting Standard No. 146 ("SFAS 146"), Accounting for
Costs  Associated  with  Exit or Disposal Activities. SFAS 146 requires that the
liability  for a cost associated with an exit or disposal activity be recognized
at  its  fair  value when the liability is incurred.  Under previous guidance, a
liability  for  certain  exit  costs  was recognized at the date that management
committed  to  an  exit  plan.  SFAS  146 is effective only for exit or disposal
activities  initiated after December 31, 2002. The adoption of this statement is
not expected to impact the Company's consolidated financial statements for 2003.

(h)     In  November  2002,  FASB  issued FASB Interpretation No. 45 ("FIN 45"),
Guarantor's  Accounting  and  Disclosure  Requirements for Guarantees, Including
Indirect  Guarantees  of  Indebtedness  of  Others.  FIN  45  requires that upon
issuance  of  a  guarantee,  a guarantor must recognize a liability for the fair
value  of  an  obligation  assumed  under  a  guarantee.  FIN  45  also requires
additional  disclosures  by  a  guarantor  in  its  interim and annual financial
statements  about  the  obligations  associated  with  guarantees  issued.  The
recognition  provisions  of FIN 45 will be effective for any guarantees that are
issued  or  modified  after  December  31,  2002.  The  Company  has adopted the
disclosure  requirements  and  is  currently  evaluating  the  effects  of  the
recognition  provisions of FIN 45; however, it does not expect that the adoption
of  such  provisions  will  have  a  material impact on the Company's results of
operations  or  financial  position.

(i)     In  December  2002,  the  FASB  issued Statement of Financial Accounting
Standard  No.  148  ("SFAS  148"),  Accounting  for  Stock-Based  Compensation -
Transition  and  Disclosure. SFAS 148 provides alternative methods of transition
for  a  voluntary  change  to  the  fair  value  based  method of accounting for
stock-based  employee  compensation. SFAS 148 also requires prominent disclosure
in  the  "Summary of Significant Accounting Policies" of both annual and interim
financial  statements  about  the  method of accounting for stock-based employee
compensation  and the effect of the method used on reported results. The Company
has  adopted  SFAS  148 for the 2003 fiscal year end. Adoption of this statement
has  affected  the  location of the Company's disclosure within the consolidated
financial  statements, but will not impact the Company's results of operation or
financial  position  unless  the  Company  changes  to  the fair value method of
accounting  for  stock-based  employee  compensation.

(j)     In  January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"),
Consolidation  of  Variable Interest Entities - an interpretation of ARB No. 51.
FIN  46  requires  that  if any entity has a controlling financial interest in a
variable  interest  entity, the assets, liabilities and results of activities of
the  variable  interest  entity should be included in the consolidated financial
statements  of  the entity. FIN 46 provisions are effective for all arrangements
entered  into  after January 31, 2003. For those arrangements entered into prior
to  January  31,  2003,  FIN  46  provisions  are  required to be adopted at the
beginning  of  the first interim or annual period beginning after June 15, 2003.
The  adoption  of  this  statement  will  not  impact the Company's consolidated
financial  statements  for  2003.

(k)     In  April  2003,  the  FASB  issued  Statement  of  Financial Accounting
Standard  No.  149  ("SFAS  149"),  Amendment  of  Statement  133  on Derivative
Instruments and Hedging Activities. SFAS 149 amends and clarifies accounting for
derivative  instruments,  including  certain  derivative instruments embedded in
other contracts and for hedging activities under SFAS 133. SFAS 149 is generally
effective  for derivative instruments, including derivative instruments embedded
in  certain  contracts,  entered  into  or  modified after June 30, 2003 and for
hedging  relationships  designated  after  June  30, 2003.  The Company does not
expect  the  adoption of SFAS 149 to have a material on its operating results or
financial  condition.

<PAGE>
F-25

15.     DIFFERENCES  BETWEEN  CANADIAN  AND  UNITED  STATES  GENERALLY  ACCEPTED
ACCOUNTING  PRINCIPLES  ("GAAP")  (CONT'D)

(l)     In  May 2003, the FASB issued Statement of Financial Accounting Standard
No.  150  ("SFAS  15"),  Accounting  for  Certain  Financial  Instruments  with
Characteristics  of  both  Liabilities  and  Equity.  SFAS  150  clarifies  the
accounting  for  certain  financial  instruments  with  characteristics  of both
liabilities  and  equity  and  requires  that those instruments be classified as
liabilities  on  the  balance  sheet.  Previously,  many  of  those  financial
instruments  were  classified  as  equity.  SFAS  150 is effective for financial
instruments  entered  into  or  modified  after  May  31,  2003 and otherwise is
effective  at the beginning of the first interim period beginning after June 15,
2003. The Company does not expect the adoption of SFAS 150 to have a significant
impact  on  its  operating  results  or  financial  position.

(m)     On  April  22,  2003,  the  FASB  announced  its decision to require all
companies to expense the fair value of employee stock options. Companies will be
required  to  measure  the  cost  according  to  the  fair value of the options.
Although the new guidelines have not yet been released, it is expected that they
will be finalized soon and be effective in 2004. When final rules are announced,
the  Company  will  assess  the impact to its consolidated financial statements.

<PAGE>
F-27


<TABLE>
<CAPTION>

<S>                                        <C>             <C>            <C>
DONNER MINERALS LTD.
(AN EXPLORATION STAGE COMPANY)
SCHEDULE OF EXPLORATION EXPENDITURES
(CANADIAN DOLLARS)
---------------------------------------------------------------------------------

                                        Year ended      Year ended     Year ended
                                      February 28,    February 28,   February 28,
                                        2003            2002           2001
                                    --------------  -------------  --------------

SVB NICKEL CLAIMS
Expediting, general labour and supplies $  1,077      $  1,607        $       -
Geology . . . . . . . . . . . . . . . .        -         4,000                -
Other . . . . . . . . . . . . . . . . .        -             -            8,402
Technical consulting and management fees.      -       196,312                -
--------------------------------------------------------------------------------

                                           1,077       201,919            8,402
--------------------------------------------------------------------------------

COMMANDER CLAIMS
Drilling. . . . . . . . . . . . .. .           -             -           (3,697)
Geology . . . . . . . . . . . . . .            -             -          (16,479)
Geophysics. . . . . . . . . . . . . . . .      -             -           (2,903)
Other . . . . . . . . . . . . . . . . . .      -             -          (43,741)
Technical consulting and management fees.      -         4,782                -
--------------------------------------------------------------------------------

                                               -         4,782          (66,820)
--------------------------------------------------------------------------------

NORTHERN ABITIBI CLAIMS
Other . . . . . . . . . . . . . . . . . .      -             -            3,640
Technical consulting and management fees.      -         4,781                -
--------------------------------------------------------------------------------

                                               -         4,781            3,640
--------------------------------------------------------------------------------

LAC ROCER CLAIMS
Other . . . . . . . . . . . . . . . . . .      -             -           39,229
--------------------------------------------------------------------------------

STEPHENS LAKE CLAIMS
Geology . . . . . . . . . . . . . . . . . 37,641           660                -
Geophysics. . . . . . . . . . . .        980,660             -                -
Government grants . . . . . . . .       (92,679)             -                -
Technical consulting and management fees.     -         10,625                -
--------------------------------------------------------------------------------

                                         925,622        11,285                -
--------------------------------------------------------------------------------

LABRADOR REGIONAL EXPLORATION
Geochemistry. . . . . . . . . . . . . .  121,759             -                -
Geology . . . . . . . . . . . . .        108,227             -                -
Geophysics. . . . . . . . . . . .         11,532             -                -
--------------------------------------------------------------------------------

                                         241,518             -                -
--------------------------------------------------------------------------------

                                      $1,168,217     $ 222,767       $  (15,549)
================================================================================
</TABLE>