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**VICEROY EXPLORATION LTD.**

Annual Information Form

For the year ended December 31, 2005

Dated as of March 21, 2006











#520  700 West Pender Street Vancouver, BC V6C 1G8
Tel: 604-669-4777 Fax: 604-696-0212

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TABLE OF CONTENTS

|COVER PAGE                                                 |                                                          
|---------------------------------------------------------- | ---------------------------------------------------------
|INTRODUCTORY NOTES                                         | III                                                      
|                                                           | DATE OF INFORMATION                                      
|                                                           | FINANCIAL STATEMENTS                                     
|                                                           | CURRENCY PRESENTATION AND EXCHANGE RATE INFORMATION      
|                                                           | CONVERSION TABLE                                         
|                                                           | DEFINITIONS AND TECHNICAL TERMS                          
|CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING STATEMENTS | IV                                                       
|CAUTIONARY NOTE TO UNITED STATES INVESTORS                 | IV                                                       
|GLOSSARY OF TECHNICAL TERMS AND DEFINITIONS                | V                                                        
|CORPORATE STRUCTURE                                        | 1                                                        
|                                                           | NAME, ADDRESS AND INCORPORATION                          
|                                                           | INTERCORPORATE RELATIONSHIPS                             
|GENERAL DEVELOPMENT OF THE BUSINESS                        | 2                                                        
|                                                           | THREE YEAR HISTORY                                       
|DESCRIPTION OF THE BUSINESS                                | 4                                                        
|                                                           | SUMMARY                                                  
|                                                           | GUALCAMAYO PROPERTY                                      
|                                                           | OTHER PROPERTIES                                         
|                                                           | RISK FACTORS                                             
|SELECTED CONSOLIDATED FINANCIAL INFORMATION                | 45                                                       
|                                                           | ANNUAL INFORMATION                                       
|                                                           | CRITICAL ACCOUNTING ESTIMATES                            
|                                                           | GENERAL DESCRIPTION OF CAPITAL STRUCTURE                 
|                                                           | DIVIDENDS                                                
|MANAGEMENTS DISCUSSION AND ANALYSIS                       | 47                                                       
|                                                           | DESCRIPTION OF THE BUSINESS AND OVERALL PERFORMANCE      
|                                                           | SELECTED ANNUAL INFORMATION                              
|                                                           | RESULTS OF OPERATIONS                                    
|                                                           | SUMMARY OF QUARTERLY RESULTS                             
|                                                           | CONTRACTUAL OBLIGATIONS                                  
|                                                           | TRANSACTIONS WITH RELATED PARTIES                        
|                                                           | FOURTH QUARTER                                           
|                                                           | CRITICAL ACCOUNTING ESTIMATES                            
|                                                           | CHANGES IN ACCOUNTING POLICIES INCLUDING INITIAL ADOPTION
|                                                           | DISCLOSURE CONTROLS AND PROCEDURES                       
|                                                           | DISCLOSURE OF SHARE DATA AS AT FEBRUARY 28, 2006         
|                                                           | OTHER INFORMATION                                        
|MARKET FOR SECURITIES                                      | 57                                                       
|DIRECTORS AND OFFICERS                                     | 58                                                       
|                                                           | NAME, ADDRESS, OCCUPATION AND SECURITY HOLDINGS          
|                                                           | CEASE TRADE ORDERS , BANKRUPTCIES, PENALTIES OR SANCTIONS
|                                                           | CONFLICTS OF INTEREST                                    
|                                                           | AUDIT COMMITTEE INFORMATION                              
|                                                           | AUDIT COMMITTEE MANDATE                                  
|                                                           | COMPOSITION OF THE AUDIT COMMITTEE                       
|                                                           | RELEVANT EDUCATION AND EXPERIENCE                        
|                                                           | PRE-APPROVAL POLICIES AND PROCEDURES                     
|                                                           | EXTERNAL AUDITOR SERVICES FEES                           
|LEGAL PROCEEDINGS                                          | 61                                                       
|INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS | 61                                                       
|TRANSFER AGENTS AND REGISTRARS                             | 62                                                       
|MATERIAL CONTRACTS                                         | 62                                                       
|INTERESTS OF EXPERTS                                       | 63                                                       
|                                                           | NAMES OF EXPERTS                                         
|                                                           | INTERESTS OF EXPERTS                                     
|ADDITIONAL INFORMATION                                     | 64                                                       

ii

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INTRODUCTORY NOTES

Date of Information

In this Annual Information Form (the AIF), Viceroy
Exploration Ltd., together with its subsidiaries, as the context requires, is
referred to as Viceroy or the Company. All information contained herein is
as at March 21, 2006, unless otherwise stated.

Financial Statements

This AIF should be read in conjunction with the Company's
consolidated financial statements and management's discussion and analysis for
the 12 months ended December 31, 2005. The financial statements and management's
discussion and analysis are available at www.viceroyexploration.com and
under the Company's profile on the SEDAR website at www.sedar.com. All
financial statements are prepared in accordance with Canadian generally accepted
accounting principles.

Currency Presentation and Exchange Rate Information

All sums of money which are referred to in this AIF are
expressed in lawful money of Canada, unless otherwise specified.

The closing, high, low and average exchange rates for the
Canadian dollar in terms of US dollars for the three years ended December 31,
2005, 2004 and 2003, as reported by the Bank of Canada, were as follows:

Year Ended December 312005
    2004
    2003Closing
    $0.8577
    $0.8333
    $0.7751High
    0.8690
    0.8547
    0.7751Low
    0.7872
    0.7194
    0.6369Average(1)
    0.8254
    0.7692
    0.7142


| | (1) | Calculated as an average of the daily noon rates for the
      period
| | --- | ---------------------------------------------------------------------

Conversion Table

All data and information is presented in metric units. For this
report the following conversion factors are used:

2.47 acres
    =
    1 hectare
    
    0.4047 hectares
    =
    1 acre3.28 feet
    =
    1 m
    
    0.3048 m
    =
    1 foot0.62 miles
    =
    1 km
    
    1.609 km
    =
    1 mile0.032 ounces (troy)
    =
    1 gm
    
    31.103 grams
    =
    1 ounce (troy)1.102 tons (short)
    =
    1 tonne
    
    0.907 tonnes
    =
    1 ton0.029 ounces/ton
    =
    1 gm/tonne
    
    34.28 gm/tonne
    =
    1 ounce/ton1 ppm
    =
    1 gm/tonne1 ounce/ton
    =
    34.286 ppm1%
    =
    10,000 ppm


Definitions and Technical Terms

Capitalized terms, that are not otherwise defined in the body
of this AIF, and technical terms are defined in Glossary of Technical Terms and
Definitions herein.

iii

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CAUTIONARY STATEMENTS REGARDING FORWARD LOOKING
STATEMENTS

Except for statements of historical fact relating to Viceroy,
certain information contained herein constitutes forward-looking statements.

Forward-looking statements include, but are not limited to,
statements with respect to the future price of gold and silver, the estimation
of mineral reserves and resources, the realization of mineral reserve estimates,
the timing and amount of estimated future production, costs of production,
capital expenditures, costs and timing of the development of new deposits,
success of exploration activities, permitting time lines, currency fluctuations,
requirements for additional capital, government regulation of mining operations,
environmental risks, unanticipated reclamation expenses, title disputes or
claims, limitations on insurance coverage and the timing and possible outcome of
pending litigation. In certain cases, forward-looking statements can be
identified by the use of words such as plans, expects or does not expect,
is expected, budget, scheduled, estimates, forecasts, intends,
anticipates or does not anticipate, or believes, or variations of such
words and phrases, or state that certain actions, events or results may,
could, would, might or will be taken, occur or be achieved.
Forward-looking statements involve known and unknown risks, uncertainties and
other factors which may cause the actual results, performance or achievements of
Viceroy to be materially different from any future results, performance or
achievements expressed or implied by the forward-looking statements. Such
factors include, among others, risks related to the integration of acquisitions;
risks related to international operations; risks related to joint venture
operations; actual results of current exploration activities; actual results of
current reclamation activities; conclusions of economic evaluations; changes in
project parameters as plans continue to be refined; future prices of gold and
silver; possible variations in ore reserves, grade or recovery rates; failure of
plant, equipment or processes to operate as anticipated; accidents, labour
disputes and other risks of the mining industry; delays in obtaining
governmental approvals or financing or in the completion of development or
construction activities, as well as those factors discussed in the section
entitled Risk Factors in this Annual Information Form. Although Viceroy has
attempted to identify important factors that could cause actual actions, events
or results to differ materially from those described in forward-looking
statements, there may be other factors that cause actions, events or results not
to be as anticipated, estimated or intended. There can be no assurance that
forward-looking statements will prove to be accurate, as actual results and
future events could differ materially from those anticipated in such statements.
Accordingly, readers should not place undue reliance on forward-looking
statements.

CAUTIONARY NOTE TO UNITED STATES INVESTORS

This Annual Information Form has been prepared in accordance
with the requirements of the securities laws in effect in Canada, which differ
from the requirements of United States securities laws. Unless otherwise
indicated, all resource estimates included in this Annual Information Form have
been prepared in accordance with Canadian National Instrument 43-101 ("NI
43-101") and the Canadian Institute of Mining and Metallurgy Classification
System. NI 43-101 is a rule developed by the Canadian Securities Administrators
which establishes standards for all public disclosure an issuer makes of
scientific and technical information concerning mineral projects. NI 43-101
permits a historical estimate made prior to the adoption of NI 43-101 that does
not comply with NI 43-101 to be disclosed using the historical terminology if
the disclosure: (a) identifies the source and date of the historical estimate;
(b) comments on the relevance and reliability of the historical estimate; (c)
states whether the historical estimate uses categories other than those
prescribed by NI 43-101; and (d) includes any more recent estimates or data
available. Such historical estimates are presented concerning the Company's
Gualcamayo Property.

iv

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Canadian standards differ significantly from the requirements
of the United States Securities and Exchange Commission ("SEC"), and resource
information contained herein may not be comparable to similar information
disclosed by U.S. companies. In particular, and without limiting the generality
of the foregoing, the term "resource" does not equate to the term "reserves".
Under U.S. standards, mineralization may not be classified as a "reserve" unless
the determination has been made that the mineralization could be economically
and legally produced or extracted at the time the reserve determination is made.
The SEC's disclosure standards normally do not permit the inclusion of
information concerning "measured mineral resources", "indicated mineral
resources" or "inferred mineral resources" or other descriptions of the amount
of mineralization in mineral deposits that do not constitute "reserves" by U.S.
standards in documents filed with the SEC, unless such information is required
to be disclosed by the law of the Company's jurisdiction of incorporation or of
a jurisdiction in which its securities are traded. U.S. Investors should also
understand that "inferred mineral resources" have a great amount of uncertainty
as to their existence and great uncertainty as to their economic and legal
feasibility. It cannot be assumed that all or any party of an "inferred mineral
resource" will ever be upgraded to a higher category. Under Canadian rules,
estimated "inferred mineral resources" may not form the basis of feasibility or
pre-feasibility studies except in rare cases. Investors are cautioned not to
assume that all or any part of an "inferred mineral resource" exists or is
economically or legally mineable. Disclosure of "contained ounces" is permitted
disclosure under Canadian regulations; however, the SEC normally only permits
issuers to report "resources" as in place tonnage and grade without reference to
unit measures.

GLOSSARY OF TECHNICAL TERMS AND DEFINITIONS

In this AIF, the following terms have the following meanings:

|Argentine Properties | Includes the Gualcamayo property and the Las Flechas,
      Salamanca, Evelina and La Brea/Las Carachas properties, substantially all
      located in the San Juan province, Argentina.                                                                                                                                                                                                                                                                                                          
|-------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|assay                | A chemical test performed on a sample of ores or minerals
      to determine the amount of valuable metals contained.                                                                                                                                                                                                                                                                                                                                                                             
|
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Ag                   | Silver                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Au                   | Gold                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|breccia              | Rock consisting of fragments, more or less angular, in a
      matrix of finer-grained material or of cementing material.                                                                                                                                                                                                                                                                                                                                                                         
|
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|carbonate            | A mineral containing the radical CO3.                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Cateo                | A cateois an exploration permit granted for a
      period of up to 1,100 days which allows the holder the exclusive right to
      explore the area, subject to certain pre-existing rights of owners of
      minaswithin the area and adjacent owners of mining rights. Through
      exploration, the owner of the cateomay make and file
      manifestacionesof discovery and petition the mining office for the
      granting of minas. A cateomay be up to 10,000 hectares in
      size.
|
|
|
|
|
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Contained Ounces     | Represents ounces in the ground before reduction of
      ounces not able to be recovered by the applicable metallurgical process.                                                                                                                                                                                                                                                                                                                                                                
|
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|disseminated         | Mineralization scattered through a volume of host rock.                                                                                                                                                                                                                                                                                                                                                                                                                                           
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|geology              | A science that deals with the history of the earth as
      recorded in rocks.                                                                                                                                                                                                                                                                                                                                                                                                                    
|                     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|grade                | The concentration of an ore metal in a rock sample, given
      either as weight percent for base metals or in grams per tonne (g/t) or
      ounces per short ton (oz/t) for precious metals. The grade of an ore
      deposit is calculated, often using sophisticated statistical procedures,
      as an average of the grades of a very large number of samples collected
      from throughout the deposit.                                                                                
|
|
|
|

v

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|g/t                 | Grams per tonne                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|------------------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|ID3Model            | Also referred to as Inverse Distance Weighting: Block
      values are estimated based on the weighted values of data points closest
      to the block centroid. The weighting is the inverse of the distance of the
      data point from the centroid raised to a specific power. The higher the
      power the closer the estimate becomes to a nearest neighbor interpolation.
      The most common power is 2 but higher powers may be used in order to
      reduce smoothing of grades.                                                                                                                           
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|intrusive/intrusion | An igneous rock that was once molten and has intruded
      into pre-existing rocks in that state, after which it cools.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Kriged Model        | Also referred to as BLUE (best, linear, unbiased
      estimator), is a method of determining a weighted average in such a way
      that the geostatistical estimation variance of the weighted average is
      minimized. Kriging utilizes the spatial relationship between samples, as
      quantified by the semivariogram, to provide weights for the estimation of
      the unknown point or block. Kriging has many variations but the most
      commonly used is ordinary (or linear) kriging.                                                                                                                  
|
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|manifestaciones     | In Argentina, manifestacionesof discovery are
      official notices filed with the mining department indicating that the
      person filing (who must be the owner of the cateoin an area
      covered by a cateo) has made a discovery. The filing and acceptance
      of such a notice constitutes the first step in converting a discovery to a
      mina. A manifestacionof discovery may cover one or more
      claims in the case of either a vein or disseminated deposit. The size of
      the manifestacionesand the annual payments are the same as those
      for minas.                                 
|
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|MASA                | Minas Argentinas S.A., an indirect 100% owned Argentinean
      subsidiary which holds all of the Companys Argentinean assets.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|Mina                | A mina,or mineral concession, is a real property
      interest that grants the right to explore or exploit on a permanent basis
      for as long as the right is diligently, utilized and semi-annual payments
      per claim are made. A minamay consist of one or several claims or
      pertinencias. In the case of vein deposits, each claim is a
      maximum of 200 by 300 m or six hectares; for disseminated deposits, each
      claim is up to one square km or 100 hectares.                                                                                                                             
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|mineral reserve     | Securities and Exchange Commission Industry Guide 7
      Description of Property by Issuers Engaged or to be Engaged in
      Significant Mining Operationsof the Securities and Exchange
      Commission defines a reserve as that part of a mineral deposit which
      could be economically and legally extracted or produced at the time of the
      reserve determination. Reserves consist of:                                                                                                                                                                                                                  
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                    | (1) Proven (Measured) Reserves.Reserves for
      which: (a) quantity is computed from dimensions revealed in outcrops,
      trenches, workings or drill holes; grade and/or quality are computed from
      the results of detailed sampling; and (b) the sites for inspection,
      sampling and measurement are spaced so closely and the geologic character
      is so well defined that size, shape, depth and mineral content of reserves
      are well-established.                                                                                                                                              
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|                    | (2) Probable (Indicated) Reserves.Reserves for
      which quantity and grade and/or quality are computed from information
      similar to that used for proven (measured) reserves, but the sites for
      inspection, sampling and measurement are farther apart or are otherwise
      less adequately spaced. The degree of assurance, although lower than that
      for proven (measured) reserves, is high enough to assume continuity
      between points of observation.                                                                                                                                        
|
|
|
|
|                    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|mineral resource    | National Instrument 43-101 Standards of Disclosure for
      Mineral Projectsof the Canadian Securities Administrators defines a
      Mineral Resource as a concentration or occurrence of natural, solid,
      inorganic or fossilized organic material in or on the Earths crust in
      such form and quantity and of such a grade or quality that it has
      reasonable prospects for economic extraction. The location, quantity,
      grade, geological characteristics and continuity of a mineral resource are
      known, estimated or interpreted from specific geological evidence and
      knowledge.
|
|
|
|
|
|

vi

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|               | Mineral Resources are sub-divided, in order of increasing
      geological confidence, into Inferred, Indicated and Measured categories.
      An Inferred Mineral Resource has a lower level of confidence than that
      applied to an Indicated Mineral Resource. An Indicated Mineral Resource
      has a higher level of confidence than an Inferred Mineral Resource but has
      a lower level of confidence than a Measured Mineral Resource.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|-------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|
|
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|               | (1) Inferred Mineral Resource.An Inferred
      Mineral Resource is that part of a Mineral Resource for which quantity
      and grade or quality can be estimated on the basis of geological evidence
      and limited sampling and reasonably assumed, but not verified, geological
      and grade continuity. The estimate is based on limited information and
      sampling gathered through appropriate techniques from locations such as
      outcrops, trenches, pits, workings and drill holes.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|
|
|
|
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|               | (2) Indicated Mineral Resource.An Indicated
      Mineral Resource is that part of a Mineral Resource for which quantity,
      grade or quality, densities, shape and physical characteristics can be
      estimated with a level of confidence sufficient to allow the appropriate
      application of technical and economic parameters, to support mine planning
      and evaluation of the economic viability of the deposit. The estimate is
      based on detailed and reliable exploration and testing information
      gathered through appropriate techniques from locations such as outcrops,
      trenches, pits, workings and drill holes that are spaced closely enough
      for geological and grade continuity to be reasonably assumed.                                                                                                                                                                                                                                                                                                                                                                          
|
|
|
|
|
|
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|               | (3) Measured Mineral Resource.A Measured
        Mineral Resource is that part of a Mineral Resource for which quantity,
        grade or quality, densities, shape, physical characteristics are so well
        established that they can be estimated with confidence sufficient to allow
        the appropriate application of technical and economic parameters, to support
        production planning and evaluation of the economic viability of the deposit.
        The estimate is based on detailed and reliable exploration, sampling and
        testing information gathered through appropriate techniques from locations
        such as outcrops, trenches, pits, workings and drill holes that are spaced
        closely enough to confirm both geological and grade continuity.
      Industry Guide 7  Description of Property
        by Issuers Engaged or to be Engaged in Significant Mining Operationsof the Securities and Exchange Commission does not define or recognize
        resources. As used in this Annual Information Form, resources
        are as defined in National Instrument 43-101.
|
|
|
|
|
|
|
|
|
|
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|mineralization | Minerals of value occurring in rocks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|MRDI           | Mineral Resources Development Inc., an independent
      geological consulting firm                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|NI 43-101      | National Instrument 43-101 Standards of Disclosure
      for Mineral Projectsof the Canadian Securities Administrators                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|ore            | A naturally occurring material from which one or more
      minerals may be mined and sold at a profit, or from which some part may be
      profitably separated.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|ppm            | Parts per million                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|QA/QC          | Quality Assurance/Quality Control                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|QDD            | Quebrada del Diablo, a gold bearing carbonate zone on the
      Gualcamayo property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|RC             | Reverse circulation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|skarn          | A style of alteration characterized by iron and magnesium
      bearing aluminosilicate materials such as garnet and diopside.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|sulphide       | A compound containing sulphur and some other metal.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|TSX            | The Toronto Stock Exchange                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|               |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|TSX-V          | TSX Venture Exchange                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       

vii

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CORPORATE STRUCTURE

Name, Address and Incorporation

Viceroy was incorporated on March 31, 2003 under the Company
Act (British Columbia) (the Company Act).

In March 2004, the Province of British Columbia adopted the
Business Corporations Act (British Columbia) (the Business Corporations
Act), which replaced the Company Act. In 2004, the Company took steps to bring
its charter documents into conformity with the Business Corporations Act and
filed the Companys Notice of Articles, which replaced its Memorandum, with
the British Columbia Registrar of Companies and amended its Articles.

The Companys head office and the registered and records
office, are located at Suite 520  700 West Pender Street, Vancouver, British
Columbia, V6C 1G8, Canada.

Intercorporate Relationships

The following chart sets out the Companys corporate structure,
including its material subsidiaries, as at the date of this AIF:



1

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GENERAL DEVELOPMENT OF THE BUSINESS

Three Year History

Viceroy Arrangement

The Company entered into an agreement dated May 15, 2003 to
participate in a statutory plan of arrangement (the Viceroy Arrangement)
involving Viceroy Resource Corporation (Viceroy Resource), Quest Investment
Corporation , Avatar Petroleum Inc., Arapaho Capital Corp., SpectrumGold Inc.,
Oro Belle Resources Corporation (Oro Belle) and 650399 B.C. Ltd. The Viceroy
Arrangement was approved by the Supreme Court of British Columbia and was
completed on June 30, 2003. On completion of the Viceroy Arrangement, the
following events took place in order to complete the Companys corporate
organization:

| | 1. | Oro Belle was formerly a wholly owned subsidiary of
      Viceroy Resource that owned Viceroy Resources Argentine mineral
      exploration assets (the Argentine Properties) and held approximately
      $500,000 cash. All of the issued shares of Oro Belle were exchanged by
      Viceroy Resource for an aggregate of 13,800,000 common shares of the
      Company and thereby the Company became the sole shareholder of Oro Belle
      and owner of the Argentine Properties.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | 2. | In conjunction and concurrent with these share exchanges,
      Viceroy Resource distributed 11,150,400 of the Companys common shares to
      the shareholders of Viceroy Resource effective as of June 30,
  2003.                                                                                                                                                                                                                                                                      

The Company did not carry on any material business operations
from March 31, 2003, the date of the Companys incorporation, to June 30, 2003,
the date of the closing of the Viceroy Arrangement.

Pursuant to the Viceroy Arrangement, the Company acquired a
portfolio of Argentinean exploration properties with a value of $6.016 million,
of which $5.256 million was ascribed to the Gualcamayo property. Since this
acquisition, the Company has spent an aggregate of $13.843 million to the end of
2005 on acquisition and exploration expenditures, primarily on the Gualcamayo
property which is the Companys main focus.

Trillion Arrangement

On July 12, 2003, the Company executed a letter agreement
(Letter Agreement) providing for the acquisition of all the shares of
Consolidated Trillion Resources Ltd., (Trillion), on the basis of 1 of the
Companys shares for 0.7 of a Trillion share, by way of a statutory plan of
arrangement under the Company Act (the Trillion Arrangement). Closing of the
Trillion Arrangement was conditional upon, among other things, receipt of all
regulatory and shareholder approvals and the Company obtaining a listing on a
recognized Canadian national stock exchange and raising a minimum of $1 million.
On November 14, 2003, the Company was granted a Tier 1 listing on the TSX
Venture Exchange (TSX-V) under the symbol VYE. On November 18, 2003, the
Company closed a private placement of 4,200,000 units at $0.50 per unit for a
total consideration of $2,100,000. Each unit consisted of one common share and
one share purchase warrant granting the holder the right to purchase one common
share of the Company at a price of $0.60 until November 18, 2006. The Company
issued 6,471,158 common shares to the shareholders of Trillion on completion of
the Trillion Arrangement.

The Trillion Arrangement closed on December 2, 2003 and
resulted in the Company acquiring all of the common shares of Trillion and
merging Trillion with Oro Belle to continue under the name Oro Belle. Prior to
the completion of the Trillion Arrangement, Trillion's common shares were
registered pursuant to Section 12(g) of the United States Securities Exchange
Act of 1934 (the Exchange Act). As a result of

2

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the exchange of our common shares for Trillion common shares,
the Companys common shares were deemed registered under the Exchange Act by
application of Rule 12g-3(a) of the Exchange Act. Viceroy is the successor
issuer to Trillion in this transaction.

Concurrent with closing of the Trillion Arrangement, Patrick
Downey was appointed the Companys president and chief executive officer
(CEO). Mr. Downey was previously president and CEO of Trillion. Ronald
Netolitzky resigned as the Companys president and remained as Chairman.

Pursuant to the Trillion Arrangement, the Company acquired cash
of $2,816,280 and an account receivable of $100,000 (refer to Managements
Discussion and Analysis, Result of Operations for further information on this
account receivable).

Tenke Option Agreement

In April, 2004, the Company reached an agreement with
Desarrollo de Prospectos Mineros, S.A. (Deprominsa), a subsidiary of Tenke
Mining Corp. (Tenke), a TSX listed company, whereby Deprominsa may earn a
one-time 75% interest in the Companys Las Flechas property through expenditures
with pre-agreed minimum annual exploration expenditures aggregating to US$4.5
million over 5 years. Deprominsa completed a first phase of soil geochemistry
and geological mapping and sampling in the 2004-05 season. Results to date have
been encouraging and Deprominsa have informed the Company that it intends to
proceed to the next phase of exploration in the 2006-07 season. Trenching is
planned prior to the end of the current field program, with a goal of
delineating drill targets for the 2006/07 field season, if warranted.

Independent Resource Estimate Update

In November 2004, the Company released a new resource estimate
on the Gualcamayo property. The report completed by Ronald G. Simpson, P.Geo.
(Simpson), principal of GeoSim Services Ltd., an independent qualified person
as defined by NI 43-101, estimated the measured and indicated resource at the
Quebrada del Diablo (QDD) deposit to be 37.1 million tonnes of 1.04 g/t Au
(1.2 million ounces) using a cutoff grade of 0.5 g/t Au. An additional 11.3
million tonnes of 1.20 g/t Au (435,000 ounces) are classified as inferred. The
nearby Amelia Inés deposit is estimated to contain a measured and indicated
resource of 2.1 million tonnes averaging 2.82 g/t Au (192,000 ounces) using a
0.5 g/t Au cutoff grade. The combined inferred resources for Amelia Inés and the
adjacent Magdalena deposit amount to 2.9 million tonnes grading 1.88 g/t Au
(176,000 ounces).

Preliminary Economic Assessment

In January 2005, AMEC Americas Limited ("AMEC") completed a
Preliminary Economic Assessment on the QDD zone in accordance with NI 43-101.
Highlights of the Preliminary Economic Assessment include:

| | (a) | average annual gold production over a projected 10 year
      mine life of 96,195 ounces based on 80% recovery from a heap-leach
      operation;
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                  
| | (b) | average cash costs of US$133 per ounce;                                                                                                          
| |     |                                                                                                                                                  
| | (c) | capital of US$55.7 million;                                                                                                                      
| |     |                                                                                                                                                  
| | (d) | sustaining capital over the 10 year life of mine of
      US$14.4 million; and                                                                   
| |     |                                                                                                                                                  
| | (e) | projected after-tax internal rate of return of 32.3%
      based on US$400 per ounce of gold.                                                    

3

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The above numbers are based on order of magnitude level
estimates, with an accuracy of ±35%. As recommended by AMEC, the Company is
proceeding towards feasibility, which will incorporate any additional resources
at QDD, Amelia Inés and Magdalena not already incorporated in the Resource
Report.

The Preliminary Economic Assessment is based partially on
inferred resources that are considered too speculative geologically to have
economic considerations applied to them that would enable them to be categorized
as mineral reserves, therefore there is no certainty that the results predicted
by the Preliminary Economic Assessment will be realized. United States investors
are cautioned that the United States Securities and Exchange Commission does not
permit U.S. mining companies to disclose economic results from a preliminary
economic assessment based on inferred resources.

TSX Listing

On May 2, 2005, the Companys common shares began trading on
the Toronto Stock Exchange (TSX) and were delisted from the TSX-V.

Financings

On July 5, 2005, the Company completed a bought deal financing
for a total of 5,750,000 common shares for gross proceeds of $18,687,500.

Subsequent to the year ended December 31, 2005, the Company
completed on February 16, 2006, a bought deal financing for a total of 9,600,000
common shares for gross proceeds of $60,000,000.

Proceeds from both financings are being used to advance the
exploration and development of the Gualcamayo project and for general working
capital purposes.

DESCRIPTION OF THE BUSINESS

Summary

Since the completion of the Viceroy Arrangement on June 30,
2003, the Companys focus has been the exploration and advancement of the
Argentinean mineral properties, with particular emphasis on its most advanced
property, the 100% held Gualcamayo gold property in San Juan, Argentina (the
"Gualcamayo Property"). In addition, the Company has four other properties which
consist of, the Salamanca property (the "Salamanca Property") located north of
the Gualcamayo Property on the border between San Juan and La Rioja Provinces of
Argentina, and the Las Flechas property, the Evelina property and the La
Brea/Las Carachas property all of which are located in the High Andes in
northwest San Juan Province. These properties together with the Gualcamayo
Property are collectively called the "Argentine Properties".

The Company has conducted two phases of drilling on the
Gualcamayo Property. The first phase included an 11,920 m reverse circulation
(RC) drilling program and was completed from April to August 2004. The second
phase of drilling began in December 2004 and was completed in December 2005 with
approximately 27,000 m of RC and diamond drilling. Detailed results are
discussed herein under Gualcamayo Property  Results and Interpretation.
Drilling continues on the Property with two diamond drills and one truck mounted
RC rig on site. A fourth rig (diamond drill) was delivered to the project in
late February and a fifth rig (RC) has been scheduled for arrival by April
2006.

The Companys Vancouver head office is located at Suite 520 
700 West Pender Street, Vancouver, BC.

4

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During the fiscal year ended December 31, 2005, the Company had
7 employees at its head office in Vancouver and 56 in Argentina. The Company
also retains the services of consultants as required. Together, employees and
consultants have the required skills and knowledge to support the operations of
the Company, including geological, financial and other.

Subsequent to completion of the first phase 11,920 m RC
drilling program, the Company released an updated resource estimate on the
Gualcamayo Property in November 2004. This was followed by a Preliminary
Economic Assessment in January 2005 which recommended proceeding towards
feasibility.

In the 2006 first quarter, the Company plans to carry out a new
resource estimate followed by an updated Preliminary Economic Assessment, to
continue drilling and to begin the feasibility study.

Concurrent with the second phase drill program on the three
main zones of mineralization the Company completed a regional exploration
program within and around the main Gualcamayo land holdings. The results of this
surface sampling and mapping program were successful in outlining new zones of
mineralization at Pirrotina, Mina San Jose and Quebrada Perdida. Subsequent to
this sampling and mapping program, a regional aeromagnetic survey was flown to
help outline the intrusive bodies and determine favourable structures. Further
mapping and sampling is ongoing and the Company plans to commence limited
drilling of the Pirrotina and Perdida targets by the end of the first quarter of
2006.

Gualcamayo Property

Property Description and Location

The Gualcamayo Property, which is the Companys material
project, is located in northern San Juan Province, Argentina, approximately 180
km north of the provincial capital of San Juan.

The main Gualcamayo block consists of one Cateo and 57
Minas, as shown in the table below. Fifty-five (55) of theMinas
are contiguous and lie wholly within the Cateo. One Mina(Chani)
lies partially outside the Cateo and one Mina (Perico) lies wholly
outside the Cateo. This area is the subject of the NI 43-101 reports
dated December 8, 2004 and filed on SEDAR December 8, 2004 (Simpson, 2004) and
January 13, 2005, respectively. Six (6) contiguous Minas known as the
Virgen de Lourdes Property, in which the Company does not hold an interest and
which cover a 50 hectare area, lie within the main Gualcamayo Property block.

Main Gualcamayo Block

File Number
    Name
    Type
    Size (Ha)*339189-L-93
    Unnamed (Rio Piojos)
    Cateo
    7,128157563-O-76
    Jorge Alfredo
    Mina
    6156084-O-75
    Don Felipe
    Mina
    6157.233-A-77
    Patrimonio I
    Mina
    24157.316-P-77
    Patrimonio IV
    Mina
    24157.232-A-77
    Patrimonio
    Mina
    24157.315-A-77
    Patrimonio III
    Mina
    2458-B-50
    Leticia
    Mina
    6258.891-C-84
    Aconcagua
    Mina
    24258.894-C-84
    Alaya
    Mina
    24258.903-C-84
    Alfarcito
    Mina
    24195.016-B-82
    Alicia
    Mina
    12


5

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17-B-50
    Amelia Inés
    Mina
    12258.904-C-84
    Ampacama
    Mina
    24258.888-S-84
    Ansilta
    Mina
    24258.877-S-84
    Atutia
    Mina
    24258.886-S-84
    Batea
    Mina
    2422-M-50
    Beatriz Eugenia
    Mina
    12258.879-S-84
    Caparro
    Mina
    24156.089-O-75
    Chacho
    Mina
    6258.899-C-84
    Chani
    Mina
    242.504-B-67
    Chela
    Mina
    36258.893-C-84
    Cerro Tamberias
    Mina
    24258.878-S-84
    Colanguil
    Mina
    24258.901-C-84
    Coranzuli
    Mina
    24195.017-B-82
    Diana
    Mina
    12258.882-S-84
    El Chivato
    Mina
    24157.564-M-76
    El Filo
    Mina
    62.502-B-67
    Elsa
    Mina
    3662-G-43
    Gral. Belgrano
    Mina
    1219-B-50
    Hilda Edith
    Mina
    12259.052-C-84
    Irigoyen
    Mina
    24258.885-S-84
    Lagañoso
    Mina
    242.437-B-65
    Los Ranchos
    Mina
    1220-B-50
    Magdalena
    Mina
    1218-B-50
    Maria
    Mina
    13258.892-C-84
    Mercedario
    Mina
    24258.884-S-84
    Mondaca
    Mina
    24156.085-M-75
    Ojo De Agua
    Mina
    6258.898-C-84
    Panacam
    Mina
    18157.234-A-77
    Patrimonio II
    Mina
    24259.053-C-84
    Perico
    Mina
    242.436-B-65
    Portezuelo
    Mina
    12258.900-C-84
    Pululus
    Mina
    25165-M-49
    Puntilla Blanca
    Mina
    6258.902-C-84
    Quevar
    Mina
    2416-B-50
    San Nicolas De Bari
    Mina
    18258.897-C-84
    Sosneado
    Mina
    242.501-B-67
    Susana
    Mina
    24258.881-S-84
    Tambillos
    Mina
    24258.887-S-84
    Teatinos
    Mina
    24258.895-C-84
    Tontal
    Mina
    24258.889-S-84
    Tortolas
    Mina
    24258.890-S-84
    Villicum
    Mina
    24258.883-S-84
    Yanso
    Mina
    24258.880-S-84
    Zancarron
    Mina
    24414-1192-M-05
    Gualcamayo 1
    Mina
    2,443414-1193-M-05
    Gualcamayo 2
    Mina
    2,435Total Size (Ha)
    
    
    7,128


* Numbers in italics indicate overlap between Minas
Argentinas S.A.(MASA) Mina and Cateo

6

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The area surrounding the main Gualcamayo block, which has not
been as extensively explored as the main block and which does not contain any
resource, includes the following contiguous land holdings, with the exception of
the Cerro Penon, Volcan 1 and Volcan 2 Cateos which lie to the west.

Surrounding Gualcamayo Cateos and Minas

File Number
    Name
    Type
    Size (Ha)*545575-S-94
    Unnamed
    Cateo
    2,8001210 F18-95
    Cerro Saltito N° 1
    Mina
    4001211-F18-95
    Cerro Saltito N° 2
    Mina
    2661212-F18-95
    Cerro Saltito N° 3
    Mina
    6631213-F18-95
    Cerro Saltito N° 4
    Mina
    2001214-F18-95
    Cerro Saltito N° 5
    Mina
    2451215 F18-95
    Cerro Saltito N° 6
    Mina
    2202249-T-62
    San José
    Mina
    121.151-L-95
    Unnamed (Ernie)
    Cateo
    1,200520-0453-99
    La Esperanza I
    Mina
    3531114-F18-95
    Sony
    Mina
    4001115-F18-95
    Domingo
    Mina
    1,1011116-F18-95
    Roki
    Mina
    1,1001117-F18-95.
    Tachi
    Mina
    1,8931118-F18-95
    Merval
    Mina
    6001119-F18-95
    Alfredo
    Mina
    1,064425.053-M-2001
    Vancouver I
    Mina
    2,5970948 F18-95
    Unnamed (Cerro Penon)
    Cateo
    700425-169-M-00
    Suzy
    Mina
    4,924425-267-M-00
    Unnamed (Liz)
    Cateo
    2,434414-563-M-04
    Daniela
    Mina
    305414-1204-M-05
    Unnamed (Volcan 1)
    Cateo
    9,752414-1205-M-05
    Unnamed (Volcan 2)
    Cateo
    9,955414-1392-M-05
    Unnamed (Vancouver 2)
    Cateo
    3,792414-1104-M-05
    Unnamed (Gualcamayo Este)
    Cateo
    1,200Total Size (Ha)
    41,742


* Numbers in italics indicate
overlap between MASA Mina and Cateo

Property Size

The Gualcamayo Property covers the main block of 7,128 hectares
and the surrounding area of 41,742 hectares, for a total of 48,870 hectares.

Ownership

The Gualcamayo Property is owned 100% by Minas Argentinas S.A
(MASA), subject to the royalties described herein.

7

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Agreements and Royalties

The Gualcamayo Property is not the subject of any existing or
proposed options, joint ventures or other agreements. Royalties on the property
are as follows:

| | 1. | a 1% Net Smelter Return royalty (NSR) on production
      from the Gualcamayo Property is payable to Inversiones Mineras Argentinas
      Inc. (IMA);                 
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                           
| | 2. | a 1% NSR, capped at $US200,000 on production from the
      Patrimonio, Patrimonio I, Patrimonio III, Patrimonio IV and Leticia
      Minasis payable to the Lirio Family;
| |    |                                                                                                                                                                           
| | 3. | a 1.5% NSR, capped at $US500,000, is payable to the Lirio
      Family on production from the Rio Piojos
Cateo.                                                           

The Company is unaware of any additional royalties, overrides,
back-in rights or encumbrances that affect the property.

Environmental Legislation

Following the official granting of mining rights the
Environmental Protection Law for the Mining Industry in Argentina requires an
Environmental Impact Report be submitted to the Environmental Provincial
Management Unit (EPMU; Unidad de Gestion Ambiental Provincial) of the
San Juan Department of Mines at the onset of prospecting, exploration and
exploitation on the property.

Two exploration stage Environmental Impact Reports have been
submitted and approved for the Gualcamayo Property by MASA, these consist of:

| | 1. | Sanchez, A and Hernandez, M., Nov. 1997. Informe de
      Impacto Ambiental, Etapa de Exploración, Anexo II, Proyecto Hualcamayo"
      Expediente No: 520-1051-97, Approved by Resolution 285-HCM-98, June, 1998.
      The third update of this report was filed in January 2006 and is under
      review;
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|
|
| |    |                                                                                                                                                                                                                                                                                                              
| | 2. | Hernandez, M., Dec., 2000. Informe de Impacto Ambiental,
      Etapa de Exploración, Anexo II, Proyecto "Lajitas Tamberías", Expediente
      No 425-497-2000; approval pending.                                                                                                                             
|

Infrastructure and Accessibility

The project area is easily accessible from the city of San Juan
by driving three hours north on paved Highway 40 and then via an 18 km gravel
road to two exploration camps located approximately 0.5 km due north of the main
QDD resource area. The main exploration camp is comprised of four permanent one
storey buildings and nine weatherhaven tents which are used as an office,
kitchen, sleeping quarters, washrooms and storage facilities. The second camp is
located approximately 1.5 km northeast of the main camp and consists of 17 four
person rooms, a large kitchen, washroom, shower facilities and a fully equipped
first aid room. This camp was completed in June 2005. A core storage facility
and an explosives shed have been constructed approximately 1.5 km northeast of
the second camp. Well water in the Gualcamayo River basin is pumped to each camp
and diamond drill rigs through a series of hoses and metal pipes. Construction
began on a permanent access road to the project, a total distance of
approximately 10 km, which will significantly reduce travel time to site.

The general services and infrastructure for the area are good.
Drilling contractors, heavy machinery dealerships, repair services, parts, and
fuel are available at both San Juan and Mendoza. Local labour is readily
available and staff engineers and geologists are available through the
University of San Juan, as well as from consulting firms based in the region.

8

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The National power grid is located approximately 65 km from the
project site. A proposed new high tension electrical line (Linea Minera)
is planned to run adjacent to the project area. Electricity for exploration
activities is supplied via generator.

Elevation ranges from 1,600 m to nearly 3,000 m. The most
prominent physiographic feature is Quebrada del Diablo, a northwest trending
structurally controlled 750 m long canyon with up to 400 m of near vertical
relief.

The climate is semi-arid with summer highs exceeding 40° C and
winter temperatures averaging 15° C with sub-zero temperatures reached,
especially at night. July and August can experience snow accumulations to 15 cm
above 2,000 m. The snow typically melts within one or two weeks. Aside from
occasional flash flooding in the rainy season, January through March, no
disruption of operation can be expected. Vegetation consists of thorny bushes
and cactus. Wildlife is sparse and there is no agriculture within the project
area.

History of Exploration

United States Investors are Referred to the Cautionary
      Note to United States Investors Concerning Estimates of Measured,
      Indicated and Inferred Resources set forth in the Introductory
      Notes to this Annual Information Form.


History of exploration on the Gualcamayo can be obtained from
the Technical Report entitled "Preliminary Assessment and Economic Evaluation of
Quebrada Del Diablo Deposit, Gualcamayo Project" dated January, 2005 and the
Technical Report entitled "Update on Resources: Gualcamayo Gold Project", dated
December 8, 2004, both of which are available on Sedar at www.sedar.com.

The general area of what is now the Gualcamayo Property is
known to have been worked by indigenous gold, silver, and/or copper miners
through the first part of the twentieth century (Mincorp, 1988). Systematic
exploration of what was then called the Hualcamayo Property was conducted
between 1983 and 1988 by Exploraciones S.A. (Mincorp). In September, 1988, prior
to the discovery of the QDD deposit, Mincorp compiled a summary of exploration
in the project area to attract outside company interest in the project (Mincorp,
1988). Between 1996 and November 2002, the Gualcamayo Property was the subject
of a joint venture between MASA and Mincorp. During 1999, Viceroy Resource
completed designated exploration expenditures which were required for MASA to
earn a 60% interest from Mincorp. In November 2002, MASA purchased Mincorps
remaining 40% interest in the property for US$1.0 million to hold a 100%
interest. Past exploration activities are summarized in the tables below.

9

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Summary of exploration activities by past operators

YEAR
    COMPANY
    **PROGRAM**Pre 1983
    Small Miners
      •    
           High grade shear-hosted mineralization1983  1988
    Mincorp
      •    
           Map & sample Amelia Inés/Magdalena/ Belgrano areas 
             •      Underground
          sample program at Amelia Inés/Magdalena/Belgrano 
             •      Surface &
          underground drill program of Amelia Inés/Magdalena/Belgrano areas1996 - 1997
    MASA
      •    
           Mapping & reconnaissance sampling, Gualcamayo area 
             •      Discovery of
          breccia/sediment hosted gold mineralization at QDD1998
    MASA
      •    
           Cut channel samples at previous site rock-chip panel. Results
          consistent and higher 
             •      Detail sample/map
          QDD 130 continuous rock-chip channel samples from road cut 
             •      Contractor review
          of regional aeromagnetics 
             •      Diamond drill
          QDD area 
             •      Twinning of
          certain core drill holes with RC holes1999
    MASA
      •    
           Petrographic studies 
             •      Geologic mapping/sampling
          1:500 scale 
             •      Diamond drill
          and RC drill QDD 
             •      Metallurgical
          test work on core and cuttings2000
    MASA
      •    
           Structural mapping (1:250 scale) coincident with geochem program
          
             •      RC drill program


Summary of drilling by past operators at the QDD deposit.

Program/Year
      Core (holes)
      Core (m)
      RC (holes)
      RC (m)MASA 1998
    14
    2,706MASA 1999
    19
    3,337
    9
    1,400MASA 2000
    
    
    13
    3,422Total
    33
    6,043
    22
    4,822


Summary of drilling by past operators at the Amelia Inés
and Magdalena deposits

Program/Year
      Core (holes)
      Core (m)
      RC (holes)
      RC (m)Mincorp 1983-88
    127
    1,475MASA 2000
    
    
    2
    311Total
    127
    1,475
    2
    311


10

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Mineral Resources Development, Inc. (MRDI) was contracted to
confirm a resource estimate based on data from 33 core holes and 9 RC holes
drilled during the 1998 and 1999 programs, prepared by Simpson, an independent
consultant to Viceroy Resource.

The MRDI study reviewed the geology, parameters of the
geological model, drilling and sampling procedures, QA/QC and the technical
database. MRDI verified the model using independently derived grade
distributions, variography and Kriged grade models. The comparisons of the two
studies are presented below.

QDD resource model comparisons for drilling up to and
including 99QD-042 (0.6 g/t cutoff)

Model
      Category
      Tonnes (000s)
      Grade (g/t Au)
      Total oz (000s)MRDI (Kriged Model)
    Indicated
    18,441
    1.104
    655Inferred
    18,779
    1.153
    696MASA (Viceroy Resource) (ID3Model)
    Indicated
    12,243
    1.196
    471Inferred
    25,432
    1.163
    951


A revised geological resource was estimated by Simpson, in
August 2001, for the Gualcamayo area using all drill data up to and including
00QDR-058. The updated estimate was based on new drill geological data collected
during the 2000 program. The geologic resource estimate using a cutoff grade of
0.6 g/t Au is presented below.

August, 2001 QDD Revised Resource Estimate (0.6 g/t
cutoff)

Category
      Tonnes (000s)
      Grade (g/t Au)
      Total oz (000s)Indicated (ID3Model)
    12,734
    1.17
    480Inferred (ID3Model)
    22,449
    1.02
    734


The principal change between the two studies resulted from
additional structural interpretation of mineralized zones based on detailed
structural mapping, surface sampling and the 2000 drill results. The earlier
MRDI and in-house results were strongly influenced by hole 98QD-027. MRDI
concluded that it was not warranted to reduce or discount the resource blocks
influenced by this hole.

Although the later interpretation and estimate reduced the
total ounces, the waste to ore ratio and reliability of the resource estimate
was significantly improved and the relative influence on the estimate by any one
hole was reduced.

Based on 3,414 m of surface diamond drilling, 1,405 m of
underground development on three levels, and 4,047 m of underground drilling
from 79 holes, Mincorp identified three zones of gold mineralization at Amelia
Inés. They named these the Betsy, Ana and Diana zones. Mincorp reported a
resource estimate termed proven and probable using a specific gravity of 3 and
cutoff grades of 1 g/t and 3 g/t .

1988 historic Amelia Inés inferred resource estimate (not
NI 43-101 compliant)

Cutoff (g/t Au)
      Tonnes (000s)
      Grade (g/t Au)
      Total oz1.0
    1,010
    5.77
    187,3943.0
    436
    9.30
    130,383


11

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A preliminary geologic resource was estimated for Amelia Inés
by Simpson in June 1999 using Mincorp drill data and underground channel
sampling (Dircksen, 2003). This estimate was classified as inferred for
several reasons. At that time there was no rock density information available,
the topographic control was poor and the geological model was thought to be
overly simplified. Since a number of the channels had multi-gram gold grades a
second estimate was performed to investigate the effect of capping at 30 g/t
gold on the overall resource. The estimates are presented below.

June, 1999 Amelia Inés Inferred Resource Estimate (0.5
g/t cutoff)

Model
      Tonnes (000s)
      Grade (g/t Au)
      Total oz (000s)ID3 no capping
    2,681
    2.63
    226,321ID3 cap at 30 g/t Au
    2,679
    1.86
    160,273


A preliminary geologic resource was estimated for Amelia Inés
by Simpson in June 1999 using Mincorp drill data and underground channel
sampling (Dircksen, 2003). This estimate was classified as inferred for
several reasons. At that time there was no rock density information available,
the topographic control was poor and the geological model was thought to be
overly simplified. Since a number of the channels had multi-gram gold grades a
second estimate was performed to investigate the effect of capping at 30 g/t
gold on the overall resource. The estimates are presented below.

June, 1999 Amelia Inés Inferred Resource Estimate (0.5
g/t cutoff)

Model
      Tonnes (000s)
      Grade (g/t Au)
      Total oz (000s)ID3 no capping
    2,681
    2.63
    226,321ID3 cap at 30 g/t Au
    2,679
    1.86
    160,273


Geology

The Gualcamayo Property is located along the eastern margin of
the Precordillera of west central Argentina, immediately to the east of the
Cordillera de Los Andes. The Precordillera consists of a series of
north-south trending ranges comprised of Cambrian-Early Ordovician marine
platform carbonates overlain by mid-Ordovician through Early Carboniferous
marine clastic sediments, which are in turn overlain by late
Carboniferous-Tertiary continental clastic sediments. Permo-Triassic and
Tertiary granitic complexes locally intrude all sediments.

The Gualcamayo Property is located primarily within a package
of lower Paleozoic stratigraphy characterized by thick carbonate sequences of
upper-Cambrian La Flecha and Ordovician San Juan Formations, which are overlain
by marine clastic sediments of Upper Ordovician Trapiche Formation. The entire
stratigraphic section exceeds 1,000 m in thickness. The immediate project area
is intruded by a dioritic-dacitic porphyry complex. Although the intrusive
phases have not been differentiated, subtle compositional variations and
contrasting structural emplacement suggests a complex intrusive history.

Three main mineral occurrences have been outlined on the
Gualcamayo Property. These consist of the sediment-hosted disseminated gold QDD
deposit and the skarn-hosted gold Magdalena and Amelia Inés deposits.

12

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At QDD, gold mineralization is concentrated within
stockwork-fractured carbonates, carbonate breccias and intrusive breccias. The
mineralization can be described as low sulfide bearing (<3%) and is in a low
silica system. At Amelia Inés and Magdalena, gold mineralization is present in
sulphide-bearing skarns that have developed at carbonate/intrusive contacts.

Work by Viceroy

Summaries of drilling and surface sampling conducted by the
Company since acquisition of the property in June, 2003, including dates the
work was performed, are presented in tables below.

Summary of Exploration by the Company

YEAR
      COMPANY
      PROGRAMJune, 2003 to December, 2003
    MASA
    Rock geochem sampling Re-sampling
      of Anglo American drill coreJanuary, 2004 to
    MASA
    Phase One RC
      drill program Rock geochem sampling Channel sampling
      Re-logging of drill coreNovember, 2004 to
      December 2005
    MASA
    Phase
      TwoDiamond and RC drill program Rock geochem sampling
      Regional Exploration  Salamanca and surrounding Gualcamayo areaJanuary, 2006 to March
      xx, 2006
    MASA
    2006 Program Diamond drill
      and RC program Rock geochem sampling Regional Exploration 
      surrounding Gualcamayo area


Summary of Drilling by the Company *

Program & Hole
      Numbers
      Number of Holes
      M Drilled
      Program Dates
      Core Diameter
      Drill Hole Type
      Primary Lab
      Check LabPhase 1: 04QDR-059 to 04QDR-105
    47
    11,920
    April to August 2004
    Not applicable
    RC
    ALS- Chemex
    Alex Stewart**Phase 2: 04QDR-106 to04QD-109
      05QD-110 to05QDR-230
    127
    27,000
    November, 2004 to December, 2005
    HQ, minor/NQ
    RC & Diamond Drill Core
    Alex Stewart
    ALS- Chemex


*reflects data disclosed to March 21, 2006 ** Alex Stewart
Assayers Argentina, S.A. (Alex Stewart)

13

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Summary of Surface Sampling by the Company

Date Collected
      Saw Cut Channel
      Samples
      Chip, Outcrop &
      Silt Samples
      Total Samples
      Primary Lab
      Check LabOctober, 2003 to October, 2004
    153
    1,139
    1,292
    ALS-Chemex
    Alex StewartNovember 2004 to December 2005
    15
    1,963
    1,978
    Alex Stewart
    ALS-Chemex


Sampling Procedures

RC Drilling

The RC holes were drilled with a 5 1⁄4 bit and the drill material
was collected on 2 m intervals using a dry cyclone system; 100% of the sample
from the cyclone was collected using pre-labeled plastic bags. The total sample
was weighed, and then two 50% splits were collected using a Gilson splitter with
a large hopper to allow the total sample to be split at the same time. One of
the two 50% splits was split in half again to produce two 25% splits (12-15 kg).
The two 25% split samples were bagged in heavy-duty plastic bags with one split
labeled by hole number and interval and the other labeled the same but with the
addition of an R following the sample number. The Original split was sent to
the primary lab and the other Reject split was stored on site. All samples
were sealed with tamper-resistant plastic ties. Small (washed and unwashed)
representative samples were taken from the 50% duplicate split samples and
placed in plastic chip trays for detailed logging purposes.

Sample recoveries were calculated by weighing the cuttings from
the entire sampled interval. The recoveries for the 2 m intervals averaged 63 kg
with an interquartile range from 58 to 70 kg. Chip trays were filled at the
drill site and preserved for logging using the same protocol as previous drill
programs.

Diamond Drilling

Core samples are split in half, ideally on maximum 2 m
intervals with exceptions of shorter intervals (min. 10 cm) based on pertinent
geologic/mineralization breaks. One half is bagged in durable plastic bags with
tamper-resistant plastic ties and sent for assay, with the second half retained
in core boxes for reference.

Saw-Cut Channel Sampling

Channels were sawn 4 to 8 cm deep and 4 to 10 cm wide. The
samples were then chipped by hammer and moil. Tarps were laid out along the
sample trace to maximize collection of fines. Samples were bagged and sealed
with tamper-resistant seals for shipping. Individual sample lengths ranged from
1.0 to 5.5 m and averaged 2.1 m. In some instances portions of the lines
extended over talus or overburden. These sections were not sampled and were
flagged as NS (no sample) in the database.

Grab Sample, Rock Chip and Silt Sampling

Rock chip grab samples were collected throughout the project
area on a reconnaissance basis. Very little soil cover exists and therefore, the
samples represent fairly continuous chip samples across outcrops and along road
cuts. The samples were bagged and sealed with tamper-resistant seals for
shipping.

14

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Assay Laboratories, Sample Preparation and Analytical
Methods

Two assay laboratories, ALS Chemex and Alex Stewart, have been
used by Viceroy for analysis of samples from the Gualcamayo Property. Through
the Phase One drill program ALS-Chemex was used as the primary laboratory for
all drill and surface samples and Alex Stewart was used as the check laboratory.
From the commencement of the Phase Two program to the present Alex Stewart has
been used as the primary laboratory for all drill and surface samples and
ALS-Chemex has been used as the check laboratory. Samples sent to ALSChemex
were prepared in Mendoza, Argentina and analyzed in Chile. Samples sent to Alex
Stewart were prepared and analyzed in Mendoza.

Analytical techniques employed by ALS-Chemex consist of fire
assay-atomic absorption spectroscopy (FA-AAS). ALS-Chemex laboratories in
Chile and Argentina are registered to ISO 9001:2000.

Analytical techniques employed by Alex Stewart consist of
FA-AAS and inductively coupled plasmaoptical emission spectroscopy (ICP-OES).
Alex Stewarts Mendoza facility is currently working towards ISO 9001:2000
certification. This recommendation was incorporated into the Companys QA/QC
program.

RC Drilling

All samples for the Phase One RC drilling program were prepared
and analyzed for Au and Ag by ALS-Chemex using standard FA/AAS finish sample
preparation and assay procedures. Lab sample preparation procedures included: 1)
dry samples; 2) coarse crush 100% to 10 mesh; 3) split 250 gm for pulp; and 4)
fine pulverize split to 150 mesh. Selected intervals were later selected for 37
element ICP-OES with aqua regia digestion. All samples for the Phase Two RC
drilling program were prepared and analyzed for Au and a 39 element ICP suite
using standard FA/AAS sample preparation and assay procedures. Lab sample
preparations procedures include: 1) drying samples; 2) coarse crush, with 70%
passing 2 mm; 3) split 250 gm for pulp; and 4) fine pulverize split to 85%
passing 75 micron. Gold is then analyzed by FA/AAS on a 50 gm split. An ICP
suite including silver is then completed with an aqua regia digestion.

Part way through the Phase Two RC and core drilling programs a
30 g split was used instead of a 50 g split for FAA. The reason for changing was
due to the carbonate rock type requiring more flux addition in the crucible
causing over boiling during FAA process. Due to the fineness of gold at
Gulacamayo (1-5 microns) and good assay reproduceability it was decided to
change to a 30 g split to lessen the sample and flux size in the crucible to
prevent over boiling. Significant intervals in two previous holes were
re-assayed using a 30 g split and compared to the original 50 g FAA results.
Results for the two holes compared very well and as a result a 30 g split has
been used for 05QD-154 and up.

Diamond Drilling

All samples are prepared and analyzed for Au and a 39 element
ICP suite using standard FA/AAS sample preparation and assay procedures. Lab
sample preparation procedures include: 1) drying samples; 2) coarse crush, with
70% passing 2 mm; 3) split 250 gm for pulp; and 4) fine pulverize split to 85%
passing 75 micron. Gold is then analyzed by FA/AAS on a 50 gm split. An ICP
suite including silver is then completed with an aqua regia digestion.

Surface Samples

Surface samples are prepared and analyzed following the same
procedures as for diamond drill samples as described above.

15

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Re-sampling Checks of Mincorp Core Drilling

In 2003, select re-sampling of core from the Mincorp
Exploraciones S.A. (Mincorp) drill programs at Amelia Inés and Magdalena was
carried out to verify their reliability for use in an updated resource
calculation. [PD] Mincorp was a joint venture between Minorco, owned by Anglo
American, and Perez Companc, an Argentinean conglomerate. Exact re-sampling of
intervals was not always possible because core had shifted during transportation
from a storage facility at Anglo Americans Cerro Vanguardia property. There
were also many narrow (0.5 m) sample intervals with little material remaining
and core run locations were poorly marked. In about half of the cases,
composites were made where there was confidence in matching Mincorps sampled
intervals. Mincorp used their own internal lab and no pulps are available. For
the re-sampling, duplicate pulps were done on every 10th sample, and a blank or
MASA standard was inserted randomly for 10% of the samples. The MASA
standards were rig duplicates of drill cuttings from previous RC drilling. The
primary lab used was ALS-Chemex and the check lab was Alex Stewart.

A total of 380 sample intervals were collected from 38 drill
holes. Most of the sampled holes were from the underground drilling program at
Amelia Inés. The Magdalena deposit was represented by samples from three surface
and one underground drill hole.

Scatter plots presented in Simpson, 2004 include both sample
intervals which could be matched exactly to Mincorps samples and composited
samples averaged over longer intervals. A simple linear trend model indicates
that the data is skewed towards higher values for the re-sampled checks. The
higher values, particularly for lower grade intervals, may reflect a higher
calibration of Mincorps analytical equipment towards higher grades vs.
ALS-Chemex. The results of this work verified that the Mincorp data could be
relied upon for use for resource calculation purposes.

Sample Security

All drill samples are transported from the drill sites to camp
via truck and are stored at the camp site in an enclosed, secure warehouse. They
are then either shipped directly to the ALS-Chemex or Alex Stewart preparation
facility in Mendoza via a commercial truck arranged through the lab or trucked
to the Companys San Juan, Argentina office for secure storage until being
picked up by an assay laboratory vehicle, depending on the size of the shipment.
Rock and silt samples are transported to camp by the geologist collecting the
samples, then shipped to the assay laboratory preparation facility by the same
method described above for drill samples. Samples are packaged in large, durable
woven plastic sacks with tamper-resistant plastic ties. A list of samples and
sacks were prepared for each shipment and a copy of submittal sent for filing in
San Juan.

Check Assay Procedures

RC Drilling

In the Phase One RC drill program rig duplicates were inserted
to monitor analytical precision at the primary lab and were also sent to the
check lab for further verification. The results show a reasonable correlation
between the original and the re-assay results (Simpson, 2004). For every hole,
blank samples were inserted immediately following a probable mineralized
intercept, as picked by the drill site geologist.

For every twentieth sample from each hole, duplicate rejects
and pulps were sent to the check lab. During routine sample preparation
procedures, the primary laboratory was directed to prepare a second 250 gm
coarse reject split and ship these splits directly to the check lab, where new
pulps were prepared and

16

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analyzed for gold. For pulp checks, the primary laboratory
prepared a duplicate pulp and submitted it to the check lab. Duplicate reject
and pulp checks were staggered to prevent re-duplication of check intervals.

Only internal laboratory standards were used in the Phase One
and previous drilling programs at Gualcamayo. Simpson (Simpson, 2004)
recommended the use of site specific standards prepared from sample material
collected from the Phase One RC drilling program to be used as part of the QA/QC
procedures in subsequent drilling and sampling programs. Subsequently, for all
Phase Two RC drilling a suite of three site specific standards were prepared
with gold values of approx. 0.6 g/t, 1.2 g/t, and 2.4 g/t. For every twenty
samples one was inserted randomly.

Check comparisons were conducted following MRDI QA/QC
recommendations. For each pair of results the absolute value of the pair
difference divided by the pair means was taken. Only those pairs whose means are
greater than 400 ppb were used for graphing. For pulps MRDI recommends precision
of ±10% for 90% of the data. For rig & coarse reject duplicates MRDI
recommends precisions of ±20% for 90% of the data. Although those criteria could
not be met in all cases, in general, check comparisons are adequate. Where
results did not meet acceptable criteria, pulps or rejects were rerun to try to
explain the differences. If an explanation was evident, the new result was used
in graphing. The majority of problems were found to be caused by mislabeling of
samples sent by the primary lab to the check lab. Further checks revealed that
when the original material was re-sampled it compared well to the initial
result. In a few cases there was evidence that the lab mixed up adjacent sample
intervals and these errors were later corrected.

For archival purposes the one quarter split sample coarse
rejects taken at the drill rig were saved for all samples. All pulps were
returned and are maintained in long term secure storage in the MASA warehouse.
Reject samples were organized in labeled rice bags and stored in a secure area
on the property. Bags were systematically organized to facilitate easy retrieval
in the future for other analytical, metallurgical or environmental test work.

Diamond Drilling

Check assay procedures for the Phase Two diamond drill program
consist of a system of blind standards, coarse reject and pulp duplicates, and
blanks to check assay validity.

Only internal laboratory standards were used in the Phase One
and previous drilling programs at Gualcamayo. Simpson (Simpson, 2004)
recommended the use of site specific standards prepared from sample material
collected from the Phase One RC drilling program to be used as part of the QA/QC
procedures in subsequent drilling and sampling programs. This recommendation was
incorporated into the Companys QA/QC program.

A suite of three site specific standards was prepared with gold
values of approx. 0.6 g/t, 1.2 g/t, and 2.4 g/t. For every twenty samples one is
inserted randomly. For every drill hole a blank is inserted immediately
following a probable ore grade intercept as selected by the drill site
geologist. For every twenty samples, duplicate rejects and pulps are
automatically sent to the check laboratory. During routine sample preparation
procedures, the primary lab will prepare a second 250 gm coarse reject split and
ship these splits directly to the check laboratory, who prepare new pulps and
assay for gold. For pulp checks, Alex Stewart prepares a duplicate pulp to be
submitted to ALS-Chemex. Duplicate reject and pulp checks are staggered to
prevent reduplication of check intervals.

17

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Results and Interpretation

The table below summarizes all significant intervals from the
Phase One drill program exceeding 2 m in length, using a cutoff grade of 0.3 g/t
Au. Internal waste was included only if a drill hole interval of less than 0.3
gpt Au was used less than 10 m in length.

Significant Drill Intervals from the Phase One
Program

Hole
      Interval (m)
      Width (m)
      Au (g/t)
      Area
      CommentsFrom
      To04QDR-059
    0.0
    30.0
    30.0
    2.311
    QDDincluding
    6.0
    22.0
    16.0
    3.17804QDR-060
    2.0
    36.0
    34.0
    0.937
    QDD04QDR-061
    6.0
    12.0
    6.0
    1.103
    QDD04QDR-062
    0.0
    16.0
    16.0
    0.641
    Magdalena04QDR-063
    0.0
    6.0
    6.0
    0.566
    Magdalena16.0
    42.0
    26.0
    1.783including
    22.0
    28.0
    6.0
    3.643106.0
    146.0
    40.0
    0.879194.0
    200.0
    6.0
    3.131208.0
    222.0
    14.0
    0.666242.0
    254.0
    12.0
    1.31504QDR-064
    84.0
    112.0
    28.0
    3.260
    Magdalena98.0
    110.0
    12.0
    6.768124.0
    140.0
    16.0
    0.761162.0
    174.0
    12.0
    3.61804QDR-065
    36.0
    42.0
    6.0
    1.492
    Amelia Inés04QDR-066
    132.0
    148.0
    16.0
    1.280
    QDD210.0
    256.0
    46.0
    0.865including
    218.0
    250.0
    32.0
    1.00104QDR-067
    150.0
    245.0
    95.0
    1.082
    QDDincluding
    150.0
    176.0
    26.0
    2.12704QDR-068
    112.0
    122.0
    10.0
    0.759
    QDD140.0
    200.0
    60.0
    0.945166.0
    188.0
    22.0
    1.860228.0
    262.0
    34.0
    1.022including
    236.0
    260.0
    24.0
    1.22704QDR-069
    124.0
    140.0
    16.0
    1.170
    QDD264.0
    322.0
    58.0
    0.746including
    278.0
    288.0
    10.0
    1.41004QDR-070
    130.0
    140.0
    10.0
    1.206
    QDD204.0
    288.0
    84.0
    0.740including
    260.0
    288.0
    28.0
    1.181


18

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Hole
      Interval (m)
      Width (m)
      Au (g/t)
      Area
      CommentsFrom
      To04QDR-071
    138.0
    196.0
    58.0
    0.866
    QDDincluding
    138.0
    152.0
    14.0
    1.250including
    170.0
    194.0
    24.0
    1.13004QDR-072
    0.0
    32.0
    32.0
    0.489
    QDD116.0
    160.0
    44.0
    0.79604QDR-073
    112.0
    142.0
    30.0
    1.338
    QDD192.0
    256.0
    64.0
    2.442including
    202.0
    234.0
    32.0
    3.428including
    244.0
    252.0
    8.0
    2.45004QDR-074
    124.0
    138.0
    14.0
    1.075
    QDD190.0
    196.0
    6.0
    1.510224.0
    278.0
    54.0
    1.142including
    248.0
    260.0
    12.0
    2.30104QDR-075
    80.0
    174.0
    94.0
    0.796
    QDDincluding
    100.0
    120.0
    20.0
    1.606214.0
    220.0
    6.0
    1.41704QDR-076
    100.0
    188.0
    88.0
    1.158
    QDDincluding
    142.0
    166.0
    24.0
    2.44004QDR-077
    198.0
    252.0
    54.0
    1.304
    QDDincluding
    204.0
    236.0
    32.0
    1.764including
    220.0
    232.0
    12.0
    2.25304QDR-078
    6.0
    14.0
    8.0
    1.855
    QDD92.0
    216.0
    124.0
    1.210including
    94.0
    110.0
    16.0
    2.098including
    194.0
    206.0
    12.0
    2.29504QDR-079
    48.0
    82.0
    34.0
    0.814
    Target 3D98.0
    110.0
    12.0
    0.652182.0
    196.0
    14.0
    0.513200.0
    216.0
    16.0
    0.62804QDR-080
    28.0
    34.0
    6.0
    1.291
    Target 3D46.0
    50.0
    4.0
    1.354172.0
    188.0
    16.0
    0.61004QDR-081
    98.0
    114.0
    16.0
    0.947
    Target 3D04QDR-082
    224.0
    238.0
    14.0
    0.696
    Target 3D04QDR-083
    no significant intervals > 2 m
    
    Target K04QDR-084
    no significant intervals > 2 m
    
    Target K04QDR-085
    24.0
    30.0
    6.0
    1.862
    Amelia Inés140.0
    160.0
    20.0
    1.33304QDR-086
    10.0
    42.0
    32.0
    6.779
    Amelia Inés


19

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Hole
      Interval (m)
      Width (m)
      Au (g/t)
      Area
      CommentsFrom
      Toincluding
    28.0
    38.0
    10.0
    17.54056.0
    68.0
    12.0
    0.618130.0
    136.0
    6.0
    0.981148.0
    150.0
    2.0
    4.390
    
    end of hole04QDR-087
    94.00
    100.0
    6.0
    2.755
    Amelia Inés108.0
    124.0
    16.0
    1.69804QDR-088
    44.00
    56.0
    12.0
    2.188
    Amelia Inés160.0
    172.0
    12.0
    0.687182.0
    198.0
    16.0
    0.69004QDR-089
    90.0
    96.0
    6.0
    0.555
    Magdalena112.00
    146.0
    34.0
    7.005including
    124.0
    146.0
    22.0
    10.468168.0
    204.0
    36.0
    1.99404QDR-090
    no significant intervals > 2 m
    
    Magdalena04QDR-091
    148.00
    154.0
    6.0
    1.180
    Magdalena04QDR-092
    158.00
    182.0
    24.0
    1.443
    QDD200.0
    256.0
    56.0
    1.10204QDR-093
    122.00
    128.0
    6.0
    2.328152.0
    168.0
    16.0
    3.338210.0
    218.0
    8.0
    1.07904QDR-094
    8.00
    14.0
    6.0
    3.13704QDR-095
    130.00
    136.0
    6.0
    0.603188.0
    208.0
    20.0
    1.665including
    194.0
    206.0
    12.0
    2.165260.0
    320.0
    60.0
    0.997
    
    Includes one interval with no
      recoveryincluding
    302.0
    314.0
    12.0
    1.82804QDR-096
    no significant intervals > 2 m
    
    Target 3D04QDR-097
    96.00
    138.0
    42.0
    1.475
    QDDincluding
    118.0
    128.0
    10.0
    2.887154.0
    162.0
    8.0
    1.239170.0
    176.0
    6.0
    1.05404QDR-098
    no significant intervals > 2 m
    
    Tunnel D04QDR-099
    118.00
    180.0
    62.0
    2.805
    QDDincluding
    150.0
    166.0
    16.0
    6.408including
    156.0
    160.0
    4.0
    14.62504QDR-100
    80.00
    128.0
    48.0
    1.096
    QDDincluding
    92.0
    98.0
    6.0
    2.33304QDR-101
    0.0
    80.0
    80.0
    0.871
    QDDincluding
    0.0
    6.0
    6.0
    2.157


20

---

Hole
      Interval (m)
      Width (m)
      Au (g/t)
      Area
      CommentsFrom
      To110.0
    124.0
    14.0
    1.33804QDR-102
    10.0
    18.0
    8.0
    0.972
    QDD26.0
    34.0
    8.0
    1.004136.0
    154.0
    18.0
    1.00904QDR-103
    no significant intervals > 2 m
    
    Magdalena04QDR-104
    86.00
    94.0
    8.0
    2.253
    Magdalena128.0
    146.0
    18.0
    1.269158.0
    170.0
    12.0
    5.163176.0
    186.0
    10.0
    1.86604QDR-105
    no significant intervals > 2 m
    
    QDD


The following table summarizes all significant intervals from
  the Phase Two drill program exceeding 2 m in length, using a cutoff grade of
  0.4 g/t Au released to January 18, 2006. Internal waste was included only if
  the average with the adjacent sample was greater or equal to 0.4 g/t Au.

Significant Drill Intervals from the Phase Two Program

Hole
      Interval (m)
      Width (m)
      Au(g/t)
      Area
      CommentsFrom
      To04QD  106
    8.00
    20.00
    12.00
    0.44
    QDD30.00
    34.00
    4.00
    0.69
    QDD40.00
    42.00
    2.00
    0.42
    QDD56.00
    58.00
    2.00
    0.59
    QDD71.80
    74.00
    2.20
    1.79
    QDD85.50
    88.50
    3.00
    1.13
    QDD04QD  107
    5.50
    12.60
    7.10
    1.48
    QDD22.00
    24.00
    2.00
    0.43
    QDD37.50
    39.50
    2.00
    1.34
    QDD47.50
    49.50
    2.00
    0.42
    QDD62.75
    66.75
    4.00
    0.57
    QDD86.55
    88.55
    2.00
    0.62
    QDD96.55
    102.55
    6.00
    0.72
    QDD112.55
    114.55
    2.00
    0.51
    QDD05QD  108
    0.00
    87.50
    87.50
    2.49
    QDD
    From surfaceincluding
    21.70
    52.00
    30.30
    4.10
    QDD05QD - 109
    0.00
    87.00
    87.00
    2.20
    QDD
    From surfaceincluding
    24.30
    54.50
    30.20
    4.20
    QDD05QD  110
    0.00
    40.80
    40.80
    1.55
    QDD
    From surface, Hole lostincluding
    20.40
    40.80
    20.40
    2.36
    QDD05QD  111
    0.00
    71.75
    71.75
    2.08
    QDD
    From surface, Hole lost


21

---

Hole
      Interval (m)
      Width(m)
      Au (g/t)
      Area
      CommentsFrom
      Toincluding
    29.10
    31.78
    2.68
    7.94
    QDD34.62
    44.74
    10.12
    5.28
    QDD59.43
    63.43
    4.00
    4.07
    QDD05QD  112
    0.00
    110.65
    110.65
    1.75
    QDD
    From surfaceincluding
    31.40
    75.50
    44.10
    3.31
    QDDincluding
    43.33
    51.34
    8.01
    6.82
    QDD05QD  113
    0.00
    143.75
    143.75
    0.64
    QDD
    From surfaceincluding
    0.00
    32.20
    32.20
    1.26
    QDD05QD  114
    0.00
    104.50
    104.50
    0.57
    QDD
    From surfaceIncluding
    0.00
    19.40
    19.40
    1.08
    QDD05QD  115
    0.00
    225.25
    225.25
    0.70
    QDD
    From surfaceIncluding
    0.00
    80.60
    80.60
    1.10
    QDD05QD  116
    0.00
    104.30
    104.30
    0.70
    QDD
    From surfaceIncluding
    0.00
    16.00
    16.00
    1.24
    QDD05QD  117
    0.00
    141.50
    141.50
    0.59
    QDD
    From surface, hole ended in mineralizationIncluding
    0.00
    17.30
    17.30
    1.33
    QDD05QD  118
    0.00
    89.35
    89.35
    0.73
    QDD
    From surface, holeended in mineralizationIncluding
    0.00
    17.53
    17.53
    1.14
    QDD76.72
    89.35
    12.63
    1.21
    QDD05QD  119
    0.00
    214.05
    214.05
    1.39
    QDD
    From surfaceIncluding
    0.00
    84.00
    84.00
    2.35
    QDDIncluding
    3.02
    54.62
    51.60
    3.04
    QDD05QD  120
    0.00
    46.10
    46.10
    1.55
    QDD
    From surfaceIncluding
    0.00
    14.35
    14.35
    3.46
    QDD05QD  121
    0.00
    92.30
    92.30
    0.98
    QDD
    From surface, hole ended in mineralizationIncluding
    0.00
    21.10
    21.10
    2.07
    QDD05QD  122
    6.90
    77.50
    70.60
    0.82
    QDDIncluding
    36.80
    77.50
    40.70
    1.04
    QDD05QD  123
    0.00
    70.40
    70.40
    2.70
    QDD
    From surfaceIncluding
    19.29
    51.60
    32.31
    4.64
    QDDIncluding
    39.87
    49.65
    9.78
    7.50
    QDD05QD  124
    1.90
    47.75
    45.85
    0.55
    QDDIncluding
    8.85
    18.85
    10.00
    1.16
    QDD05QD  125
    0.00
    77.65
    77.65
    0.68
    QDD
    From surfaceIncluding
    2.00
    19.46
    17.46
    1.15
    QDD05QD  127
    0.00
    79.30
    79.30
    1.42
    QDD
    From surfaceIncluding
    13.83
    17.50
    3.67
    5.39
    QDD


22

---

Hole  Interval (m)
      Width (m)
      Au(g/t)
      Area
      CommentsFrom
      To61.75
    75.40
    13.65
    3.20
    QDD05QD  128
    0.00
    60.10
    60.10
    0.70
    QDD
    From surfaceIncluding
    45.10
    52.10
    7.00
    1.61
    QDD05QD  129
    0.00
    20.80
    20.80
    0.56
    Infill52.50
    57.10
    4.60
    0.9190.30
    95.60
    5.30
    0.5705QD  131
    0.00
    68.60
    68.60
    1.03
    InfillIncluding
    24.95
    48.95
    24.00
    1.4705QD  132
    110.30
    279.80
    169.50
    0.77
    Geotech (QDD Main)
    Hole lost in karst cavityIncluding
    218.30
    279.80
    61.50
    1.4305QD  133
    96.60
    99.80
    3.20
    0.71
    QDD west05QD  134
    4.00
    16.00
    12.00
    1.07
    Geotech (QDD Main)128.80
    165.90
    37.10
    0.50216.80
    220.80
    4.00
    0.8005QD  135
    23.00
    27.00
    4.00
    0.56
    QDD West05QD  136
    30.00
    153.30
    123.30
    0.68
    Geotech (QDD Main)106.38
    150.10
    43.72
    1.04117.00
    135.40
    18.40
    1.4305QD  137
    105.06
    145.35
    40.29
    1.09
    QDD WestIncluding
    119.18
    127.00
    7.82
    1.6705QD  139
    94.78
    98.85
    4.07
    0.78
    QDD West123.45
    141.35
    17.90
    0.7205QD  141
    69.95
    131.40
    61.45
    0.76
    QDD WestIncluding
    93.60
    113.30
    19.70
    1.3205QD  142
    125.01
    178.53
    53.52
    1.14
    QDD WestIncluding
    156.70
    163.40
    6.70
    4.4205QD  143
    0.00
    67.70
    67.70
    0.50
    QDD West106.15
    161.08
    54.93
    0.66Including
    128.30
    158.88
    30.58
    0.97220.15
    226.25
    6.10
    1.9005QD  144
    120.90
    150.73
    29.83
    0.56
    QDD Main202.75
    320.32
    117.57
    0.74
    InfillIncluding
    230.50
    270.50
    40.00
    1.0605QD  145
    no significant intervals
    
    QDD West05QD  147
    15.10
    17.70
    2.60
    2.11
    QDD West25.78
    27.80
    2.02
    2.5884.10
    92.45
    8.35
    1.13146.50
    208.90
    62.40
    0.95Including
    160.50
    188.91
    28.41
    1.27


23

---

Hole  Interval (m)
      Width(m)
      Au (g/t)
      Area
      CommentsFrom
      To05QD  149
    112.50
    177.00
    64.50
    0.65
    QDD WestIncluding
    112.50
    126.40
    13.90
    1.17Including
    167.05
    177.00
    9.95
    1.2405QD  151
    0.00
    8.00
    8.00
    0.64
    QDD West98.50
    105.27
    6.77
    0.96178.15
    184.18
    6.03
    0.72253.5
    255.50
    2.00
    1.6405QD  153
    43.85
    190.00
    146.15
    1.24
    QDD WestIncluding
    100.60
    158.10
    57.50
    2.1905QD  126
    0.00
    50.15
    50.15
    0.78
    QDD Main (Infill)Including
    0.00
    16.40
    16.40
    1.1481.91
    91.91
    10.00
    0.7005QDR  154
    326.00
    358.00
    32.00
    0.36
    Target 905QD  155
    62.42
    78.66
    16.24
    0.63
    QDD WestIncluding
    95.58
    167.00
    71.42
    1.24Including
    124.65
    132.70
    8.05
    2.49Including
    143.40
    161.00
    17.60
    2.4405QD  156
    0.00
    2.00
    2.00
    0.31
    Target D6.00
    10.00
    4.00
    0.96222.50
    224.50
    2.00
    0.34273.70
    275.45
    1.75
    0.4405QD  157
    no significant intervals
    
    Target 905QD  158
    4.00
    6.20
    2.20
    0.63
    Target D59.10
    60.88
    1.78
    0.88117.90
    119.90
    2.00
    1.46145.45
    149.40
    3.95
    0.56209.48
    215.40
    5.92
    0.53340.15
    346.00
    5.85
    0.7905QD  159
    55.30
    57.30
    2.00
    0.39
    Target D200.20
    204.10
    3.90
    0.88211.90
    213.85
    1.95
    0.38248.09
    249.43
    1.34
    0.3405QD  160
    27.74
    63.23
    35.49
    0.56
    QDD WestIncluding
    35.71
    44.75
    9.00
    1.0477.00
    126.33
    49.33
    0.74Including
    94.79
    98.49
    3.70
    1.60Including
    106.20
    112.20
    6.00
    1.66156.04
    165.50
    9.46
    1.80


24

---

Hole
      Interval (m)
      Width
        (m)
      Au (g/t)
      Area
      CommentsFrom
      To05QD  161
    59.31
    61.31
    2.00
    1.13
    QDD West71.35
    73.30
    1.95
    0.51112.00
    131.20
    19.20
    0.43162.15
    164.15
    2.00
    0.5005QD  162
    9.36
    12.32
    2.96
    2.65
    QDD Main (Infill)58.55
    67.99
    9.44
    0.60Including
    65.99
    67.99
    2.00
    1.60164.40
    168.70
    4.30
    1.14Including
    191.25
    299.50
    108.25
    1.15Including
    191.25
    194.49
    3.24
    2.44Including
    229.49
    233.65
    4.16
    2.58Including
    263.50
    297.80
    34.30
    1.88Including
    289.85
    296.30
    6.45
    4.71Including
    294.43
    296.30
    1.87
    10.77397.50
    472.00
    74.50
    0.7505QD  163
    93.10
    94.40
    1.30
    7.43
    QDD West102.35
    106.30
    3.95
    0.82118.30
    172.30
    54.00
    1.30190.45
    194.46
    4.01
    1.1905QD  164
    16.30
    18.30
    2.00
    0.76
    QDD West05QD  165
    75.60
    82.35
    6.75
    0.47
    QDD West05QDR  166A
    4.00
    18.00
    14.00
    2.05
    Target K
    Hole LostIncluding
    16.00
    18.00
    2.00
    6.6905QDR  166
    260.00
    270.00
    10.00
    0.74
    Target K304.00
    320.00
    16.00
    0.3305QDR 167
    226.00
    248.00
    22.00
    1.61
    Target KIncluding
    226.00
    232.00
    6.00
    2.99Including
    244.00
    246.00
    2.00
    4.05272.00
    274.00
    2.00
    0.93314.00
    344.00
    30.00
    0.4905QDR  168A
    14.00
    16.00
    2.00
    1.08
    Target K
    Hole Lost05QDR  168
    8.00
    24.00
    16.00
    1.34
    Target KIncluding
    16.00
    18.00
    2.00
    4.5784.00
    90.00
    6.00
    0.60134.00
    144.00
    10.00
    0.5805QDR  169
    0.00
    20.00
    20.00
    0.65
    Target K160.00
    164.00
    4.00
    0.58318.00
    328.00
    10.00
    0.54


25

---

Hole
      Interval (m)
      Width (m)
      Au(g/t)
      Area
      CommentsFrom
      To05QD  170
    157.61
    181.07
    23.46
    0.83
    QDD Main (Infill)246.20
    279.80
    33.60
    0.46307.64
    323.50
    15.86
    0.63394.31
    396.12
    1.81
    2.1105QD  172
    14.30
    18.05
    3.75
    0.56
    QDD West109.00
    169.25
    60.25
    1.32Including
    162.19
    167.25
    5.06
    3.3105QD  174
    0.00
    33.15
    33.15
    0.37
    QDD West45.05
    137.30
    92.25
    0.7005QD  175
    0.00
    62.80
    62.80
    1.07
    QDD WestIncluding
    0.00
    4.20
    4.2
    1.9945.70
    57.40
    11.70
    2.0305QDR  176
    16.00
    38.00
    22.00
    1.11
    Amelia Inés (west)05QDR  177
    98.00
    112.00
    14.00
    2.27
    MagdalenaIncluding
    108.00
    110.00
    2.00
    8.2705QDR  178
    0.00
    38.00
    38.00
    1.06
    MagdalenaIncluding
    0.00
    12.00
    12.00
    1.48114.00
    186.00
    72.00
    0.74216.00
    256.00
    40.00
    2.53Including
    232.00
    256.00
    24.00
    3.66Including
    242.00
    246.00
    4.00
    6.9605QD  179
    0.00
    34.60
    34.60
    0.84
    Amelia InésIncluding
    25.41
    32.60
    7.19
    2.3205QDR  182
    50.00
    62.00
    12.00
    4.91
    QDD WestIncluding
    56.00
    60.00
    4.00
    13.6570.00
    108.00
    38.00
    2.00Including
    86.00
    108.00
    22.00
    3.01Including
    100.00
    102.00
    2.00
    11.4705QD  173
    0.00
    16.0
    16.0
    0.48
    QDD WestIncluding
    10.00
    11.6
    1.6
    1.6526.0
    36.0
    10.0
    0.6275.5
    95.2
    19.7
    0.54Including
    77.5
    79.3
    1.8
    1.3005QD  180
    7.1
    8.0
    0.9
    1.79
    Amelia Inés11.4
    13.5
    2.1
    0.4415.5
    17.5
    2.0
    0.5828.7
    32.5
    3.8
    7.45


26

---

Hole
      Interval (m)
      Width(m)
      Au(g/t)
      Area
      CommentsFrom
      ToIncluding
    28.7
    29.7
    1.0
    16.1045.1
    60.2
    15.1
    0.74Including
    58.6
    60.2
    1.6
    4.3669.3
    97.1
    27.8
    0.72Including
    86.9
    89.0
    2.1
    2.68Including
    95.5
    97.1
    1.6
    2.19104.3
    107.2
    2.9
    0.5505QDR  184
    52.0
    102.0
    50.0
    1.58
    Target AIncluding
    52.0
    54.0
    2.0
    11.83Including
    60.0
    66.0
    6.0
    3.77Including
    74.0
    78.0
    4.0
    2.8805QD  185
    no significant intervals
    
    Magdalena05QDR  186
    0.0
    36.0
    36.0
    1.75
    QDD WestIncluding
    4.0
    18.0
    14.0
    3.0942.0
    84.0
    42.0
    0.4005QDR  187
    0.0
    44.0
    44.0
    0.78
    QDD WestIncluding
    0.0
    14.0
    14.0
    1.6666.0
    68.0
    2.0
    2.3892.0
    106.0
    14.0
    0.4805QD  188
    35.87
    37.47
    1.6
    0.44
    Magdalena05QDR  189
    0.00
    44.0
    44.0
    0.52
    QDD West54.0
    72.0
    18.0
    0.44104.0
    156.0
    52.0
    0.62Including
    142.0
    144.0
    2.0
    3.0005QDR  190
    0.0
    36.0
    36.0
    0.67
    QDD Main (Ptz Blanco)Including
    0.0
    8.0
    8.0
    1.0790.0
    96.0
    6.0
    1.77104.0
    140.0
    36.0
    0.64Including
    118.0
    122.0
    4.0
    1.50154.0
    162.0
    8.0
    0.5405QDR  191
    0.0
    2.0
    2.0
    0.34
    QDD Main (Ptz Blanco)18.0
    26.0
    8.0
    1.93Including
    18.0
    20.0
    2.0
    4.8942.0
    46.0
    4.0
    0.6480.0
    82.0
    2.0
    1.0994.0
    102.0
    8.0
    0.6505QDR  192
    6.0
    12.0
    6.0
    1.45
    QDD Main


27

---

Hole
      Interval (m)
      Width(m)
      Au(g/t)
      Area
      CommentsFrom
      To(Ptz Blanco)24.0
    28.0
    4.0
    4.3138.0
    42.0
    4.0
    0.4456.0
    66.0
    10.0
    1.0905QDR  194
    10.0
    38.0
    28.0
    3.49
    QDD Main (Ptz Blanco)Including
    24.0
    26.0
    2.0
    7.93Including
    36.0
    38.0
    2.0
    31.0966.0
    68.0
    2.0
    1.10100.0
    106.0
    6.0
    3.64174.0
    212.0
    38.0
    0.52280.0
    288.0
    8.0
    0.4505QD  195
    100.0
    120.0
    20.0
    0.43
    QDD MainIncluding
    118.0
    120.0
    2.0
    1.54132.0
    138.0
    6.0
    0.81148.0
    182.0
    34.0
    0.91203.4
    261.5
    58.1
    0.87Including
    246.9
    252.2
    5.3
    2.68Including
    259.6
    261.5
    1.9
    2.1405QDR  196
    16.0
    42.0
    26.0
    9.18
    QDD Main (Ptz Blanco)Including
    18.0
    26.0
    8.0
    10.68Including
    32.0
    34.0
    2.0
    8.08Including
    36.0
    38.0
    2.0
    16.9662.0
    70.0
    8.0
    1.19Including
    68.0
    70.0
    2.0
    3.3382.0
    92.0
    10.0
    2.42Including
    90.0
    92.0
    2.0
    7.47112.0
    114.0
    2.0
    2.53Including
    134.0
    282.0
    148.0
    1.39
    
    Hole ended in mineralization at
      1.5 g/t AuIncluding
    144.0
    154.0
    10.0
    2.10166.0
    202.0
    36.0
    2.5505QDR  197
    34.0
    40.0
    6.0
    26.74
    Tunnel DIncluding
    38.0
    40.0
    2.0
    77.8605QDR  198
    no significant intervals
    
    QDD West05QDR  199
    32.00
    36.00
    4.00
    1.14
    QDD West05QD  202
    95.20
    96.35
    1.15
    2.49
    Magdalena05QDR  203
    0.00
    108.00
    108.00
    0.72
    QDD West


28

---

Hole
      Interval (m)
      Width (m)
      Au (g/t)
      Area
      CommentsFrom
      ToIncluding
    2.00
    36.00
    34.00
    1.3105QD  205
    10.20
    15.90
    5.70
    0.40
    Ptz Blanco31.80
    33.90
    2.10
    0.9041.22
    99.70
    58.48
    0.67Including
    65.20
    83.35
    18.15
    1.1305QD  206
    39.22
    51.90
    12.68
    0.88
    Magdalena57.25
    58.90
    1.65
    2.0805QD  207
    47.20
    65.98
    18.78
    0.57
    MagdalenaIncluding
    52.25
    54.60
    2.35
    2.02135.86
    151.60
    15.74
    1.19Including
    141.41
    142.95
    1.54
    7.6505QD  208
    32.46
    34.46
    2.00
    4.44
    Ptz Blanco53.30
    70.80
    17.50
    4.83Including
    55.10
    66.50
    11.40
    6.7591.23
    110.10
    18.87
    1.18Including
    103.80
    108.00
    4.20
    3.89125.75
    132.02
    6.27
    2.11190.50
    259.88
    69.38
    1.53Including
    201.72
    225.90
    24.18
    1.98Including
    227.90
    247.90
    20.00
    2.3205QD  209
    38.22
    55.82
    17.60
    0.91
    Magdalena05QD  210
    32.25
    62.35
    30.10
    1.01
    Ptz BlancoIncluding
    34.25
    40.20
    5.95
    1.9305QD  21
    65.80
    108.90
    43.10
    2.44
    MagdalenaIncluding
    80.60
    101.90
    21.30
    4.1605QDR  213
    16.00
    36.00
    20.00
    1.69
    Ptz BlancoIncluding
    16.00
    28.00
    12.00
    2.65Including
    22.00
    24.00
    2.00
    11.7152.00
    54.00
    2.00
    6.44168.00
    228.00
    60.00
    1.33Including
    178.00
    218.00
    40.00
    1.7105QD  214
    3.95
    105.15
    101.20
    1.18
    Ptz BlancoIncluding
    3.95
    37.21
    33.26
    2.2605QDR  216
    no significant intervals
    
    Q. Lagarto05QD  217
    7.80
    24.85
    17.05
    3.17
    Target 3DIncluding
    16.80
    22.80
    6.00
    8.27Including
    20.80
    22.80
    2.00
    15.8537.59
    43.35
    5.76
    0.7075.80
    86.05
    10.25
    1.56


29

---

Hole
      Interval (m)
      Width(m)
      Au (g/t)
      Area
      CommentsFrom
      To05QD  218
    0.00
    58.20
    58.20
    0.73
    Ptz BlancoIncluding
    30.85
    48.51
    17.66
    1.1205QDR  219
    no significant intervals
    
    Q. Lagarto05QDR  220
    no significant intervals
    
    Q. Lagarto05QDR  221
    34.00
    36.00
    2.00
    0.49
    Magdalena46.00
    50.00
    4.00
    0.5458.00
    60.00
    2.00
    0.5084.00
    88.00
    4.00
    0.6405QD  222
    0.00
    9.25
    9.25
    2.34
    Ptz Blanco05QDR  223
    8.00
    10.00
    2.00
    0.88
    Magdalena56.00
    64.00
    8.00
    0.7680.00
    82.00
    2.00
    1.0290.00
    102.00
    12.00
    4.57Including
    94.00
    98.00
    4.00
    7.72138.00
    144.00
    6.00
    0.7205QD  224
    0.00
    7.73
    7.73
    0.91
    Ptz Blanco23.32
    27.73
    4.41
    1.4667.96
    100.30
    32.34
    1.46Including
    67.96
    74.32
    6.36
    2.65108.30
    120.80
    12.50
    0.4805QDR  225
    no significant intervals
    
    QDD West05QDR  226
    92.00
    94.00
    2.00
    0.97
    QDD West116.00
    120.00
    4.00
    1.32164.00
    166.00
    2.00
    1.95194.00
    198.00
    4.00
    1.3105QD  227
    0.00
    14.63
    14.63
    3.00
    Ptz BlancoIncluding
    10.40
    14.63
    4.23
    6.0605QDR  228
    0.00
    36.00
    36.00
    0.57
    QDD74.00
    132.00
    58.00
    0.87Including
    76.00
    88.00
    12.00
    1.04Including
    100.00
    110.00
    10.00
    1.08Including
    118.00
    132.00
    14.00
    1.3605QDR  229
    0.00
    48.00
    48.00
    0.73
    QDDIncluding
    26.00
    36.00
    10.00
    1.6705QDR  230
    0.00
    22.00
    22.00
    0.56
    QDD36.00
    44.00
    8.00
    1.59132.00
    142.00
    10.00
    1.19


30

---

The Phase Two drill program confirmed the western extension of
the main QDD deposit, which remains open to the west towards the Amelia Inés
zone, and confirmed the existence of a high grade, near surface zone along the
eastern edge of the QDD deposit in an area called Puertozuelo Blanco (Ptz
Blanco). Exploration drilling 200 m west from the Magdalena zone, called Target
3D, intersected a new zone of mineralization which will require additional
drilling to define its extent. Based on the results of the above drilling
program, the Company plans to continue infill and exploration drilling in and
around the main QDD zone and the Amelia Inés and Magdalena zones and Target 3D
zones.

Continuous chip samples above the new Ptz Blanco road in the
QDD main zone returned significant values as follows:

Rock Chip SamplesLocation
      Au (g/t)
      Sample Interval (m)Ptz. Blanco Lower Road
    3.68
    68.85Ptz. Blanco Lower Road
    3.40
    50.00Ptz. Blanco Lower Road
    0.92
    17.35


Exploration to date has defined two distinct styles of
mineralization of economic interest. They are:

- Sediment-hosted distal-disseminated gold mineralization (QDD)
- Sulphide-bearing skarn deposits containing copper zinc and molybdenum with
  late stage gold- arsenic mineralization (Amelia Inés and Magdalena).

Gold mineralization at QDD occurs in carbonate sediments within
conformable and discordant carbonate breccias and fractured limestone. The gold
mineralization is related to a hydrothermal event overprinting the proximal
skarns and extending into the surrounding marbles and limestones. The QDD canyon
itself lies along a fault/dyke system which is believed to be the primary
conduit for hydrothermal fluids migrating away from the intrusive contacts. The
mineralizing fluids were then dispersed into the receptive limestone aquifers
immediately above the marble contact traveling up dip following the hydraulic
gradient. The permeability was provided by the east-west faulting, tectonic
brecciation along fold hinges and stylolite formation during transpressional
wrench faulting. Pre-mineral karst development may also have played a roll in
gold deposition along with hydrothermal karst caused by the fluid injection.

Alteration of the host rocks is minimal and sulfide content is
low. Gold, sulfides (arsenopyrite), realgar, orpiment, pyrite and calcite are
deposited along fractures and as matrix fillings. Higher gold values are
spatially related to intrusive breccia. The mineralized structures are strongly
oxidized throughout the depth of drilling, except for minor unoxidized intervals
in which the primary mineralization is preserved.

At Amelia Inés and Magdalena, skarn mineralization comprised of
chalcopyrite, sphalerite, galena, pyrhotite and pyrite was deposited as a
retrograde event preceding the introduction of the gold-arsenic mineralization.

Drill and saw-cut channel results from the Phase One program in
2004 were used as the basis of a revised resource estimate by Simpson (Simpson,
2004), the results of which are presented under the Section Resources.

31

---

Resources

United States Investors are Referred to the Cautionary
      Note to United States Investors Concerning Estimates of Measured,
      Indicated and Inferred Resources set forth in the Introductory
      Notes to this Annual Information Form.


Based on drilling conducted up to August 2004, a current
resource estimate for the QDD, Amelia Inés and Magdalena zones was prepared by
Simpson, in a NI 43-101 compliant Technical Report by GeoSim Services Inc. dated
December 8, 2004 (Simpson, 2004). All mineral resource estimates are reported
using a cutoff grade of 0.5 g/t Au; summaries of the resource estimates are
presented in the tables below.

A preliminary recovery model based on 4 column tests and 279
bottle roll tests indicates over 80% recoveries for gold from oxide material
which comprises approximately 90% of the resource.

Current resource estimate for the QDD Deposit

Resource Category
      Tonnes (000s)
      Grade Au (g/t)
      Contained ounces(1)Au (000s)Measured Indicated Measured +
      Indicated Inferred
    4,495 32,586 37,081
      11,323
    1.10 1.03 1.04
      1.20
    159 1,077 1,236
      435


Current resource estimate for the Amelia Inés Deposit

Resource Category
      Tonnes(000s)
      Grade Au (g/t)
      Contained ounces(1)Au(000s)Measured Indicated Measured +
      Indicated Inferred
    203 1,910 2,114
      383
    3.12 2.79 2.82
      1.95
    20 171 192 24


Current resource estimate for the Magdalena Deposit

Resource Category
      Tonnes(000s)
      Grade Au (g/t)
      Contained ounces(1)Au (000s)Inferred
    2,526
    1.87
    151


Regional Exploration

Pirrotina and Pirrotina Norte

Mapping and sampling in the Pirrotina and Pirrotina Norte
target areas have returned encouraging values and identified an extensive
alteration system within Trapiche clastic sediments which overlie the favorable
San Juan carbonates that host the QDD deposit. In the Pirrotina Norte target
massive pyrrhotite mineralization in outcrop and boulders have returned values
of 2.6 g/t Au and 2.9 g/t Au and have associated metals that are indicative of a
reduced skarn type of gold deposit. Table 1 below indicates the significant
values returned from this area. The recently completed airborne magnetic survey
will assist in

32

---

defining drill targets on this mineralization. The location is
accessible for drilling with only limited road building required.

Table 1

Sample #
    UTM
      E
    UTM
      N
    Au
      ppb*
    Type17-1525
    2532216
    6715011
    2960
    Rock43-0400
    2532173
    6715101
    1200
    Rock17-1347
    2532258
    6715205
    1480
    Float17-1348
    2532197
    6715012
    990
    Rock17-1294
    2532293
    6715025
    2560
    Float45-173
    2532491
    6715085
    2450
    Rock45-167
    2532255
    6714590
    3320
    Rock17-1676
    2532217
    6715015
    1580
    Rock


*1000ppb =1g/t

Mina San Jose

At the Mina San Jose target gold values as high as 27.4 gpt and
10.3 gpt have been obtained from east-west striking fractures and shear zones
cutting clastic sediments and porphyry. Recent mapping and sampling (see Table 2
below) indicate that the gold-bearing structures occur within an area that is at
least 400 m by 200 m. The Company is awaiting results of additional sampling
and, subject to the results, construction of road access will commence. The area
will require about one km of new road to obtain drill access.

Table 2

Sample #
    UTM
      E
    UTM
      N
    Au
      ppb*
    Type43-0343
    2530159
    6714607
    8740
    Rock43-0359
    2530049
    6714677
    3160
    Rock17-1439
    2530122
    6714432
    27430
    Rock17-1437
    2530026
    6714532
    10310
    Rock44-0275
    2530103
    6714430
    1770
    Rock17-1380
    2530019
    6714448
    3250
    Rock42-0212
    2530034
    6714653
    2000
    Rock42-0213
    2529964
    6714680
    2230
    Rock42-211
    2530066
    6714769
    520
    Rock17-1658
    2530080
    6714759
    780
    Rock


*1000ppb =1g/t

Quebrada Perdida

Gold values of up to 4.62 gpt have been obtained from silt
samples taken along the 1.5 km length of Quebrada Perdida. A recent follow-up
mapping and sampling program identified argillically altered porphyry and
clastic sediments with gold values of up to 5.99 gpt. Table 3 below indicates
the significant values returned from this area. A program of detailed rock and
silt sampling is underway to further define the target.

33

---

Table 3

Sample #
    UTM
      E
    UTM
      N
    Au
      ppb*
    Type25-014
    2528837
    6713191
    798
    Silt25-016
    2528731
    6712974
    529
    Silt17-1626
    2528433
    6712774
    4620
    Silt25-013
    2528970
    6713300
    1334
    Silt10-355
    2528418
    6712759
    1515
    Silt45-001
    2529072
    6713263
    2960
    Rock45-002
    2529075
    6713264
    5990
    Rock17-1406
    2529325
    6713407
    1030
    Rock17-1422
    2529040
    6713302
    1590
    Rock17-1427
    2529417
    6713238
    1100
    Rock6-1615
    2529034
    6713196
    1649
    Rock


*1000ppb =1g/t

Quebrada Finada

Quebrada Finada is located 2.5 km east of the currently defined
boundaries of the QDD deposit. Anomalous gold values obtained from rock samples
(see Table 4 below) taken from the Quebrada Finada may be indicative of an
eastward continuation of gold mineralization along the broad WNW trending
structural corridor 20 km in strike length that incorporates the Gualcamayo
Property. This hypothesis will be tested by additional sampling.

Table 4

Sample #
    UTM
      E
    UTM
      N
    Au
      ppb*
    Type17-1584
    2537208
    6714154
    1420
    Rock17-1596
    2536836
    6714536
    1750
    Rock17-1598
    2536822
    6714531
    190
    Rock43-423
    2537201
    6714174
    270
    Rock35-046
    2537755
    6715006
    510
    Rock35-047
    2537902
    6715090
    530
    Rock


*1000ppb =1g/t

Proposed Activities

The following outlines the Companys proposed activities for
the next 18 months:

- Apply results of Phase Two program to update the resource calculations and
  Preliminary Ecomonic Assessment in terms of NI 43-101;
- complete additional engineering studies of the Gualcamayo gold resource;
- complete a detailed Feasibility Study;
- complete all work leading to an Environmental Impact Statement (EIS); and
- continue with definition and exploration drilling on known resource areas
  and regional exploration on the Gualcamayo and adjacent Salamanca properties.

34

---

Environmental Protection

The Company integrates responsible environmental management
into all its exploration activities. The Company follows and implements all
regulations as defined by the Province of San Juan, and ensures that all
contractors implement these same policies.

The only permit currently required for exploration is a water
use permit.

In mid 2005, the Company commenced the base-line work required
  for the completion of an EIS to meet its planned construction and development
  schedule. This process is on-going and is expected to be completed by the third
  quarter of 2006. The Company will then submit the required EIS for review by
  the provincial authorities in order to obtain the necessary permits for construction
  and operation of a mine.

Social and Environmental Policies

The Company recognizes that it has a responsibility to the
community in which it operates and has worked diligently to be a good corporate
citizen. The Company understands that it must establish and maintain open
dialogue with local communities regarding the project and its ongoing
development. In that regard the Company has opened an office in Jachal some 60
km south of the project which it intends to use as an information centre. An
office is also planned in the town of Guandacol, 25 km north of the project.

In addition, the Company policy is to hire from the local
communities to assist in the exploration program and to provide goods and
services for the project. This has provided a benefit to the community and also
assisted in disseminating information about the project development throughout
the community.

Other Properties

The Company has four other properties as follows:

Las Flechas Property

Property Description and Location

The Las Flechas Property is located in the High Andes of
northwest San Juan Province, Argentina, approximately 330 km northwest of the
provincial capital of San Juan. The non-contiguous property is comprised of
eight Cateos and 53 Minascovering 35,600 hectares.

Ownership

The Las Flechas Property is owned 100% by MASA, subject to
royalties described herein.

Agreements and Royalties

The property is the subject of a Joint Venture Agreement among
Viceroy, MASA, and Deprominsa. Under the terms of the agreement, Deprominsa
holds an option to acquire a one-time 75% undivided interest in the Las Flechas
Property. To maintain the option in full force Deprominsa shall fund
expenditures on the property in the aggregate amount of US$ 4,500,000 over a
five year period. The Agreement is in its second year and Deprominsa has met its
obligations to date.

35

---

Royalties on the property are as follows:

| | 1) | a 1% NSR on production from the property is payable to
      IMA;                          
| | -- | -------------------------------------------------------------------------------------------
| |    |                                                                                            
| | 2) | a Provincial Royalty of up to 3% payable to the Province
      of San Juan upon production.

We are unaware of any additional royalties, overrides, back-in
rights or encumbrances that affect the property.

Environmental Legislation

A Prospecting Stage Environmental Impact Report has been
submitted by Deprominsa to the EPMU, of the San Juan Department of Mines and is
currently being evaluated.

Current Work

Exploration activities by Deprominsa at Las Flechas were initiated
  in late 2004. This work, which consists of regional geological mapping and sampling,
  is currently ongoing. Trenching is planned prior to the end of the current field
  program, with a goal of delineating drill targets for the 2006/07 field season,
  if warranted.

Mineralization

The Las Flechas Property is underlain by Tertiary volcanics and
subvolcanics that have been variably altered by widespread hydrothermal
alteration. The volcanic sequence consists of intermediate composition flows and
porphyries overlain by intermediate to felsic composition tuffs and ignimbrites.
The volcanics have been intruded by quartz-feldspar porphyries that appear to be
associated with major structures.

ASTER (Advanced Spaceborne Thermal Emission and Reflection
Radiometer) satellite imagery and subsequent field work has identified the
presence of broad zones of argillic alteration and silicification in several
zones on the property. Geological mapping has identified the presence of high
sulphidation epithermal alteration and mineralization associated with porphyry
domes.

Salamanca Property

Property Description and Location

The Salamanca Property is located directly north of the
Gualcamayo Property, on the border between San Juan and La Rioja Provinces and
approximately 230 km north of the city of San Juan. The property is comprised of
a single contiguous block containing nine Minas and four Cateos,covering 32,200 hectares.

Ownership

The Salamanca Property is owned 100% by MASA, subject to
royalties described herein.

36

---

Agreements and Royalties

The property is not the subject of any existing or proposed
options, joint ventures or other agreements. Royalties on the property are as
follows:

| | 1. | a 1% NSR on production from the property is payable to
      IMA,                                                                                                    
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                      
| | 2. | a 1% NSR capped at US$800,000 payable to the Ridao
      Brothers on production from the Cerro Corral No. 1, 2, 3, 7 and 8 and Los
      Sapitos Norte Minas;        
| |    |                                                                                                                                                                      
| | 3. | a Provincial Royalty of up to 3% payable to the Province
      of San Juan upon production. Presently, this royalty does not apply to the
      Province of La Rioja.

We are unaware of any additional royalties, overrides, back-in
rights or encumbrances that affect the property.

Environmental Legislation

During 2005, three exploration stage Environment Impact Reports
were submitted to the EPMU of the La Rioja Department of Mines, all of which are
currently being reviewed.

Current Work

A thorough review of the Salamanca target, including the
historical drilling records and new sampling and geological mapping, indicates a
structurally controlled target with a minimum strike length of 1100 meters. Gold
values from historical drill holes by Viceroy Resources include 36.4 m of 2.15
gpt (S96-4), 41 m of 1.8 gpt (S97-3) and 69.9 m of 1.8 gpt (S97-5). Gold-bearing
mineralization is hosted in Tertiary age clastic sediments and Paleozoic
carbonates that are in contact along a thrust fault. Mapping and drill hole data
indicate that the clastic sediments underlying the carbonates are the preferred
host. With this model as a guide, the strike length and depth of the mineralized
zone will be further tested in 2006.

Mineralization

The mapping, sampling and drilling completed by Mincorp and
MASA have defined a potential mineralized zone along a north-northwest dipping
thrust fault extending approximately 600 m along strike and with a thickness
between 40 and 55 m. This zone appears to be open along strike and at depth.

Evelina Property

Property Description and Location

The Evelina Property is located in the High Andes, in northwest
San Juan Province, Argentina, approximately 210 km northwest of the provincial
capital of San Juan. The contiguous property is comprised of one Cateo
and three Minas; namely the Evelina Cateoand the Gabriela 1, 2
and 3 Minas. The Gabriela 1 and 2 Minas lie within the Evelina
Cateo covering 3,900 hectares.

Ownership

The Evelina Property is owned 100% by MASA, subject to the
royalties described herein.

37

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Agreements and Royalties

The property is not the subject of any existing or proposed
options, joint ventures or other agreements. Royalties on the property are as
follows:

| | 1) | a 1% NSR on production from the property is payable to
      IMA;                          
| | -- | -------------------------------------------------------------------------------------------
| |    |                                                                                            
| | 2) | a Provincial Royalty of up to 3% payable to the Province
      of San Juan upon production.

We are unaware of any additional royalties, overrides, back-in
rights or encumbrances that affect the property.

Environmental Legislation

A Prospecting Stage Environmental Impact Report was submitted
in January 2005 to the EPMU of the San Juan Department of Mines and is in the
process of being reviewed.

Current Work

The Company reviewed the results of work done in 1995  2000 by
a previous joint venture partner and determined that the property merited
further work. The project is a high sulphidization system similar to Veladero. A
limited campaign of surface sampling and mapping was completed in early February
2006 and, once results are obtained and analyzed, the Company will decide on the
next phase of work for this season.

Mineralization

The property is underlain by relatively flat-lying tuffs and
pyroclastic deposits cut by black porphyry and polymictic magmatic hydrothermal
breccia. Three types of mineralization have been mapped on the property; these
consist of east-west trending zones of structurally controlled silicified veins,
brecciated and banded veins and structures containing vuggy silica hosted within
rhyodacitic to dacitic composition porphyry. Telescoped high and low
sulphidation epithermal systems are interpreted to occur on the Evelina
Property.

La Brea/Las Carachas Property

Property Description and Location

The La Brea/Las Carachas Property covers approximately 8,500
hectares and is located in the High Andes, in northwest San Juan Province,
Argentina, approximately 320 km northwest of the provincial capital of San Juan.
The property is comprised of two non-contiguous blocks. The northern block,
known as the La Brea block is comprised of one Cateo which includes three
Minas. The southern block, known as the Las Carachas block comprises one
Cateoand eight Minas, which lie wholly within the Cateo.

Ownership

The La Brea/Las Carachas Property is owned 100% by MASA,
subject to the royalties described herein.

38

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Agreements and Royalties

The property is not the subject of any existing or proposed
options, joint ventures or other agreements. Royalties on the property are as
follows:

| | 1) | a 1% NSR on production from the property is payable to
      IMA;                          
| | -- | -------------------------------------------------------------------------------------------
| |    |                                                                                            
| | 2) | a Provincial Royalty of up to 3% payable to the Province
      of San Juan upon production.

We are unaware of any additional royalties, overrides, back-in
rights or encumbrances that affect the property.

Environmental Legislation

An Environmental Impact Report has not yet been required to be
submitted to the EPMU, of the San Juan Department of Mines.

Current Work

There are no current field activities on the La Brea/Las
Carachas Property. MASA is currently compiling and reviewing all historical data
on the property in order to seek a joint venture partner.

Mineralization

The property is underlain by a sub-horizontal package of
Tertiary age volcanic strata consisting of a lower sequence of andesite to
dacite composition flows overlain by an upper sequence of rhyolitic to
rhyodacitic composition flows. Ignimbrites of the upper sequence and a series of
dike swarms may indicate a buried caldera structure.

The Tertiary volcanics overlie Permo-Triassic sedimentary and
granitic rocks in the La Brea block. Chloritic and argillic alteration in the
lower volcanic sequence suggests low sulphidation epithermal mineralization.

Risk Factors

In addition to the other information presented in this AIF, the
following risk factors should be considered carefully in evaluating the Company
and its business.

The Company is engaged in exploration activities which, by
their nature, are speculative due to the high risk nature of its business and
the present stage of its development. An investment in the Common Shares
involves significant risk, which should be carefully considered by prospective
investors before purchasing the Common Shares. In addition to the information
set out elsewhere or incorporated by reference in this AIF, investors should
carefully consider the risk factors set out below. Such risk factors could
materially affect the Company's future financial results and could cause events
to differ materially from those described in forward-looking statements relating
to the Company, each of which could cause investors to lose part or all of their
investments in the Common Shares of the Company.

39

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Exploration and development

Resource exploration is a speculative business and involves a
high degree of risk. There is no known body of commercial ore on the Argentine
Properties and there is no certainty that the expenditures to be made by the
Company in the exploration of the Argentine Properties or otherwise will result
in discoveries of commercial quantities of minerals. The exploration for and
development of mineral deposits involves significant risks, which even a
combination of careful evaluation, experience and knowledge may not eliminate.
Although the discovery of an ore body may result in substantial rewards, few
properties explored are ultimately developed into producing mines. Significant
expenditures may be required to locate and establish ore reserves, to develop
metallurgical processes and to construct mining and processing facilities at a
particular site. It is impossible to ensure that the current exploration
programs planned by Viceroy will result in a profitable commercial mining
operation. Significant capital investment is required to achieve commercial
production from successful exploration efforts.

The commercial viability of a mineral deposit is dependent upon
a number of factors. These include deposit attributes such as size, grade and
proximity to infrastructure, current and future metal prices (which can be
cyclical), and government regulations, including those relating to prices,
taxes, royalties, land tenure, land use, importing and exporting of minerals and
necessary supplies and environmental protection. The complete effect of these
factors, either alone or in combination, cannot be entirely predicted, and their
impact may result in Viceroy not receiving an adequate return on invested
capital.

The figures for mineral resources stated in this AIF are
estimates and no assurance can be given that the anticipated tonnages and grades
will be achieved or that the indicated level of recovery will be realized.
Market fluctuations and the prices of metals may render resources uneconomic.
Moreover, short-term operating factors relating to the mineral deposits, such as
the need for orderly development of the deposits or the processing of new or
different grades of ore, may cause a mining operation to be unprofitable in any
particular accounting period.

There is no assurance that any of the Companys mineral
properties possess commercially mineable bodies of ore

The Companys mineral projects, including the Gualcamayo
Property, are in the exploration stage as opposed to the development stage and
have no known body of economic mineralization. The known mineralization at these
projects has not been determined to be economic ore and there can be no
assurance that a commercially mineable ore body exists on any of the Companys
properties. There is no certainty that any expenditure made in the exploration
of the Companys mineral properties will result in discoveries of commercially
recoverable quantities of ore. Such assurance will require completion of final
comprehensive feasibility studies and, possibly, further associated exploration
and other work that concludes a potential mine at each of these projects is
likely to be economic. In order to carry out exploration and development
programs of any economic ore body and place it into commercial production, the
Company may be required to raise substantial additional funding.

The Mineral Resources estimates presented by Viceroy for
the Gualcamayo Property are estimates only and there is no assurance that these
resources represent economically recoverable mineralization.

Viceroy has included mineral resource estimates that have been
made in accordance with Canadian National Instrument 43-101. These resources
estimates are classified as measured resources, indicated resources and
inferred resources. Viceroy advises investors that while these terms are
recognized and required by Canadian securities regulations, the U.S. Securities
and Exchange Commission does not recognize these terms. Investors are
cautioned not to assume that any part or all of mineral deposits classified as
measured resources or indicated resources will ever be converted into
reserves.

40

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Further, inferred resources have a great amount of
uncertainty as to their existence, and economic and legal feasibility. It cannot
be assumed that all or any part of an inferred mineral resource will ever be
upgraded to a higher category. Under Canadian rules, estimates of inferred
mineral resources may not form the basis of feasibility or pre-feasibility
studies, except in rare cases. Investors are cautioned not to assume that
part or all of an inferred resource exists, or is economically or legally
mineable.

All amounts of mineral resources are estimates only, and
Viceroy cannot be certain that any specified level of recovery of metals from
the mineralized material will in fact be realized or that the Gualcamayo
Property or any other identified mineral deposit will ever qualify as a
commercially mineable (or viable) orebody that can be economically exploited.
Mineralized material, which is not mineral reserves, does not have demonstrated
economic viability. In addition, the quantity of mineral reserves and mineral
resources may vary depending on, among other things, metal prices.

As the Company does not have revenues, it will be
dependent upon future financings to continue its plan of operation

The Company has not generated any revenues from its business
activities since its incorporation. The plan of operations involves the
completion of exploration programs on its mineral properties. There is no
assurance that these exploration activities will result in the establishment of
commercially exploitable mineral deposits on the Companys mineral properties.
Even if commercially exploitable mineral deposits are discovered, the Company
may require substantial additional financing in order to carry out the full
exploration and development of its mineral properties before it is able to
achieve revenues from sales of mineral resources that it is able to extract.

If the Company is not able to raise additional financing,
there is no assurance that it will be able to complete the full exploration and
development of its mineral properties

The Company plans to proceed through feasibility to a
production decision in late 2006. Depending on the results of this study,
significant capital will be required to develop the project to production. This
may require additional financing either in the form of debt or equity or a
combination thereof. There is no assurance that any such funds will be available
should a development decision be reached. Failure to obtain any required
additional financing on a timely basis could cause the Company to reduce or
terminate its proposed plan of operations.

The Company has incurred losses and there is no assurance
that it will ever be profitable

The Company has incurred losses in the past and will continue
to experience losses unless and until it can derive sufficient revenues from its
properties. The Company has no history of earnings or of a return on investment,
and there is no assurance that any of the properties that it has or will acquire
will generate earnings, operate profitably or provide a return on investment in
the future.

Dependence on key personnel

The Companys success is highly dependent upon the performance
of key personnel working full-time in management, supervisory and administrative
capacities or as consultants, namely, Patrick G. Downey, President and Chief
Executive Officer, Ronald K. Netolitzky, Chairman, John P. Fairchild, Chief
Financial Officer and Michele A. Jones, Corporate Secretary. The loss of the
services of its senior management or key personnel could have a material and
adverse effect on Viceroy and its business and results of operations.

41

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Reliance on independent contractors

The Companys success depends to a significant extent on the
performance and continued service of certain independent contractors. The
Company contracts the services of professional drillers and others for
exploration, environmental, construction and engineering services. Poor
performance by such contractors or the loss of such services could have a
material and adverse effect on Viceroy and its business and results of
operations and result in failure to meet its business objectives.

There is no assurance that Viceroys title to its mineral
properties will not be challenged

The acquisition of title to mineral properties is a very
detailed and time-consuming process. Title to and the area of mineral properties
may be disputed. While the Company has diligently investigated title to the
Argentine Properties and has received a title opinion this should not be
construed as a guarantee of title to any of the Argentine Properties. The
Argentine Properties may be subject to prior unregistered agreements or
transfers and title may be affected by undetected defects. Viceroy has not
surveyed the boundaries of all of the Argentine Properties and consequently the
boundaries of the properties may be disputed. The Argentine Properties may also
be subject to prior unregistered agreements of transfer or aboriginal land
claims, and title may be affected by undetected defects. All of the properties
are held 100% by MASA, subject to certain royalty agreements.

There is no assurance that the Company will obtain
required permits and licenses

The Companys operations will require licenses and permits from
various governmental authorities. The Company believes that it will be able to
obtain in the future all necessary licenses and permits to carry on the
activities which it intends to conduct, and intends to comply in all material
respects with the terms of such licenses and permits. There can be no guarantee,
however, that it will be able to obtain and maintain, at all times, all
necessary licenses and permits required to undertake the proposed exploration
and development or to place its properties into commercial production and to
operate mining facilities thereon. In the event of commercial production, the
cost of compliance with changes in governmental regulations has the potential to
reduce the profitability of operations or preclude the economic development of
the property.

Political, regulatory and economic conditions in
Argentina may adversely affect the Companys operations

Even if Viceroys Argentine Properties are proven to host
economic reserves of metals, factors such as political instability, terrorism,
opposition from local constituents, or governmental expropriation or regulation
may prevent or restrict mining of any such deposits or repatriation of profits.
All of the Companys mineral properties are located in Argentina. Mineral
exploration and mining activities in Argentina may be affected by varying
degrees by political stability and government regulations relating to the mining
industry. Any changes in regulations or shifts in political conditions are
beyond its control and may adversely affect its business. Operations may be
affected in varying degrees by government regulations with respect to
restrictions on production, price controls, export controls, income taxes,
expropriation of property, environmental legislation and mine safety.
Argentinas status as a developing country may make it more difficult for the
Company to obtain any required exploration, development and production financing
for its projects.

42

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Viceroys potential profitability depends upon factors
beyond its control

Although the Argentine Properties have resources (as defined
under NI 43-101), the potential profitability of such properties will be
dependent upon many factors beyond the Companys control. For instance, world
prices of and markets for minerals are unpredictable, highly volatile,
potentially subject to governmental interference, pegging and/or controls and
respond to changes in domestic, international, political, social and economic
environments. Another factor is that rates of recovery of minerals from mined
ore may vary from the rate experienced in tests and a reduction in the recovery
rate will adversely affect profitability and, possibly, the economic viability
of the property. Profitability also depends on the costs of operations,
including costs of labour, equipment, electricity, environmental compliance or
other production inputs. Such costs will fluctuate in ways the Company cannot
predict and are beyond the Companys control, and such fluctuations will impact
on profitability and may eliminate profitability altogether. Additionally, due
to worldwide political and economic uncertainty, the availability and cost of
funds for development and other costs have become increasingly difficult, if not
impossible, to project. These changes and events may materially affect the
Companys financial performance.

Fluctuation of mineral prices may affect the Companys
financial results

Factors beyond the Companys control may affect the
marketability and price of any minerals discovered, if any. Resource prices have
fluctuated widely in recent years and are affected by numerous factors beyond
the Companys control, including international, economic and political trends,
expectations of inflation, currency exchange fluctuations, interest rates,
global or regional consumptive patterns, speculative activities and increased
production due to new extraction developments and improved extraction and
production methods. The effects of these factors cannot be accurately predicted.

Competitive nature of the mining industry

There is aggressive competition within the mining industry for
the discovery and acquisition of properties considered to have commercial
potential. Viceroy will be competing with other mining companies, many of which
have greater financial resources than it does, for the acquisition of mineral
claims, leases and other mineral interests as well as for the recruitment and
retention of qualified employees and other personnel. There can be no assurance
that the necessary funds can be raised or that any projected work will be
completed.

Environmental, health and safety regulation of resource
industry

If the Argentine Properties are proven to host economic
reserves of metals, mining operations will be subject to federal, provincial and
local laws relating to the protection of the environment, including laws
regulating removal of natural resources from the ground and the discharge of
materials into the environment. Mining operations will be subject to federal,
provincial and local laws and regulations which seek to maintain health and
safety standards by regulating the design and use of mining methods and
equipment. Various permits from government bodies are required for mining
operations to be conducted; no assurance can be given that such permits will be
received. No assurance can be given that environmental standards imposed by
federal, provincial or local authorities will not be changed or that any such
changes would not have material adverse effects on the Companys activities.
Moreover, compliance with such laws may cause substantial delays or require
capital outlays in excess of those anticipated, thus causing an adverse effect
on the Company. Additionally, the Company may be subject to liability for
pollution or other environmental damages, which it may not insure against.

43

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The Companys shares may experience price volatility

Securities markets have a high level of price and volume
volatility, and the market price of securities of many companies, including the
Company, have experienced wide fluctuations in price which have not necessarily
been related to the operating performance, underlying asset values or prospects
of such companies. Factors unrelated to the financial performance or prospects
of the Company include macroeconomic developments in North America and globally,
and market perceptions of the attractiveness of particular industries. The
Companys share price, financial condition and results of operations are all
also likely to be significantly affected by short-term changes in gold. There
can be no assurance that continual fluctuations in metal prices will not occur.
As a result of any of these factors, the market price of the Common Shares at
any given point in time may not accurately reflect the Companys long-term
value.

The Company may encounter difficulties in conducting its
business through foreign subsidiaries

Viceroy is a holding company that conducts its business through
foreign subsidiaries, joint ventures and divisions, and substantially all of its
assets are held in such entities. Accordingly, any limitation on the transfer of
cash or other assets between Viceroy and its subsidiaries, or among its
subsidiaries, could restrict the Companys ability to fund operations
efficiently. Any such limitations, or the perception that such limitations may
exist now or in the future, could have an adverse impact on the Companys
valuation and share price.

The Company has not declared dividends and expects to
retain any earnings

No dividends on the Companys common shares have been paid by
the Company to date. The Company anticipates that it will retain all future
earnings and other cash resources for the future operation and development of
its business. The Company does not intend to declare or pay any cash dividends
in the foreseeable future. Payment of any future dividends will be at the
discretion of the Companys board of directors after taking into account many
factors, including the Companys operating results, financial condition and
current and anticipated cash needs.

Future sales of common shares by its present shareholders
and dilution of common shares

The increase in the number of common shares in the market and
the possibility of sales of such shares may have a depressive effect on the
price of the Common Shares and the Companys ability to raise capital through
future sales of common shares. The Company has previously completed private
placements at prices per share which are lower than the current market price of
the common shares. Accordingly, a significant number of shareholders of the
Company have an investment profit in the common shares that they may seek to
liquidate. Substantially all of the common shares not held by affiliates of the
Company can be resold without material restriction whether in the United States
and/or in Canada.

Viceroys operating results and financial condition may
be adversely impacted by currency fluctuations

The Companys functional currency is the Canadian dollar. If
the Company locates minerals on its properties, the market for sale of such
minerals will be in foreign countries and may be subject to foreign currency
fluctuations. Such fluctuations may materially affect the Companys financial
position and results.

44

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Viceroy is not always able or may choose not to obtain
insurance for many of the risks that it faces

In the course of exploration, development and production of
mineral properties, several risks and, in particular, unexpected or unusual
geological or operating conditions, may occur. It is not always possible to
fully insure against such risks, and the Company may decide not to take out
insurance against such risks as a result of high premiums or other reasons.
Should such liabilities arise they could reduce or eliminate any future
profitability and result in an increase in costs and a decline in value of the
Companys securities.

The Company is not insured against environmental risks.
Insurance against environmental risks (including potential liability for
pollution or other hazards as a result of the disposal of waste products
occurring from exploration and production) has not been generally available to
companies within the industry. The Company will periodically evaluate the cost
and coverage of the insurance that is available against certain environmental
risks to determine if it would be appropriate to obtain such insurance. Without
such insurance and if it becomes subject to environmental liabilities, the
payment of such liabilities would reduce or eliminate the Companys available
funds or could exceed the funds it has to pay such liabilities and result in
bankruptcy. Should the Company be unable to fund fully the remedial cost of an
environmental problem, it might be required to enter into interim compliance
measures pending completion of the required remedy.

SELECTED CONSOLIDATED FINANCIAL INFORMATION

Annual Information

The following tables summarize selected financial data for
Viceroy extracted from Viceroys audited financial statements. This financial
information is stated in Canadian dollars. Information is provided in accordance
with Canadian generally accepted accounting principles (Canadian GAAP) and
should be read in conjunction with Viceroys financial statements.

Summary of Financial Information In Viceroys Financial
Statements:(Canadian dollars)

Summary Consolidated Balance
      Sheet Information:
      As at December
      31, 2005
      As at December
      31, 2004
      As at December
      31, 2003
      As at June 30,
      2003Current Assets
    23,260,143
    14,687,617
    4,954,856
    556,061Exploration Properties
    19,944,753
    9,920,885
    6,369,419
    6,015,995Total Assets
    43,253,604
    24,637,943
    11,324,275
    6,572,056Current Liabilities
    959,140
    256,582
    234,687
    67,673Long Term Debt
    -
    -
    -
    -Total Shareholders
    42,294,464
    24,381,361
    11,089,588
    6,504,383EquityCapital Stock
    45,116,078
    25,812,231
    11,284,526
    6,515,196Common Shares Outstanding
    42,033,043
    35,370,308
    24,471,158
    13,800,000


45

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Summary Consolidated Statements
      of Operations and Deficit Information:
      Fiscal Year ended
      December 31, 2005
      Fiscal Year ended
      December 31, 2004
      Fiscal Year July 1, 2003 to
      December 31, 2003
      Fiscal Year March 31, 2003
      (date of incorporation) to June 30, 2003Total Revenues
    -
    -
    -
    -Total Expenses
    3,650,636
    2,391,709
    1,433,285
    10,813Interest Income
    479,782
    83,916
    7,604
    -Net Loss
    3,121,835
    2,377,721
    1,436,596
    10,813Income (Loss) Per Common Share (1)
    (0.08)
    (0.08)
    (0.10)
    (0.00)


| | (1) | The net loss per share amounts are the same on both a
      basic and a diluted basis.
| | --- | --------------------------------------------------------------------------------------

Critical Accounting Estimates

Exploration property costs  The Company records
its interest in exploration properties at cost. The cost of acquiring mineral
properties and related exploration and development expenditures are deferred and
would be amortized against future production following commencement of
commercial production or are written off if the properties are sold, allowed to
lapse or abandoned. Management regularly reviews the net carrying value of each
mineral property, and where management believes that the carrying value cannot
be recovered, the carrying value is written down to fair value.

Stock-based compensation  Management is required
to make significant estimates about future volatility and the period in which
stock options will be exercised. The selection of the volatility factor, and the
estimate of the period in which an option will be exercised will have a
significant impact on the cost recognized for stock-based compensation. The
estimates concerning volatility are made with reference to historical
volatility, which is not necessarily an accurate indicator of volatility which
will be experienced in the future. Management assumes that stock options will
remain unexercised until immediately prior to their expiry date, which may not
be the case.

General Description of Capital Structure

The authorized share capital of the Company consists of an
unlimited number of common shares without par value of which 52,641,235 were
issued and outstanding as at March 21, 2006, and an unlimited number of first
and second preferred shares without par value, of which none are issued and
outstanding.

The holders of common shares are entitled to one vote per
common share at all meetings of shareholders, to receive dividends as and when
declared by the directors, and to receive a pro rata share of the remaining
property and assets of the Company in the event of liquidation, dissolution or
winding up of the Company. The common shares have no pre-emptive, redemption,
purchase or conversion rights. There are no sinking fund provisions in relation
to the common shares and they are not liable to further calls or to assessment
by the Company. The Articles of the Company provide that the rights attached to
any issued shares may not be prejudiced or interfered with unless all
shareholders holding shares of the class being affected consent in writing or
unless a special resolution is passed by a majority of not less than 66 2/3% of
the votes cast in person or by proxy by holders of shares of that class.

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The first preferred shares and second preferred shares may be
issued in one or more series. The directors of the Company may by resolution of
the directors before the issue of any series alter the Company's Notice of
Articles to fix the number of preferred shares in a series and create, attach
and define special rights such as payment of dividends and rights of redemption,
conversion and retraction. Holders of first preferred shares shall be entitled
to one vote in respect of each first preferred share held at general meetings.
Holders of second preferred shares shall not be entitled as such to vote at any
general meeting of shareholders of the Company. Holders of first preferred
shares of each series rank on a parity with the first preferred shares of every
other series and are entitled to preference over the second preferred shares and
the common shares. Holders of second preferred shares of each series rank on a
parity with the second preferred shares of every other series and are entitled
to preference over the common shares.

Dividends

The Company has not declared or paid any dividends since
incorporation.

MANAGEMENTS DISCUSSION AND ANALYSIS

The following information, prepared as of February 28, 2006,
should be read in conjunction with the Companys December 2005 audited
consolidated financial statements and related notes, which are prepared in
accordance with generally accepted accounting principles in Canada. All amounts
are expressed in Canadian dollars unless otherwise indicated.

The Audit Committee of the Board of Directors of the Company,
consisting of three independent directors, has reviewed this document pursuant
to its mandate and charter.

This information may contain forward-looking statements that
involve inherent risks and uncertainties. The Companys actual results may
differ significantly from those anticipated in the forward-looking statements
and readers are cautioned not to place undue reliance on these forward-looking
statements. The Company undertakes no obligation to publicly release the results
of any revisions to forward-looking statements that may be made to reflect
events or circumstances after the above-stated date or to reflect the occurrence
of unanticipated events.

Description of the Business and Overall
Performance

Viceroy Exploration Ltd (the Company) is a natural resource
exploration stage Company with five 100% owned exploration properties in
Argentina. The principal focus of the Company is the continued exploration and
development of its Gualcamayo gold property in San Juan province, Argentina,
which property currently consists of three zones of mineralization. The
Companys ownership interest, including surface rights, covers the entire area
of known mineralization at the Gualcamayo property. Favorable geological
structures at Gualcamayo are open in several directions and this will be a
priority for further investigation in 2006. The Company is also carrying out a
regional exploration program within the Gualcamayo property as well as programs
on the adjacent Salamanca property and on its Evelina property in the High
Andes.

Prior to the June 30, 2003 acquisition of the Gualcamayo
property by the Company, previous drilling on the property had been completed by
the then owners in three campaigns, in 1983-1988 and between 1998 and 2000. In
August 2004, the Company completed its first phase exploration program on the
property which included a 47 hole, 11,920 metre reverse circulation drill
program and in December 2004 began a second phase of exploration drilling
consisting mainly of diamond drilling. In November 2004, the Company announced
that a new resource estimate had been completed on the three zones of
mineralization of the property by an Independent Qualified Person which estimate
added more than 35 %

47

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to the total resources and doubled the Measured and Indicated
resources. This new resource announcement was followed up by an updated National
Instrument 43-101 Technical Report which was SEDAR filed in December 2004.

In January 2005, the Company announced completion of a
Preliminary Economic Assessment on the main zone of mineralization within the
property. Based on the recommendations of the Preliminary Economic Assessment,
the Company continued engineering studies throughout 2005 in preparation for a
feasibility study in 2006. During 2005, the second phase drilling program
continued on the three zones of mineralization, a regional exploration program
began, and in December 2005 the second phase 127 hole, approximate 27,000 metre
diamond and reverse circulation drilling program was completed with final assays
announced in January 2006. Progress of the drill program was behind plan
throughout the year due in part to rig availability and delays in replacement
parts. At the 2005 year end, there were two diamond drill and one truck mounted
reverse circulation rigs on site. A fourth rig (diamond drill) was delivered to
the property in late February and a fifth rig (reverse circulation) has been
scheduled for arrival by April 2006.

In the 2006 first quarter, the Company plans a new resource
estimate followed by an updated Preliminary Economic Assessment, continued
drilling and the commencement of the feasibility study. Study conditions
favorable to the project, among others, include the presence of a skilled local
mining labor force; access to electrical power from the local grid; sufficient
water within the property for the operations contemplated; and current
metallurgical test-work indicating that the bulk of the ore is readily amenable
to cyanide leaching.

On February 23, 2006, the Company announced, among others, the
appointments of three senior operations management personnel; the appointments
of engineering consultants for the feasibility study; completion of a regional
aeromagnetic survey within the Gualcamayo and Salamanca properties which has
identified areas for further exploration, including drill targets with drilling
planned to commence by early April 2006; and commencement of a first stage
exploration program at the Companys wholly owned Evelina property in the High
Andes which is in the proximity of a large operating gold mine. Depending on the
results of the Evelina program, a joint venture partner may be sought for the
property.

The 2004 increase in the resource size and quality at the
Gualcamayo project together with the positive gold market combined to provide
momentum for the Company in 2005 and has benefited the Companys ability to
raise equity in the capital markets. On July 5, 2005, the Company completed a
bought deal financing of a total 5,750,000 common shares at $3.25 per share for
gross proceeds of $18,687,500, and on February 16, 2006, the Company completed a
bought deal financing of a total 9,600,000 common shares at $6.25 per share for
gross proceeds of $60,000,000.

In June 2004, a farm-out option agreement was entered into on
one of the Companys other Argentine properties, Las Flechas and in June 2005,
the agreement was continued for a second year in which drilling is planned. The
Company is seeking a joint venture partner for the Companys La Brea/Las
Carachas property which is located in an area of ongoing mineral exploration in
Argentina.

As at December 31, 2005, the Company has cash and cash
equivalents of $23,116,259 substantially all of which is available as working
capital and together with the $60,000,000 gross proceeds from the February 2006
bought deal financing is considered sufficient to carry out the above referred
activities on the Gualcamayo gold property, regional exploration as well as for
property maintenance requirements and administrative overhead for the next
eighteen months.

As at December 31, 2005 and to the above-stated date of this
report, the quoted price of the Companys common shares on the TSX has exceeded
the exercise prices of the Companys outstanding stock options

48

---

and warrants granted. If all outstanding options and warrants
as at December 31, 2005 were exercised, a total 6,334,140 shares would be issued
for cash proceeds of $14,920,485. The weighted average remaining contractual
life of the 3,470,000 outstanding options is 3.69 years. The 2,864,140
outstanding warrants expire December 6, 2006. In the period from January 1, 2006
to February 28, 2006, 445,000 shares were issued for options exercised and
474,465 shares were issued for warrants exercised for combined total cash of
$2,104,078.

Mineral exploration and development involves a high degree of
risk and few properties that are explored are ultimately developed into
producing mines. The commercial viability of a mineral deposit is also dependent
upon a number of factors which are beyond the Companys control. Some of these
factors are the attributes of the deposit, commodity prices, cost of financing
and country risks including uncertain political and economic environments,
restrictions on export and repatriation of capital and profits.

Continued development of the Gualcamayo and other Argentine
properties of the Company will require licenses and permits from various levels
of government. The Company believes that it will be able to obtain in the future
all necessary licenses and permits to continue the activities which it intends
to conduct, and it intends to continue to comply in all material respects with
the terms of such licenses and permits. However, there is no assurance that this
will continue to occur.

The Gualcamayo property is located in a region of Argentina in
which mining is of significant economic importance. The Company believes it is
conducting its business there in a responsible and prudent manner and, to date,
it has been able to progress as planned. Indication of this has been transparent
and timely progress with the ongoing permit process to date and acceptance in
the community. The Company does not maintain and does not intend to purchase
political risk insurance. The majority of the Companys funds are held in Canada
and only funds sufficient to meet current obligations are transferred to
Argentina. In 2004 and 2005, inflation was not an issue in Argentina.

In 2004, the directors of the Company approved establishment of
a pool of US$110,000 to be used for payments to certain employees of Minas
Argentinas S.A. in the eventuality that certain development events occur in
future. The Company has not formally established a reserve of this amount. In
2005, undertakings totaling US$117,400 have been made by the Company to certain
employees and contractors for payments upon defined development events.
Beginning January 2006, the five independent directors of the Company are to
receive annual fees of $24,000 for their services as directors, payable
quarterly.

The directors of the Company have approved in principle a
shareholders rights protection plan which the Company intends to submit to
shareholders for approval at the Companys annual meeting on April 28, 2006.
Shareholders will be asked to approve the plan, subject to implementation at the
discretion of the directors. As at December 31, 2005, buy out clauses in the
event of a takeover (as defined) of the Company among eleven individuals total
approximately $1,516,000.

Selected Annual Information

Financial data derived from the Companys consolidated
statements for each of the three most recently completed financial periods:

49

---

Year ended
    Year ended
    Six monthsDecember 31,
    December 31,
    ended December2005
    2004
    31, 2003$
    **$**
    $Loss for the period
    3,121,835 (1)
    2,377,721(2)
    1,436,596(3)Basic and diluted loss per share
    (0.08) (1)
    (0.08)(2)
    (0.10)(3)Total assets at end of period
    43,253,604 (4)(5)
    24,637,943(6)
    11,324,275


| | (1) | includes $1,978,419 stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | includes $1,183,085 stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | (3) | includes $1,117,080 stock-based compensation                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | (4) | includes $408,926 stock-based compensation together with
      bonus shares capitalized to exploration properties                                                                                                                                                                                                                                                                                                                                                                                                  
| | (5) | increase as compared to total assets as at December 31,
      2004 is primarily a result of $17,283,418 net cash proceeds received from
      a bought deal financing and $1,420,721 cash on exercise of warrants and
      stock options of which $9,671,488 was expended on (deferred) property
      exploration, $479,782 interest income and $352,380 stock-based
      compensation and bonus shares capitalized to property exploration
      expenditures less $1,169,792 cash used in operating activities
| | (6) | increase as compared to total assets as at December 31,
      2003 is primarily a result of $11,417,706 net cash proceeds received from
      a private placement and $3,068,703 cash on exercise of warrants and stock
      options of which $3,551,466 was expended on (deferred) property
      exploration and land purchase less $1,254,001 cash used in operating
      activities                                                                                                                          

Results of Operations

|(a) | Loss for the year ended December 31, 2005:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Being in the exploration stage, the Company does not have
      revenues from operations and, except for income from its cash and cash
      equivalents, relies on equity funding by members for its continuing
      financial liquidity. The principal focus of the Company is the continued
      exploration of its Gualcamayo gold property in Argentina. In support of
      this activity, for the year ended December 31, 2005, the Company incurred
      period operating expenditures resulting in a loss of $3,121,835 (2004 -
      $2,377,721) of which, net of stock-based compensation and interest income
      was $1,623,198 (2004 - $1,278,552). Of this $689,772 and $304,770 was
      spent on cash compensation and investor relations/shareholders
      communication, respectively, $162,322 was spent on professional fees
      including an ongoing control certification assignment, and net $466,334
      for all other period expenses. In 2004, $683,684 and $192,801 was spent on
      cash compensation and investor relations/shareholders communication,
      respectively, $78,224 was spent on professional fees and net $323,843 for
      all other period expenses.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    | Included in the net assets acquired by the Company in the
      December 2, 2003 acquisition of Consolidated Trillion Resources Ltd.
      (Trillion) was a $100,000 account receivable in connection with a sale
      agreement by Trillion of two wholly-owned subsidiary companies, one
      holding company incorporated in Guernsey and the second an operating
      company in Zimbabwe. In the 2005 fourth quarter, the Company completed the
      sale of the Zimbabwe company and began the wind up of the Guernsey
      company. Consideration received on sale was US$60,000 cash and a one-time
      right to buy- back a 30% interest of the company for US$1 exercisable upon
      expenditures, as defined, of US$400,000 on its mining claims, subject to
      regulatory approvals. Due to the country risk involved, the Company has
      not assigned a value to the buy-back right which has resulted in the
      $30,532 bad debt.                                                                                                                                                                                                                                                   

50

---

|    | The $64,613 gain on sale of short-term investment and
      $19,935 rent recovery occurred in the 2005 third quarter as a result of
      the disposal by the Company of shares previously acquired in settlement of
      debt.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In 2005, Company representatives attended twelve industry
      conferences (2004  seven industry conferences) throughout North America,
      hosted a number of analysts visits to the Gualcamayo project and made
      numerous presentations to interested parties in North America and
      Europe.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(b) | Capitalized Property Expenditures for the twelve months
      ended December 31, 2005 and plans for the Gualcamayo project:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In the year ended December 31, 2005, a total $10,023,868
      (2004 - $3,551,466 including a $42,962 purchase of additional land) was
      capitalized as property expenditures, substantially all to the Gualcamayo
      gold property. Based on the recommendations of the January 2005
      Preliminary Economic Assessment on the main zone of mineralization within
      the Gualcamayo property, the Company continued engineering studies
      throughout 2005 in preparation for a feasibility study in 2006. During
      2005, the second phase program continued on the three zones of
      mineralization, a regional exploration program began, and in December 2005
      the second phase 127 hole, approximate 27,000 metre diamond and reverse
      circulation drilling program was completed with final assays received in
      the New Year.                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | During the year, construction of a second camp including
      kitchen was completed which combined camps can accommodate 100-110 persons
      and construction of a permanent access road to the project began which
      will significantly reduce travel time when it is completed by the end of
      the 2006 first quarter. In 2005, the Company awarded a contract to prepare
      an Environmental Impact Statement intended to define and coordinate
      environmental impact statement work in order that required environmental,
      construction and mining permits can be obtained as needed. The Company
      hired an experienced environmental permitting supervisor to co-ordinate
      this activity. Under the supervision of the Companys principal
      metallurgical consultant, metallurgical test-work samples for the proposed
      column leach test-work have recently been shipped to the University of San
      Juan and the commencement of cyanide addition began in the first quarter
      2006. Results from these column tests will be used for the upcoming
      feasibility study.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | Included in cumulative deferred exploration expenditures
      at December 31, 2005 is $1,507,358 (2004 - $394,759) of Argentine value
      added tax. The Company is making application to recover amounts that are
      eligible; however, the recovery, if any, is uncertain.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In the 2006 first quarter, the Company plans a new
      resource estimate followed by an updated Preliminary Economic Assessment,
      continued drilling and commencement of the feasibility study.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|(c) | Cash Flows for the year ended December 31,
2005:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    | In the year ended December 31, 2005, cash flows from a
      bought deal financing at $3.25 per share and the exercise of warrants and
      stock options totaled $18,704,139, cash used substantially all on
      Gualcamayo property exploration (deferred expenditures) totaled
      $8,917,072, cash used substantially all on administration and investor
      relations in support of the Gualcamayo project (period operating
      expenditures) totaled $1,169,792, resulting in an increase in cash and
      cash equivalents of $8,617,275 for total cash and cash equivalents at
      December 31, 2005 of $23,116,259. In 2005, the number of issued and
      outstanding common shares increased by 6,662,735 to a total 42,033,043
      shares (2004  an increase by 10,899,150 common shares to a total
      35,370,308 shares).                                                                                                                                                                                                                                                                           

51

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Summary of Quarterly Results

The following table sets forth selected unaudited consolidated
information for the Company for each of the eight most recently completely
quarters.

|                 |               |               |              | Quarter Ended |             |             |              
|---------------- | ------------- | ------------- | ------------ | ------------- | ----------- | ----------- | -------------
|                 | Dec 31,       | Sep 30,       | Jun 30,      | Mar 31,       | Dec 31,     | Sep 30,     | Jun 30,      
|                 | 2005          | 2005          | 2005         | 2005          | 2004        | 2004        | 2004         
|                 | $             | $             | $            | $             | $           | $           | $            
|                 |               |               |              |               |             |             |              
|Capitalized      |               |               |              |               |             |             |              
|property         |               |               |              |               |             |             |              
|acquisition and  |               |               |              |               |             |             |              
|exploration      |               |               |              |               |             |             |              
|costs            | 3,962,184 (2) | 2,911,029 (3) | 1,826,823(3) | 1,323,832(3)  | 443,981(3)  | 877,031 (3) | 1,470,588 (3)
|Revenue(1)       | -             | -             | -            | -             | -           | -           | -            
|Loss from        |               |               |              |               |             |             |              
|operations       | 1,185,816 (5) | 75,071        | 557,240      | 1,303,708 (6) | 658,536 (7) | 673,637 (8) | 466,183 (9)  
|Basic and        |               |               |              |               |             |             |              
|diluted loss per |               |               |              |               |             |             |              
|share            | (0.03)        | (0.00)        | (0.02)       | (0.04)        | (0.02)      | (0.02)      | (0.02)       

| | (1)  | the Company is in the exploration stage and has no
      revenues                              
| | ---- | -----------------------------------------------------------------------------------------------
| | (2)  | includes $214,019 stock-based compensation and $138,361
      bonus shares                     
| | (3)  | consists entirely of capitalized property exploration
      costs                              
| | (4)  | comprising capitalized $42,962 land purchase cost and
      $363,480 property exploration costs
| | (5)  | includes $1,064,288 stock-based compensation                                                   
| | (6)  | includes $1,092,697 stock-based compensation                                                   
| | (7)  | includes $230,150 stock based compensation                                                     
| | (8)  | includes $392,900 stock-based compensation                                                     
| | (9)  | includes $162,920 stock-based compensation                                                     
| | (10) | includes $397,115 stock based
  compensation                                                   

Liquidity and Capital Resources

As at December 31, 2005, the Company has cash and cash
equivalents of $23,116,259. Working capital at December 31, 2005 is $22,301,003,
substantially all of which is available to advance the Gualcamayo project.
Following completion of the 9,600,000 common share bought deal financing on
February 16, 2006, the Company has in excess of $80 million which is considered
sufficient to carry out the planned activities on the Gualcamayo gold property
that are described elsewhere in this document as well as for property
maintenance requirements and administrative overhead for the next eighteen
months. As at December 31, 2005 and to the above-stated date of this report, the
quoted price of the Companys common shares on the TSX has exceeded the exercise
prices of the Companys outstanding warrants and stock options granted. If all
outstanding warrants and options as at December 31, 2005 were exercised, a total
6,334,140 shares would be issued for cash proceeds of $14,920,485.

Development of the Gualcamayo project beyond feasibility may
require additional equity or possible debt financing.

The functional currency of the Company is the Canadian dollar
and to date new funding has been raised in Canadian dollars. Included in cash
and cash equivalents at December 31, 2005 is $286,688 and $640,683 denominated
in US dollars and Argentine pesos, respectively, which are subject to foreign
currency rate fluctuations. In conducting its business, the Company makes
payments as appropriate from

52

---

time to time in each of these three currencies. Accordingly, as
planned increased spending on the Gualcamayo property materializes, the Company
will be subject to foreign currency rate fluctuations in future between the
Canadian dollar and these currencies.

Contractual Obligations

(a)Operating lease obligations

Payments Due by PeriodLess than
    
    
    1  3Total
    
    
    1 year
    
    
    years$
    
    
    $
    
    
    $Vancouver office
    
    118,853
    
    
    75,065
    
    
    43,788Argentina office
    
    7,377
    
    
    7,377
    
    
    -126,230
    
    
    82,442
    
    
    43,788


(b)Other contractual obligations

As at December 31, 2005, certain employment and consulting
agreements entered into by the Company require up to twelve months notice not to
renew. The Companys purchase obligations for goods and services are in the
normal course of business and are cancelable on short notice.

Transactions with Related Parties

During the year ended December 31, 2005, the Company had
monthly consulting services arrangements with each of its four officers, two of
which are also directors of the Company. Cash paid or payable pursuant to these
arrangements was $145,092, $121,667, $110,000 and $45,000, an aggregate of
$421,759. These amounts exclude compensation paid or payable beginning the month
of June 2005 in the case of two of the officers for amounts as salaries pursuant
to the employment agreements made effective June 1, 2005.

Fourth Quarter

|(a) | Loss for the three months ended December 31,
  2005:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|    | In support of the continued exploration and development
      of its Gualcamayo gold property in Argentina, for the three months ended
      December 31, 2005, the Company incurred period operating expenditures
      resulting in a loss of $1,185,816 (three months ended December 31, 2004 -
      $658,536) which, net of stock-based compensation and interest income was
      $469,093 (three months ended December 31, 2004 - $455,280). Of this
      $177,811 and $62,139 was spent on cash compensation and investor
      relations/shareholders communication, respectively, $118,057 was spent on
      professional fees including an ongoing control certification assignment,
      and $111,086 for all other period expenses. In the three months ended
      December 31, 2004, $238,345 and $63,501 was spent on cash compensation
      including bonuses and investor relations/shareholders communication,
      respectively, $42,583 was spent on professional fees and $110,851 for all
      other period expenses. In the period, representatives attended one
      industry conference, in the United States, promoting the Company
  as

53

---

|    | compared to two conferences attended in the United States
      in the three months ended December 31, 2004.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(b) | Capitalized Property Expenditures for the three months
      ended December 31, 2005:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | In the three months ended December 31, 2005, a total
      $3,962,184 was capitalized to property expenditures, substantially all to
      the Gualcamayo property as compared to a total $443,981 capitalized to
      property expenditures in the three months ended December 31, 2004,
      substantially all to the Gualcamayo property. Amounts capitalized to the
      Gualcamayo property in the period included $1,883,478 for drilling, road
      maintenance/drill pads, geologists/engineers fees/travel/lodging, field
      support and assays; $531,907 toward construction of a permanent access
      road; $352,380 for stock- based compensation and bonus shares; $260,056
      for permitting activities; and $219,361 on engineering studies.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(c) | Cash Flows for the three months ended December 31,
      2005:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|    | In the three months ended December 31, 2005, cash flows
      from the exercise of warrants and stock options totaled $399,338, cash
      used substantially all on Gualcamayo property (deferred expenditures)
      totaled $3,754,623, cash used substantially all on administration and
      investor relations in support of the Gualcamayo project (period operating
      expenditures) totaled $162,661, resulting in an decrease in cash and cash
      equivalents of $3,517,946 for total cash and cash equivalents at December
      31, 2005 of $23,116,259.                                                                                                                                                                                              

Critical Accounting Estimates

|(a) | Exploration property costs  The Company records its
      interest in exploration properties at cost. The cost of acquiring mineral
      properties and related exploration and development expenditures are
      deferred and would be amortized against future production following
      commencement of commercial production or are written off if the properties
      are sold, allowed to lapse or abandoned. Management regularly reviews the
      net carrying value of each mineral property, and where management believes
      that the carrying value cannot be recovered, the carrying value is written
      down to fair value.                                                                                                    
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|(b) | Stock-based compensation  Management is required to make
      significant estimates about future volatility and the period in which
      stock options will be exercised. The selection of the volatility factor,
      and the estimate of the period in which an option will be exercised will
      have a significant impact on the cost recognized for stock-based
      compensation. The estimates concerning volatility are made with reference
      to historical volatility, which is not necessarily an accurate indicator
      of volatility which will be experienced in the future. Management assumes
      that stock options will remain unexercised until immediately prior to
      their expiry date, which may not be the case.

Changes in Accounting Policies including Initial Adoption

|(a) | Consolidation of variable interest entities  Effective
      January 1, 2005, the Company adopted Accounting Guideline AcG-15,
      Consolidation of Variable Interest Entities, which requires consolidation
      of entities in which the Company has a controlling financial interest. The
      Company has determined that it has no variable interest
entities.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                         
|(b) | Financial instruments  recognition and measurement,
      hedges, and comprehensive income  Effective January 1, 2005, the Company
      adopted the new accounting standards for Financial Instruments 
      Recognition and Measurement, Hedges, and Comprehensive
  Income.                                                                                      

54

---

|    | Financial instruments other than trade receivables, trade
      payables and certain other financial liabilities including long-term debt
      are recorded at fair value, not historical cost. If a financial instrument
      is measured at fair value, changes in its fair value are recognized in
      operations in the period in which they occur except for investments, and
      possibly certain other assets, designated as being available- for-sale.
      Changes in the fair value are recorded directly in shareholders equity in
      a special account called other comprehensive income until the asset
      disappears or is impaired. At that time, the gains and losses are recycled
      to the operations statement. The result of applying this standard is that
      income from these investments will be reported in the operations statement
      as if the assets were accounted for at historical cost.                                                                                                                                                                                                                                                                                                                                                                    
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | There is no impact on these consolidated financial
      statements resulting from the adoption of the above-described new
      accounting standards.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(c) | Canadian generally accepted accounting principles  In
      2005, the Accounting Standards Board (AcSB) approved a strategy whereby
      Canadian standards for public companies are to converge with International
      Financial Reporting Standards (IFRS) over a five-year transitional period.
      Presently, countries requiring or permitting IFRS for publicly traded
      companies include all countries in the European Union as well as Australia
      and Russia. The International Accounting Standards Board (IASB) is working
      closely with the Financial Accounting Standards Board in the US toward the
      convergence of existing US and international standards, and the IASB is
      working with both Japan and China to minimize differences between IFRS and
      Japanese and Chinese accounting standards, respectively. The implications
      of the above to Viceroy have not been determined.                                                                                                                                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(d) | Uncertain tax positions  The AcSB is undertaking a
      project on income taxes to converge certain aspects of Section 3465,
      Income Taxes, with amendments being considered as part of a joint short
      term convergence project underway among the FASB and IASB. Before the
      fore-mentioned joint project began, the FASB had issued Exposure Draft,
      Accounting for Uncertain Tax Positions  an Interpretation of FASB
      Statement 109. Subsequently, the FASB decided to consider proposals from
      the joint project prior to proceeding with the Exposure Draft, Accounting
      for Uncertain Tax Positions.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|    | The portion of the Canadian project addressing Accounting
      for Uncertain Tax Positions may be issued separately from the main project
      with a final standard being issued in 2006 and with an effective date in
      2006. The Company has determined that the US rule, if enacted, would have
      no material impact on the Companys financial statements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|(e) | Accounting for stripping costs in the mining industry 
      The Emerging Issues Committee (EIC) issued Draft Abstract D56 in October
      2005, Accounting for Stripping Costs in the Mining Industry. This was
      issued as a result of Issue 04-6 releases by the US Emerging Issues Task
      Force regarding stripping costs incurred during the production phase of a
      mine, which consensus was ratified by the FASB, and which states stripping
      costs incurred during the production phase of a mine are variable
      production costs that should be included in the cost of inventory produced
      (that is extracted) during the period that the stripping costs are
      incurred. The US standard is effective for reporting periods beginning
      after December 15, 2005. In respect of stripping costs incurred during the
      production phase, the EIC reached a consensus that stripping costs in the
      production phase should be capitalized if the stripping activity can be
      shown to represent a betterment to the mineral property. This being the
      case, a difference between Canadian and US GAAP would arise. The Company
      will comply with the EIC pronouncement as appropriate and will report any
      significant differences to US GAAP.

Disclosure Controls and Procedures

An evaluation was performed under the supervision and with the
participation of the Companys management, including the chief executive officer
and chief financial officer, of the effectiveness of the

55

---

design and operation of the Companys disclosure controls and
procedures as of the end of the financial year ended December 31, 2005. Based on
that evaluation, the Companys management, including the chief executive officer
and chief financial officer, concluded that the Companys disclosure controls
and procedures were effective as of the end of the 2005 financial year to
provide reasonable assurance that information required to be disclosed by the
Company in the 2005 annual filings is recorded, processed, summarized and
reported within the regulated time period.

The Companys management, including the chief executive officer
and chief financial officer, identified no change in the Companys internal
control over financial reporting that occurred during the Companys financial
year ended December 31, 2005 and that has materially affected, or is reasonably
likely to materially affect, the Companys internal control over financial
reporting.

The term internal control over financial reporting means a
process designed by, or under supervision of, the Companys principal executive
and principal financial officers, or persons performing similar functions, and
effected by the Companys board of directors, management and other personnel, to
provide reasonable assurance regarding the reliability of financial reporting
and the preparation of financial statements for external purposes in accordance
with generally accepted accounting principles and includes those policies and
procedures that:

|(1) | Pertain to the maintenance of records that in reasonable
      detail accurately and fairly reflect the transactions and dispositions of
      the assets of the Company;                                                                                                                                                                                            
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                      
|(2) | Provide reasonable assurance that transactions are
      recorded as necessary to permit preparation of financial statements in
      accordance with generally accepted accounting principles, and that
      receipts and expenditures of the Company are being made only in accordance
      with authorizations of management and directors of the Company;
  and
|    |                                                                                                                                                                                                                                                                                                                                                                      
|(3) | Provide reasonable assurance regarding prevention or
      timely detection of unauthorized acquisitions, use of disposition of the
      Companys assets that could have a material effect on the financial
      statements.                                                                                                                                      

Disclosure of Share Data as at February 28, 2006

|(a) | shares authorized:
      an unlimited number of common shares without par value
      an unlimited number of first preferred shares without par
      value
      an unlimited number of second preferred shares without
      par value
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                         
|(b) | shares issued and outstanding:                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                         
|    | 52,552,508 common shares with an estimated recorded value
      of $104,731,679                                                                                                                                                         

56

---

|(c) | warrants and stock options
outstanding:
|--- | ---------------------------------------

Number
    
    Exercise Price
    Date of Expiry$Stock
    100,000
    
    0.50
    September 12, 2008Options590,000
    
    1.25
    December 3, 2008140,000
    
    1.35
    January 12, 2009200,000
    
    1.25
    February 19, 200913,000
    
    1.26
    March 25, 2009150,000
    
    1.27
    April 2, 200920,000
    
    0.93
    June 10, 2009400,000
    
    1.57
    September 13, 2009822,000
    
    2.46
    January 31, 2010105,000
    
    3.24
    August 15, 2010395,000
    
    3.55
    November 16, 201090,000
    (1)
    4.61
    December 20, 2010255,000
    (2)
    5.10
    January 6, 20, 20113,280,000Warrants
    2,389,675
    
    2.75
    December 6, 20065,669,675


| | (1) | one option for 30,000 shares vested on February 21, 2006;
      one option for 60,000 shares is subject to vesting on March 10,
  2006                                 
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | two options totaling 245,000 shares are subject to
      vesting in equal portions over four periods ending April 30, June 30,
      September 30 and December 31, 2006

Other Information

|(a) | Additional information relating to the Company is
      available for viewing on SEDAR at www.sedar.comthe Companys
      website at www.viceroyexploration.com.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------

MARKET FOR SECURITIES

The Company was incorporated on March 31, 2003 and its shares
were listed for trading on the TSX-V on November 14, 2003 under the symbol
VYE. As of May 2, 2005, the common shares of the Company began trading on the
TSX under the same symbol and was delisted from the TSX-V. The Company's shares
traded on the TSX-V to April 29, 2005 and on the TSX thereafter. During the 12
months ended December 31, 2005 and the subsequent period to March 21, 2006
trading was as follows:

VYE - TSX-V and TSX

Month
      Volume
      High
      LowMarch 1 - 21, 2006
    2,918,742
    $7.35
    $6.20February 2006
    7,113,100
    $7.00
    $5.15January 2006
    7,496,731
    $6.75
    $4.75December 2005
    4,241,152
    $5.20
    $3.81


57

---

Month
      Volume
      High
      LowNovember 2005
    2,715,272
    $4.01
    $3.16October 2005
    1,133,630
    $3.55
    $2.95September 2005
    1,446,228
    $3.75
    $2.93August 2005
    1,532,745
    $3.35
    $2.85July 2005
    1,348,805
    $3.29
    $2.84June 2005
    2,968,035
    $3.45
    $2.75May 2005
    1,268,914
    $3.40
    $2.60April 2005
    2,963,528
    $3.40
    $2.50March 2005
    2,478,764
    $3.20
    $2.50February 2005
    1,330,390
    $2.75
    $2.24January 2005
    1,291,078
    $2.80
    $2.30


DIRECTORS AND OFFICERS

Name, Address, Occupation and Security
Holdings

The following table sets forth all current directors and
executive officers as of the date of this AIF, with each position and office
held by them in the Company and the period of service as such. Each directors
term of office expires at the next annual general meeting of shareholders. The
last annual general meeting was held on April 22, 2005.

Name, Municipalityof Residence and Position
      Date of InitialAppointment
      Principal OccupationW. David Black(1)(2) (3)(4)Vancouver, BC Director
      (Independent)
    March 2003
    Retired; Partner, DuMoulin Black, from 1968 to December
      2003.Richard M. Colterjohn(1)(2)(4)
        Toronto, ON Director (Independent)
    October 2004
    Managing Partner, Glencoban Capital Management Inc.,
      October 2003 to present; President and CEO, Centenario Copper Corporation,
      March 2004 to present; Senior officer in corporate finance department, UBS
      Bunting Warburg Inc., April 1992 to April 2002, and Director of UBS
      Bunting Warburg Inc., April 1997 to April 2002. Also a director of
      Cumberland Resources Ltd. Mr. Colterjohn holds an MBA from I.M.D.,
      Lausanne, Switzerland.Eric W. Cunningham(3)(5)Toronto, ON Director (Independent)
    December 2003
    Mining ConsultantPatrick G. Downey(5)North Vancouver, BC President, CEO and Director
    December 2003
    President and CEO of the Company; Professional Engineer
      and Principal of P. Downey & Associates; President and Director of
      Oliver Gold Corporation, November 1997 to February 2002; Director of
      Canico Resource Corporation, February 2002 to February 2003; President
      & C.E.O., Consolidated Trillion Resources Ltd., January 1998 to
      December 2003.


58

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|Name, Municipality of Residence and Position                                       | Date of Initial Appointment | Principal Occupation                                                                                                                                                                                                                                                                                                                                                      
|---------------------------------------------------------------------------------- | --------------------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|
|John P. Fairchild 
      Vancouver, BC CFO                                         | March 2004                  | Mr. Fairchild, a Chartered Accountant, is an independent
      contractor. From July 1, 1994 to November 24, 2003 he was CFO and
      Corporate Secretary of Jordex Resources Inc./iTech Capital Corp./Sirit
      Inc.                                                                                                                                                  
|
|
|
|
|Michael H. Halvorson(2)(3)(4)(5)
      Edmonton, AB Director
      (Independent)   | March 2003                  | President of Halcorp Capital Ltd., a private investment
      and consulting company, since 1980.                                                                                                                                                                                                                                                                         
|
|
|Michele A. Jones 
      Vancouver,BC Corporate Secretary                           | February 2004               | Prior to joining the Company, Miss Jones was Executive
      Vice President, Administration, and Corporate Secretary of Cross Lake
      Minerals Ltd., a TSX listed exploration company, from April 1997 to
      December 2003. She has served as Corporate Secretary of several natural
      resource public companies since 1990. Miss Jones holds a B.A. in Spanish.
|
|
|
|
|
|
|Robert V. Matthews(1)(2)(4)
      North Vancouver, BC Director
      (Independent) | March 2003                  | President, Sheppards Building Materials Inc. Mr. Matthews
      is a Chartered Accountant.                                                                                                                                                                                                                                                                                
|
|
|Ronald K. Netolitzky(5)
      
      Victoria, BC Chairman and
      Director      | March 2003                  | Chairman since April 2003; past President March 2003 to
      December 2003; Chairman of Consolidated Trillion Resources Ltd. from
      January 1999 to December 2003; Consulting Geologist, Keewatin Consultants,
      a division of Chintz & Co., 49.6% held by Mr. Netolitzky .                                                                                      
|
|
|
|

| | (1) | Member of the audit committee.                                    
| | --- | ------------------------------------------------------------------
| | (2) | Member of the compensation committee.                             
| | (3) | Member of the corporate governance and nominating
      committee.
| | (4) | Member of the take-over response committee.                       
| | (5) | Member of environmental and safely
  committee                    

As of the date of this AIF the directors and executive officers
of the Company as a group beneficially own, directly or indirectly, or over
which control or direction is exercised, 2,918,559 shares representing 5% of
securities of each class of voting securities of the Company or any of its
subsidiaries.

Cease Trade Orders , Bankruptcies, Penalties or Sanctions

To the knowledge of the Company, no director or executive
officer of the Company, or a shareholder holding a sufficient number of
securities of the Company to affect materially, the control of the Company is,
or has been in the last ten years, a director or executive officer of any
company that, while that person was acting in that capacity, (a) was the subject
of a cease trade order or similar order or an order that denied the company
access to any exemptions under Canadian securities legislation, for a period of
more than 30 consecutive days, (b) was subject to an event that resulted, after
that person ceased to be a director or executive officer, in the company being
the subject of a cease trade or similar order or an order that denied the issuer
access to any exemption under Canadian securities legislation, for a period of
more than 30 consecutive days, or (c) or within a year of that person ceasing to
act in that capacity, become bankrupt, made a proposal under any legislation
relating to bankruptcy or insolvency or was subject to or instituted any
proceedings, arrangement or compromise with creditors or had a receiver,
receiver manager or trustee appointed to hold its assets. To the knowledge of
the Company, in the past ten years, no director or executive officer of the
Company, or a shareholder holding a sufficient number of securities of the
Company to affect materially the control of the Company has become bankrupt,
made a proposal

59

---

under any legislation related to bankruptcy or insolvency, or
was subject to or instituted any proceedings, arrangement or compromise with
creditors, or had a receiver, receiver manger or trustee appointed to hold the
assets of the director, officer or shareholder.

Conflicts of Interest

Certain of the Company's directors and officers serve or may
agree to serve as directors or officers of other reporting companies or have
significant shareholdings in other reporting companies and, to the extent that
such other companies may participate in ventures in which the Company may
participate, the directors of the Company may have a conflict of interest in
negotiating and concluding terms respecting the extent of such participation. In
the event that such a conflict of interest arises at a meeting of the Company's
directors, a director who has such a conflict will abstain from voting for or
against the approval of such a participation or such terms and such director
will not participate in negotiating and concluding terms of any proposed
transaction. From time to time, several companies may participate in the
acquisition, exploration and development of natural resource properties thereby
allowing for their participation in larger programs, permitting involvement in a
greater number of programs and reducing financial exposure in respect of any one
program. It may also occur that a particular company will assign all or a
portion of its interest in a particular program to another of these companies
due to the financial position of the company making the assignment. Under the
laws of the Province of British Columbia, the directors of the Company are
required to act honestly, in good faith and in the best interests of the
Company. In determining whether or not the Company will participate in a
particular program and the interest therein to be acquired by it, the directors
will primarily consider the degree of risk to which the Company may be exposed
and its financial position at that time.

AUDIT COMMITTEE INFORMATION

Audit Committee Mandate

The Company's audit committees charter (the "Audit Committee
Charter") is attached as Schedule B to the Companys information circular dated
March 14, 2006. The information circular of the Company may be found on SEDAR at
www.sedar.com. The Audit Committee Charter is incorporated by reference
into this AIF.

Composition of the Audit Committee

The following are the members of the Company's audit committee:

Robert V. Matthews (Chairman)
    Independent (1)
    Financially literate (1)W. David Black
    Independent (1)
    Financially literate (1)Richard M. Colterjohn (2)
    Independent (1)
    Financially literate (1)


| | (1) | As defined by Multilateral Instrument 52-110 ("MI
      52-110").                                                                                                              
| | --- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| | (2) | Mr. Colterjohn replaced Mr. Halvorson on November 9, 2005
      at which time Mr. Halvorson was appointed to the Companys Corporate
      Governance and Nominating Committee.

Relevant Education and Experience

A description of the education and experience of each audit
committee member that is relevant to the performance of his or her
responsibilities as an audit committee member may be found above under the
heading Directors and Officers.

60

---

Pre-Approval Policies and Procedures

The Audit Committees charter sets out responsibilities regards
the provision of non-audit services by our external auditors. This policy
encourages consideration of whether the provision of services other than audit
services is compatible with maintaining the auditors independence and requires
Audit Committee pre-approval of permitted audit and audit-related services.

External Auditor Services Fees

Audit Fees

The aggregate fees (excluding expenses) billed by the Company's
external auditors in the year ended December 31, 2005 was $83,646. These fees
related to the audit of our consolidated financial statements for the period
ended December 31, 2004, the audit of the non-consolidated financial statements
of Minas Argentinas (Barbados) Inc. for the eight years from 1997-2004,
inclusive, and to a 2005 prospectus including related translation services.

Audit-Related Fees

There were no audit-related fees billed by the Companys
external auditors in the year ended December 31, 2005.

Tax Fees

Tax fees in respect of tax planning for the corporate group
billed in the year ended December 31, 2005 was $7,167.

All Other Fees

Other fees billed by the Companys external auditors in the
year ended December 31, 2005 was $2,650.

LEGAL PROCEEDINGS

The Company is not a party to any legal proceedings and is not
aware of any such proceedings known to be contemplated which may materially
affect the Company or its property holdings.

INTEREST OF MANAGEMENT AND OTHERS IN MATERIAL TRANSACTIONS

No director, executive officer or principal shareholder of the
Company, or any associate or affiliate of the foregoing, has had any material
interest, direct or indirect, in any transaction within the three most recently
completed financial years or during the current financial year prior to the date
of this AIF that has materially affected or will materially affect the Company
save as described below:

| | 1. | During the year ended December 31, 2005, the Company had
      consulting service arrangements with each of its four officers, two of
      which are also directors of the Company. Cash paid or payable pursuant to
      these arrangements was $145,092, $121,667, $110,000 and $45,000, an
      aggregate $421,759. These amounts exclude compensation paid or payable
      beginning the month of June 2005 in the case of two of the officers for
      amounts as salaries pursuant to the employment agreements made effective
      June 1, 2005.
| | -- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | 2. | During the twelve months ended December 31, 2004 and six
      months ended December 31, 2003, the Company paid $7,500 and $55,000,
      respectively, for administrative and corporate                                                                                                                                                                                                                                                                                                                                                                     

61

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| |    | services, and office space to a company which at the time
      was related by virtue of common directors and officers. The arrangement
      terminated February 14, 2004.                                                                                                                                                                                                                                     
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                 
| | 3. | In the twelve months ended December 31, 2004, the Company
      had monthly consulting services arrangements with each of its four
      officers, two of which are also directors of the Company. Cash paid or
      payable pursuant to these arrangements was $175,000, $112,027, $112,000
      and $102,650, an aggregate of $501,677. The arrangement with one of the
      officers began March 15, 2004.
|
|
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                 
| | 4. | In connection with the 2004 private placement of the
      Company, the independent directors of the Company approved the
      participation by one director of the Company in the private placement for
      the purchase of 150,000 units on the same terms as arms length
      investors.                                                                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                 
| | 5. | During the six months ended December 31, 2003, the
      Company paid a total $59,500 for management services to two companies each
      which has a common director with the Company.                                                                                                                                                                                                                         

TRANSFER AGENTS AND REGISTRARS

The transfer agent and registrar for the common shares is
Computershare Investor Services Inc. Vancouver, British Columbia, and Toronto,
Ontario.

MATERIAL CONTRACTS

The Company has entered into the following material contracts,
other than contracts entered into in the ordinary course of business, within the
most recent completed financial year, or before the most recently completed
financial year but is still in effect.

| | 1. | Option Agreement dated July 26, 2004 among Deprominsa,
      MASA and the Company whereby Deprominsa may earn a one-time 75% interest
      in the Las Flechas property of the Company by making expenditures
      aggregating US$4.5 million over 5 years.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | 2. | Underwriting Agreement dated for reference November 16,
      2004 among Canaccord Capital Corporation, Pacific International Securities
      Inc., Haywood Securities Inc. (collectively, the Underwriters) and the
      Company whereby the Company completed the brokered private placement of
      5,604,650 units for gross proceeds of $12,330,230. Each unit consisted of
      one common share at a price of $2.20 and one half of one transferable
      purchase warrant. Each whole warrant entitles the holder to acquire one
      common share at a price of $2.75 until December 6, 2006. The directors of
      the Company approved the participation by one director of the Company in
      the private placement for the purchase of 150,000 units on the same terms
      as arm's length investors. The director who so participated did not vote
      on the resolution to approve the private placement. In consideration for
      the services of the Underwriters, the Underwriters received a cash
      commission of $780,015 and 354,552 non-transferable brokers warrants
      entitling the Underwriters to purchase up to 354,552 common shares of the
      Company until December 6, 2006 at a price of $2.75 per common
  share.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
| | 3. | Underwriting Agreement dated for reference June 28, 2005
      among Canaccord Capital Corporation, Orion Securities Inc., National Bank
      Financial Inc., and Paradigm Capital Inc. (collectively the
      Underwriters), the Underwriters and the Company whereby the Company
      completed the brokered private placement of 5,750,000 Common Shares at a
      price of $3.25 per Common Share for total consideration of $18,687,500. In
      consideration for the services of the Underwriters, the Underwriters
      received a fee equal to $0.195 per Common Share (6% of the issue price)
      and expenses in consideration of services rendered by the Underwriters
      in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|
|

62

---

| |    | connection with the offering. As part of the offering,
      the Company further granted to the Underwriters an Over-Allotment Option
      to purchase up to an additional 750,000 Over- Allotment Shares at a price
      of $3.25 per Over-Allotment Share within 48 hours prior to the Closing
      Date. The Over-Allotment Option was exercised by the Underwriters in full
      and is reflected in the gross proceeds of $18,687,500.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
| | 4. | Underwriting Agreement dated for reference February 10,
      2006 among Canaccord Capital Corporation, Orion Securities Inc., National
      Bank Financial Inc., Paradigm Capital Inc. and Haywood Securities Inc.
      (collectively the Underwriters), and the Company whereby a brokered
      private placement of 9,600,000 Common Shares was completed at a price of
      $6.25 per Common Share for total consideration of $60,000,000. The
      Underwriters received a fee equal to $0.3125 per Common Share (5% of the
      issue price) and expenses in consideration of services rendered by the
      Underwriters in connection with the offering. As part of the offering, the
      Company granted to the Underwriters the Over-Allotment Option to purchase
      up to an additional 3,200,000 Over-Allotment Shares at a price of $6.25
      per Over-Allotment Share within 48 hours of the announcement of the
      Offering. The Over-Allotment Option was exercised by the Underwriters in
      full and is reflected in the gross proceeds of
  $60,000,000.

INTERESTS OF EXPERTS

Names of Experts

| | 1. | PricewaterhouseCoopers LLP (PWC) at Suite 700, 250 Howe
      Street, Vancouver, British Columbia, V6C 3S7, are the auditors for the
      Company. PWC signed the auditors report on the annual financial
      statements of the Company for the year ended December 31, 2005.                                                                                                                                                                                                                                       
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 2. | AMEC Americas Limited, an engineering consulting firm and
      a qualified person for the purposes of National Instrument 43-101, is
      responsible for the preparation of a technical report dated January 2005,
      entitled Preliminary Assessment and Economic Evaluation of Quebrada del
      Diablo Deposit, Gualcamayo Project.                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 3. | Ronald G. Simpson, P.Geo. a principle of Geosim Services
      Inc., an independent consulting geologist, a member of the Association of
      Professional Engineers and Geoscientists of British Columbia and a
      qualified person for the purposes of National Instrument 43-101, is one
      of the authors responsible for the preparation of a technical report dated
      January 2005, entitled Preliminary Assessment and Economic Evaluation of
      Quebrada del Diablo Deposit, Gualcamayo Project.
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
| | 4. | Technical Report entitled "Update on Resources:
      Gualcamayo Gold Project", dated December 8, 2004 was prepared by Ronald G.
      Simpson, P.Geo, a principle of Geosim Services Inc., a member of the
      Association of Professional Engineers and Geoscientists of British
      Columbia and an independent consulting geologist and a "qualified person"
      for the purposes of NI 43-101.                                                                                                                 

Interests of Experts

The Company's auditors PWC, Chartered Accountants, have
prepared an independent auditors' report dated March 10, 2006 in respect of the
Companys Consolidated financial statements with accompanying notes as at and
for the years ended December 31, 2005 and 2004. PWC has advised that they are
independent with respect to the Company within the meaning of the Rules of
Professional Conduct of the Institute of Chartered Accountants of British
Columbia and the rules of the US Securities and Exchange Commission.

63

---

To the knowledge of the Company, none of the other experts
named under "Names of Experts", held at the time that expert prepared the
statement, report or valuation, has received or will receive any registered or
beneficial interests, direct or indirect, in any securities or other property of
the Company or of one of the Company's associates or affiliates in connection
with the preparation or certification of any statement, report or valuation
prepared by such person.

ADDITIONAL INFORMATION

Additional information, is provided in

| | 1) | the Companys information circular dated March 21, 2006,
      which includes directors and officers remuneration and indebtedness,
      principal holders of the Companys securities and securities authorized
      for issuance under equity compensation plans; and
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                            
| | 2) | the Company's financial statements and MD&A for its
      most recently completed financial year;                                                                                                                                                                          

which may be found on SEDAR at www.sedar.com.

Copies of the above materials and the Companys AIF are
available upon request to the Corporate Secretary of the Company.

64

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