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

                                    FORM 20-F

(Mark One)

[ ]      Registration  Statement  Pursuant  to  Section  12(b)  or  (g)  of  the
         Securities Exchange Act of 1934

                                       or

[X]      Annual  Report  Pursuant  to  Section  13 or  15(d)  of the  Securities
         Exchange Act of 1934
                  FOR THE FISCAL YEAR ENDED DECEMBER 31, 2006

                                       or

[ ]      Transition  Report  Pursuant  to Section 13 or 15(d) of the  Securities
         Exchange Act of 1934
              For the transition period from _________ to _________

                                       or

[ ]      Shell Company Report  Pursuant to Section 13 OR 15(d) of the Securities
         Exchange Act of 1934

                         Commission file number: 0-51005

                           AMERA RESOURCES CORPORATION
             (Exact name of Registrant as specified in its charter)

                           AMERA RESOURCES CORPORATION
                 (Translation of Registrant's name into English)

                            BRITISH COLUMBIA, CANADA
                 (Jurisdiction of incorporation or organization)

   SUITE 709 - 837 WEST HASTINGS STREET, VANCOUVER, BRITISH COLUMBIA, V6C 3N6
                    (Address of principal executive offices)

Securities registered or to be registered pursuant to Section 12(b) of the Act.
                                      NONE

Securities registered or to be registered pursuant to Section 12(g) of the Act.
                           COMMON STOCK, NO PAR VALUE
                                (Title of Class)

Securities for which there is a reporting  obligation  pursuant to Section 15(d)
of the Act.
                                 NOT APPLICABLE
                                (Title of Class)

Indicate the number of  outstanding  shares of each of the  issuer's  classes of
capital or common stock as of December 31, 2006.

          21,748,592 COMMON SHARES OUTSTANDING AS OF DECEMBER 31, 2006

Indicate by check mark if the  registrant is a well-known  seasoned  issuer,  as
defined in Rule 405 of the Securities Act.

Yes [ ]  No [X]

If this report is an annual or transition report,  indicate by check mark if the
registrant  is not required to file  reports  pursuant to Section 13 or 15(d) of
the Securities Exchange Act of 1934.

Yes [ ]  No [X]

<PAGE>

Note - Checking the box above will not relieve any  registrant  required to file
reports  pursuant to Section 13 or 15(d) of the Securities  Exchange Act of 1934
from their obligations under those Sections.

Indicate by check mark whether the registrant (1) has filed all reports required
to be filed by Section 13 or 15(d) of the Securities Exchange Act of 1934 during
the  preceding 12 months (or for such  shorter  period that the  registrant  was
required  to file  such  reports),  and  (2) has  been  subject  to such  filing
requirements for the past 90 days.

Yes [X]  No [ ]

Indicate by check mark whether the registrant is a large  accelerated  filer, an
accelerated  filer, or a  non-accelerated  filer. See definition of "accelerated
filer and large  accelerated  filer" in Rule 12b-2 of the Exchange  Act.  (Check
one):

Large accelerated filer [ ]   Accelerated filer [ ]    Non-accelerated filer [X]

Indicate by check mark which financial statement item the registrant has elected
to follow.

Item 17 [X]   Item 18 [ ]

If this is an annual report,  indicate by check mark whether the registrant is a
shell company (as defined in Rule 12b-2 of the Exchange Act)     Yes [ ]  No [X]


                                     - 2 -
<PAGE>


GENERAL INFORMATION:

Unless otherwise indicated, all references herein are to Canadian dollars.

The Company is required under Canadian law (National Instrument 43-101 Standards
Of Disclosure  For Mineral  Projects)  ("NI 43-101") to calculate and categorize
"mineral  reserve",  "proven  mineral  reserve",   "probable  mineral  reserve",
"mineral  resource",  "measured mineral resource",  "indicated mineral resource"
and  "inferred  mineral  resource"  under  the  Canadian   Institute  of  Mining
Metallurgy and Petroleum  ("CIM")  Standards on Mineral Resources and Reserves -
Definitions and Guidelines  dated December 11, 2005.  These standards  establish
definitions and guidelines for the reporting of exploration information, mineral
resources  and  mineral  reserves  in Canada.  These  definitions  have not been
adopted for use in the United States of America by the  Securities  and Exchange
Commission (the "SEC").  Under these  guidelines,  the CIM definitions of proven
and probable  mineral  reserves equate to the definitions of proven and probable
reserves as set out in Guide 7 of the Securities Act Industry  Guides adopted by
the SEC ("Guide 7"). In addition,  Canadian law requires  disclosure  of mineral
resources that equate to measured, indicated and inferred resources.

                                    GLOSSARY

The  following  is a glossary of  geological  and  technical  terms used in this
annual report:


ALTERATION                   Any  physical  or  chemical  change  in a  rock  or
                             mineral  subsequent  to its  formation.  Milder and
                             more localized than metamorphism.

BRECCIA                      A rock containing  generally  angular  fragments of
                             itself or some other rock.

CATEO                        In Argentina,  a cateo is an exploration concession
                             granted for a period of up to 1,100 days.  In areas
                             where  field work  seasons  are  limited,  only the
                             available   field  season  will  be  considered  in
                             determining  the  1,100  days.  A cateo  gives  the
                             holder the  exclusive  right to  explore  the area,
                             subject to certain pre-existing rights of owners of
                             mines  within  the  area  and  abutting  owners  of
                             cateos.  Through  the process of  exploration,  the
                             owner   of   the    cateo   may   make   and   file
                             "manifestations"   of  discovery  (see  below)  and
                             petition the mining  authority  for the granting of
                             mines  (see  below).  A cateo  may be up to  10,000
                             hectares  in size.  A single  legal  person may not
                             hold more than 20 cateos  or  200,000  hectares  of
                             cateos  in any one  province.  When  the  cateo  is
                             officially  granted,  a one time  payment  of about
                             US$0.35 ( Pesos $0.80 ) per hectare is required.

CLASTIC                      Rock components  consisting of fragments derived by
                             mechanical erosion of pre-existing rocks.

EPITHERMAL                   A   mineral   deposit   consisting   of  veins  and
                             replacement   bodies,   usually  in   volcanic   or
                             sedimentary rocks,  containing precious metals, or,
                             more rarely, base metals.  Epithermal deposits form
                             in   hydrothermal   systems   related  to  volcanic
                             activity  and while  active  can  discharge  to the
                             surface as hot springs or fumaroles.

G/T                          grams per tonne

HIGH SULPHIDATION            Veins,  vuggy  breccias and  sulphide  replacements
                             ranging  from  pods  to  massive  lenses  occur  in
                             volcanic  sequences   associated  with  high  level
                             hydrothermal   systems   marked  by   acid-leached,
                             advanced argillic, siliceous alteration.

HYDROTHERMAL ALTERATION      Those chemical and mineral  changes  resulting from
                             the   interaction  of  hot  water   solutions  with
                             pre-existing solid mineral phases.

INTRUSIVE ROCK               A body of rock,  that while fluid,  penetrated into
                             or  between  other  rocks,  but  solidified  before
                             reaching the surface.

KM                           Kilometre

LWA                          length weighted average

M                            Metre



                                     - 3 -
<PAGE>

MAFIC                        Dark  colored,  generally  iron or magnesium  rich,
                             rock or mineral.

MANIFESTATIONS               In Argentina,  manifestations or  "manifestaciones"
                             of discovery  are official  notices  filed with the
                             mining authority  indicating that the person filing
                             (who  must be the  owner  of the  cateo  in an area
                             covered  by a  cateo)  has  made a  discovery.  The
                             filing and  acceptance  by the mining  authority of
                             such  a  notice,  constitutes  the  first  step  in
                             converting  a discovery  to a mine (see  below).  A
                             manifestation  of  discovery  may cover one or more
                             claims in the case of either a vein or disseminated
                             deposit.  The  size of the  manifestations  and the
                             annual  payments  required of the owner is the same
                             as those for a mine.

MINE                         In  Argentina,  a mine or "mina" is a real property
                             interest. It is a right of exploration granted on a
                             permanent basis after the completion of an official
                             survey  for as  long  as the  right  is  diligently
                             utilized  and  semi-annual  payments  of  40  Pesos
                             (approximately US$17.50) per claim are made. A mine
                             may   consist   of  one  or   several   claims   or
                             "pertenencias".  In the case of vein deposits, each
                             claim  is a  maximum  of 200 by 300  metres  or six
                             hectares; for disseminated deposits,  each claim is
                             up to one square kilometre or 100 hectares.

PORPHYRY                     An igneous rock  containing  mineral  crystals that
                             are visibly  larger than other crystals of the same
                             or different composition.

POTASSIC ALTERATION          Development    of   secondary    potassium-dominant
                             minerals   such  as   K-Feldspar   or   biotite  by
                             hydrothermal activity.

PPM                          parts per million

PROPYLITIC ALTERATION        Hydrothermal  alteration  consisting of the mineral
                             assemblage  epidote-chlorite-albite-calcite usually
                             found in the  outer  zones of  epithermal  gold and
                             copper porphyry deposits.

QUALIFIED PERSON             As  defined   in  under   Canadian  law   (National
                             Instrument  43-101   Standards  of  Disclosure  for
                             Mineral Projects)  ("NI 43-101") an individual  who
                             (a) is an engineer  or  geoscientist  with at least
                             five years of experience  in  mineral  exploration,
                             mine  development or operation  or mineral  project
                             assessment, or any  combination  of these;  (b) has
                             experience relevant  to the  subject  matter of the
                             mineral project and the technical report; and (c)is
                             a  member  in  good  standing  of  a   professional
                             association.

SEDIMENTARY ROCKS            Descriptive  term for a rock  formed  of  sediment,
                             namely  solid  material  both  mineral and organic,
                             deposited from suspension in a liquid.

SKARN                        A style  of  alteration  characterized  by iron and
                             magnesium bearing aluminosilicate materials such as
                             garnet and diopside.

STOCKWORK                    A mineral deposit or  accumulation  consisting of a
                             three-dimensional  network  of planar to  irregular
                             veinlets spaced closely together

STREAM SEDIMENT SAMPLE       A  sample  of  fine   sediment   derived  from  the
                             mechanical action of the stream.

SULFIDE                      A  compound  of  sulfur  combined  with one or more
                             metallic or semi-metallic elements.

SUPERGENE                    A mineral  deposit or  enrichment  formed  near the
                             surface by descending solutions.

TALUS                        Rock fragments lying at the base of a cliff or on a
                             steep slope from which they were derived.

VEINLET                      A small vein.

VEINS                        An  occurrence  of minerals,  having been  intruded
                             into another rock, forming tabular shaped bodies.

AG                           Silver



                                     - 4 -
<PAGE>

AS                           Arsenic

AU                           Gold

BA                           Barium

CO                           Cobalt

CU                           Copper

MO                           Molybdenum

PB                           Lead

SB                           Antimony

ZN                           Zinc


                                    MINERALS

ARGENTITE                    A silver sulphide mineral - Ag2S

AZURITE                      A  deep  blue  to  violet  blue  copper   carbonate
                             hydroxide  mineral  commonly found in the oxidation
                             zones of porphyry copper deposits - Cu3(CO3)2(OH)2.

BIOTITE                      An iron and magnesium bearing mica mineral.

CARBONATE                    A mineral containing the radical CO3.

CALCITE                      Calcium Carbonate (CaCO3)

CHALCOPYRITE                 A  sulfide  mineral  containing  copper  and iron -
                             CuFeS2.

CHLORITE                     Family of sheet silicates of iron,  magnesium,  and
                             aluminum,  characteristic of low-grade metamorphism
                             or  hydrothermal  alteration.   Green  color,  with
                             cleavage  like  mica  except  that  chlorite  small
                             scales are not elastic.

FELDSPAR                     An   aluminosilicate   with  variable   amounts  of
                             potassium, sodium and calcium.

HORNBLENDE                   A complex  hydrated  aluminosilicate  of magnesium,
                             iron and sodium.

MAGNETITE                    A magnetic iron oxide mineral.

MALACHITE                    A bright green copper carbonate  hydroxide  mineral
                             often found in the oxidized zone of porphyry copper
                             deposits - Cu2(CO3)(OH)2.

PYROXENE                     An aluminosilicate of magnesium and iron.



                                     - 5 -
<PAGE>


                                   ROCK TYPES


ANDESITE                     A volcanic rock with the principal  minerals  being
                             plagioclase.

CONGLOMERATE                 A  clastic   sedimentary  rock  containing  rounded
                             fragments of gravel or pebble size.

DACITE                       A  volcanic  or  shallow  intrusive  rock  with the
                             principal  minerals being  plagioclase,  quartz and
                             one or more mafic constituents.

DIORITE                      An intrusive  rock  composed  essentially  of sodic
                             plagioclase, hornblende, biotite, or pyroxene.

LIMESTONE                    A sedimentary  rock  consisting  chiefly of calcium
                             carbonate.

SANDSTONE                    A clastic  sedimentary  rock  composed  largely  of
                             sand-sized grains, principally quartz.

SHALE                        A  clastic   sedimentary  rock  derived  from  very
                             fine-grained sediment (mud).

TUFF                         A  consolidated  rock formed of compacted  volcanic
                             fragments and fine ash,  generally smaller than 4mm
                             in  diameter.  If  particles  are  melted  slightly
                             together  from  their  own  heat,  it is a  "welded
                             tuff."


FORWARD LOOKING STATEMENTS

The Company cautions readers regarding  forward looking  statements found in the
following  discussion  and  elsewhere  in this  annual  report  and in any other
statement  made by, or on the  behalf of the  Company,  whether or not in future
filings with the Securities  Exchange  Commission  (the "SEC").  Forward looking
statements are statements not based on historical  information  and which relate
to future  operations,  strategies,  financial  results  or other  developments.
Forward looking  statements are necessarily based upon estimates and assumptions
that are inherently  subject to significant  business,  economic and competitive
uncertainties and contingencies,  many of which are beyond the Company's control
and many of which,  with respect to future  business  decisions,  are subject to
change.  See "Item 3. Key Information - Risk Factors".  These  uncertainties and
contingencies can affect actual results and could cause actual results to differ
materially from those expressed in any forward looking  statements made by or on
behalf of the Company.  The Company  disclaims any  obligation to update forward
looking statements.




                                     - 6 -
<PAGE>


                                     PART I

ITEM 1.  DIRECTORS, SENIOR MANAGEMENT AND ADVISORS.
--------------------------------------------------------------------------------

Not applicable.


ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE.
--------------------------------------------------------------------------------

Not applicable.


ITEM 3.  KEY INFORMATION.
--------------------------------------------------------------------------------

SELECTED FINANCIAL DATA

The  selected  financial  data of the Company for the years ended  December  31,
2006,  2005 and 2004,  was derived from the financial  statements of the Company
which have been audited by Ernst & Young LLP, independent Chartered Accountants,
as indicated in their report which is included  elsewhere in this annual report.
The selected  financial data set forth for the years ended December 31, 2003 and
2002 are derived from the Company's audited financial  statements,  not included
herein.

The selected  financial data for the periods ended  December 31, 2006,  2005 and
2004,  have been derived from the audited  financial  statements of the Company,
included  herein  and,  in  the  opinion  of  the  Company,  also  included  all
adjustments  (consisting of normally recurring adjustments) necessary to present
fairly the information set forth therein.

The  information  in the following  table was  extracted  from the more detailed
financial  statements  and related notes  included  herein and should be read in
conjunction  with such financial  statements and with the information  appearing
under the heading "Item 5.
Operating and Financial Review and Prospects."

Reference is made to Note 11 of the Company's audited  financial  statements for
the years ended December 31, 2006 of the Company's financial  statements,  which
are included  herein,  for a  discussion  of the  material  differences  between
Canadian  generally  accepted  accounting  principles  ("GAAP") and US GAAP, and
their effect on the Company's financial statements.

To date,  the Company has not generated any cashflow from its activities to fund
ongoing activities and cash commitments. The Company has financed its operations
principally  through the sale of its equity securities.  The Company believes it
has adequate  resources to maintain its core  activities  for the 12 months from
January  1, 2007 to  December  31,  2007,  but may not have  sufficient  working
capital to fund all its  planned  exploration  activities.  In the  future,  the
Company  may need to raise  additional  capital  through  the sale of its equity
securities to fund further  exploration  activities.  See "Item 5. Operating and
Financial  Review and Prospects - Liquidity and Capital  Resources." The Company
may not be able to raise the  necessary  funds,  if any,  and may not be able to
raise such funds at terms which are acceptable to the Company.  In the event the
Company is unable to raise adequate finances to fund the proposed activities, it
will need to reassess  its  alternatives  and may have to abandon one or more of
its property interests as a result.



                                     - 7 -
<PAGE>


CANADIAN GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

<TABLE>
<CAPTION>

                                                                           (CDN $)
                                        ----------------------------------------------------------------------------
                                                                   YEAR ENDED DECEMBER 31,
                                        ----------------------------------------------------------------------------
                                            2006            2005            2004            2003            2002
                                        ------------    ------------    ------------    ------------    ------------
<S>                                    <C>             <C>             <C>             <C>             <C>

Revenue                                            -               -               -               -               -
General Corporate Expenditures            (1,125,939)       (988,664)       (845,181)       (408,352)        (26,614)
General Exploration Expenditures            (296,810)       (199,264)        (18,318)              -               -
Foreign Exchange Loss                         (2,910)        (36,624)        (25,104)           (896)              -
Interest and Miscellaneous Income             30,924          15,001          14,271           3,492             356
Write-off of mineral properties             (525,514)       (225,000)              -               -               -

Net Loss for the year                     (1,920,249)     (1,434,551)       (874,332)       (405,756)        (26,258)
Loss per Share Basic and Diluted               (0.10)          (0.09)          (0.07)          (0.08)          (1.25)
Weighted Average Number
     of Shares Outstanding                19,169,121      15,916,822      13,192,736       4,848,716          20,974

Working Capital                              870,731         516,270       1,686,120       1,021,272         174,042
Capital Assets                                     -               -           2,796               -               -
Mineral Properties                         3,356,158       3,184,844       2,014,978         684,259               -
Long-Term Debt                                     -               -               -               -               -
Total Assets                               4,343,852       3,843,389       3,754,341       1,820,883         207,469
Net Assets - Shareholder's Equity          4,165,095       3,546,233       3,604,137       1,705,531         184,042
</TABLE>

ADJUSTED TO UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

Under U.S.  GAAP the  following  financial  information  would be adjusted  from
Canadian GAAP (references are made to Note 11 of the  accompanying  consolidated
audited financial statements):
<TABLE>
<CAPTION>

                                               ----------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF OPERATIONS                                            (CDN $)
                                               ----------------------------------------------------------------------------
                                                   2006            2005            2004            2003            2002
                                               ------------    ------------    ------------    ------------    ------------
<S>                                           <C>             <C>             <C>             <C>             <C>

Loss for the year under Canadian GAAP            (1,920,249)     (1,434,551)       (874,332)       (405,756)        (26,258)

Mineral property and deferred exploration
     costs for the year, net of reversal of
     future income tax                             (789,915)     (1,339,742)     (1,230,962)       (684,259)              -

Mineral property and deferred exploration
     costs written off during the year which
     would have been expensed in the year
     incurred                                       525,514         225,000               -               -               -
                                               ------------    ------------    ------------    ------------    ------------
Loss for the year under US GAAP                  (2,184,650)     (2,549,293)     (2,105,294)     (1,090,015)        (26,258)

Unrealized gains on available-for-sale
     securities                                       7,000               -               -               -               -
                                               ------------    ------------    ------------    ------------    ------------
Comprehensive loss under US GAAP                 (2,177,650)     (2,549,293)     (2,105,294)     (1,090,015)        (26,258)
                                               ============    ============    ============    ============    ============

Basic and diluted loss per share
     under US GAAP                                   (0.11)          (0.16)          (0.16)          (0.22)          (1.25)
                                               ============    ============    ============    ============    ============
</TABLE>




                                     - 8 -
<PAGE>


<TABLE>
<CAPTION>

                                               ----------------------------------------------------------------------------
CONSOLIDATED BALANCE SHEETS                                                       (CDN $)
                                               ----------------------------------------------------------------------------
                                                   2006            2005            2004            2003            2002
                                               ------------    ------------    ------------    ------------    ------------
<S>                                           <C>             <C>             <C>             <C>             <C>

SHAREHOLDERS' EQUITY

Balance per Canadian GAAP                         4,165,095       3,546,233       3,604,137       1,705,531         184,042

Mineral property and deferred exploration
     costs expensed net of reversal of
     future income tax                           (3,294,364)     (3,029,963)     (1,915,221)       (684,259)              -

Accumulated other comprehensive income                7,000               -               -               -               -
                                               ------------    ------------    ------------    ------------    ------------
Balance per US GAAP                                 877,731         516,270       1,688,916       1,021,272         184,042
                                               ============    ============    ============    ============    ============

MINERAL PROPERTIES AND DEFERRED COSTS
Balance per Canadian GAAP                         3,356,158       3,184,844       2,014,978         684,259               -
Mineral properties and deferred costs
     expensed under US GAAP                      (3,356,158)     (3,184,844)     (2,014,978)       (684,259)              -
                                               ------------    ------------    ------------    ------------    ------------
Balance per US GAAP                                       -               -               -               -               -
                                               ============    ============    ============    ============    ============

FUTURE INCOME TAX LIABILITIES
Balance per Canadian GAAP                            61,794         154,881          99,757               -               -
Reversal of future income tax liability             (61,794)       (154,881)        (99,757)              -               -
                                               ------------    ------------    ------------    ------------    ------------
Balance per US GAAP                                       -               -               -               -               -
                                               ============    ============    ============    ============    ============
</TABLE>

<TABLE>
<CAPTION>

                                               ----------------------------------------------------------------------------
CONSOLIDATED STATEMENTS OF CASH FLOWS                                             (CDN $)
                                               ----------------------------------------------------------------------------
                                                   2006            2005            2004            2003            2002
                                               ------------    ------------    ------------    ------------    ------------
<S>                                           <C>             <C>             <C>             <C>             <C>

OPERATING ACTIVITIES

Cash used per Canadian GAAP                      (1,350,297)     (1,131,111)       (845,988)        (80,610)         (4,031)
Mineral properties and deferred costs              (696,915)     (1,196,242)     (1,230,962)       (414,259)              -
                                               ------------    ------------    ------------    ------------    ------------
Cash used per US GAAP                            (2,047,212)     (2,327,353)     (2,076,950)       (494,869)         (4,031)
                                               ============    ============    ============    ============    ============

INVESTING ACTIVITIES

Cash used per Canadian GAAP                        (796,915)       (196,242)     (2,233,759)       (414,259)              -
Mineral properties and deferred costs               696,915       1,196,242       1,230,962         414,259               -
                                               ------------    ------------    ------------    ------------    ------------
Cash provided (used) per US GAAP                   (100,000)      1,000,000      (1,002,797)              -               -
                                               ============    ============    ============    ============    ============

FINANCING ACTIVITIES

Cash provided per Canadian
     and US GAAP                                  2,156,011       1,170,448       2,641,134       1,415,245         201,499
                                               ============    ============    ============    ============    ============
</TABLE>

See Note 11 of the Company's consolidated financial statements.


                                     - 9 -
<PAGE>


EXCHANGE RATE HISTORY

The noon rate of  exchange  on April 30,  2007,  reported  by the United  States
Federal  Reserve Bank of New York for the  conversion  of Canadian  dollars into
United States dollars was CDN$1.1068 (US$0.9035 = CDN$1.00).

The following table sets forth the average exchange rate for one Canadian dollar
expressed in terms of one U.S. dollar for the past five fiscal years.

         PERIOD                                     AVERAGE

         January 1, 2006 - December 31, 2006         0.8818
         January 1, 2005 - December 31, 2005         0.8254
         January 1, 2004 - December 31, 2004         0.7682
         January 1, 2003 - December 31, 2003         0.7206
         January 1, 2002 - December 31, 2002         0.6368

The  following  table sets forth high and low  exchange  rates for one  Canadian
dollar expressed in terms of one U.S. dollar for the past six months:

         MONTH                      HIGH              LOW

         April 2007                0.9035            0.8633
         March 2007                0.8673            0.8467
         February 2007             0.8631            0.8437
         January 2007              0.8586            0.8547
         December 2006             0.8760            0.8582
         November 2006             0.8869            0.8715

Exchange  rates are based upon the noon  buying  rate in New York City for cable
transfers in foreign currencies as certified for customs purposes by the Federal
Reserve Bank of New York.

RECENT ACCOUNTING PRONOUNCEMENTS

UNITED STATES PRONOUNCEMENTS

The  Financial  Accounting  Standards  Board  ("FASB")  has issued  Statement of
Financial  Accounting  Standards ("SFAS") 157, "Fair Value Measurements"  ("SFAS
157"),  which  defines  fair value,  establishes  a framework  for  consistently
measuring  fair  value  under  GAAP and  expands  disclosures  about  fair value
measurements.  SFAS  157  is  effective  beginning  January  1,  2008,  and  the
provisions  of SFAS 157  will be  applied  prospectively  as of that  date.  The
adoption  of  SFAS  157 is not  expected  to  have an  effect  on the  Company's
financial position.

The FASB has also issued FAS  Interpretation No. 48, "Accounting for Uncertainty
in Income Taxes" ("FIN 48"). FIN 48 clarifies the accounting for  uncertainty in
income taxes  recognized in an enterprise's  financial  statements in accordance
with  FAS  Interpretation  No.  109,  "Accounting  for  Income  Taxes".  FIN  48
prescribes  a  recognition  threshold  and  measurement   attributable  for  the
financial  statement  recognition  and  measurement  of a tax position  taken or
expected  to be  taken  in a tax  return.  FIN  48  also  provides  guidance  on
derecognition,  classification,  interest and  penalties,  accounting in interim
periods,  disclosures  and  transitions.  FIN 48 is  effective  for fiscal years
beginning  after  December 15,  2006.  The adoption of FIN 48 is not expected to
have an effect on the Company's financial position.

CANADIAN PRONOUNCEMENTS

The Company  believes that there are no new Canadian  pronouncements  which will
have a  material  effect on the  Company's  financial  position  or  results  of
operations.



                                     - 10 -
<PAGE>


RISK FACTORS

Due to the nature of the Company's business and the present stage of exploration
on its mineral  resource  properties,  the  following  risk factors apply to the
Company's  operations  (see "Item 4.  Information  on the  Company - History and
Development of the Company"):

LIQUIDITY  AND CASH FLOW:  The Company has limited  financial  resources,  has a
history of losses and has no source of operating  cash flow. The Company has not
generated any revenues from its mineral  claims and does not  anticipate  any in
the foreseeable future. Historically,  the only source of funds available to the
Company has been through the sale of its common shares.

As of  April  30,  2007,  the  Company  had  working  capital  of  approximately
$3,800,000.  The Company believes it has adequate resources to maintain its core
activities  for the 12 months from January 1, 2007 to December 31, 2007, but may
not  have  sufficient  working  capital  to  fund  all its  planned  exploration
activities.  In the future,  the Company  may need to raise  additional  capital
through  the  sale  of  its  equity  securities  to  fund  further   exploration
activities.  See  "Item 5.  Operating  and  Financial  Review  and  Prospects  -
Liquidity  and  Capital  Resources."  The  Company  may not be able to raise the
necessary  funds, if any, and may not be able to raise such funds at terms which
are  acceptable  to the  Company.  In the event the  Company  is unable to raise
adequate finances to fund the proposed activities,  it will need to reassess its
alternatives and may have to abandon one or more of its property  interests as a
result.  Any further  additional equity financing  undertaken by the Company may
cause dilution to its shareholders.

EXPLORATION STAGE COMPANY:  All of the Company's  property  interests are in the
exploration stage and do not contain any "reserves",  as that term is defined in
Guide 7 adopted by the SEC. The term  "reserves"  is defined in Guide 7 as "that
part of a mineral deposit which could be economically  and legally  extracted or
produced at the time of the reserve  determination."  Guide 7 is available  from
the SEC's website at:
       http://www.sec.gov/divisions/corpfin/forms/industry.htm#secguide7.

Mineral  exploration  involves  significant  risk  and few  properties  that are
explored are ultimately  developed into producing  mines.  The probability of an
individual  prospect ever having reserves that meet the requirements of Industry
Guide  7  is  extremely  remote.  The  Company's  property  interests,   in  all
probability,  do not contain any reserves and any funds spent on  exploration of
the Company's  property interests will probably be lost. If any of the Company's
exploration  programs are successful,  the Company will require additional funds
to advance the property beyond the exploration stage.  Substantial  expenditures
are required to establish  reserves through drilling,  to develop  metallurgical
processes to extract the metal from the ore and, in the case of new  properties,
to develop the mining and processing  facilities and  infrastructure at any site
chosen for mining.  If the Company is unable to secure additional  funding,  the
Company may lose its interest in one or more of its mineral claims and/or may be
required to cease all activities.

ADDITIONAL  FINANCING:  In recent years,  the securities  markets in Canada have
experienced a high level of price and volume volatility, and the market price of
securities of many companies, particularly junior mineral exploration companies,
have  experienced  wide  fluctuations in price which have not  necessarily  been
related to the operating  performance,  underlying  asset values or prospects of
such  companies.  Substantially  all  of  the  Company's  financings  have  been
conducted  through the sale of its common stock.  Continued  price  fluctuations
will have a  significant  impact on the  Company's  ability to  complete  equity
financings.

EXPLORATION  RISKS:  The  properties  in which the Company  has an interest  are
located in  Argentina (a portion of one project  extends  into Chile),  Peru and
Nevada, United States. Mineral exploration activities may be affected in varying
degrees by political  instability  and  government  regulations  relating to the
mining  industry.  Any changes in regulations or shifts in political  conditions
are beyond the control of the Company and may adversely affect its business. The
Company's  exploration   activities  may  be  affected  in  varying  degrees  by
government  regulations  with respect to restrictions on price controls,  export
controls,  income taxes,  expropriations of property,  environmental legislation
and mine safety.  The status of Argentina and Peru as  developing  countries may
make it more  difficult  for the  Company  to obtain  any  required  exploration
financing  for its  projects.  The  effect  of all of these  factors  cannot  be
accurately   predicted.   Both  the  Argentinean  and  Peruvian  economies  have
experienced  recessions in recent years and there can be no assurance that their
economies will recover from such  recessions.  If the economies of Argentina and
Peru fail to grow


                                     - 11 -
<PAGE>


or suffer a recession, the Company may not be able to continue its activities in
those  countries.  The Company does not maintain and does not intend to purchase
political risk insurance.

Exploration  activities  require  permits from various  federal,  provincial  or
territorial and local  governmental  authorities and are subject to national and
local  laws  and  regulations  governing  prospecting,   exports,  taxes,  labor
standards,  occupational  health,  waste disposal,  toxic substances,  land use,
environmental  protection,  mine safety,  and others  which  currently or in the
future  may have a  substantial  adverse  impact  on the  Company.  See "Item 4.
Information  on the  Company -  Business  Overview  -  Government  Regulations."
Exploration  activities are also subject to substantial  regulation  under these
laws by  governmental  agencies.  There can be no assurance,  however,  that all
permits  which the Company may require for its  exploration  activities  will be
obtainable on reasonable terms or on a timely basis or such laws and regulations
would  not have an  adverse  effect  on any  project  which  the  Company  might
undertake.

If the Company is unable to obtain the  necessary  permits  for its  exploration
activities,  the Company might have to change or abandon its planned exploration
for  such   non-permitted   properties   and/or  to  seek  other  joint  venture
arrangements.  In such event, the Company might be forced to sell or abandon its
property interests.

Failure to comply with applicable laws, regulations, and permitting requirements
may  result  in  enforcement  actions  thereunder,  including  orders  issued by
regulatory or judicial authorities causing exploration activities to cease or be
curtailed,  and may include corrective measures requiring capital  expenditures,
installation of additional equipment, or remedial actions.

Any change in or amendments to current laws,  regulations and permits  governing
activities of mineral exploration  companies,  or more stringent  implementation
thereof, could require increases in exploration expenditures,  or require delays
in exploration or abandonment of new mineral properties.  The cost of compliance
with  changes in  governmental  regulations  has a  potential  to  increase  the
Company's expenses.

PROJECT  DELAY:  If the Company  undertakes  new, or  significantly  expands its
existing,   exploration  activities  the  Company  may  be  required  to  obtain
pre-construction  environmental  and land use review and comply with permitting,
control and mitigation requirements of the jurisdiction in which such activities
are to be conducted.  Compliance with new requirements could impose costs on the
Company in the future,  the materiality of which cannot  reasonably be predicted
at this time.  Also, the Company may require  additional  permits for its future
activities, which may or may not be obtainable on reasonable terms.

TITLE TO PROPERTIES: The Company owns, leases or has under option mining claims,
mineral claims or concessions which constitute the Company's  property holdings.
The ownership and validity of mining claims and  concessions are often uncertain
and may be contested.

The Company does not obtain title  insurance  for its  property  interests.  The
possibility  exists that title to one or more of its  concessions,  particularly
title to undeveloped  claims,  might be defective because of errors or omissions
in the chain of title,  including defects in conveyances and defects in locating
or maintaining such claims, or concessions.

The Company's  mineral property  interests may be subject to prior  unregistered
agreements  or  transfers  or native  land  claims and title may be  affected by
undetected  defects.  Surveys have not been carried out on any of the  Company's
mineral properties,  therefore,  in accordance with the laws of the jurisdiction
in which such  properties  are  situated;  their  existence and area could be in
doubt. Until competing interests in the mineral lands have been determined,  the
Company  can give no  assurance  as to the  validity  of title of the Company to
those lands or the size of such mineral lands.

If the  Company,  or the person or entity from which the Company has obtained an
option  for  property  interests,  does not have  proper  title to its  property
interests,  the Company may incur  significant  expenses  defending or acquiring
proper  title  and/or may have to abandon  such  interests,  which may result in
significant  losses for the  Company and could  result in the Company  having to
cease all of its activities.

PRICE  FLUCTUATIONS AND SHARE PRICE  VOLATILITY:  In recent years the securities
markets in Canada have  experienced a high level of price and volume  volatility
and the  market  price of  securities  of many  companies,  particularly  junior
mineral  exploration   companies,   like  the  Company,  have  experienced  wide
fluctuations   which  have  not  necessarily   been  related  to


                                     - 12 -
<PAGE>

the  operating  performance,  underlying  asset  values  or  prospects  of  such
companies. In particular,  the per share price of the Company's common shares on
the TSX Venture Exchange (the "TSX-V")  fluctuated from a high of $0.73 to a low
of $0.32 during the 12-month  period ending  December 31, 2006.  There can be no
assurance that continual fluctuations in price will not occur.

CURRENCY RISK:  Business is transacted by the Company in a number of currencies.
Fluctuations  in exchange rates may have a significant  effect on the cash flows
of the Company.  Future  changes in exchange rates could  materially  affect the
Company's results in either a positive or negative direction.

OPERATING  HAZARDS AND RISKS:  All of the Company's  mineral claim interests are
located  outside of Canada.  If the Company  were to become  involved in a legal
action in Canada relating to its mineral claim interests, the Company may not be
able to enforce any judgment it obtains in such an action against assets located
outside of Canada.

Peru has been the subject of terrorism.  The Company may not be able to continue
its activities in Peru if the terrorism resumes.  The Company may not be able to
find  suitable  labor  for its  Peruvian  projects  or may  have  difficulty  in
obtaining financing for its Peruvian projects in that event.

The Company's  long-term  profitability  will in part be directly related to the
costs and success of its exploration programs, which may be affected by a number
of factors.  Mineral  exploration is a speculative  business  characterized by a
number of significant risks including, among other things,  unprofitable efforts
resulting not only from the failure to discover  mineral  deposits but also from
finding mineral deposits that, though present,  are insufficient in quantity and
quality to return a profit.  The Company may not discover minerals in sufficient
quantities to justify  activities  beyond the exploration  stage. In which case,
the Company may have to delay or abandon its mineral property interests.

The  marketability  of minerals  may be affected by numerous  factors  which are
beyond the control of the Company and which cannot be accurately predicted, such
as  fluctuations  in the metals  markets,  the proximity and capacity of milling
facilities,  mineral markets and processing equipment, and such other factors as
government  regulations,  including  regulations relating to royalties,  prices,
taxes, land tenure, land use, allowable  production,  importing and exporting of
minerals, and environmental protection. The exact effect of these factors cannot
be accurately predicted,  but the combination of these factors may result in the
Company  not  receiving  an adequate  return on  invested  capital or losing its
investment capital.

MANAGEMENT:  The  success of the  activities  of the Company is  dependent  to a
significant  extent on the  efforts and  abilities  of its key  management,  Mr.
Nikolaos Cacos,  the President,  Chief  Executive  Officer and a director of the
Company, and Mr. Joseph Grosso, the Chairman of the Board of Directors. The loss
of  services of either Mr.  Cacos or Mr.  Grosso  could have a material  adverse
effect on the  Company.  With the  exception of the service  agreement  with Mr.
Cacos,  the Company has not entered into  employment  agreements with any of its
officers and is not expected to do so in the  foreseeable  future.  See "Item 6.
Directors, Senior Management and Employees - Employment Agreements." The Company
has not obtained key-man life insurance on any of its officers or directors. The
Company's ability to recruit and retain highly qualified management personnel is
critical to its success; if it is unable to do so this may materially affect the
Company's financial performance.

DEPENDENCE UPON OTHERS: The success of the Company's operations will depend upon
numerous factors, many of which are beyond the Company's control,  including (i)
the  ability  of the  Company  to  enter  into  strategic  alliances  through  a
combination of one or more joint ventures,  mergers or acquisition transactions,
(ii) the ability to discover and produce minerals;  (iii) the ability to attract
and retain additional key personnel in investor relations,  marketing, technical
support,  and  finance;  and (iv) the ability  and the  operating  resources  to
develop and maintain the properties held by the Company. These and other factors
will require the use of outside  suppliers as well as the talents and efforts of
the  Company.  There can be no  assurance  of  success  with any or all of these
factors on which the Company's operations will depend.

CONFLICTS OF INTEREST:  Several of the Company's  directors are also  directors,
officers or shareholders of other companies.  Some of the directors and officers
are  engaged  and will  continue  to be engaged  in the  search  for  additional
business opportunities on behalf of other corporations, and situations may arise
where  these  directors  and  officers  will be in direct  competition  with the
Company.  Such  associations may give rise to conflicts of interest from time to
time.  Such a  conflict  poses  the  risk  that the  Company  may  enter  into a
transaction  on terms which could place the Company in a worse  position


                                     - 13 -
<PAGE>

than if no conflict existed. Conflicts, if any, will be dealt with in accordance
with the relevant provisions of the BUSINESS CORPORATIONS ACT (British Columbia)
(the "BCBCA").  The directors of the Company are required by law to act honestly
and in good  faith  with a view  to the  best  interest  of the  Company  and to
disclose any interest  which they many have in any project or opportunity of the
Company.  However, each director has a similar obligation to other companies for
which such  director  serves as an officer  or  director.  In order to avoid the
possible  conflict of interest which may arise between the directors'  duties to
the Company and their duties to the other  companies on whose boards they serve,
the directors and officers of the Company have agreed to the following:

     1.   participation in other business ventures offered to the directors will
          be allocated between the various companies and on the basis of prudent
          business  judgment and the relative  financial  abilities and needs of
          the companies to participate;
     2.   no commissions or other  extraordinary  consideration  will be paid to
          such directors and officers; and
     3.   business  opportunities  formulated by or through  other  companies in
          which the  directors  and officers are involved will not be offered to
          the Company except on the same or better terms than the basis on which
          they are offered to third party participants.

As of the date of this annual  report all material  related  party  transactions
which have arisen since January 1, 2004,  have been  described in "Item 7. Major
Shareholders and Related Party Transactions."

INSURABLE  RISKS AND  LIMITATIONS OF INSURANCE:  The Company  maintains  certain
insurance,  however,  such  insurance  is subject  to  numerous  exclusions  and
limitations.  The Company maintains a Total Office Policy in Canadian dollars on
its principal  offices.  Generally,  the Total Office  Policy  provides All Risk
Replacement  Cost  Coverage  on office  contents,  up to  $300,000,  with a $500
deductible.  In  addition,  the policy  provides  Commercial  General  Liability
coverage of up to $5,000,000  for Third Party Bodily Injury or Property  Damage,
per occurrence  and  $2,000,000  for Tenants Legal  Liability for any one leased
premises, with a $500 deductible.  The Company also has insurance coverage of up
to $5,000,000 for non-owned automobile liability.

The Company  maintains a Foreign  Commercial  General  Liability  policy in U.S.
dollars  which  provides  US$5,000,000  coverage  for bodily  injury or property
damage per occurrence and coverage up to  US$5,000,000  per offence for personal
injury or advertising  injury (libel,  slander,  etc.). The policy has a general
aggregate limit for all claims during each consecutive policy period, except for
those  resulting  from  product  hazards or  completed  operations  hazards,  of
US$5,000,000. The policy has a US$5,000,000 aggregate limit for each consecutive
policy period,  for bodily injury or property  damage  liability  arising out of
completed operations and products.  In addition,  the Foreign Commercial General
Liability  policy provides for coverage of up to US$10,000 in medical  expenses,
per person,  with a US$10,000 limit per accident,  and up to US$100,000 for each
occurrence of tenants' fire legal liability. The policy does not apply to injury
or damages  occurring  within Canada,  the U.S.  (including its  territories and
possessions),  Puerto Rico, any countries or territories  against which the U.S.
has an  embargo,  sanction  or ban in effect,  territorial  waters of any of the
foregoing,  the Gulf of Mexico,  or  international  waters or  airspace  when an
injury or damage occurs in the course of travel or transportation to any country
or place  included in the  foregoing.  The policy  also does not cover  asbestos
related claims or liability for bodily injury or property damages arising out of
the  discharge,  dispersal,  release or escape of smoke,  vapors,  soot,  fumes,
acids,  alkalis,  toxic  chemicals,  liquids or gases,  waste materials or other
irritants,  contaminants or pollutants into or upon land, the atmosphere, or any
water-course or body of water. The policy also contains a professional liability
exclusion  which  applies to bodily  injury or  property  damage  arising out of
defects in maps, plans, designs or specifications prepared,  acquired or used by
the Company or arising out of any act of negligence,  error, mistake or omission
in  rendering  or  failing  to render  professional  consulting  or  engineering
services,  whether  performed  by the  Company or other for whom the  Company is
responsible.

The Company maintains a Foreign Commercial Automobile Liability Insurance policy
on owned, leased,  hired and non-owned  automobiles with the following liability
limitations:

     o    $5,000,000 bodily injury liability for each person.
     o    $5,000,000 bodily injury liability for each occurrence.
     o    $5,000,000 property damage liability for each occurrence.
     o    $10,000 medical expense coverage, per person.



                                     - 14 -
<PAGE>

     o    $10,000 medical expense coverage, per accident.

The foregoing descriptions of the Company's insurance policies do not purport to
be complete and does not cover all of the exclusions to such policies.

The Company has an Executive and Organization Liability insurance policy for the
benefit of  directors  and  officers.  The  aggregate  limit of  liability is $5
million. The policy is renewable on a yearly basis.

FOREIGN COUNTRIES AND REGULATORY REQUIREMENTS: The projects in which the Company
has an interest are located in Argentina,  Peru and the United  States.  Mineral
exploration  and mining  activities  in  Argentina  and Peru may be  affected in
varying degrees by political instability and government  regulations relating to
the  mining  industry.  Any  changes  in  regulations  or  shifts  in  political
conditions  are beyond the control of the Company and may  adversely  affect its
business.  The  Company  does  not  maintain  and does not  intend  to  purchase
political  risk  insurance.  Operations  may be affected  in varying  degrees by
government  regulations  with  respect  to  restrictions  on  production,  price
controls,   export   controls,   income  taxes,   expropriations   of  property,
environmental  legislation and mine safety.  The status of Argentina and Peru as
developing  countries  may make it more  difficult for the Company to obtain any
required  exploration  financing  for its  projects.  The effect of all of these
factors  cannot be accurately  predicted.  The Argentine and Peruvian  economies
have  experienced  recessions in recent years and there can be no assurance that
their economies will recover from such recessions.

Argentina has recently  experienced  some  economic and  political  instability.
Management  believes the new democratic elected government is making progress in
the   domestic   economy  and  it  is   improving   the  image  of  the  country
internationally.  Additionally,  management  believes  the  economic  crisis  of
December 2001 has been  overcome,  and although the country had defaulted on its
loans,  it has repaid its debt to the  International  Monetary  Fund in December
2005.  The  Company  maintains  the  majority  of its funds in  Canada  and only
forwards sufficient funds to meet current obligations and overhead in Argentina.
The Company does not believe that any current currency restrictions which may be
imposed in Argentina will have any immediate impact on the Company's exploration
activities.

IMPACT OF  GOVERNMENT  REGULATIONS  ON THE  COMPANY'S  BUSINESS:  The  Company's
activities are subject to various  governmental  regulations in Argentina,  Peru
and the United States.

ARGENTINA

MINING INDUSTRY

Mineral  companies  are  subject  to various  federal  and  provincial  laws and
regulations  including  specific  mining and  environmental  rules.  The Company
believes it is in material compliance with all applicable legislation.

The right to explore a property (a "cateo")  and the right to exploit (a "mina")
are granted by administrative or judicial  authorities via concessions.  Foreign
individuals  and  corporations  may apply for and hold cateos and minas,  at the
same level as local  investors  without  differences  of any nature.  Cateos and
minas are freely  transferable  upon  registration  with the  Provincial  Mining
Registry where title to the cateo or mina was first  registered.  Upon the grant
of a legal  concession  of a cateo or a mine,  parties have the right to explore
the land or to own the mine and the resources extracted therefrom.

REGULATORY ENVIRONMENT

Management  believes  the  present  government  is  committed  to opening up the
economy and there has been progress in reducing  import duties and export taxes.
For decades  local  industry has been  protected  and the  transition to greater
international competitiveness will take some time.

Importers and exporters  must be registered  with  Argentinean  Customs  office.
Except  for a limited  list of items  requiring  the  previous  approval  of the
authorities there are no import restrictions. Import of pharmaceuticals,  drugs,
foodstuffs,  defense  material and some other items  require the approval of the
applicable government  authority.  Import duties are being progressively reduced
in accordance with the free enterprise and free-trade  policy being  implemented
by the


                                     - 15 -
<PAGE>


government  in  order  to  achieve  greater  international  competitiveness.  To
illustrate,  duties currently range between zero and 20 percent. Restrictions on
exports are not generally imposed,  although there are export taxes currently in
place including mineral products.

POLITICAL ENVIRONMENT AND ECONOMY

In recent years Argentina has experienced a number of changes to its government.
The current president,  Nestor Kirchner, came to power in May 2003. The economic
performance  of the  country  has been  troubled  and  uncertain  since the late
1990's.  Management  believes there are positive  indications  that the economic
situation continues to improve.

PERU

MINING INDUSTRY

Peru has a lengthy  history  of mining  activities  that  predates  the  Spanish
conquistadors.  Although  political  unrest  and  instability  have  slowed  the
development of some of Peru's ore bodies in recent years, mining continues to be
an important  contributor  to the national  economy and  exploration  by foreign
companies  is  accelerating  due to the  abundance of mineral  sources.  Peru is
already a  substantial  producer of at least six metals and may have  unexplored
and unexploited  reserves in these and other metals. Peru ranks among the top 20
gold producing nations, and the newly expanded Yanacocha mine is Latin America's
largest single gold producer and Antamina is the world's largest zinc and copper
mine.

MINERAL CONCESSIONS IN PERU

Under  Peruvian law the right to explore for and exploit  minerals is granted by
way of concessions.  A Peruvian mining concession is a  property-related  right,
distinct and independent from the ownership of land on which it is located, even
when both belong to the same person.  The rights granted by a mining  concession
are defensible against third parties,  transferable,  chargeable and in general,
may be the  subject of any  transaction  or  contract.  The basic unit for newly
claimed mining  concessions is 100 hectares and existing  concessions of greater
than 100 hectares  will be reduced to that amount.  Otherwise,  concessions  can
only be divided by percentage  parts or shares.  Buildings  and other  permanent
structures  used in a mining  operation are  considered  real property and as an
accessory to the concession on which they are situated.

The concession holder must pay an annual rent of US$3.00 per hectare (except for
the  year  of  acquisition,  as this  rent  is  paid  as part of the  concession
application  fee). The concession  holder must sustain a minimum level of annual
commercial  production  of greater than US$100 per hectare in gross sales within
six years of the grant of the  concession or, if the concession has not been put
into production  within that period,  from the seventh year, a penalty is due of
US$6.00 per hectare per year in addition to the annual rent. The concession will
terminate  if the annual  rent is not paid for two  consecutive  or  alternative
years. The term of a concession is indefinite provided it is properly maintained
by payment of rental duties.

The  Constitution  of Peru  provides  that foreign  persons or companies  cannot
acquire or own a land title or mining  right,  directly or  indirectly,  if such
land title or mining right is located  within 50 kilometres  of Peru's  borders.
The  government  of Peru is permitted to grant an  exemption  by  publishing  an
official statement declaring a public necessity,  called a Decreto Supremo.  The
Decreto  Supremo must be signed by the  President  of Peru and the  Presidential
Cabinet, called the Consejo de Ministros.

None  of the  Company's  Peruvian  property  interests  are  located  within  50
kilometres of Peru's borders.

Many commercial  activities  performed by private  companies are subject to some
government  inspection  or  control,  including  mining,  which  requires  prior
government  permission,  licensing or concession,  and  compliance  with special
registration  procedures  of the  Department of Energy and Mines.  However,  the
Company's exploration activities do not require any licenses or permits from the
Department of Energy and Mines. The Company has obtained the necessary  permits,
if any, for its current and planed work on the Peruvian properties.


                                     - 16 -
<PAGE>


NEVADA, UNITED STATES

In the U.S., much of the Company's  exploration  activities  occur on unpatented
lode mining claims and mill sites that are on federal lands  pursuant to federal
mining  laws.  There are numerous  federal  regulatory  developments  that could
restrict  the  Company's   activities  and  significantly   increase  regulatory
obligations  and  compliance  costs with  respect to the  Company's  exploration
activities.

The  Company's  exploration  programs in Nevada are subject to state and federal
regulations regarding  environmental  considerations.  All activities associated
with the  exploration  for minerals are subject to existing laws and regulations
relating to exploration  procedures,  safety  precautions,  employee  health and
safety,  air quality  standards,  pollution of streams and fresh water  sources,
odor,  noise,  dust and  other  environmental  protection  controls  adopted  by
federal,  state  and local  governmental  authorities  as well as the  rights of
adjoining property owners. The Company may be required to prepare and present to
federal, state or local authorities data pertaining to the effect or impact that
its activities may have upon the environment.  All  requirements  imposed by any
such  authorities  may be costly,  time consuming and may delay  commencement or
continuation of the Company's  activities.  Future legislation may significantly
emphasize  the  protection  of  the  environment,  and,  as a  consequence,  the
activities of the Company may be more closely  regulated to further the cause of
environmental protection. Such legislation, as well as further interpretation of
existing  laws in the  United  States,  may  require  substantial  increases  in
equipment and  operating  costs to the Company and delays,  interruptions,  or a
termination  of its  activities,  the  extent  of  which  cannot  be  predicted.
Environmental  problems known to exist at this time in the United States may not
be in compliance  with  regulations  that may come into existence in the future.
This may have a substantial impact upon the capital expenditures required of the
Company  in order to deal  with such  problem  and  could  substantially  reduce
earnings.

At the present time, the Company's mineral exploration  activities in Nevada are
in compliance with all known environmental requirements.

Additionally, the National Historic Preservation Act requires that all operators
on public lands  conduct an  archeological  survey of the proposed  sites of new
disturbance.  As of the date of this annual report the Company has not conducted
an archeological survey on its Nevada properties.  In the future the Company may
be  required  to  conduct  such  a  survey  if  its   activities   constitute  a
"disturbance".  To the  best  of  management's  knowledge,  there  are no  known
environmental or threaten and endangered species issues at our Nevada properties
that would provide grounds for denial of approval of a plan of operation.

ENVIRONMENTAL REGULATIONS: The Company's operations are subject to environmental
regulations promulgated by government agencies from time to time.  Environmental
legislation  provides for restrictions  and prohibitions on spills,  releases or
emissions of various  substances  produced in  association  with certain  mining
industry  operations,  such as seepage from tailings disposal areas, which would
result in  environmental  pollution.  A breach of such legislation may result in
the imposition of fines and penalties.  At present, the Company does not believe
that compliance  with  environmental  legislation  and  regulations  will have a
material  affect  on  the  Company's   operations;   however,   any  changes  in
environmental  legislation or  regulations,  or in the Company's  business,  may
cause  compliance  with such  legislation  and/or  regulation to have a material
impact on the  Company's  operations.  In addition,  certain types of operations
require  the  submission  and  approval  of  environmental  impact  assessments.
Environmental   legislation  is  evolving  in  a  manner  which  means  stricter
standards,  and  enforcement,  fines and penalties for  non-compliance  are more
stringent.  Environmental  assessments  of proposed  projects carry a heightened
degree of  responsibility  for companies and directors,  officers and employees.
The cost of compliance with changes in governmental  regulations has a potential
to reduce the profitability of operations. The Company intends to ensure that it
complies fully with all environmental regulations relating to its operations.

NO  DIVIDENDS:  The Company has never  declared  or paid cash  dividends  on its
common  shares  and does not  anticipate  doing  so in the  foreseeable  future.
Additionally, the determination as to the declaration of dividends is within the
discretion  of the Company's  Board of  Directors,  which may never declare cash
dividends on the Company's  common stock.  Investors  cannot expect to receive a
dividend on the Company's common shares in the foreseeable future, if at all.



                                     - 17 -
<PAGE>


PENNY STOCK  REGULATION:  The SEC has adopted rules that regulate  broker-dealer
practices in connection with  transactions in "penny stocks".  Generally,  penny
stocks are  equity  securities  with a price of less than  US$5.00  (other  than
securities  registered on certain national securities exchanges or quoted on the
NASDAQ system).  Since the Company's shares are traded for less than US$5.00 per
share,  the shares are subject to the SEC's penny stock rules until such time as
(1) the Company's net tangible assets exceed  US$5,000,000  during the Company's
first three years of continuous  operations or US$2,000,000  after the Company's
first three years of continuous  operations;  or (2) the Company has had average
revenue of at least  US$6,000,000 for three years. The penny stock rules require
a  broker-dealer,  prior to a transaction in a penny stock not otherwise  exempt
from the rules, to deliver a standardized risk disclosure document prescribed by
the SEC that provides information about penny stocks and the nature and level of
risks in the  penny  stock  market.  The  broker-dealer  must  obtain a  written
acknowledgement   from  the  purchaser  that  the  purchaser  has  received  the
disclosure  document.  The  broker-dealer  also must provide the  customer  with
current bid and offer  quotations for the penny stock,  the  compensation of the
broker-dealer  and  its  salesperson  in the  transaction  and  monthly  account
statements  showing the market value of each penny stock held in the  customer's
account. In addition,  the penny stock rules require that prior to a transaction
in a penny stock not otherwise exempt from those rules, the  broker-dealer  must
make a  special  written  determination  that  the  penny  stock  is a  suitable
investment for the purchaser and receive the  purchaser's  written  agreement to
the transaction. These requirements may have the effect of reducing the level of
trading activity in the secondary market for a stock that becomes subject to the
penny stock rules.  Such rules and regulations may make it difficult for holders
to sell the  common  stock of the  Company,  and they may be  forced  to hold it
indefinitely.

EXCHANGE  APPROVALS:  Pursuant  to the  policies  of the TSX-V,  the  Company is
required to provide certain information about proposed acquisitions to the TSX-V
and the Company  must obtain  approval  from the TSX-V prior to  completing  any
proposed  acquisition.  In addition,  the Company must obtain  approval from the
TSX-V prior to issuing any shares in connection  with an acquisition  of, or the
exercise of an option on, a property  interest.  There is no assurance  that the
TSX-V will approve the acquisition of any additional  properties by the Company,
whether by way of option or otherwise,  or the subsequent issuance of any shares
in connection with any property which the Company acquires.

UNITED STATES MARKET:
The  Company's  common stock is illiquid and its  shareholders  may be unable to
sell their  shares.  The Company's  common  shares are  currently  quoted on the
Over-the-Counter  Bulletin Board (OTC Bulletin Board) and are thinly traded.  In
the past, the Company's share trading prices have fluctuated  widely,  depending
on many  factors  that may have little to do with the  Company's  operations  or
business prospects. There is currently a limited market for the Company's common
shares and the Company can provide no assurance to investors  that a market will
develop.  Consequently,  the Company's shareholders in the United States may not
be able to use  their  shares  for  collateral  or loans  and may not be able to
liquidate at a suitable price in the event of an emergency.  If a market for the
Company's common shares does not develop, the Company's  shareholders may not be
able to re-sell the Company's  common  shares that they have  purchased and they
may lose all of their investment.  In addition, the OTC Bulletin Board is not an
exchange and,  because  trading of securities on the OTC Bulletin Board is often
more sporadic than the trading of securities listed on an exchange of the NASDAQ
Stock Market, Inc., and the Company's shareholders may have difficulty reselling
any shares purchased.

ENFORCEMENT  OF LEGAL  PROCESS:  It may be difficult to bring and enforce  suits
against  the  Company.  The  Company is a  corporation  incorporated  in British
Columbia.  None of the Company's  directors are residents of the United  States,
and all or a  substantial  portion of their  assets are  located  outside of the
United  States.  As a  result,  it may be  difficult  for  U.S.  holders  of the
Company's common shares to effect service of process on these persons within the
United States or to enforce  judgments  obtained in the U.S.  based on the civil
liability  provisions of the U.S. federal securities laws against the Company or
its officers and directors.  In addition,  a shareholder  should not assume that
the courts of Canada (i) would  enforce  judgments  of U.S.  courts  obtained in
actions against the Company, its officers or directors predicated upon the civil
liability  provisions of the U.S.  federal  securities laws or other laws of the
United States, or (ii) would enforce,  in original actions,  liabilities against
the  Company,  its  officers  or  directors  predicated  upon the  U.S.  federal
securities laws or other laws of the United States.

U.S. laws may not be enforced by a Canadian  court if those laws are contrary to
Canadian  public policy,  are foreign penal laws or laws that deal with taxation
or the taking of property by a foreign  government or they are not in compliance
with applicable Canadian legislation regarding the limitation of actions.  Also,
a judgment obtained in a U.S. court may not be recognized by a Canadian court:


                                     - 18 -
<PAGE>


     a)   where  the  U.S.   court  where  the  judgment  was  rendered  had  no
          jurisdiction according to applicable Canadian law;
     b)   the judgment was subject to ordinary remedy  (appeal,  judicial review
          and any other  judicial  proceeding  which  renders the  judgment  not
          final,  conclusive  or  enforceable  under the laws of the  applicable
          state) or not final,  conclusive or enforceable  under the laws of the
          applicable state;
     c)   the  judgment  was  obtained  by fraud or in any  manner  contrary  to
          natural justice or rendered in contravention of fundamental principles
          of procedure;
     d)   a dispute  between the same parties,  based on the same subject matter
          has given rise to a judgment  rendered in a Canadian court or has been
          decided  in a third  country  and the  judgment  meets  the  necessary
          conditions for recognition in a Canadian court;
     e)   the outcome of the judgment of the U.S.  court was  inconsistent  with
          Canadian public policy;
     f)   the judgment enforces  obligations  arising from foreign penal laws or
          laws that deal with  taxation  or the taking of  property by a foreign
          government;  or g)  there  has not  been  compliance  with  applicable
          Canadian law dealing with the limitation of actions.


COMPETITION:  The mineral  industry is intensely  competitive in all its phases.
The Company competes with many companies  possessing greater financial resources
and technical facilities than itself for the acquisition of mineral concessions,
claims,  leases and other mineral  interests as well as for the  recruitment and
retention  of  qualified  employees.  If the  Company  is unable to  effectively
compete against the other companies engaged in the mineral exploration industry,
the Company may be forced to cease all of its activities.  Specifically,  if the
Company is unable to recruit  and retain  qualified  officers,  consultants  and
others to provide the Company with the expertise necessary to plan and implement
its  exploration  programs,  the Company may be required to delay or abandon its
exploration programs or cease its activities entirely.

OUTSIDE  SCRUTINY:  Some mining companies have  experienced  issues and problems
from local  communities  relating to their exploration  activities.  These local
communities  have  restricted  access  to  the  companies'  properties.  If  the
Company's  activities  are not  acceptable  to  communities  where work is being
undertaken the Company may have to abandon its investment in the property.

DILUTION:  The Company may in the future grant to some or all of its  directors,
officers,  insiders and key employees  options to purchase the Company's  common
shares as non-cash incentives to those employees. Such options may be granted at
exercise  prices equal to market  prices,  or at prices as  allowable  under the
policies of the TSX-V,  when the public market is depressed.  To the extent that
significant numbers of such options may be granted and exercised,  the interests
of then  existing  shareholders  of the  Company  may be subject  to  additional
dilution.

METALS PRICE FLUCTUATIONS:  Factors beyond the control of the Company may affect
the  marketability  of any substances  discovered.  The prices of various metals
have  experienced  significant  movement  over short  periods  of time,  and are
affected  by  numerous  factors  beyond the  control of the  Company,  including
international economic and political trends, expectations of inflation, currency
exchange  fluctuations,  interest  rates  and  global  or  regional  consumption
patterns,  speculative  activities and increased  production of such metals. The
supply of and  demand  for metals are  affected  by various  factors,  including
political  events,  economic  conditions and  production  costs in major mineral
producing  regions.  Variations in the market prices of metals may impact on the
Company's ability to raise funding to continue  exploration of its projects.  In
addition,  any  significant  fluctuations  in metal  prices  will  impact on the
Company's decision to accelerate or reduce its exploration activities.

U.S.  TAX  LIABILITY:  The  Company  may  be  deemed  to be a  "Passive  Foreign
Investment Company" ("PFIC").  See "Item 10. Additional Information - Taxation."
If the Company is deemed to be a PFIC, a United  States  holder of the Company's
common  shares  would be required to pay an interest  charge  together  with tax
calculated at maximum tax rates on certain  "excess  distributions"  (defined to
include  certain  dividends  from a PFIC  and any gain on the sale of stock of a
PFIC)  unless such  holder made an election  either to (1) include in his or her
taxable income his or her pro rata share of the PFIC's ordinary earnings and net
capital gains under the Qualified  Electing Fund rules or (2) mark to market his
or her Company  common  shares at the end of each  taxable  year as set forth in
Section 1296 of the Internal  Revenue Code of


                                     - 19 -
<PAGE>


1986, as amended. The elections require certain conditions be met such as filing
on or before the due date, as extended,  for filing the shareholder's income tax
return for the first taxable year to which the election will apply.


ITEM 4.  INFORMATION ON THE COMPANY.
--------------------------------------------------------------------------------

HISTORY AND DEVELOPMENT OF THE COMPANY

The Company was incorporated pursuant to the COMPANY ACT (British Columbia) (the
"Company  Act") on April 11, 2000 under the name "XS Capital  Corp."  Initially,
the  Company  had one share  issued  and  outstanding,  which was held by Joseph
Grosso,  who at the time was not an  officer or  director  of the  Company.  Mr.
Grosso  transferred the single  outstanding share to Mr. Cacos,  President and a
director of the Company, on April 11, 2001.  Effective February 2004, Mr. Grosso
became the Chairman and a director of the Company.  The Company remained without
a business asset and was inactive until March 2003, when the Company  negotiated
a number of  agreements  to option and  acquire  interests  in  various  mineral
concessions  located  in  Argentina,  as  described  below.  As a result  of the
decision to engage in mineral  exploration  activities,  the Company changed its
name to "Amera  Resources  Corporation" on March 4, 2003. There was no change of
control or change in management in connection with the name change.  In December
2003, the Company  completed its initial public  offering  ("IPO") and commenced
trading  on  the  TSX-V  under  the  symbol  "AMS".  See  "Item  10.  Additional
Information - Memorandum and Articles of Association."

The  Company  is a  mineral  exploration  company  engaged  in the  business  of
acquiring, exploring and evaluating natural resource properties, and potentially
joint venturing these properties depending on the evaluation of the property.

To this end, the Company  entered into a Letter of Intent,  dated March 6, 2003,
(the  "Letter of  Intent"),  as  amended  by  Amending  Letter  Agreement  dated
September 30, 2003, (the "Amended Letter Agreement"),  with IMA Exploration Inc.
("IMA")  and  Inversiones  Mineras  Argentinas  S.A.  ("IMASA"),   an  indirect,
wholly-owned   subsidiary  of  IMA,   whereunder  the  Company  was  granted  an
irrevocable  option (the "Mogote Option") to acquire a 51% undivided interest in
the group of mineral  rights  known as Mogote,  located in the  Province  of San
Juan, Argentina (the "Mogote Project").  See "Item 4. Information on the Company
- Property,  Plant and  Equipment - Principal  Properties - Mogote  Project" and
"Item 7. Major  Shareholders  and Related  Party  Transactions  - Related  Party
Transactions."  To exercise  the option,  the  Company  must issue an  aggregate
1,650,000  common  shares and incur an  aggregate  US$1,250,000  in  exploration
expenditures  on the Mogote Project by July 1, 2007, less the amount paid to IMA
as reimbursement for all past payments made and expenditures  incurred by IMA on
the Mogote Project,  being $197,854. As well, the Company has agreed to make all
payments required to maintain the Mogote Project in good standing  including all
payments  due  to  the  underlying  owners  and  vendors  thereof,  which  total
US$269,100.  As of  December  31,  2006  the  full  amount  of  the  exploration
expenditures  and the IMA  expenditures  obligation  have been paid and  750,000
common shares have been issued.

The Company shall be the operator of the Mogote  Project  throughout the term of
the subject option.

On April 8, 2004,  the  Company and IMA entered  into a further  agreement  (the
"Second Amending Letter Agreement"),  whereby the Company can earn an additional
24% interest Mogote Project, for a total 75% interest, after earning the initial
51%  interest,  by  issuing  an  additional  300,000  common  shares  to IMA and
expending an additional  US$3 million of exploration  expenditures  over a three
year period. The 300,000 common shares were issued to IMA on April 22, 2004. See
"Item 4. Information on the Company - Property,  Plant and Equipment - Principal
Properties - Mogote Project" and "Item 7. Major  Shareholders  and Related Party
Transactions - Related Party Transactions."

By an assignment  agreement dated June 28, 2004,  effective July 7, 2004,  IMA's
and IMASA's  rights and  obligations  under these  agreements  were  assigned to
Golden Arrow Resources  Corporation  ("Golden  Arrow") and  Inversiones  Mineras
Australes S.A. ("IMAUSA"), an Argentine company and an indirectly,  wholly owned
subsidiary of Golden Arrow,  as a result of IMA  transferring  its option on the
Mogote property to Golden Arrow, through the transfer of IMASA's interest in the
Mogote property to IMAUSA.

The  Company  appointed  a  special   committee  of  independent   directors  to
re-negotiate the terms of the Mogote Option with Golden Arrow.  According to the
resolutions adopted by the boards of both companies,  the US$1,000,000  property
expenditures


                                     - 20 -
<PAGE>


required  by May 30, 2006 were  extended  to May 30,  2007 and the  US$1,000,000
property expenditures required by May 30, 2007 were extended to May 30, 2008. In
return for granting of the extension,  10% of any payments,  in terms of cash or
stock  received  by the  the  Company  from a third  party  who  enters  into an
agreement regarding the Mogote property, will be paid to Golden Arrow.

In addition, the Company entered into a Property Purchase Agreement,  also dated
March  6,  2003,  (the  "Property  Purchase  Agreement"),  with  IMA  and  IMASA
whereunder the Company  acquired a 100% interest in certain mineral  exploration
properties located in the Province of Chubut, Argentina, consisting of three (3)
cateos known as Lago Pico, Loma Alta and Nueva Ruta (the "Chubut Project").  See
"Item 4.  Information  on the  Company - Property,  Plant and  Equipment - Other
Properties - Chubut Project" and "Item 7. Major  Shareholders  and Related Party
Transactions - Related Party  Transactions."  In  consideration  therefore,  the
Company agreed to issue 500,000 of its common shares to IMA (with a deemed value
at the time of the  transaction of $22,000 which was IMA's recorded cost for the
properties).  IMA retained a 3% net smelter  returns  royalty in respect of such
properties  and the Company  agreed to pay a cash bonus of  US$250,000 to IMA at
such time as a decision to place any of the properties in commercial  production
is made.  Although the 500,000  shares had a deemed value of $22,000 at the time
of the  transaction,  the  shares  were  not  issued  until  November  2003,  in
connection with the Company's IPO. Under Canadian GAAP, the shares were required
to be valued at the market  price at the time of  issuance,  which was  $225,000
(based  upon the  initial  public  offering  price of $0.45  per  share).  By an
assignment  agreement  dated June 28, 2004,  effective  July 7, 2004,  IMA's and
IMASA's  rights and  obligations  under the  Property  Purchase  Agreement  were
assigned to Golden Arrow and IMAUSA.

In March 2003,  when the Letter of Intent and Property  Purchase  Agreement were
executed, the Company was not publicly listed. The agreements were negotiated by
the Company's  directors (then Messrs.  Cacos, Minni and Coltura) who considered
among other factors the agreements,  transactions of a similar nature  currently
being entered in the mining industry, the Company's business plan, the Company's
future IPO and its planned listing on the TSX-V. At the time, Messrs.  Minni and
Coltura were disinterested members of the board of directors. At the time of the
Second Amending Letter Agreement, Messrs. Cacos and Grosso abstained from voting
and the transaction was approved by the remaining  disinterested  members of the
board of directors, who at the time were Messrs. Minni, Coltura and Bottomer.

In March 2005, pursuant to an acknowledgement agreement dated December 31, 2004,
with Steven K. Jones,  M.Sc.,  C.P.G.,  the Company acquired two claim blocks in
the Roysten Hills area of Nye County of west central  Nevada (the "Roy and Hills
Claims").  Mr. Jones, as agent for the Company,  staked the Roy and Hills Claims
on behalf of the Company in November  2004 and the Company  advanced  all of the
costs associated with staking the claims during the last quarter of fiscal 2004.
Mr. Jones is an arm's length,  third party.  Mr. Jones  transferred  the Roy and
Hills Claims to Amera Resources (US) Inc., the Company's wholly-owned subsidiary
and  Quitclaim  Deeds were filed with the Bureau of Land  Management  on June 1,
2005.  During  fiscal 2006,  the Company  granted an option on its Roy and Hills
properties in Nevada to Astral Mining (US)  Corporation.  Under the terms of the
Astral Letter of Intent,  Astral may earn up to an 80% undivided interest in the
Roy and Hills  Claims.  Astral can earn an initial  65%  interest in the Roy and
Hills Claims by incurring  US$2,500,000 in work expenditures over four years and
issuing  500,000 of its common  shares to the Company.  Astral may then elect to
earn an additional 15% interest,  by issuing a further  500,000 common shares to
the Company and completing a bankable feasibility stage, within three years.

On April 11, 2005,  the Company  entered into an option  agreement  with a third
party, Carlos Martin Thompson Palacios, for the road-accessible 800 hectare Cruz
de Mayo property  located in the southern  portion of the Department of Cuzco in
Peru.  The Company also acquired by direct  staking  2,200  hectares of adjacent
land for a total of 3,000  hectares.  The Company may earn up to 100%  undivided
interest in the Cruz de Mayo  property by making  US$150,00  in option  payments
over four years and incur  US$1,500,000  work  expenditures over four years. See
"Item 4. Information on the Company - Property, Plant and Equipment".

In October 2005,  the Company  applied for the 2,400  hectare  Cocha  concession
covering a copper-silver  target in the Department of Junin, Peru  approximately
23km east of the city of  Huancayo  and  220km to the east of Lima.  On March 2,
2006 the Company  announced  that it had been  formally  granted the  concession
title by the Peruvian  government  and now holds a 100% interest in the property
through its  wholly-owned  Peruvian  subsidiary  Recursos de los Andes S.A.C.; a
finders-fee  has been paid to an arms-length  individual in connection  with the
identification  of this  target.  See  "Item 4.  Information  on the  Company  -
Property, Plant and Equipment".

Effective  September 13, 2006, the Company received clearance for trading on the
Over-the-Counter  Bulletin Board



                                     - 21 -
<PAGE>


("OTCBB") operated by the National Association of Securities Dealers,  under the
symbol "AJRSF".

On December 7, 2006,  the Company  executed,  through its  Peruvian  subsidiary,
Recursos de los Andes S.A.C., a letter of intent with Chancadora Centauro S.A.C.
to enter into an option  agreement to acquire up to a 90% interest in the 11,184
hectare Laguna Gold Project in the Pasco  Department of west central Peru.  Upon
signing of a cession of mining rights for the property,  the Company will make a
cash  payment  of  US$120,000.  An  initial  51%  interest  will be earned  upon
incurring  US$650,000  in  work  expenditures  and  payment  of  US$890,000.  An
additional  39%  interest  may  be  earned  with  payment  of  US$4,000,000  and
completion of a bankable  feasibility  study.  See "Item 4.  Information  on the
Company - Property, Plant and Equipment".

In those situations where the Company issued shares of its common stock pursuant
to the agreements  discussed above, the shares were valued at the closing market
price on the day of  issuance.  This  amount is the value  that is  recorded  as
acquisition  cost  of the  applicable  property  as  described  in Note 5 to the
Company's December 31, 2006,  financial  statements.  The number of shares which
were  issued  for the  acquisition  of  mineral  properties  and their  value is
described in Note 6 of the Company's December 31, 2006, financial statements.

To date,  the Company  has raised  $12,609,768  in cash  through the sale of its
securities.  The Company intends to raise additional funding through the sale of
its  securities to carry out additional  exploration on its mineral  properties.
See "Item 5.  Operating  and  Financial  Review and  Prospects -  Liquidity  and
Capital  Resources".  There are no  assurances  that the Company will be able to
sell additional securities to fund its exploration or overhead requirements,  or
that the Company will receive a suitable price for any securities sold.

ACQUISITION AND DISPOSITION OF MINERAL PROPERTY INTERESTS DURING THE THREE PRIOR
FISCAL YEARS

The Company has made  additions  to mineral  properties  and  deferred  costs of
$729,828, $1,394,866 and, $1,330,719 and capital assets of $Nil, $Nil and $2,797
for the fiscal years ended December 31, 2006, 2005 and 2004, respectively.

In fiscal 2006 the Company wrote off property costs for its Esperanza and Sayhue
properties  in Peru in the amounts of $511,883  and  $13,631,  respectively.  In
fiscal  2005 the Company  wrote off the  $225,000  carrying  value in the Chubut
properties in Argentina.  During fiscal 2006,  the Company  granted an option on
its Roy and Hills properties in Nevada.  See "Item 4. Information on the Company
-  Property,  Plant  and  Equipment  -  Principal  Properties  - Roy and  Hills,
Properties." During fiscal 2004 the Company did not abandon,  dispose, assign or
joint-venture  any  of  its  arrangements  to  earn  interests  in  its  mineral
properties. To April 30, 2007, the Company has not abandoned, disposed, assigned
or  joint-ventured  any of its  arrangements  to earn  interests  in its mineral
properties.

BUSINESS OBJECTIVES

The principal  business  carried on and intended to be carried on by the Company
is the acquisition and exploration of natural resource  properties.  The Company
intends on expending its existing cash resources to carry out exploration on its
mineral  properties,  to pay for  administrative  costs  during the fiscal  year
ending  December 31, 2007,  and for working  capital.  The Company may decide to
acquire  other  property  interests  in addition to mineral  property  interests
currently held by the Company.

No capital  expenditures were made by the Company during the 2004, 2005 and 2006
fiscal years other than expenditures  relating to the Company's mineral property
interests.  See "Item 4.  Information  on the  Company  -  Business  Overview  -
Exploration Expenditures."

BUSINESS OVERVIEW

The Company is an exploration stage company exploring primarily for precious and
base metals.  To date,  the Company has not earned any production  revenue,  nor
found any "reserves" on any of its properties,  as that term is defined in Guide
7 adopted by the SEC.  Since March 2003, the Company has proceeded to enter into
a number of agreements to acquire  interests in resource  properties  located in
Argentina, Peru and Nevada, United States. In addition, the Company has acquired
interests  in  properties  located in Chile  adjacent  to the  Company's  Mogote
properties.  These Chilean  properties were staked to add to the Mogote property
in  Argentina.  The  Mogote  property  is  located  near the  border  of the two



                                     - 22 -
<PAGE>


countries.  The Chilean  properties are being held by the Company's wholly owned
Chilean  subsidiary.  See "Item 4. Information on the Company - Property,  Plant
and Equipment - Principal Properties - Mogote Project."

EXPLORATION EXPENDITURES

During  fiscal  2006 the  Company  incurred  approximately  $302,095  (including
approximately  $126,000  which is  attributed  to 300,000  shares  issued by the
Company)  for mineral  property  acquisition  costs and  incurred  approximately
$427,733 for exploration costs on its mineral property interests.

During  fiscal  2005 the  Company  incurred  approximately  $389,035  (including
approximately  $143,500  which is  attributed  to 300,000  shares  issued by the
Company)  for mineral  property  acquisition  costs and  incurred  approximately
$1,005,831 for exploration costs on its mineral property interests.

During  fiscal  2004 the  Company  incurred  approximately  $388,739  (including
approximately  $329,250  which is  attributed  to 425,000  shares  issued by the
Company)  for mineral  property  acquisition  costs and  incurred  approximately
$941,980 for exploration costs on its mineral property interests.

EXPLORATION BUDGET

See "Item 4. Information on the Company - Plan of Operation."

SALES AND REVENUE DISTRIBUTION

As of the date of this annual  report the Company has not generated any revenues
from its mineral properties.

ORGANIZATIONAL STRUCTURE

As of the  date of  this  annual  report,  the  Company  has  four  wholly-owned
subsidiaries,  Recursos de los Andes  S.A.C.,  a Peruvian  company  which became
active in December 2004, Amera Resources (US) Inc., a Nevada (U.S.) corporation,
which was  incorporated on February 2, 2005,  Amera-Chile  Sociedad  Contractual
Minera, a Chilean company which was formed in May 2005 and Amera Resources (BVI)
Inc, a British Virgin Islands  company which was formed on January 10, 2007. The
Company is also a 50%  shareholder in Golden Amera Resources Inc. (BVI) ("Golden
Amera") a company  incorporated  in the  British  Virgin  Islands on January 30,
2007. Golden Amera will establish a branch in Colombia,  South America that will
manage any future projects in that country.

Amera  Resources  (US) Inc.  was formed to hold the  Company's  interests in its
Nevada  properties.  The Company owns all of the  outstanding  voting and equity
interests in Amera Resources (US) Inc.

Recursos de los Andes S.A.C.  was formed to hold the Company's  interests in its
Peruvian  properties.  The Company owns all of the outstanding voting and equity
interests in Recursos de los Andes S.A.C.

Amera-Chile  Sociedad  Contractual  Minera  was  formed  in May 2005 to hold the
Company's  interest  in its  Chilean  properties.  The  Company  owns all of the
outstanding  voting and equity  interests in  Amera-Chile  Sociedad  Contractual
Minera.

Unless otherwise  indicated  herein,  the term "Company" means  collectively the
Company and its subsidiaries.


                                     - 23 -
<PAGE>



                               ORGANIZATION CHART

      |-------------------------------------------------------------------|
      |                    AMERA RESOURCES CORPROATION                    |
      |                   (Vancouver, British Columbia)                   |
      | (Registered in B.C. and a foreign entity registered in Argentina) |
      |--------------------------------|----------------------------------|
                                       |
                                       |
        |-------------------|----------|---------|---------------------|
        |                   |                    |                     |
        |                   |                    |                     |
        |                   |                    |                     |
       100%                100%                 100%                  100
        |                   |                    |                     |
        |                   |                    |                     |
|-------|-------|   |-------|-------|    |-------|-------|    |--------|-------|
|  Amera-Chile  |   |Amera Resources|    |Amera Resources|    | Recursos de los|
|   Sociedad    |   |  (U.S.) Inc.  |    |   (BVI) Inc.  |    |   Andes S.A.C. |
|  Contractual  |   |    (Nevada)   |    |     (BVI)     |    |      (Peru)    |
|     Minera    |   | February 2005 |    | January 2007  |    | September 2004 |
|    (Chile)    |   |               |    |               |    |                |
|    May 2005   |   |               |    |               |    |                |
|---------------|   |---------------|    |-------|-------|    |----------------|
                                                 |
                                                50%
                                                 |
                                         |-------|-------|
                                         |  Golden Amera |
                                         | Resources Inc.|
                                         |     (BVI)     |
                                         | January 2007  |
                                         |---------------|

PRINCIPAL OFFICES

The Company's  principal  office is located at #709 - 837 West Hastings  Street,
Vancouver, British Columbia, V6C 3N6. The Company's registered office is located
at #709 - 837 West Hastings Street, Vancouver, B.C. V6C 3N6 and its phone number
is 604-687-1828.

On September 1, 2002 the Company began sharing office facilities, capital assets
and personnel with IMA.  Effective  January 1, 2005, the Company entered into an
agreement with Grosso Group  Management Ltd.  ("Grosso Group") pursuant to which
the Grosso Group provides offices and administrative and management  services to
the Company.  See "Item 7. Major  Shareholders and Related Party  Transactions -
Related Party Transactions."

PROPERTY, PLANT AND EQUIPMENT

The Company's  activities are focused on the exploration of its mineral property
interests.  As of the date of this annual report,  the Company does not have any
plant and  equipment,  mines or producing  properties.  The  Company's  proposed
programs  are  exploratory  in nature and all of the  Company's  properties  are
without known reserves.

The Company's  principal assets are its options to acquire interests in unproven
mineral claims.  Under Canadian GAAP,  option payments and exploration and field
support costs directly  relating to mineral claims are deferred until the claims
to which they relate are placed into production, sold or abandoned. The deferred
costs will be amortized over the life of the ore body following  commencement of
production or written off if the property is sold or  abandoned.  Administration
costs and other  exploration  costs that do not relate to any specific  property
are expensed as incurred.

On a  periodic  basis,  management  reviews  the  carrying  values  of  deferred
acquisition and exploration  expenditures with a view to assessing whether there
has been any impairment in value.  Management takes into  consideration  various
information  including,  but not limited to, results of  exploration  activities
conducted to date,  estimated  future metal prices,  and reports and opinions of
outside geologists,  mine engineers and consultants.  In the event that reserves
are determined to be insufficient to recover the carrying value of any property,
the carrying  value will be written down or written off, as  appropriate.  As of
April 30, 2007, the Company has not established that its option interests or its
mineral claims have any known or proven reserves.



                                     - 24 -
<PAGE>



This accounting  treatment is different  under US GAAP,  under which the Company
would expense the option  payments and  exploration  costs  relating to unproven
mineral claims as incurred. In addition, US GAAP requires that exploration costs
not be  capitalized  until  a  positive  feasibility  study  is  completed.  The
capitalized costs of such claims would then be measured, on a periodic basis, to
ensure that the carrying  value can be recovered  on an  undiscounted  cash flow
basis.  If the carrying  value  cannot be  recovered on this basis,  the mineral
claims would be written down to net recoverable  value on a discounted cash flow
basis.

PRINCIPAL PROPERTIES

ARGENTINA / CHILE

MOGOTE PROJECT

LOCATION AND ACCESS

The Mogote Project property is located in the Departament Iglesia,  Macho Muerto
zone,  in the San Juan  Province,  close to the  northern  border  with La Rioja
Province,  approximately  300 kilometres  northwest of the city of San Juan, and
bordering  Chile (the "Mogote  Property").  Access to the property is via either
Chile or Argentina,  but because special  arrangements  need to be made to cross
the  international  border  where  there  are no  established  crossing  points,
practical  access is currently from the Argentina side. The nearest supply point
where most goods and services are available is the town of Guandacol in La Rioja
Province. From here the property is only accessible by road during the months of
October to April using a 4x4 vehicle. Exploration activities can only be carried
out during this period due to seasonal weather  conditions.  Total distance from
Guandacol to the Mogote Property is approximately 250 kms and the travel time is
6-7 hours.  Access from Guandacol is through  Aguadita,  across Rio Blanco,  and
through the historic La Brea mining camp. Secondary and then mountain tracks can
be taken  from  Copiapo,  Chile to reach the  Chilean  side of the  property  in
approximately 3-4 hours driving time. Road conditions are poor with local severe
dust and generally un-maintained road conditions. There is no electrical grid in
the area of the Mogote Property.

The following map identifies the location of the Mogote Property:


                                     - 25 -
<PAGE>




[OBJECT OMITTED]][GRAPHIC OMITTED] See MAP 1 of PDF file attached

MOGOTE PROJECT LOCATION MAP
SAN JUAN PROVINCE, AGRENTINA

lEGEND - Rivers, Province Boundary, Roads, Cities and Property Boundary
Drawn Janury 2005 revised May 5, 2007 Produced by Amera Resoruces Corportion



MINERAL TITLES INCLUDED IN MOGOTE PROPERTY

The Mogote Property consists of one cateo,  three discoveries and five minas. In
2004, the Company staked a number of claims adjoining the  northwestern  part of
the Mogote Property on the Chilean side of the border


                                     - 26 -
<PAGE>


<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------------
  CLAIM NAME &     CLAIM                        HECT-                  EXPIRY      WORK/PAYMENT
   COUNTRY         NUMBER       CLAIM TYPE      ACRES     OWNER         DATE         REQUIRED
----------------------------------------------------------------------------------------------------------
<S>            <C>              <C>           <C>      <C>              <C>    <C>
MOGOTES          338579-R-92      CATEO         2259     IMA USA          N/A    2,000 pesos
(Argentina)                                                                      payment after
                                                                                 concession granted
----------------------------------------------------------------------------------------------------------
ADELA # 1        425-098-A-2000   DISCOVERY     2000     N. Arturo        N/A    No payment for 3 years;
(Argentina)                                                                      afterward 800 peso per
                                                                                 year per 100 hectares
----------------------------------------------------------------------------------------------------------
MOGOTES NORTE    520-0275-R097    DISCOVERY     1650     R. Viviani       N/A    No payment for 3 years;
(Argentina)                                                                      afterward 800 peso per
                                                                                 year per 100 hectares
----------------------------------------------------------------------------------------------------------
MOGOTES SUR      520-0274-R-97    DISCOVERY     2100     R. Viviani       N/A    No payment for 3 years;
(Argentina)                                                                      afterward  800 peso per
                                                                                 year per 100 hectares
----------------------------------------------------------------------------------------------------------
MOGOTE 1         156.277-S-76     MINA            48     IMA USA          N/A    480 peso per year
(Argentina)                                                                      canon
----------------------------------------------------------------------------------------------------------
MOGOTE 9         156.285-S-76     MINA            48     N. Arturo        N/A    480 peso per year
(Argentina)                                                                      canon
----------------------------------------------------------------------------------------------------------
MOGOTE 14        156.290-S-76     MINA            48     IMA USA          N/A    480 peso per year
(Argentina)                                                                      canon
----------------------------------------------------------------------------------------------------------
MOGOTE 4         156.280-S-76     MINA            48     IMA USA          N/A    480 peso per year
(Argentina)                                                                      canon
----------------------------------------------------------------------------------------------------------
MOGOTE 5         156.280-S-76     MINA            48     IMA USA          N/A    480 peso per year canon
(Argentina)
----------------------------------------------------------------------------------------------------------
Tronquito 1              -        Concesion de   200     Amera Chile      N/A    US$220 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito 2              -        Concesion de   200     Amera Chile      N/A    US$220 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito 3              -        Concesion de   300     Amera Chile      N/A    US$330 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito 4              -        Concesion de   100     Amera Chile      N/A    US$110 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito 5              -        Concesion de   200     Amera Chile      N/A    US$220 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito 6              -        Concesion de   300     Amera Chile      N/A    US$330 per year canon
(Chile)                           Exploracion
----------------------------------------------------------------------------------------------------------
Tronquito Tres         842        Pedimento      300     Amera Chile      N/A    190,000 peso per year
(Chile)                           Petition                                       canon
----------------------------------------------------------------------------------------------------------
</TABLE>

The Company has not found any "reserves" on the Mogote Property, as that term is
defined in Guide 7 adopted by the SEC.

AGREEMENTS

 See  "Item 4.  Information  on the  Company - History  and  Development  of the
Company" for a description  of the Agreements  under which the Company  acquired
its interest in the Mogote Property.

As of December 31,  2006,  the Company had expended  $1,056,309  in  acquisition
costs and $1,255,195 in exploration expenses on the Mogote Property.

The  Company  appointed  a  special   committee  of  independent   directors  to
re-negotiate the terms of the Mogote Option with Golden Arrow.  According to the
resolutions adopted by the boards of both companies,  the US$1,000,000  property
expenditures  required  by May 30,  2006 were  extended  to May 30, 2007 and the
US$1,000,000  property  expenditures  required May 30, 2007 were extended to May
30, 2008. In return for granting of the extension, 10% of any payments, in terms
of cash or stock  received by the the Company from a third party who enters into
an agreement regarding the Mogote Property, will be paid to Golden Arrow.

REGIONAL AND LOCAL GEOLOGY

The property is underlain  by basement  rocks of the Permian age Choiyoi  Group,
which are faulted  against and  overlain by Tertiary  age  volcanic  rocks.  The
Mogote  Property  is located in a region  that has been  subjected  to  multiple



                                     - 27 -
<PAGE>


volcanic and intrusive  events dating from middle Miocene  (~13.65 million years
ago) back at least as far as the Permo-Triassic  (~250 million years ago), which
management   believes  makes  the  area  particularly   attractive  for  mineral
exploration.

EXPLORATION HISTORY

A brief geological  reconnaissance  took place in March-April 2000, during which
21 rock and talus samples were collected. Anomalous samples came from zones with
clay  and/or  iron  alteration.  In  November-December  2000,  a  reconnaissance
geological and geochemical  sampling  program was carried out over the property.
This work outlined an area  measuring  approximately  3 kilometres  E-W near the
northern  property boundary which returned a high proportion of anomalous copper
and gold results in both rock and sediment  samples.  In March 2001, IMA entered
into a Joint Venture  agreement with Rio Tinto Mining and  Exploration  Limited,
which carried out an eight-day program  commencing March 11, 2001, and which was
subsequently  terminated due to poor weather.  Work  accomplished  included road
construction,   talus  fines  and  rock  chip   sampling  and  resulted  in  the
identification  of the Filo Este and Filo Central  targets which both  displayed
aspects of porphyry copper-gold and high sulphidation  epithermal precious metal
systems.  During  January  2003,  IMA carried out a four week  detailed  surface
exploration program of mapping and geochemical sampling.

During the period November 17 through December 14, 2003, the Company carried out
an exploration program comprising  detailed geologic mapping,  ground magnetics,
induced   polarization   ("IP")   geophysics,   trench  sampling,   and  surface
geochemistry  in the northern part of the property.  The work was focused on two
major zones of copper-gold  mineralization,  Filo Este and Filo Central, and one
zone of high sulphidation epithermal alteration,  Zona Colorada. The copper-gold
mineralization is characterized by strongly  anomalous values in copper and gold
related to potassic  alteration  of a Miocene  (23.8 to 5.3  million  years ago)
diorite porphyry  system.  The high  sulphidation  alteration is the upper level
expression of a separate,  but similar diorite porphyry.  The work indicated the
presence of a major mineralized  porphyry beneath the Filo Este zone of potassic
and propylitic alteration. Mineralization is hosted within volcanic breccias and
phases of the Miocene diorite  porphyry which have undergone  moderate to strong
porphyry-type  alteration.   Hydrothermal  mineralization  consisted  of  copper
sulphide  minerals  chalcopyrite and bornite within quartz veins and as wallrock
disseminations.  Recent supergene  (surface-enriched)  oxidation has altered the
primary copper minerals to various copper oxide and sulphate minerals  including
malachite and antlerite.

A 600 metre trench was excavated over the Filo Este zone of potassic  alteration
and  encountered  510 metres of continuous  mineralization  that averaged 0.196%
copper  and 0.331 ppm gold.  Mineralization  consisted  of  fracture  controlled
sulfates and oxides and as disseminations  in wallrock and quartz veins.  Copper
minerals  were  approximately  80%  oxide  and 20%  sulfides  with the  sulfides
consisting  of  chalcopyrite  and bornite.  Ground  magnetics  suggest a shallow
porphyry system underlying Filo Este ridge with strong magnetite alteration that
covers an area of at least 1.5  kilometres  by 800 metres.  The shallow depth of
intrusion is indicated by a steep magnetic gradient which management believes is
consistent  with the level of exposure of  alteration  and  mineralization.  Two
other distinct  magnetic sources were encountered at Filo Central and underlying
the East Cirque area. The IP indicates several distinct copper sulfide bodies of
2-4% sulfide that are coincident with magnetite alteration on Filo Este.

MARCH 2004 DRILLING - FILO ESTE

In March 2004,  the Company  carried out a 1,475 metre,  five hole diamond drill
program and conducted further  geological mapping and talus fine sampling on the
northern part of the Mogote Property.  The drilling tested a portion of the Filo
Este porphyry  target to a depth of up to 495 metres over a strike length of 860
metres  and a  width  of  approximately  250  metres.  Hole  MOG-04-1  had to be
abandoned at 71.6 metres and hole  MOG-04-1A  was drilled from the same location
to target  depth.  Highlights  of the drill  results are  provided in table form
below.

<TABLE>
<CAPTION>
-----------------------------------------------------------------------------------------------------
                                                                     (LWA)        (LWA)         (LWA)
Drillhole           Total Depth   From        To          Interval   Gold         Silver       Copper
                    (metres)      (metres)    (metres)    (metres)   (ppm)         (ppm)         (%)
-----------------------------------------------------------------------------------------------------
<S>               <C>           <C>         <C>         <C>        <C>          <C>          <C>
MOG-04-1             71.6           2.0         70.0        68.0      0.43         13.9         0.244
-----------------------------------------------------------------------------------------------------
MOG-04-1A           495.3           6.0        495.3       489.3      0.23          2.6         0.170
  Including                       258.0        424.0       166.0      0.19          2.2         0.243
  And                             308.0        396.0        88.0      0.20          1.9         0.290
-----------------------------------------------------------------------------------------------------
MOG-04-2            315.4           2.0        315.4       313.4      0.16          1.9         0.171
  Including                       196.0        315.4       119.4      0.21          2.8         0.248
-----------------------------------------------------------------------------------------------------
MOG-04-3            300.0           6.0        300.0       294.0      0.11          1.3         0.078
-----------------------------------------------------------------------------------------------------
MOG-04-4            292.9           2.0        292.9       290.9      0.23          3.1         0.104
-----------------------------------------------------------------------------------------------------
</TABLE>


                                     - 28 -
<PAGE>


In addition to the drill program,  regional surface work was carried out on Filo
Central  and other  targets  in March 2004 to  advance  them to the  drill-ready
stage. This work comprised detailed mapping,  additional step-out talus sampling
and  road/trench  construction.  Talus fine sampling on the Filo Central target,
defined by a strong magnetic signature coextensive with highly anomalous surface
geochemistry,  has now extended the surface  copper-gold  geochemical anomaly of
greater  than  0.1 ppm Au and 500 ppm Cu to  4,000  x 800  metres.  Within  this
anomaly is a 600 x 400 metre area of greater than 0.5 ppm.  Management  believes
Filo Central is a high priority  target for the next phase of exploration on the
Mogote Property.

JANUARY-FEBRUARY 2005 DRILLING - FILO ESTE AND FILO CENTRAL

Between  mid-January  and early  February 2005 the Company  completed a Phase II
2,577 metre 9-hole RC drill program on the Mogote  Property.  Of the nine holes,
four were  found to contain  significant  gold-copper  mineralization  hosted in
porphyry or in metamorphosed volcanic sediments at the margin of porphyry.

All the Phase II drill holes were sited to test strong areas of potassic-altered
intrusive porphyries within the Filo Este and Filo Central anomalies, defined by
strong  magnetics,  highly  anomalous  copper and gold  geochemistry and surface
alteration.  Five holes were  completed  on Filo Este over an  east-west  strike
extent of 1.4  kilometres  spanning a  north-south  distance of 720 metres.  The
remaining  four holes were spaced out over 1.6 kilometres of strike length along
Filo  Central.  All  drill  holes  were  located  on the  Argentina  side of the
international border.

The significant intercepts include:

<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------------------
                          Total                                          ppm       ppm          %
 Drillhole     Zone       Depth      From         To       Interval     Gold      Silver     Copper
                         (metres)  (metres)    (metres)    (metres)     (LWA)     (LWA)       (LWA)
----------------------------------------------------------------------------------------------------
<S>          <C>         <C>        <C>        <C>          <C>       <C>         <C>        <C>

 MOG-6         Este        250         0         250          250        0.22                  0.083
 including                           176         246           70        0.36       3.0        0.158
----------------------------------------------------------------------------------------------------
 MOG-7         Este        287         0         287          287        0.25       3.0        0.107
----------------------------------------------------------------------------------------------------
 MOG-8         Este        300         4         142          138        0.47       2.0        0.093
----------------------------------------------------------------------------------------------------
 MOG-12        Este        300       214         276           62        0.30       1.1        0.140
----------------------------------------------------------------------------------------------------
</TABLE>

All significant  intercepts were from holes on Filo Este.  Drill holes MOG-7, 8,
and 12 are all  located  in the  northwest  corner  of the  property  and in the
northwestern  portion of the Filo Central  anomaly.  These holes were all hosted
in, or spatially related to, a newly mapped occurrence of fine-grained intrusive
porphyry that is interpreted as an early porphyry phase that typically alters to
potassic or intermediate argillic assemblages.

Copper  and gold  mineralization  in the drill  holes was  related  to  potassic
quartz-biotite  alteration and directly  related to early vein density and local
silicification.  Vein hosted and  disseminated  sulfides  include  chalcopyrite,
pyrite, and minor bornite.

The 2005 Phase II drill program was carried out under the supervision of project
geologist  Steven K. Jones,  M.Sc.,  C.P.G.,  a Qualified Person under NI-43-101
guidelines. Assays for the drilling program were performed by Alex Stewart Labs,
Mendoza,  Argentina,  an internationally  recognized assay service provider. The
Company has no current plans to conduct  exploration on the property and has not
budgeted any funds for further work at this time.


                                     - 29 -
<PAGE>


CHUBUT PROPERTIES

The Company  entered into a Property  Purchase  Agreement,  dated March 6, 2003,
with IMA and IMASA,  whereunder the Company  acquired a 100% interest in certain
mineral  exploration  properties  located in the Province of Chubut,  Argentina,
consisting of three (3) cateos known as Lago Pico, Loma Alta and Nueva Ruta (the
"Chubut  Properties").  See "Item 4.  Information  on the  Company - History and
Development  of  the  Company  -  Property,  Plant  and  Equipment  -  Principal
Properties  and "Item 7. Major  Shareholders  and Related Party  Transactions  -
Related Party Transactions."

The Company has not found any "reserves" on the Chubut Properties,  as that term
is defined in Guide 7 adopted by the SEC.

The Company has spent $225,000 in acquisition  costs  (represented by the deemed
value of the common shares issued) and had not incurred any exploration expenses
on the Chubut Properties.

During  2005,  the  Company  wrote off  $225,000 in  connection  with the Chubut
Properties,  representing  the fair value of the  Company's  shares  issued upon
acquisition  of the  properties.  The  Company  decided  to write off the Chubut
Properties,  as there is no active exploration on the properties and the Company
has postponed any exploration indefinitely.  Additionally, on June 29, 2006, the
Chubut provincial  government announced a 36-month metallic mining suspension in
western Chubut Province. The Company continues to hold legal title to the Chubut
Properties.

PERU

COCHA COPPER-SILVER PROJECT, DEPARTMENT OF JUNIN, PERU

In October 2005,  the Company  applied for the 2,400  hectare  Cocha  concession
covering a  copper-silver  target in the Department of Junin,  Peru. The Company
was  formally  granted the  concession  titles to the  property by the  Peruvian
government on March 20, 2006 and April 10, 2006 and now holds a 100% interest in
the Cocha Property through its wholly-owned  Peruvian subsidiary Recursos de los
Andes S.A.C.

LOCATION AND ACCESS

The Cocha Property is located in the  Department of Junin , Peru,  approximately
220km east of Lima. UTM  Coordinates at the center of the property are 497 000 m
E. and 8 675 000 m N. The  National  map sheets  covering  the  Property are the
Jauja 24-M and the Huancayo  25-M;  Zone 18 South (1:100 000). The following map
identifies the location of the Cocha Property.


                                     - 30 -
<PAGE>


[OBJECT OMITTED]                             [GRAPHIC OMITTED][GRAPHIC OMITTED]


COCHA PROPERTY LOCATION - See MAP 2 of PDF file attached
JUNIN DEPARTMENT, PERU

Map of part of South America showing PERU and surrounding countries.
Shows the location of Cocha Property
Drawn December 2006 Revised May 5, 2007 by Aemra Resources Corporation


Access to the Cocha  property is by road from the city of Huancayo,  the capital
of the Junin Department. From Lima to Huancayo, the route up the Central Highway
is 310 km long and takes about five and a half hours by car.  This paved



                                     - 31 -
<PAGE>


highway travels through the high mountain pass of Anticona  (Ticlio,  at 4818m).
From  Huancayo to the Property,  travel time is about one hour.  The main gravel
road from  Huancayo  to  Acopallca  is  accessible  year round and is one of the
access  roads to the Amazon and  eastern  slopes of the Andes.  The gravel  road
travels  through deeply incised  valleys past the village of Acopallca  where it
bisects into two roads providing  access to the property's north and south ends.
The  property  is not always  accessible  by road  during  the rainy  season and
therefore  the optimal  conditions  exist for  exploration  work between May and
October.

HISTORY

The Cocha project has a very limited history of previous exploration and mining.
At the time of staking by the Company  Resources,  the Cocha  property  was free
with  only two small  concessions  in the south  central  part of the  property.
Several historical mineral showings  previously  explored and some of them mined
by individual "small miners" were identified on the Cocha property.  It could be
assumed that copper was the main focus of the previous mining  efforts.  Most of
the  workings  are less than 2-3m deep and there was no  significant  production
from the property. Several overgrown and partially destroyed access mining roads
lead to previously explored showings.

EXPLORATION AND PROPOSED PROGRAM

The Cocha  Property  is located in a belt of  Permian-aged  clastic  sedimentary
rocks known to host stratabound copper-silver  mineralization.  Initial sampling
of the property at the Discovery Outcrop showing returned a continuous series of
chip samples which assayed 0.80% copper and 10g/t silver over 80m, including two
non-adjacent  10-metre  intervals assaying 2.69 % copper and 24.4 g/t silver and
1.38% copper and 26.2 g/t silver (see table below).  Rock samples collected from
the property to date returned assays ranging from 4 ppm to 2.89% copper and <0.2
to   99.2   g/t   silver.    Mineralization   is   hosted   by   steeply-dipping
malachite-stained sandstone and mudstone of the Permian Mitu Formation.


--------------------------------------------------------------------------------
  SAMPLE
  NUMBER      LOCATION                TYPE     INTERVAL         CU         AG
                                                 (m)            (%)      (g/t)
--------------------------------------------------------------------------------
  246006      Discovery Outcrop       chip       10.0           1.38      26.2
  246005      Discovery Outcrop       chip       10.0           0.54       7.6
  246008      Discovery Outcrop       chip       10.0           0.22       1.3
  246003      Discovery Outcrop       chip       10.0           0.05       0.3
  246002      Discovery Outcrop       chip       10.0           0.46       3.6
  246001      Discovery Outcrop       chip       10.0           0.06       0.4
  246200      Discovery Outcrop       chip       10.0           2.69      24.4
  246241      2.4km SSW of D.O.(*)    chip        0.7           2.89      99.2
  246242      1.6km SSW of D.O.(*)    chip        0.3           1.65       1.5

(*)D.O. equals Discovery Outcrop
--------------------------------------------------------------------------------

While  carrying  out surface  exploration  work on the  property  the  Company's
geologists  discovered  the Merce Showing which assayed 0.46% copper and 9.4 g/t
silver over 9.5m in outcrop and is located  approximately  700m northwest and on
trend from the  Discovery  Outcrop.  This 9.5m  interval is  comprised  of three
consecutive chip samples,  including: 0.18% copper and 4.2 g/t silver over 4.0m,
1.7% copper and 25.1 g/t silver  over 1.0m and 0.43%  copper and 10.6 g/t silver
over 4.5m.

The  area   surrounding   the  Discovery   Outcrop  and  the  Merce  showing  is
predominantly  overburden covered.  Therefore a series of soil sample lines were
established  to  test  for  extensions  to the  mineralized  zone  under  cover.
Widespread anomalous copper-silver in soils extends for over 2.2km in length and
up to 750m in width along what has been named the Discovery  Outcrop Trend, with
soil geochemical values up to 0.32% copper and 4.7 g/t silver. The copper-silver
soil anomaly at the Discovery Outcrop Trend is open in all directions.  To date,
275 soil samples have been collected along it. Soil samples were collected along
lines  spaced  at   approximately   100m  on  either  12.5  or  25m   intervals.
Morphologically  the soil anomalies  suggest that  mineralization  in subsurface
bedrock forms several sub-parallel zones. The strongest part of the soil anomaly
envelops the Discovery Outcrop.

In November  2006 the Company  announced  that its ongoing  surface  exploration
program  had  revealed a new  silver-copper  soil  anomaly  in the  southwestern


                                     - 32 -
<PAGE>


portion  of the  Cocha  Property  (South  Cocha  Trend-SCT)  as well as four new
copper-silver  targets.  A total of 51 rock samples were  collected  during this
exploration program. Results ranged from 3 ppm to 4.47% copper and 0.1to 163 g/t
silver and revealed  presence of four new copper-silver  targets.  Highlights of
sample results from the new targets are provided below in the table below.

--------------------------------------------------------------------------------
TARGET #     SAMPLE TYPE    SAMPLE LENGTH [M]    CU [PPM]     CU [%]    AG [G/T]
--------------------------------------------------------------------------------
   1            Chip               0.5            44,700       4.47      163.0
--------------------------------------------------------------------------------
   2            Chip               0.4            28,000       2.80      105.0
--------------------------------------------------------------------------------
   2            Chip               0.5             9,700       0.97       51.2
--------------------------------------------------------------------------------
   3            Chip               2.0            14,700       1.47       14.3
--------------------------------------------------------------------------------
   3            Chip               2.0            15,300       1.53        6.6
--------------------------------------------------------------------------------
   3            Chip               2.0            11,100       1.11        5.8
--------------------------------------------------------------------------------
   3            Chip               4.0             6,750       0.68        5.6
--------------------------------------------------------------------------------
   3            Chip               0.5            13,800       1.38       16.0
--------------------------------------------------------------------------------
   3            Chip               2.0             9,200       0.92       11.4
--------------------------------------------------------------------------------
   4            Chip               1.1            21,500       2.15       97.0
--------------------------------------------------------------------------------
   4            Chip               1.1            19,600       1.96       59.2
--------------------------------------------------------------------------------
   4            Chip               1.1             6,440       0.64        8.3
--------------------------------------------------------------------------------

Targets #1 and #2 represent  vein-hosted  mineralization  related to the contact
between  Pucara  limestone and Mitu  sandstone.  Target #3 is a breccia zone and
occurs on, or close to, the  contact  between  Mitu  sandstone  and Tarma  group
limestone.  Target #4 is  structurally-controlled  copper-silver  mineralization
hosted in Mitu volcaniclastic sandstones.

The South Cocha  Trend-SCT soil anomaly is located on the contact between Pucara
limestone and Mitu sandstone.  The SCT is located  approximately 1.5km southwest
of, and sub-parallel to, the main Discovery  Outcrop  mineralized  trend where a
copper-silver  soil  anomaly  extends for over 2.2km in length and is up to 750m
wide.

A total of 133  soil  samples  were  collected  during  the  recent  exploration
campaign  with values  ranging  from 2 to 126 ppm copper and from 0.1 to 2.2 g/t
silver bringing the total soil samples collected to date on the property to 408.
For the entire suite of soil samples collected to date soil geochemical  results
range from 2 to 3,230 ppm (0.32%) copper and 0.1 to 4.7 g/t silver.  The new SCT
anomaly  is at  present  2.4km  long,  when the two  completed  soil  grids  are
combined, and 400 to 850m wide and is open along strike in both directions. Soil
coverage is being  extended to cover the  extensions to the SCT soil anomaly and
to evaluate the areas around the newly discovered bedrock showings.

Phase I drill  program on the Cocha  Project  began in August 2006 and  complete
results were received and reported in November 2006. The program was designed to
provide a preliminary test of approximately  400m of the strike length along the
mineralized   trend  in  either   direction   from  the  Discovery   Outcrop  to
approximately  150m vertical  depth.  A total of 1,394m in eleven  diamond drill
holes were completed.  Highlights from Phase I drill program are provided in the
table below.
<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------
 DRILL HOLE     AZIMUTH  INCLIN-   TOTAL     FROM       TO    INTERVAL   CU       AG       MO     PB     ZN
                          ATION    DEPTH      [M]       [M]     [M]      [%]     [G/T]   [PPM]    [%]    [%]
-------------------------------------------------------------------------------------------------------------
<S>             <C>     <C>       <C>      <C>        <C>      <C>      <C>     <C>      <C>     <C>    <C>

COCHA-06-01       220     -45       93.9               NSR**
-------------------------------------------------------------------------------------------------------------
COCHA-06-02       220     -55      150.7       0       13.31    13.31    0.8     10.8
-------------------------------------------------------------------------------------------------------------
COCHA-06-02                                  32.02     50.03    18.01    1.93    17.2
-------------------------------------------------------------------------------------------------------------
COCHA-06-02                                  64.72     76.27    11.55    0.82     9.2
-------------------------------------------------------------------------------------------------------------
COCHA-06-03       220     -65      183.3     73.00     75.83     2.83    0.29     3.4
-------------------------------------------------------------------------------------------------------------
</TABLE>





                                     - 33 -
<PAGE>

<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------
 DRILL HOLE     AZIMUTH  INCLIN-   TOTAL     FROM       TO    INTERVAL   CU       AG       MO     PB     ZN
                          ATION    DEPTH      [M]       [M]     [M]      [%]     [G/T]   [PPM]    [%]    [%]
-------------------------------------------------------------------------------------------------------------
<S>             <C>     <C>       <C>      <C>        <C>      <C>      <C>     <C>      <C>     <C>    <C>

COCHA-06-03                                  82.90    113.13    30.23    2.67    24.1
 Including*                                  89.65     96.40     6.75    4.71    43.5
-------------------------------------------------------------------------------------------------------------
COCHA-06-04       220     -45      116.5     23.85     25.60     1.75     0.2     4.3
-------------------------------------------------------------------------------------------------------------
COCHA-06-04                                  42.00     45.20     3.20    0.21     2.6
-------------------------------------------------------------------------------------------------------------
COCHA-06-04                                  62.05     86.23    24.18    0.11     3.7
-------------------------------------------------------------------------------------------------------------
COCHA-06-04                                  67.85     85.80    17.95                     109.4
-------------------------------------------------------------------------------------------------------------
COCHA-06-04                                  79.05     86.23     7.18                             0.54
-------------------------------------------------------------------------------------------------------------
COCHA-06-05       220     -55      151.0     64.98     66.60     1.62    0.45     5.7
-------------------------------------------------------------------------------------------------------------
COCHA-06-05                                 107.8     109.35     1.55    1.02    25.7
-------------------------------------------------------------------------------------------------------------
COCHA-06-06       220     -45      113.6     71.20     83.45    12.25    0.13     8.7
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  69.15     84.00    14.85                      70.4   0.67
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  80.90     83.45     2.55                                    0.69
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  91.00     99.75     8.75    0.14     6.4
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  91.60    100.30     8.70                      85.7
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  96.50    102.00     5.50                             0.73
-------------------------------------------------------------------------------------------------------------
COCHA-06-06                                  97.00    100.30     3.30                                    0.40
-------------------------------------------------------------------------------------------------------------
COCHA-06-07       220     -45      103.1     67.2      69.35     2.15    0.15     3.5
-------------------------------------------------------------------------------------------------------------
COCHA-06-08       220     -55       91.5               NSR
-------------------------------------------------------------------------------------------------------------
COCHA-06-09       220     -65      100.0               NSR
-------------------------------------------------------------------------------------------------------------
COCHA-06-10       260     -50      170.0               NSR
-------------------------------------------------------------------------------------------------------------
COCHA-06-11       220     -45      120.0     89.3      92.2      2.9     0.06     3.2
-------------------------------------------------------------------------------------------------------------
</TABLE>
**NSR = No Significant Results

All drillholes  cored a package of  volcaniclastic  rocks  belonging to the Mitu
Formation.  Lithologies comprised mainly ash, lapilli and tuff agglomerates with
local  volcanic  flow  interbeds  overlaying  red  sandstone.  Copper and silver
mineralization  is associated with the presence of fine-grained dark horizons of
argillic composition containing  carbonaceous material within the volcaniclastic
sequences  characterized by carbonate content and stronger  foliation.  The most
common ore minerals are bornite,  chalcocite, and pyrite, with associated minor,
chalcopyrite,  magnetite, and iron oxides. Chlorite, carbonate with minor silica
and epidote alteration were also observed.

The  geochemical  zonation from  copper-silver  mineralization  in the Discovery
Outcrop  area (trench  samples and  drillholes  COCHA-06-02  and 03) to the more
polymetallic  copper-silver-molybdenum-lead-zinc  mineralization  found in holes
COCHA-06-04,  70m to the southeast,  and in  COCHA-06-06,  235m southeast of the
Discovery Outcrop, is a characteristic property of sediment-hosted copper-silver
mineralized  systems.  At the Lubin  deposit in the  Kupferschiefer  district of
Poland  a  lead-zinc  enriched  zone  occurs  stratigraphically  above  the main
copper-silver horizon.

In the Cocha  Property  drill hole  analyses  molybdenum  ranges  from less than
detection to 282 ppm and all  anomalous  values over 50ppm are either from holes
COCHA-06-04  or 06.  Lead  values  range up to 65,400 ppm (6.54%) and all values
over 2,000 ppm come from  either  COCHA-06-04  or 06.  Zinc  values  range up to
11,300  (1.13%)  and all values  greater  than  1,000 ppm are from  COCHA-06-06.
Delineating  this geochemical  zonation pattern along the Discovery  Outcrop and
South Cocha trends will aid in understanding  of the Cocha Property  mineralized
system.  The significant  variation  between the strong copper and silver values
intersected in drill holes COCHA-06-02 and 03 and lower copper and silver values
associated  with  elevated  molybdenum,  zinc and lead in other  holes  suggests
structural  complexity that requires more interpretation work to properly target
and trace sediment-hosted mineralization.



                                     - 34 -
<PAGE>



Local Peruvian drilling company Geotecnia Peruana S.R.L. was contracted to carry
out the  drilling  program.  They  used an Atlas  Copco  Diamec  262  drill  rig
recovering mostly HQ core (6.35cm).  Drill core was cut on site using a rock saw
or split using a core  splitter.  Half of the core samples were submitted to the
assay lab for analysis  while the  remainder was stored in core boxes for future
reference. A rigorous program of QA/QC involving the use of standard samples has
been incorporated into the sampling regime for the project.

At present  the  Company is  focused  on gaining a better  understanding  of the
controls to the mineralized system present in the Discovery Outcrop area through
detailed  geological and structural  interpretation  of the drill core and metal
zonation patterns  identified in the  multi-element  geochemical data. This work
will provide guidance on targeting  future drilling.  One of the primary aims is
expanding the  significant  copper-silver  mineralization  intersected  in drill
holes COCHA-06-02 and COCHA-06-03. In addition the Company will be conducting an
intensive surface  exploration  program along the new parallel South Cocha trend
and newly discovered  copper-silver showings. These two concurrent programs will
allow the the  Company  to plan a Phase II drill  program  for the first part of
2007. Positive results from the drill program combined with the discovery of the
new showings and mineralized  trend prompted the Company to apply for additional
concessions in the Cocha Property area.

The Company has not found any "reserves" on the Cocha Property,  as that term is
defined in Guide 7 adopted by the SEC.

Analyses for the samples from the Cocha  Property  were  performed by ALS Chemex
Laboratories in Lima,  Peru and North  Vancouver,  Canada.  Work was carried out
under the direction of Piotr Lutynski,  M.Sc., P.Eng., and reviewed by Dr. David
A. Terry, P.Geo., Vice President Exploration, both Qualified Persons.

CRUZ DE MAYO PROPERTY, DEPARTMENT OF CUZCO, PERU

LOCATION AND ACCESS:

The Cruz de Mayo Project is located in the southern  part of the  Department  of
Cusco, Peru. The property is road accessible from the village of Velille. Travel
time is 9 hours  from  Cusco to  Velille  and 15  minutes  from  Velille  to the
property. The following map identifies the location of the Cruz de Mayo Property
as well as the Acero and Fuyani  Properties which are also within the Department
of Cusco.

                                     - 35 -
<PAGE>

[OBJECT OMITTED]D][GRAPHIC OMITTED]

                         SEE MAP 3 OF PDF FILE ATTACHED

             ACERO, CRUZ DE MAYO AND FUYANI PROPERTIES LOCATION MAP
                           DEPARTMENT OF CUSCO, PERU

Legend Showing Roads, Cities and Proeprty Boundary

Drawn June 2006, revised May 4, 2007 by Amera Resources Corporation

MINERAL TENURE:

In July 2005, the Company  obtained an option to acquire the 800 hectare Cruz de
Mayo property located in the southern portion of the Department of Cuzco in Peru
(the "Cruz de Mayo  Property")  from  Carlos  Thompson a  Peruvian  Lawyer.  The
Company also acquired, by direct staking,  2,200 hectares of adjacent land for a
total of 3,000 hectares. Mineral titles included in the Cruz de Mayo Project are
described below.


                                     - 36 -
<PAGE>
<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------------
CLAIM NAME          CLAIM NUMBER       CLAIM TYPE     HECTARES     OWNER           EXPIRY DATE   PAYMENT/WORK REQUIRED
------------------------------------------------------------------------------------------------------------------------------
<S>                <C>                <C>             <C>        <C>                <C>         <C>

CRUZ DE MAYO I      010-0137-05        Concession       1000       Recursos de         N/A        US$3 per Hectare per year
                                                                   los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------------
CRUZ DE MAYO II     010-0138-05        Concession       1000       Recursos de         N/A        US$3 per Hectare per year
                                                                   los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------------
CRUZ DE MAYO III    010-0139-05        Concession        200       Recursos de         N/A        US$3 per Hectare per year
                                                                   los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------------
PAQUITA 2004        010-2330-04        Concession        100       Carlos Thompson     N/A        See payment schedule below

------------------------------------------------------------------------------------------------------------------------------
PAQUITA DOS 2004    010-2331-04        Concession        700       Carlos Thompson     N/A        See payment schedule below

------------------------------------------------------------------------------------------------------------------------------
</TABLE>

To earn  the  interest  in the  Cruz de Mayo  Property,  the  Company  must  pay
US$150,000 in option  payments to Carlos  Thompson over the period of four years
(US$35,000 paid) and incur US$1,500,000  expenditures over a four year period as
follows:

 OPTION PAYMENTS    EXPLORATION
      US $          EXPENDITURES           DATE
                        US $

     35,000                -          April 11, 2005 (paid)
     25,000            200,000        April 11, 2007 (extended to June 30, 2007)
     40,000            550,000        April 11, 2008
     50,000            750,000        April 11, 2009
    -------          ---------
    150,000          1,500,000
    =======          =========

A US$3 per Hectare per year  validity fee applies for the three claims staked by
the Company through its wholly owned Peruvian  subsidiary  Recursos de los Andes
S.A.C.

Prior to  commencing  work and  obtaining  government  permits  for  drilling an
agreement  must be reached  with the local  community  concerning  access to the
property.  To date no  agreement  is in place.  The Company is working  with the
local communities to obtain access to the Cruz de Mayo Property.

HISTORY

Historical mining activity is evident in a series of trenches and dams that were
used in a placer  operation to wash gold from the bedrock.  These  possibly date
from  Spanish  colony  times.  More recent  trenching  is also  apparent  but no
comprehensive report describes the nature and results of this work.

EXPLORATION AND PROPOSED PROGRAM

The Cruz de Mayo  property  is  underlain  by  Jurassic  sandstone  intruded  by
diorite.  Three high priority  target zones have been  identified on the Cruz de
Mayo  Property:  (i) the Fatima  Gold  Target,  (ii) the Central  Zone  Porphyry
Copper-Gold Target, and (iii) Skarn Targets, each as described below.

FATIMA GOLD TARGET

Fatima is a bulk tonnage  target with  potential for  bonanza-grade  veins as it
comprises  multiple  higher-grade  gold  bearing  shears and veins  enveloped by
lower-grade  material.  The zone  occurs  in a  northwesterly-oriented  trend of
alteration  and veining which is at least 1.2 kilometres in length and up to 600
metres wide. Within this target area, historical mining activity is evident in a
series of trenches  and dams that were used in a placer  operation  to wash gold
from the  bedrock.  The  structures  are  strongly  oxidized  at surface and all
sulphide  minerals have been leached.  Results  reported in the table below were
collected within an area measuring 550m by 450m.


                                     - 37 -
<PAGE>
<TABLE>
<CAPTION>
----------------------------------------------------------------------------------------
ZONE           SAMPLE          SAMPLE      TRENCH [T]     AU      AG       PB       CU
                TYPE            [m]         PANEL [P]   [ppm]   [ppm]      [%]      [%]
----------------------------------------------------------------------------------------
<S>           <C>         <C>             <C>         <C>      <C>      <C>       <C>

Fatima Zone     Chip            1.0m         FZ-T1     14.35     43.9    1,980     0.05
----------------------------------------------------------------------------------------
Fatima Zone     Chip            0.5m         FZ-T2      8.36     12.1      156     0.06
----------------------------------------------------------------------------------------
Fatima Zone     Chip            8.5m         FZ-T3      2.90     11.7      870     0.08
              including         0.2m                   24.80    143.0      838     0.52
              including         3.6m                    4.69     17.3      473     0.14
----------------------------------------------------------------------------------------
Fatima Zone     Chip            8.0m         FZ-T4      0.91     25.6    5,400     0.07
----------------------------------------------------------------------------------------
Fatima Zone     Chip            6.0m         FZ-T5      0.42     20.0    2,573     0.02
----------------------------------------------------------------------------------------
Fatima Zone     Chip           10.0m         FZ-T6      0.35      1.4      297     0.04
----------------------------------------------------------------------------------------
Fatima Zone     Chip           14.0m         FZ-T7      0.29      2.8    1,256     0.03
----------------------------------------------------------------------------------------
Fatima Zone     Chip            9.0m         FZ-T8      0.17      9.5    4,150     0.15
----------------------------------------------------------------------------------------
Fatima Zone     Chip            7.0m         FZ-T9      0.14      1.3    1,120     0.02
----------------------------------------------------------------------------------------
Fatima Zone     Panel       10.0 x 20.0m     FZ-P1      1.86     14.0      215     0.05
----------------------------------------------------------------------------------------
Fatima Zone     Panel       10.0 x 20.0m     FZ-P2      0.43      8.0      148     0.09
----------------------------------------------------------------------------------------
</TABLE>

CENTRAL ZONE PORPHYRY COPPER-GOLD TARGET

The  Central  Zone  bulk-tonnage   porphyry  Cu-Au  target  is  located  in  the
south-central part of the property.  Malachite-stained  copper-bearing sandstone
has been mapped over an area of approximately 300 metres by 700 metres.  Several
gold-bearing  shears which cut the  copper-bearing  sandstone were  historically
mined for gold in this area.  Sample results  reported below were collected from
outcrops and historical trenches within a surface area measuring 300m by 500m.

--------------------------------------------------------------------------------
ZONE          SAMPLE TYPE       SAMPLE           TRENCH [T]       AU         CU
                                  [M]             PANEL [P]     [PPM]        [%]
--------------------------------------------------------------------------------

Central Zone       Chip          23.0m              CZ-T1        0.07       0.28
Central Zone      Panel        5.0 x 5.0m           CZ-P1        2.87       0.02
Central Zone      Panel        5.0 x 5.0m           CZ-P2        0.01       1.81
Central Zone      Panel       10.0 x 10.0m          CZ-P3        0.32       0.12
Central Zone      Panel        1.0 x 3.0m           CZ-P4        0.51       0.10
--------------------------------------------------------------------------------

The Company has not found any "reserves" on the Cruz de Mayo  Property,  as that
term is defined in Guide 7 adopted by the SEC.

The Company plans a detailed surface exploration  program comprising  geological
mapping, rock and soil sampling on the project to fully evaluate the dimensions,
grade and character of the  mineralized  zones  identified to date and to better
delineate drill targets.  Work on the Cruz de Mayo Property has been carried out
under the direction of Piotr Lutynski,  M.Sc.,  P.Eng.  and has been reviewed by
Dr. David A. Terry,  P.Geo.,  Vice President  Exploration for the Company,  both
Qualified Persons. All assays from the Cruz de Mayo Property were carried out by
ALS Chemex.

ACERO COPPER-GOLD PROJECT, DEPARTMENT OF CUZCO, PERU

LOCATION AND ACCESS:

The 1,700 hectare Acero  Property  lies within the Santo Tomas  Porphyry  Copper
Belt and is located just 8km west of the  Company's  Cruz de Mayo  Property near
the town of Velille.  It is road  accessible  from the  village of Velille.  The
property location map can be found under the section "Cruz de Mayo" above.

MINERAL TENURE:

In 2005,  the  Company  acquired  by  staking,  the Acero  porphyry  copper-gold
property in southern  Department of Cuzco,  Peru. Mineral titles included in the
Acero Project are summarized below.

                                     - 38 -
<PAGE>

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------------
CLAIM NAME    CLAIM NUMBER   CLAIM TYPE      HECTARES     OWNER             EXPIRY DATE    PAYMENT/WORK REQUIRED
---------------------------------------------------------------------------------------------------------------------
<S>         <C>            <C>               <C>         <C>                 <C>         <C>

ACERO I       010-2343-05    Concession         800       Recursos de           N/A        US$3 per Hectare per year
                                                          los Andes S.A.C
---------------------------------------------------------------------------------------------------------------------
ACERO II      010-2344-05    Concession         900       Recursos de           N/A        US$3 per Hectare per year
                                                          los Andes S.A.C
---------------------------------------------------------------------------------------------------------------------
</TABLE>

HISTORY

Claims  were  held  in the  Acero  Property  area in the  past  by  Southwestern
Resources   through  a  joint-venture   Southern  Peru  Copper.   They  reported
discovering two zones of altered feldspar porphyry with potassic  alteration and
associated  leach cap with copper  oxides and  secondary  chalcocite.  A limited
drill program  reportedly  intersected "thick zones" of sulphide porphyry copper
style  mineralization with grades ranging between 0.3 and 0.5% copper with local
narrow  sections  assaying over 1% copper  (Southwestern  Gold Corp. 2000 Annual
Report).

EXPLORATION AND PROPOSED PROGRAM

Several phases of intrusive have been mapped on the property  including  dacite,
micro-diorite  and granodiorite;  the majority of mineralization  and alteration
identified  to date is hosted  by  dacitic  intrusive.  Quartz  stockwork,  with
individual  veinlets up to 3cm wide, is  widespread in the southwest  portion of
the mineralized area. Copper  mineralization  identified on surface on the Acero
Property  appears to be open to the  southeast  of current  mapping and sampling
coverage.

Tabulated preliminary sample results from surface sampling of the Acero Property
are presented below.

--------------------------------------------------------------------------------
                                  TRENCH [T]
  SAMPLE TYPE     SAMPLE LENGTH    PANEL [P]      CU      AU       AG      MO
                       [m]         GRAB [G]       [%]    [ppm]    [ppm]   [ppm]
--------------------------------------------------------------------------------

     Chip              4.0           T1         0.55     0.01      0.2       4
     Chip             10.0           T2         0.55     0.04      0.3       6
     Chip             10.0           T3         0.47     0.02      0.5       5
     Chip             12.0           T4         0.42     0.13      1.0       5
     Chip             10.0           T5         0.36     0.03      0.3       8
     Chip             10.0           T6         0.31     0.03      0.2       5
     Chip              3.0           T7         0.31     0.11      2.0       4
     Chip             10.0           T8         0.28     0.17      0.7       3
     Chip             10.0           T9         0.24     0.03      0.4       9
     Chip             11.0           T10        0.22     0.04      0.5       4
     Chip             10.0           T11        0.16     0.10      0.4       1
     Chip             11.0           T12        0.14     0.12      0.9       1
     Chip             12.0           T13        0.13     0.75    316.0      36
     Chip             30.0           T14        0.11     0.06      1.0      46
     Panel         5.0 x 5.0         P1         0.48     0.06      0.9     109
     Panel         3.0 x 5.0         P2         0.12     0.05      0.7       2
--------------------------------------------------------------------------------


                                     - 39 -
<PAGE>



The Company has not found any "reserves" on the Acero Property,  as that term is
defined in Guide 7 adopted by the SEC.

The Company is planning a comprehensive  surface exploration program to identify
drill  targets  on the core  area and to  evaluate  the  remainder  of the Acero
Property. Prior to commencing work and obtaining government permits for drilling
an agreement must be reached with the local community  concerning  access to the
property.  To date no  agreement  is in place.  The Company is working  with the
local communities to obtain access to the Acero Property.

Work on the Acero  Property  has been  carried out under the  direction of Piotr
Lutynski,  M.Sc.,  P.Eng.  and has been reviewed by Dr. David A. Terry,  P.Geo.,
both Qualified  Persons.  All assays from the Acero Property were carried out by
ALS Chemex.

FUYANI COPPER-GOLD PROPERTY, DEPARTMENT OF CUSCO, PERU

LOCATION AND ACCESS:

The Fuyani  Property is located 40km north of Santo Tomas in the  Department  of
Cusco,  in the Santo Tomas Porphyry Copper belt. It is easily accessed along the
gravel  road  connecting  Santo  Tomas  with  Cusco,  70km  north of the  Fuyani
Property.  The Fuyani Property lies 40km NW of the Constancia  copper-molybdenum
project  currently being explored by Norsemont Mining Inc; the high-profile Liam
epithermal gold project of Newmont Peru Limited/Southwestern  Resources Corp. is
located 80km to the  southwest;  and BHP Billiton's  Tintaya  copper-gold-silver
porphyry-related  skarn deposit is located 100km to the southeast.  Location map
for the Fuyani  Gold  Property  can be viewed  under the  section  "Cruz de Mayo
Property" above.

MINERAL TENURE:

The 1000 Hectares Fuyani  copper-gold  property was acquired by staking in 2006.
It consists of a single  concession  registered  under  Recursos de los Andes, a
wholly  owned  subsidiary  of the  Company.  The claim is described in the table
below.
<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------------
CLAIM NAME    CLAIM NUMBER   CLAIM TYPE      HECTARES     OWNER             EXPIRY DATE    PAYMENT/WORK REQUIRED
---------------------------------------------------------------------------------------------------------------------
<S>         <C>            <C>               <C>         <C>                 <C>         <C>

FUYANI        01-00875-06    Concession         1000      Recursos de           N/A        US$3 per Hectare per year
                                                          los Andes S.A.C
---------------------------------------------------------------------------------------------------------------------
</TABLE>


HISTORY

There is no indication  of previous  work or  historical  workings on the Fuyani
property.

EXPLORATION AND PROPOSED PROGRAM

The Fuyani  property is  underlain  by  Cretaceous  volcaniclastics  intruded by
tertiary granodioritic  intrusive.  Tertiary sediments cover topographically low
areas. Porphyry-style copper (malachite,  chalcopyrite,  and bornite) and silver
mineralization,   with  elevated  lead,  zinc  and  molybdenum,   is  hosted  by
epidote-altered  granodiorite.  Abundant  massive  magnetite and garnet float in
several creeks draining the Fuyani property suggests also presence of skarn type
mineralization.



                                     - 40 -
<PAGE>


The Company has not found any "reserves" on the Fuyani Property, as that term is
defined in Guide 7 adopted by the SEC.  Only 4 rock samples have been  collected
from the Fuyani Property to date.

MITU COPPER-SILVER PROPERTY, DEPARTMENT OF JUNIN, PERU

LOCATION AND ACCESS:

The Mitu  Property  is  located  approximately  155km  northeast  of Lima,  80km
southeast of the historic  mining camp of Cerro de Pasco and 110km  northwest of
the Company's Cocha copper-silver  project in the department of Junin, Peru. The
Mitu Property is easily accessible via a paved  road-connecting  Lima with Oroya
and Cerro de Pasco.  From the paved road there are several 4x4 roads  leading to
different areas of the property. Elevations on the property range from 3,700m to
4,400m above sea level.  The following map  identifies  the location of the Mitu
Property:


                                     - 41 -
<PAGE>


[OBJECT OMITTED]][GRAPHIC OMITTED]

                         SEE MAP 4 OF PDF FILE ATTACHED

MITU PROPERTY LOCATION JUNIN DEPARTMENT, PERU

Showing PERU in relationship to surrounding countires
Showing Mitu Property

Drawn December 2006 revised May 5, 2007 by Amera Resources Corporation


                                     - 42 -
<PAGE>


MINERAL TENURE

In June 2006 the  Company was granted the 5,600  hectare  Mitu  concession.  The
Company holds a 100% interest in the Mitu Property,  acquired by direct staking.
Mineral titles for the Mitu Property are described in the table below.
<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
CLAIM NAME     CLAIM NUMBER     CLAIM TYPE     HECTARES       OWNER             EXPIRY DATE    PAYMENT/WORK REQUIRED
------------------------------------------------------------------------------------------------------------------------
<S>            <C>             <C>             <C>           <C>                 <C>          <C>

MITU 1          01-00869-06     Concession       1000         Recursos de           N/A        US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
MITU 2          01-00870-06     Concession       1000         Recursos de            N/A         US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
MITU 3          01-00871-06     Concession       1000         Recursos de            N/A         US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
MITU 4          01-00872-06     Concession       1000         Recursos de            N/A         US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
MITU 5          01-00873-06     Concession       1000         Recursos de            N/A         US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
MITU 6          01-00874-06     Concession        600         Recursos de            N/A         US$3 per Hectare per year
                                                              los Andes S.A.C
------------------------------------------------------------------------------------------------------------------------
</TABLE>

HISTORY

Small  historical  workings  are evident on the Mitu  property  but there are no
reports of modern exploration prior to the Company's staking.

EXPLORATION AND PROPOSED PROGRAM

The Company has not found any "reserves" on the Mitu  Property,  as that term is
defined   in  Guide  7  adopted  by  the  SEC.   Sediment-hosted   copper-silver
mineralization  occurs in the clastic Mitu  Formation at, or close to, its upper
contact  with the Pucara  limestone.  Three  rock chip  samples  collected  from
historical  workings  during an initial site  evaluation of the Mitu  concession
assayed 4.5% copper and 128 ppm silver over 1.2m, 6.2% copper and 324 ppm silver
over 0.4m,  and 1.7%  copper  and 45 ppm silver  over  0.3m;  all  samples  were
collected across structurally and/or stratigraphically-controlled horizons.

A total of 10 stream sediment  samples were collected in the Mitu Property area.
Results  ranged from 8 to 246 ppm copper and 0.1 to 0.4 ppm silver.  The highest
copper  value  came  from  one  sample  collected  in the  central  part  of the
concession  reflecting  mineralization  associated  with the contact between the
Mitu and Pucara formations.

The  Company is  currently  carrying  out a  comprehensive  surface  exploration
program  comprising  prospecting,  geological  mapping and soil grid sampling to
delineate drill targets. Drilling is expected to begin in the Fall 2007.

Analyses for the samples from the Mitu  Property  were  performed by ALS Chemex.
Work on the Mitu Property was carried out under the direction of Piotr Lutynski,
M.Sc.,  P.Eng., and technical  information from the property was reviewed by Dr.
David A. Terry, P.Geo., Vice President Exploration both Qualified Person.

LAGUNA GOLD PROPERTY, DEPARTMENT OF PASCO, PERU

LOCATION AND ACCESS:

The  Laguna  Gold  Property  is located  in the Cerro de Pasco  district  and is
immediately  west of the  mineral  belt  that  includes  the  Cerro de Pasco and
Colquijirca area polymetallic  deposits.  The property is easily accessible from
the town of  Cerro de Pasco by  following  the main  road  west  past the  large
tailings dam and out onto the flat gravel-covered  plateau to the east where the
property is located.  Gravel roads access many areas of the property. The Quicay
Mine  in  the  centre  of the  property  has  electrical  power.  Several  small


                                     - 43 -
<PAGE>


communities such as Pachoyan are scattered around the area of the property.  The
following map identifies the location of the Laguna Gold Property:



                                     - 44 -
<PAGE>

[OBJECT OMITTED]            [GRAPHIC OMITTED][GRAPHIC OMITTED]

                         SEE MAP 5 OF PDF FILE ATTACHED

MAP OF LAGUNA GOLD PROJECT, PASCO DEPARTMENT, PERU
Showing Mines and Geochemical/Geophysical Targets.

DRAWN JANUARY 2007 BY AMERA RESORUCES CORPORATION


                                     - 45 -
<PAGE>


MINERAL TENURE

On December  7, 2006,  the  Company  signed a letter of intent  with  Chancadora
Centauro  S.A.C.  to enter  into an  option  agreement  to  acquire  up to a 90%
interest in the 11,184  hectare  Laguna Gold Project in the Pasco  Department of
west central Peru (the "Laguna Gold Property").  In addition,  applications have
been filed for  additional  claims  covering  8,800  hectares in adjacent  areas
bringing the project total to 19,984  hectares.  The table below  summarizes the
titles for the claims pertaining to the option agreement. Mineral titles for the
additional claims are pending.
<TABLE>
<CAPTION>

----------------------------------------------------------------------------------------------------------------------------
CLAIM NAME        CLAIM NUMBER     CLAIM TYPE      HECTARES    OWNER                EXPIRY DATE      PAYMENT/WORK REQUIRED
----------------------------------------------------------------------------------------------------------------------------
<S>             <C>               <C>             <C>         <C>                       <C>         <C>

PDP 8             01-03443-04      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PDP 9             01-03444-04      Concession         200      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PDP 15            01-01283-05      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
---------------------------------------------------------------------------------------------------------------------------
PDP 18            01-01803-05      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PDP 19            01-01802-05      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PAMPA DOS A       04013412X01      Concession         400      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PAMPA DOS C       04013412X10      Concession         250      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PAMPA DOS D       04013412X16      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
PAMPA DOS E       04013412X19      Concession         450      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 3    01-00064-92      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 4    01-00065-92      Concession        1000      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 5    01-00066-92      Concession       334.224    Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 6    01-00067-92      Concession          50      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 9    01-00070-92      Concession         800      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 10   01-00061-92      Concession         800      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
CENTROMIN No 11   01-00060-92      Concession         900      Chancadora Centauro        N/A        See terms of the letter
                                                                     S.A.C.                               of intent below
----------------------------------------------------------------------------------------------------------------------------
</TABLE>

Under  the terms of the  letter  of  intent,  the  Company  may earn up to a 90%
interest in the Laguna Gold  Property.  An initial 51% interest may be earned by
incurring US$650,000 in work expenditures and US$900,000 in option payments over
2 years.  The  Company may then elect to earn an  additional  39%  interest,  by
making a further  US$4,000,000  in option  payments  and  completing  a bankable
feasibility study,  within seven years after the exercise of the initial option.
The letter of intent provides for a legal and technical due diligence period.

HISTORY

The Cerro de Pasco  district  is well  known  for its  precious  and base  metal
deposits.  The Laguna Gold Property is located in close  proximity to the Quicay
mine (see  map).  The area has been  prospected  and  explored  for by  numerous
companies with greater  emphasis in the last ten years. In 2001,  Anglo American
Exploration  Peru S.A.  carried out a large Spectrum  airborne  survey with 200m
line  spacing  identifying  37 targets in the Laguna area.  The Spectrum  system
measures  conductivity/resistivity  and  included a  magnetometer.  Placer  Dome
acquired  an  option  on the  property  in 2005 and  carried  out  property-wide
geochemical survey, reviewed the Anglo Spectrum data and anomalies and conducted
a review of surface geology and structure.  The result of Placer Dome's work was
the  identification  of 6 high priority  drill  targets  selected for testing in
2006.  With the takeover of Placer Dome by Barrick Gold  Corporation  the Laguna
Gold Project option was  terminated  and the targets have yet to be tested.  The
Company has  acquired the sizable  exploration  database and will be using it to
confirm the previously-identified targets.



                                     - 46 -
<PAGE>




EXPLORATION AND PROPOSED PROGRAM

The Company has not found any  "reserves" on the Laguna Gold  Property,  as that
term is defined in Guide 7 adopted by the SEC.

The  Company's  primary  target on the  Laguna  Gold  Property  is  buried  high
sulphidation gold or polymetallic  deposits.  To date, six  high-priority  drill
targets that have similar geological  characteristics to the Quicay gold deposit
have been identified on the Laguna Gold Property and they will be systematically
reviewed by the Company's technical team to prioritize drill targets.

Much of the area within the Laguna Gold  Property  lies within an  intermountain
basin and is covered with transported alluvium,  colluvium, and possibly glacial
drift  deposits.  While the cover  thickness is believed to locally exceed 100m,
the target  Miocene-aged  siliceous  alteration  systems form topographic  highs
where exposed and likely are present under reduced  thicknesses  of  transported
cover sequences. Mineralized Miocene intrusives and erosion-resistant silicified
domains occur within the project area,  specifically  at the Quicay mine site, a
siliceous  topographic  high resulting from high  sulphidation  epithermal  gold
mineralization.

NEVADA USA

ROY AND HILLS, PROPERTIES

LOCATION AND ACCESS:

The 478 hectare  (1,180 acre) Roy and the 421 ha (1,040  acre) Hills  Properties
are located 56 and 65 kilometres  respectively northwest of Tonopah. The Roy and
Hills  Claims are both  adjacent  to the Pole Line road and access to them is by
truck from Tonopah. A power line follows the Pole Line road just east of the Roy
and Hills  property.  The following map  identifies  the location of the Roy and
Hills Claims:


                                     - 47 -
<PAGE>


[OBJECT OMITTED]APHIC OMITTED][GRAPHIC OMITTED]

                         SEE MAP 6 OF PDF FILE ATTACHED

               ROY AND HILLS PROPERTIES LOCATION MAP NEVADA, USA
       Legend shows: County Boundaries, Roads Cities, Property Boundaries

Drawn April 2005 revised May 5, 2007 by Amera Resources Corporation



MINERAL TENURE

In March 2005, pursuant to an acknowledgement agreement dated December 31, 2004,
with Steven K. Jones,  M.Sc.,  C.P.G.,  the Company acquired two claim blocks in
the Roysten Hills area of Nye County of west central  Nevada (the "Roy and Hills
Claims").  Mr. Jones, as agent for the Company,  staked the Roy and Hills Claims
on behalf of the Company in November  2004 and the Company  advanced  all of the
costs associated with staking the claims during the last quarter of fiscal 2004.
Mr. Jones is an arm's length,  third party.  Mr. Jones  transferred  the Roy and
Hills Claims to Amera Resources (US) Inc., the Company's wholly-owned subsidiary
and  Quitclaim  Deeds were filed with the Bureau of Land  Management  on June 1,
2005.


                                     - 48 -
<PAGE>



Mineral Titles included in the Roy and Hills Projects:
<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------------
PROPERTY          CLAIMS      CLAIM NUMBER          ACRE     OWNER               EXPIRY DATE  PAYMENT/WORK REQUIRED
------------------------------------------------------------------------------------------------------------------------------
<S>              <C>         <C>                   <C>      <C>                    <C>       <C>

ROY                1 to 59    884363 to 884421      1,180    Amera Resources (US)     N/A     US$125 per claim for federal and
(59 claims)                                                                                   US$8.50 per claim for county
------------------------------------------------------------------------------------------------------------------------------

HILLS              1 to 28    884422 to 884449               Amera Resources (US)     N/A     US$125 per claim for federal and
(52 claims)                                         1,040                                     US$8.50 per claim for county
                  29 to 52    902686 to 902709               Amera Resources (US)     N/A     US$125 per claim for federal and
                                                                                              US$8.50 per claim for county
------------------------------------------------------------------------------------------------------------------------------
</TABLE>

HISTORY

The Roy and  Hills  properties  are  located  along the  northern  margin of the
prolific  Walker Lane  epithermal  belt,  which has seen past production of more
than 35 million  gold  equivalent  ounces.  The details of previous  work on the
Hills  property is not known.  On the Roy  property,  several short rotary drill
hole sites were found testing the more silicified alteration.  Results from this
earlier drilling are unknown.

EXPLORATION AND PROPOSED PROGRAM

Both the Roy and Hills claim blocks are underlain by Oligocene  and  Miocene-age
volcanic  rocks that  consist of latites,  quartz  latites and dacite flows that
have undergone  epithermal  alteration and mineralization prior to being covered
by lacustrian volcanic sediments and Quaternary gravels.  Work by the Company on
the Roy and Hills Claims includes surface mapping,  geological  sampling,  and a
ground magnetics survey carried out by Quantec  Geophysic along 200 meter-spaced
lines with 10 meter-spaced sample points.

On the Roy  property  a  gold-silver  epithermal  system  is  hosted  within  an
alteration  zone that outcrops over a 2.25 square  kilometre area. One sample of
float  material  collected  from the central  portion of the claim group assayed
41.5 g/t gold (1.2 oz/ton); gold values from additional surface rock sampling to
date range between 0.030 to 0.60 g/t gold.  The Hills property is located 7km to
the northwest of the Roy property and hosts a prospective silver-gold epithermal
system  within a 1km by 500m  alteration  area.  Rock chip sampling has returned
values ranging from 0.2-70.0 g/t silver and 0.1-0.2 g/t gold.

On June 9, 2006 the  Company  signed a letter of  agreement  to option to Astral
Mining  Corporation  ("Astral")  its Roy and Hills Claims (the "Astral Letter of
Agreement").  Under the terms of the Astral Letter of Agreement, Astral may earn
up to an 80% undivided interest in the Roy and Hills Claims.  Astral can earn an
initial 65% interest in the Roy and Hills Claims by  incurring  US$2,500,000  in
work  expenditures  over four years and issuing  500,000 of its common shares to
the  Company.  Astral  may then elect to earn an  additional  15%  interest,  by
issuing a further 500,000 common shares to the Company and completing a bankable
feasibility  stage,  within three  years.  The Astral  Letter of  Agreement  was
approved by the TSX-V, and Astral issued the first 100,000 shares to the Company
on August 4, 2006.

On May 18, 2007 Astral reported the results from a 7-hole 1,000m Phase I Reverse
Circulation  (RC) drill program on the Roy and Hills gold projects  commenced in
January,  2007.  . The  best  results  from  the  program  were a 6.1m  interval
averaging 0.89 g/t gold,  including a 1.5m interval  assaying 2.1 g/t gold, from
between 3.0 and 9.1m depth in hole R-07-5.  This hole,  along with R-07-03,  was
designed to test the area where  surface  samples of  subcropping  bladed quartz
vein material  assayed 41.5 g/t gold. Zones of anomalous  arsenic  concentration
were observed in all holes except  R-07-7;  zones of elevated  silver and copper
were    detected    in   hole    R-07-05    and   a   20.1m    wide    zone   of
arsenic-mercury+/-antimony+/-copper was present near the top of hole R-07-06.

The Roy and Hills drilling program was carried out under the supervision of John
Rice,  C.P.G., a Qualified Person as defined in National  Instrument 43-101. All
analytical work for the Roy and Hills drilling program was performed by American
Assay  Laboratories  Inc., an  internationally  recognized  analytical  services
provider located in Sparks,  Nevada. The technical  information  discussed above



                                     - 49 -
<PAGE>


has also been reviewed by Dr. David A. Terry, P.Geo., Vice President Exploration
for the  Company  and a  Qualified  Person as  defined  in  National  Instrument
43-101..

The Company has not found any  "reserves" on the Roy and Hills  Claims,  as that
term is defined in Guide 7 adopted by the SEC.

Dr. David A. Terry, P.Geo. is the Qualified Person for the Roy and Hills Claims.

ESPERANZA PROJECT

On August 24, 2004 the Company  entered into an option  agreement  with Arcturus
Ventures Inc. ("Arcturus") whereby it could earn up to an 80% undivided interest
in the 3,000 hectare Esperanza  Property located in northern Arequipa  Province,
Peru. The Company terminated its option agreement with Arcturus on July 31, 2006
and the Esperanza property carrying value of $511,883 was written off during the
year ended December 31, 2006.

PLAN OF OPERATION AND EXPLORATION BUDGET

As of  April  30,  2007,  the  Company  had  working  capital  of  approximately
$3,800,000.

Reconnaissance  programs  designed  to identify  properties  for staking in high
potential  mineral belts in Peru are ongoing and the projected budgets for these
programs  may be adjusted up or down  dependent  on results.  In  addition,  the
Company is continually  evaluating  property  submittals and  opportunities in a
number of prospective  jurisdictions  and has an active property review program.
As prospective  opportunities are identified,  additional funds may be allocated
to acquisitions and exploration work based on the  recommendations of management
and the board of directors.

The Company has not budgeted for any exploration programs on the Mogote Property
during  2007 and is  actively  seeking  joint  venture  partners  to advance the
project.

Preliminary  surface  exploration  comprising  prospecting,  geological mapping,
rock,  soil and silt sampling was carried out in late 2005 and early 2006 on the
Cocha  Property.  Early results from the work on the Cocha  Property  indicate a
significant zone of near-surface sediment-hosted copper-silver mineralization is
present. A Phase I eleven hole 1,394m diamond drill program was completed during
August-September 2006. A follow-up Phase II program is planned for 2007 budgeted
at $420,000.

Further  surface  work is planned for the Mitu  Property.  Numerous  showings of
high-grade  copper-silver  mineralization  has been identified on surface and in
old  workings.  A Phase I drill program to test some of these targets is planned
for late 2007 - the project has a budget of $210,000.

Subsequent  to  satisfactory  completion  of due  diligence  on the Laguna  Gold
Property,  and checking of all the  geophysical-geochemical  anomalies,  a drill
program to test at least six high priority targets will be permitted and carried
out. The 2007 budget for the Laguna Gold Property is $650,000.

Exploration  carried out during 2005 has identified two zones of  mineralization
on the Cruz de Mayo Property. The company plans to carry out a detailed soil and
rock  sampling  program,   ground  geophysics  and,   dependant  on  results,  a
preliminary  drill test of the  property.  A total of $220,000 has been budgeted
for this work.

A total of $200,000 has been  budgeted to advance other  properties  the Company
currently  has in its portfolio  through  surface  exploration  programs for the
remainder of 2007.

Reconnaissance  and evaluation  activities  aimed at  identifying  properties to
acquire by direct staking or through  agreements  with third parties are planned
to continue through the first half of 2007 in Peru. In addition the Company will
be continually evaluating submittals and other exploration opportunities as they
arise.  It is the aim of the Company to acquire  additional  properties over the
next year,  primarily  in Peru,  Chile or  Columbia.  The Company  has  budgeted
$850,000 for these  activities  during fiscal 2007.  Management may have to make


                                     - 50 -
<PAGE>


adjustments  to the  budget  throughout  the year,  dependant  upon  exploration
results and/or acquisition opportunities.

The table below sets forth the Company's  exploration budget for the fiscal 2007
period.
<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------
                                             LOCATION     JANUARY-MAY     JUNE-DECEMBER        TOTAL
------------------------------------------------------------------------------------------------------
<S>                               <C>        <C>          <C>            <C>               <C>

Cocha                              Cu-Ag       Peru         $100,000         $320,000         $420,000
Mitu                               Cu-Ag       Peru          $50,000         $160,000         $210,000
Cruz de Mayo                       Au-Cu       Peru          $50,000         $170,000         $220,000
Laguna                               Au                     $150,000         $500,000         $650,000
Other Peru Properties                          Peru          $50,000         $150,000         $200,000
Peru Generative and Acquisitions                            $250,000         $350,000         $600,000
Other Evaluations                                           $100,000         $150,000         $250,000
                                                            ------------------------------------------
TOTAL                                                       $750,000       $1,800,000       $2,550,000
                                                            ==========================================
</TABLE>

The Company does not believe it has  sufficient  financial  resources to conduct
all of the planned exploration of its mineral property interests and to fund its
ongoing overhead  expenses during the 12 months from January 1, 2007 to December
31,  2007.  In the  future,  the Company  may need to raise  additional  capital
through  the  sale  of  its  equity  securities  to  fund  further   exploration
activities.  See  "Item 5.  Operating  and  Financial  Review  and  Prospects  -
Liquidity  and  Capital  Resources."  The  Company  may not be able to raise the
necessary  funds, if any, and may not be able to raise such funds at terms which
are  acceptable  to the  Company.  In the event the  Company  is unable to raise
adequate finances to fund the proposed activities,  it will need to reassess its
alternatives and may have to abandon one or more of its property  interests as a
result.


ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS.
--------------------------------------------------------------------------------

The  following  discussion  of the results of  operation  of the Company for the
fiscal  years  ended  December  31,  2006,  2005  and  2004  should  be  read in
conjunction with the accompanying  audited  financial  statements of the Company
and related notes included therein.

The Company's  financial  statements  are prepared in  accordance  with Canadian
GAAP,  the  application  of which,  in the case of the Company,  conforms in all
material  respects  for  the  period  presented  with  US  GAAP  except  for the
differences noted in Note 11 of the Company's  audited financial  statements for
the years ended December 31, 2006, 2005 and 2004 which are included herein.  The
noon rate of exchange on April 30, 2007,  reported by the United States  Federal
Reserve Bank of New York,  for the  conversion  of Canadian  dollars into United
States dollars was CDN$1.1068  (US$0.9035 = CDN S1.00). The effects of inflation
and  price  changes  have not had a  material  impact on the  Company  since its
incorporation. The Company does not engage in hedging activities.

The Company's financial  statements were prepared on a going concern basis which
assumes  that the  Company  will be able to realize  its  assets  and  discharge
liabilities in the normal course of business.

OVERVIEW

The Company was  incorporated on April 11, 2000 and remained  without a business
asset until March 2003,  when the Company  negotiated a number of  agreements to
option  and  acquire  interests  in  various  mineral   concessions  located  in
Argentina.  In December 2003, the Company  completed its initial public offering
and commenced trading on the TSX-V under the symbol "AMS".  Effective  September
13, 2006,  the Company  received  clearance for trading on the  Over-the-Counter
Bulletin  Board  ("OTCBB")  operated by the National  Association  of Securities
Dealers, continuing under the symbol "AJRSF".

The  Company  is an  exploration  stage  company  engaged  in  the  business  of
acquiring, exploring and evaluating natural resource properties, and potentially
joint  venturing these  properties  depending on the evaluation of the property.
The Company has been focusing on conducting  exploration  programs on the Mogote
property in Argentina and on its portfolio of properties in Peru.  The Company's


                                     - 51 -
<PAGE>



material  mineral property  interests are located in Argentina,  Peru and in US.
The Company is currently reviewing other mineral property interest opportunities
in South and North  America and has budgeted  approximately  $850,000 for fiscal
2007 for generative exploration program.

During  December  2004 the  Company  staked  the Roy and Hills  claim  blocks in
Nevada. See "Item 4. Information on the Company - Property,  Plant and Equipment
- Other Properties - Nevada, USA, Properties." During 2005 the Company staked or
optioned the Cruz de Mayo, Acero and Cocha  properties in Peru.  During 2006 and
the  beginning of 2007,  the Company  staked or optioned the Fuyani,  Mitu,  and
Laguna  properties in Peru. See "Item 4.  Information on the Company - Property,
Plant and Equipment - Other Properties."

RESULTS OF OPERATIONS

FISCAL YEAR ENDED  DECEMBER 31, 2006 COMPARED TO FISCAL YEAR ENDED  DECEMBER 31,
2005

For the year  ended  December  31,  2006,  the  Company  reported  a net loss of
$1,920,249  ($0.10  per  share),  an  increase  in loss  of  $485,698  from  the
$1,434,551 ($0.09 per share) for the year ended December 31, 2005.

A total of $1,422,749 of general and administrative  costs were incurred for the
year ended December 31, 2006, compared to $1,187,928 for the year ended December
31, 2005. Significant expenditures were incurred in the following categories:

     -   Corporate   development  and  investor  relations  costs  of  $227,747,
         compared to $252,981  during 2005,  are  comprised of costs  related to
         investor  relations,  investor  conferences  and  distributing  general
         corporate  information.  These costs have decreased from the prior year
         primarily as a result of the Company discontinuing its contract with an
         external investor relations firm in early 2006.
     -   General  exploration  costs  of  $296,810  were  incurred  during  2006
         compared to $199,264 during 2005 as the Company expanded its generative
         exploration activities in Peru, Chile and Colombia.
     -   Management  fees of $85,833  were paid to the  President of the Company
         pursuant to an employment  agreement  compared to $73,500 paid in 2005.
         Under the  contract  the  President  was paid  $6,125 per month in 2005
         which increased to $7,292 per month on May 1, 2006.
     -   Office and sundry  expenses  were  $122,639  during  2006  compared  to
         $92,724 during 2005 as a result of the increase in activity in 2006.
     -   Rent of $90,099  increased  by $16,526  from $73,573 rent paid in 2005.
         The rent expense is comprised of an  allocation of fees from the Grosso
         Group.
     -   Salaries of $372,063 in 2006 increased  $77,893 from $294,170  salaries
         paid in 2005.  In 2006  salaries are comprised of an allocation of fees
         paid  to the  Grosso  Group.  In 2005  salaries  were  comprised  of an
         allocation  of fees  paid to the  Grosso  Group  and  salaries  paid to
         employees in the Peru office.
     -   Stock-based  compensation  of  $90,850 is the  estimated  fair value of
         415,000 stock options  granted to employees,  directors and consultants
         during 2006 compared to $52,500 the estimated fair value of the 250,000
         stock  options  granted  during  2005.   Stock-based   compensation  is
         accounted for at fair value as determined by the  Black-Scholes  option
         pricing  model  using  amounts  that are  believed to  approximate  the
         volatility of the trading price of the  Company's  stock,  the expected
         lives of  awards of  stock-based  compensation,  the fair  value of the
         Company's stock and the risk-free interest rate.
     -   The $525,514 write-off of mineral properties in 2006 primarily consists
         of the  $511,883  write-off  of the  Esperanza  property.  The  Company
         terminated  its option  agreement with Arcturus in August 2006 in order
         to focus its exploration efforts on its other Peruvian  properties.  In
         2005, the Company  wrote-off the $225,000  carrying value of its Chubut
         properties as there was no active exploration on the properties.

During the year ended  December 31, 2006,  the Company  capitalized  $451,169 of
expenditures on the Cocha Property, $179,770 on the Mogote Property, $111,775 on
the Cruz de Mayo  Property,  $3,657 on the  Korimarca  Property,  and $49,915 on
other properties.

FISCAL YEAR ENDED  DECEMBER 31, 2005 COMPARED TO FISCAL YEAR ENDED  DECEMBER 31,
2004

For the year  ended  December  31,  2005,  the  Company  reported  a net loss of
$1,434,551  ($0.09 per share), an increase in loss of $560,219 from the $874,332
loss ($0.07 per share) for the year ended December 31, 2004.



                                     - 52 -
<PAGE>

A total of $1,187,928 of general and administrative  costs were incurred for the
year ended  December 31, 2005  compared to $863,499 for the year ended  December
31, 2004. Significant expenditures were incurred in the following categories:

     -   Corporate  development and investor relations of $182,702,  compared to
         $151,739  during  2004,  is  comprised  of costs  related  to  investor
         relations, investor conferences and general corporate information.
     -   General exploration costs of $199,264 were incurred during 2005 (2004 -
         $18,318) as the Company expanded its generative  exploration activities
         in Peru and in the US.
     -   Management  fees of $73,500  were paid to the  President of the Company
         pursuant to an employment agreement compared to $72,400 during 2004.
     -   Office and sundry expenses were $92,724 during 2005 compared to $51,173
         during 2004 as a result of the increase in activity in 2005.
     -   Rent of $73,573  increased by $44,062 from $29,511 rent paid in 2004 to
         IMA. The rent expense in 2005  represents  allocation  of fees from the
         Grosso Group.
     -   Salaries of $294,170  represent  allocation  of fees paid to the Grosso
         Group  during  2005 and  salaries  paid to  employees  in Peru  office,
         compared to $154,074  during 2004.  Total fees of $377,410 was incurred
         by the Company from the Grosso Group during 2005  compared to $108,390,
         which was paid to IMA for rent,  salaries and  administrative  services
         during 2004.
     -   Stock-based  compensation  of  $52,500 is the  estimated  fair value of
         stock options granted to employees,  directors and  consultants  during
         2005 compared to $131,805 the estimated fair value of the stock options
         granted during 2004. Stock-based  compensation is accounted for at fair
         value as determined  by the  Black-Scholes  option  pricing model using
         amounts that are believed to approximate  the volatility of the trading
         price  of  the  Company's  stock,  the  expected  lives  of  awards  of
         stock-based compensation, the fair value of the Company's stock and the
         risk-free interest rate.
     -   Write off of mineral  properties  consists of the $225,000 write off of
         Chubut properties,  as there is no active exploration on the properties
         and the Company  has  postponed  any  exploration  indefinitely.  These
         properties  located in Western Chubut Province of Argentina are subject
         to an ongoing government moratorium on exploration activities.

During the year ended  December 31, 2005,  the Company  capitalized  $801,830 of
expenditures on the Mogote Property, $341,402 on the Esperanza property, $31,687
on the Korimarca property,  $55,448 on the Cruz de Mayo Property, $25,655 on the
Cocha  Property,  $40,879  on the  Walker  Lane  property  and  $42,841 on other
properties.

FISCAL YEAR ENDED  DECEMBER 31, 2004 COMPARED TO FISCAL YEAR ENDED  DECEMBER 31,
2003

The  Company  reported a net loss of  $874,332  in 2004  ($0.07 per  share),  an
increase in loss of $468,576  from the  $405,756  loss ($0.08 per share) for the
year ended December 31, 2003.

General and  administrative  costs in 2003 were  nominal as the Company had just
negotiated a number of mineral  property  agreements  and had not yet  commenced
significant corporate or exploration  activities.  In addition,  the Company did
not commence its efforts to begin its initial  public  offering until the second
quarter of 2003. A total of $408,3852 of general and  administrative  costs were
incurred  in 2003.  The 2004  period  represents  the first  full year since the
Company  completed  its initial  public  offering  and became a  publicly-traded
company. A total of $863,499 of general and  administrative  costs were incurred
in the year ended December 31, 2004.  Significant  expenditures were incurred in
2004 in the following categories:

     -   Corporate  development and investor relations  ($151,739) comprise of a
         monthly fee of $7,500 paid to Raven  Capital for market  awareness  and
         investor  relations for January to April.  The  arrangement  with Raven
         Capital was terminated in April.  Ridgecrest  Capital S.A. was retained
         to provide consulting  services for the Company with European investors
         and was paid fees of $18,305.  The arrangement with Ridgecrest  Capital
         was terminated  effective  December 31, 2004.  Attendance at investment
         conferences was a cost of $30,100. The remaining corporate  development
         and  investor  relations  costs in fiscal 2004 was  comprised  of costs
         related to general  corporate  information and fees paid to consultants
         to assist the Company with its financings.
     -   Management  fees ($72,400)  represents fees charged by the President of
         the Company pursuant to an employment agreement.


                                     - 53 -
<PAGE>


     -   Professional fees ($48,200) include  accounting and consulting fees for
         market research.
     -   Legal  fees  ($63,058)  have  increased  due to  costs  related  to the
         preparation  and  filing  of  the  Company's  Form  20-F   registration
         statement and increased corporate legal costs for its activities.
     -   Salaries  ($154,074)  consists mainly of fees that were paid to IMA for
         the provision of personnel under a cost sharing  arrangement and salary
         plus $25,000 relocation allowance paid to the Company's Vice President,
         Exploration.  A  total  of  $108,390  was  paid  to IMA  for  rent  and
         administrative services.
     -   Office and Sundry  ($51,173) is comprised  mainly of printing  costs of
         $20,803, telephone expense of $8,837 and other office expenses.
     -   Travel ($47,018)  principally  related to attendance at conferences and
         presentations.
     -   Advertising ($60,745) included costs to prepare materials for potential
         and existing shareholders.
     -   Stock-based  compensation  ($131,805)  is the  estimated  fair value of
         stock options granted to employees, directors and consultants.

During 2004 the Company  incurred  $707,631 of exploration  expenditures  on the
Mogote  Property.  In addition,  a total of $93,576 of foreign value added taxes
were  also  recorded  as  part  of  mineral  resource   interests  and  deferred
exploration  costs. The Company also issued 300,000 common shares to IMA, with a
deemed  value of  $279,000,  to earn an  additional  24%  interest in the Mogote
Property,  pursuant to the April 8, 2004 agreement  between the Company and IMA.
On July 7, 2004 IMA's rights and interests under these  agreements were assigned
to Golden Arrow. In July the Company issued 100,000 shares to Golden Arrow, with
a deemed value of $40,000, as required under the agreement.

During  2004,  the Company  completed a number of private  placements  of common
shares  to raise  gross  proceeds  of  $2,891,350,  of which  $658,350  had been
received by the Company at  December  31,  2003.  The  Company  also  received a
further $244,900 from the exercises of warrants and an option.

LIQUIDITY AND CAPITAL RESOURCES

The Company's  cash  position at December 31, 2006 was $531,126,  an increase of
$8,799 from  $522,327 at  December  31,  2005.  Short-term  investments  balance
increased to $100,000 at December  31, 2006 from $Nil at December 31, 2005.  The
subscription receivable of $166,250 that was outstanding as of December 31, 2006
from the  Company's  December,  2006 private  placement  was received in January
2007.  There was no subscription  receivable at December 31, 2005.  Total assets
increased to  $4,343,852  at December 31, 2006 from  $3,843,389  at December 31,
2005. This increase is mainly as a result of exploration  expenditures  incurred
in 2006 which were capitalized to the Company's mineral  properties and deferred
costs,   increased   funds  on  deposit  and  short-term   investments  and  the
subscription receivable at December 31, 2006.

As the Company is an exploration stage company, revenues are limited to interest
earned on cash held with the Company's financial  institutions.  During the year
ended  December 31, 2006,  the Company  earned  interest  income of $30,924,  an
increase  of  $15,923  from the year  ended  December  31,  2005 as a result  of
increased funds on deposit.

The  Company  has  financed  its  operations  through  the  sale  of its  equity
securities. During the year ended December 31, 2006, the Company completed:

i)       A private placement financing of 1,412,000 units at $0.60 per unit, for
         gross  proceeds of $847,200.  Each unit  comprised one common share and
         one non-transferable  share purchase warrant. Each warrant entitles the
         holder to purchase one additional  common share at a price of $0.65 per
         share on or before January 30, 2008.

ii)      A private placement financing of 2,235,000 units at $0.35 per unit, for
         gross  proceeds of $782,250.  Each unit  comprised one common share and
         one non-transferable  share purchase warrant. Each warrant entitles the
         holder to purchase one additional  common share at a price of $0.45 per
         share on or before  December 8, 2008. In addition,  the Company  issued
         48,000  Agent's  Warrants at $0.45 and 8,000 Agent's Units at $0.35 per
         Unit as a Corporate  Finance Fee. There were also cash  commissions and
         administration fees paid of $14,000.

The  Company  also  received  a  further  $716,700  (2005 -  $326,649)  from the
exercises  of  warrants  and $Nil  (2005 - $8,250)  from the  exercise  of stock
options during 2006.

                                     - 54 -
<PAGE>


During the year ended December 31, 2006,  the Company  requested and was granted
permission by the TSX Venture Exchange to amend the exercise price for 2,750,000
of $1.20  warrants with the March 24 and March 31, 2006 expiry date. The amended
exercise  price was $0.60 per  warrant,  however,  there was no extension to the
term of the warrants and the warrants expired on March 24 and March 31, 2006.

On April 19, 2007,  the Company  completed a brokered  financing  of  11,700,000
units at a price of $0.35, for total proceeds of $4,095,000.  Each unit consists
of one  common  share and one half  common  share  purchase  warrant.  Each full
warrant will entitle the holder thereof to purchase one additional  common share
in the  capital  of the  Company  for a period  of 2 years at $0.45  per  share.
Additionally,  once the resale restrictions on the shares have expired, and upon
the Company's  shares  trading at or above a weighted  average  trading price of
$0.75 for 20  consecutive  trading  days,  the  Company may give notice that the
warrants will expire 30 days from the date of providing such notice.

The Agents  were paid a  commission  of 7.5% cash and 8% Agents'  Warrants.  The
Agents'  Warrants will be exercisable  into one common share at a price of $0.45
per warrant,  for a period of 2 years.  The Agents' Warrants will not be subject
to early expiry.

The Company has received  $Nil from the  exercise of options and  warrants  from
January  1 to April 30,  2007.  As at April 30 2007,  the  Company  had  working
capital of approximately $3,800,000.

The Company  believes it has adequate  resources to maintain its core activities
for the 12 months from January 1, 2007 to December  31,  2007,  but may not have
sufficient working capital to fund all its planned  exploration  activities.  In
the future, the Company may need to raise additional capital through the sale of
its equity securities to fund further  exploration  activities.  The Company may
not be able to raise the necessary  funds,  if any, and may not be able to raise
such  funds at terms  which  are  acceptable  to the  Company.  In the event the
Company is unable to raise adequate finances to fund the proposed activities, it
will need to reassess  its  alternatives  and may have to abandon one or more of
its property  interests as a result.  Any further  additional  equity  financing
undertaken by the Company may cause dilution to its shareholders.

The  Company  does  not  know of any  trends,  demand,  commitments,  events  or
uncertainties  that will result in, or that are reasonably  likely to result in,
its liquidity  either  materially  increasing or decreasing at present or in the
foreseeable   future.   Material   increases  or  decreases  in  liquidity   are
substantially  determined by the success or failure of the exploration programs.
The Company  does not have any loans or bank debt and there are no  restrictions
on the use of its cash resources.

RESEARCH AND DEVELOPMENT

See "Item 4. Information on the Company - Business  Overview - Dispositions" and
"Item  4.  Information  on  the  Company  -  Business   Overview  -  Exploration
Expenditures."

TREND INFORMATION

None of the Company's assets are currently in production or generate revenue.

OFF-BALANCE SHEET ARRANGEMENTS

The Company does not have any material off balance sheet  arrangements that have
or are  reasonably  likely to have a current or future  effect on the  Company's
financial  condition,  changes in  financial  condition,  revenues or  expenses,
results of operations, liquidity, capital expenditures or capital resources.


                                     - 55 -
<PAGE>

TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS

                                       -----------------------------------------
                                                  PAYMENTS DUE BY PERIOD(1)
                                       -----------------------------------------
                                       LESS THAN     1-3        3-5    MORE THAN
                             TOTAL      1 YEAR      YEARS      YEARS    5 YEARS
--------------------------------------------------------------------------------

CONTRACTUAL OBLIGATIONS        -           -          -          -         -
--------------------------------------------------------------------------------
TOTAL                          -           -          -          -         -
================================================================================
(1)  As of December 31, 2006.



                                     - 56 -
<PAGE>


ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES.
--------------------------------------------------------------------------------

DIRECTORS AND SENIOR MANAGEMENT

The names,  positions held with the Company and terms of office of each director
and officer of the Company as of the date of this annual report, are as follows:
<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
                                             PRINCIPAL OCCUPATION AND IF
                                             NOT AT PRESENT AN ELECTED                                  PERIOD OF
NAME, POSITION AND                           DIRECTOR, OCCUPATION DURING                                SERVICES AS A
COUNTRY OF RESIDENCE                         THE PAST FIVE YEARS(1)                                     DIRECTOR/OFFICER
------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>                                                        <C>

NIKOLAOS CACOS                               President, CEO and Director of the Company.  VP,           April 2000
President, Chief Executive Officer           North America Corporate Development of IMA
and Director                                 Exploration Inc. since June 2005.  Director and
(resident of Vancouver, BC, Canada)          Corporate Secretary of Golden Arrow Resources
Age 40                                       Corporation since 2004.
------------------------------------------------------------------------------------------------------------------------

JOSEPH GROSSO                                Director, President and CEO of IMA Exploration Inc.        February 2004
Chairman and Director                        since February 1990.
(resident of Burnaby, BC, Canada)
Age 69
------------------------------------------------------------------------------------------------------------------------

JERRY A. MINNI                               Partner of Minni, Clark & Company, Certified General       November 2002
Director                                     Accountants since 1988;  Director and CEO Raytec
(resident of Vancouver, BC, Canada)          Development since 1992.
Age 45
------------------------------------------------------------------------------------------------------------------------

ROBERT COLTURA                               Businessman/Consultant, has been President of Matalia      August 2002
Director                                     Investments Ltd. since  Oct. 1993 to the present.
(resident of Langley, BC, Canada)
Age 41
------------------------------------------------------------------------------------------------------------------------

ARTHUR LANG                                  Chief Financial Officer.  Director and officer of IMA      March 2005
Secretary, CFO                               Exploration Inc. since April 2004 and a Director and
(resident of Vancouver, BC, Canada)          Officer of Golden Arrow Resources Corporation since
Age 63                                       June 2004.   Consultant providing financial
                                             management services to various clients from 1999 to
                                             April 2004 through Arthur G Lang Inc., a private
                                             British Columbia company.
------------------------------------------------------------------------------------------------------------------------
</TABLE>


                                     - 57 -
<PAGE>

<TABLE>
<CAPTION>

------------------------------------------------------------------------------------------------------------------------
                                             PRINCIPAL OCCUPATION AND IF
                                             NOT AT PRESENT AN ELECTED                                  PERIOD OF
NAME, POSITION AND                           DIRECTOR, OCCUPATION DURING                                SERVICES AS A
COUNTRY OF RESIDENCE                         THE PAST FIVE YEARS(1)                                     DIRECTOR/OFFICER
------------------------------------------------------------------------------------------------------------------------
<S>                                         <C>                                                        <C>

DAVID TERRY                                  Vice President for the Company since March 2004 to         March 2004
Vice President, Exploration                  present.  Vice President, Exploration for the Grosso
(resident of Maple Ridge, BC, Canada)        Group from January 2005 to present. Regional
Age 41                                       geologist with the British Columbia Ministry of
                                             Energy and Mines in Cranbrook, British Columbia from
                                             May 2001 to March 2004
------------------------------------------------------------------------------------------------------------------------

GERALD CARLSON                               President and Director of Copper Ridge Exploration         November 2006
Director                                     Inc., a public British Columbia mineral exploration
(resident of West Vancouver, BC, Canada)     company from March 1999 to present.
Age 61                                       President of Nevada Star Resources Corp, from March
                                             5, 2002 to September 2004.  President of Golden Aria
                                             Corp. from March 2005 to present
------------------------------------------------------------------------------------------------------------------------
</TABLE>

There are no family relationships between any directors or executive officers of
the Company. To the best of the Company's  knowledge,  there are no arrangements
or understandings  with major  shareholders,  customers,  suppliers,  or others,
pursuant to which any of the Company's  officers or directors was selected as an
officer or director of the Company.

CONFLICTS OF INTEREST

There are no existing or potential conflicts of interest among the Company,  its
directors, officers or promoters as a result of their outside business interests
with the  exception  that  certain  of the  Company's  directors,  officers  and
promoters serve as directors,  officers and promoters of other  companies,  and,
therefore,  it is possible  that a conflict may arise  between their duties as a
director,  officer or promoter of the Company and their  duties as a director or
officer of such other companies.

The  directors  and  officers of the Company are aware of the  existence of laws
governing accountability of directors and officers for corporate opportunity and
requiring disclosures by directors of conflicts of interest and the Company will
rely upon such laws in respect of any  directors'  and  officers'  conflicts  of
interest  or in  respect  of any  breaches  of duty by any of its  directors  or
officers.  All such conflicts will be disclosed by such directors or officers in
accordance with the BCBCA, and they will govern themselves in respect thereof to
the best of their ability in accordance with the  obligations  imposed upon them
by law.

All of the Company's  directors are also directors,  officers or shareholders of
other  companies  that are engaged in the business of acquiring,  developing and
exploiting natural resource properties  including  properties in countries where
the Company is conducting its  operations.  Such  associations  may give rise to
conflicts of interest from time to time. Such a conflict poses the risk that the
Company may enter into a transaction on terms which place the Company in a worse
position than if no conflict existed.  The directors of the Company are required
by law to act honestly and in good faith with a view to the best interest of the
Company  and to  disclose  any  interest  which they may have in any  project or
opportunity of the Company.  However,  each director has a similar obligation to
other  companies for which such director  serves as an officer or director.  The
Company has no specific internal policy governing conflicts of interest.

See "Item 3.  Key Information - Risk Factors."

The following table  identifies,  as of April 30, 2007, the name of each officer
and  director of the Company and any company (i) which  employs  such officer or



                                     - 58 -
<PAGE>


director, (ii) for which such officer or director currently serves as an officer
or director, or (iii) which is affiliated with such officer or director:
<TABLE>
<CAPTION>

-------------------------------------------------------------------------------------------------------------------------------
NAME OF DIRECTOR    NAME OF COMPANY                 DESCRIPTION OF BUSINESS     POSITION              TERM OF SERVICE
-------------------------------------------------------------------------------------------------------------------------------
<S>                <C>                             <C>                         <C>                   <C>

Nikolaos Cacos      IMA Exploration Inc.             Mineral Exploration        Vice President        June 2005 to present
                    Golden Arrow Resources Corp.     Mineral Exploration        Director              July 2004 to present
                                                                                Corporate Secretary   July 2004 to present
                    Blue Sky Uranium Corp            Uranium Exploration        Director              Nov. 2005 to present
-------------------------------------------------------------------------------------------------------------------------------
Joseph Grosso       IMA Exploration Inc.             Mineral Exploration        Director              February 1990 to present
                                                                                President & CEO       February 1990 to present
                    Golden Arrow Resources Corp.     Mineral Exploration        Director, Chairman    May 2004 to present
                                                                                President & CEO       May 2004 to present
                    Gold Point Energy Corp.          Mineral Exploration        Chairman, Director    April 2006 to present
-------------------------------------------------------------------------------------------------------------------------------
Jerry Minni         Raytec Development Corp.         Food Equipment             Director              February 1992 to present
                                                          Manufacturer          President             February 1992 to present
                    Global Sortweb.com Inc.          Software Development       Director              July 1998 to present
                                                                                CFO                   July 1998 to present
                    Avantec Technologies Inc.        Chemical Equipment         Director              June 1999 to present
-------------------------------------------------------------------------------------------------------------------------------
Gerald G. Carlson   Copper Ridge Explorations                                   President/Director    Mar 1999 to present
                    Golden Aria Corp.                                           President/Director    Mar 2005 to present
                    Almaden  Minerals Ltd.                                      Director              Jul 1998 to present
                    IMA Exploration Inc.             Mineral Exploration        Director              Feb 1999 to present
-------------------------------------------------------------------------------------------------------------------------------
David Terry         Golden Arrow Resources Corp.     Mineral Exploration        Director              July 2004 to present
                                                                                V.P. Exploration      July 2004 to present
                    IMA Exploration Inc              Mineral Exploration        Director              May 2004 to present
                                                                                V.P. Exploration      June 2004 to present
                    Astral Mining Corporation        Mineral Exploration        Director              March 2005 to present
-------------------------------------------------------------------------------------------------------------------------------
Robert Coltura      Matalia Investments Ltd.         Hospitality and Tourism    President             October 1993 to present
                                                           Consulting
-------------------------------------------------------------------------------------------------------------------------------
Arthur Lang         IMA Exploration Inc.             Mineral Exploration        Director              April 2004 to present
                                                                                VP & CFO              April 2004 to present
                    Golden Arrow Resources Corp.     Mineral Exploration        Director              June 2004 to present
                                                                                VP and CFO            July 2004 to present
                    Astral Mining Corporation        Mineral Exploration        CFO                   March 2007 to present
-------------------------------------------------------------------------------------------------------------------------------
</TABLE>


Each  director's and officer's term of office shall expire at the Company's next
annual general  meeting.  The Company does not have an executive  committee or a
compensation  committee.  The  Company's  audit  committee  is  responsible  for
reviewing the  Company's  financial  statements  before they are approved by the
Company's directors.

The Company is an exploration stage mining company. As such, management does not
believe the Company requires  full-time  employees.  The Company's needs will be
dependent upon its level of exploration  programs and financial  condition.  The
officers and directors of the Company will devote as much time as is needed. See
"Item 6.  Directors,  Senior  Management and Employees - Management  Contracts -
Grosso Group Management Ltd." and "Item 7. Major  Shareholders and Related Party
Transactions - Related Party Transactions - Conflicts of Interest."

COMPENSATION

Effective  January 1, 2005,  the  Company  engaged  the Grosso  Group to provide
services and  facilities to the Company.  The Grosso Group is a private  company
equally  owned  by the  Company,  IMA  Exploration  Inc.  ("IMA")  Golden  Arrow
Resources  Corporation ("Golden Arrow"), Gold Point Energy Corp. ("Gold Point"),
Blue Sky Uranium Corp ("Blue Sky") and Astral Mining Corporation ("Astral"). The
Grosso Group  provides its  shareholder  companies  with  geological,  corporate
development,  administrative  and management  services on a cost recovery basis.
During the year ended December 31, 2006,  the Company  incurred fees of $533,469
(2005 - $377,410) to the Grosso  Group:  $480,545  (2005 - $290,858) was paid in
twelve  monthly  payments  and $52,924  (2005 - $86,552) is included in accounts


                                     - 59 -
<PAGE>


payable as a result of a review of the  allocation  of the Grosso Group costs to
the member companies for the year. In addition,  included in other  receivables,
prepaids and deposits is a $95,000 (2005 - $95,000)  deposit to the Grosso Group
for the purchase of  equipment  and  leasehold  improvements  and for  operating
working capital.

Prior to the signing of the  Administrative  Services  Agreement with the Grosso
Group in 2005, the Company shared office  facilities  with IMA.  During the year
ended December 31, 2004, the Company was charged $108,390 by IMA for shared rent
and administration  costs.  During the year ended December 31, 2004, the Company
paid $113,400 for professional fees (including a $25,000 relocation  allowance),
billed by a director  and by an officer of the Company.  Of this amount  $42,000
was reimbursed by IMA as an allocation of the professional services.

Effective  January 2, 2004,  the  Company  entered  into an  agreement  with Mr.
Nikolaos Cacos, President of the Company, for his services.  Under the agreement
Mr. Cacos was paid $6,125 per month.  Effective April 1, 2006, the agreement was
modified so that the monthly fee was payable to a private company  controlled by
Mr.  Cacos and on May 1, 2006 the monthly fee  increased  to $7,292.  During the
year ended December 31, 2006,  the Company paid $85,833 (2005 - $73,500;  2004 -
$72,400) to Mr. Cacos or to the private  company  controlled by Mr.  Cacos.  The
agreement also provides  that, in the event the services are terminated  without
cause or upon a change in control of the Company,  a  termination  payment would
include  eighteen  months of  compensation  plus a bonus amount agreed to by the
parties.

The Company does not have any retirement plans or benefits.

EXECUTIVE COMPENSATION

The  following  information  provides  details of the  compensation  paid by the
Company to its directors and officers  during the fiscal year ended December 31,
2006,  which has been released by the Company in accordance with the regulations
(the "Regulations") made under the Securities Act (British Columbia).

SUMMARY COMPENSATION TABLE

Named  Executive  Officers mean the Chief  Executive  Officer  ("CEO") and Chief
Financial  Officer  ("CFO")  of  the  Company,   regardless  of  the  amount  of
compensation  of that  individual  and each of the  Company's  four most  highly
compensated executive officers,  other than the CEO and CFO, who were serving as
executive  officers at the end of the most recent  financial  year. In addition,
disclosure  is also  required  for any  individual  whose total salary and bonus
during the most recent financial year was at least $150,000, whether or not they
were an executive officer at the end of the financial year.

During the Company's last completed  financial year ended December 31, 2006, the
Company had two Named  Executive  Officers,  Mr.  Nikolaos  Cacos and Mr. Arthur
Lang.

The following table  (presented in accordance with the  Regulations)  sets forth
all annual and long term  compensation  for  services in all  capacities  to the
Company for the financial  years ended December 31, 2006,  2005 and 2004 (to the
extent required by the Regulations) in respect of the Named Executive Officer:

<TABLE>
<CAPTION>

                                                                    ---------------------------------------
                                                                             LONG TERM COMPENSATION
                                  ------------------------------    ---------------------------------------
                                      ANNUAL COMPENSATION                     AWARDS                PAYOUTS
                      --------    ------------------------------    ----------------------------    -------    ---------
                        YEAR                             OTHER                       RESTRICTED
------------------      ENDED                            ANNUAL      SECURITIES      SHARES OR                 ALL OTHER
    NAME AND          DECEMBER                           COMPEN-    UNDER OPTIONS/   RESTRICTED      LTIP       COMPEN-
PRINCIPAL POSITION       31       SALARY      BONUS      SATION     SARS GRANTED(1)  SHARE UNITS    PAYOUTS      SATION
------------------    --------    ------------------------------    ----------------------------    -------    ---------
                                    ($)        ($)         ($)           (#)             (#)          ($)          ($)
<S>                   <C>        <C>        <C>         <C>         <C>               <C>         <C>          <C>

Nikolaos Cacos          2006      85,833        Nil        Nil           75,000          Nil          Nil          Nil
President and CEO       2005      73,500        Nil        Nil              Nil          Nil          Nil          Nil
                        2004      72,400        Nil        Nil           50,000          Nil          Nil          Nil

</TABLE>


                                     - 60 -
<PAGE>

<TABLE>
<CAPTION>

<S>                   <C>        <C>        <C>         <C>         <C>               <C>         <C>          <C>
Arthur Lang             2006      15,223(2)     Nil        Nil           30,000          Nil          Nil          Nil
Secretary and           2005      13,402        Nil        Nil              Nil          Nil          Nil          Nil
CFO                     2004         Nil(3)     Nil        Nil              Nil          Nil          Nil          Nil
------------------    --------    ------------------------------    ----------------------------    -------    ---------
</TABLE>

NOTE:

(1)      Figures  represent  options  granted  during  a  particular  year;  see
         "Aggregate   Option"  table  for  the   aggregate   number  of  options
         outstanding at year end.
(2)      During the year 2006, Mr. Lang's total  compensation  from Grosso Group
         Management Ltd. (the "Grosso Group") was $135,021, of which $15,223 was
         allocated to the Company as part of the Grosso Group fees for the year.
(3)      During the year 2005, Mr. Lang's total  compensation  from Grosso Group
         was $94,667,  of which  $13,402 was allocated to the Company as part of
         the Grosso Group fees for the year.
(4)      During the year 2004, Mr. Lang received his compensation from IMA.

LONG TERM INCENTIVE PLAN AWARDS

The Company does not have any long term incentive plan awards  ("LTIP")  defined
as "any plan  providing  compensation  intended to motivate  performance  over a
period longer than one financial  year and does not include  option or SAR plans
or plans for compensation through restricted shares or units."

OPTION/STOCK  APPRECIATION  RIGHT ("SAR") GRANTS AND REPRICINGS  DURING THE MOST
RECENTLY COMPLETED FINANCIAL YEAR

The following  table sets forth stock options  granted by the Company during the
financial  year ended December 31, 2006 to the Named  Executive  Officers of the
Company:

<TABLE>
<CAPTION>

===============================================================================================================
                                                                               MARKET VALUE OF
                          SECURITIES       % OF TOTAL                            SECURITIES
                            UNDER        OPTIONS GRANTED                         UNDERLYING
                           OPTIONS        IN FINANCIAL       EXERCISE OR         OPTIONS ON          EXPIRATION
NAME                       GRANTED          YEAR (1)        BASE PRICE(2)       DATE OF GRANT           DATE
                             (#)              (%)           ($/SECURITY)        ($/SECURITY)
---------------          ------------    --------------     ------------      -----------------      ----------
<S>                      <C>             <C>                <C>               <C>                   <C>

Nikolaos Cacos               75,000           18%               0.60                0.60             Jul. 11/11
---------------------------------------------------------------------------------------------------------------

Art Lang                     30,000            7%               0.60                0.60             Jul. 11/11
===============================================================================================================
</TABLE>

(1)      Percentage of all options granted during the financial year.
(2)      The exercise  price of stock  options was set according to the rules of
         the TSX-V.  The exercise price of stock options may only be adjusted in
         the event that specified  events cause dilution of the Company's  share
         capital.

AGGREGATED  OPTION EXERCISES DURING THE MOST RECENTLY  COMPLETED  FINANCIAL YEAR
AND FINANCIAL YEAR-END OPTION/SAR VALUES

The following  table sets forth details of all exercises of stock options during
the financial  year ended December 31, 2006 by the Named  Executive  Officer(s),
and the financial year end value of unexercised options on an aggregated basis:

<TABLE>
<CAPTION>

======================================================================================================
                                                           UNEXERCISED OPTIONS    VALUE OF UNEXERCISED
                                                            AT FINANCIAL YEAR     IN THE MONEY OPTIONS
                        SECURITIES                               END(3)           AT FINANCIAL YEAR END
                        ACQUIRED ON     AGGREGATE VALUE           (#)                   ($)(3)(4)
                        EXERCISE(1)       REALIZED(2)         EXERCISABLE/              EXERCISABLE/
NAME                       (#)               ($)             UNEXERCISABLE             UNEXERCISABLE
--------------          -----------     ---------------    -------------------    ---------------------
<S>                     <C>              <C>                <C>                       <C>

Nikoloas Cacos             Nil               Nil              250,000 / NA                Nil / NA

Arthur Lang                Nil               Nil               30,000 / NA                Nil / NA

=======================================================================================================
</TABLE>

NOTES:
(1)      Number of common  shares of the  Company  acquired  on the  exercise of
         stock options.
(2)      Calculated  using the closing  price of common shares of the Company on
         the TSX-V.
(3)      As freestanding SARs have not been granted, the number of shares relate
         solely to stock options.
(4)      Value of unexercised  in-the-money options calculated using the closing
         price of common shares of the Company on the TSX-V on December 31, 2006
         of $0.39 per  share,  less the  exercise  price of  in-the-money  stock
         options.



                                     - 61 -
<PAGE>


TERMINATION OF EMPLOYMENT OR CHANGE OF CONTROL

Other than the management  agreement with Mr. Cacos, the Company has no plans or
arrangements  with respect to  remuneration  received or that may be received by
the Named  Executive  Officers  during the  Company's  most  recently  completed
financial year or current  financial year in view of compensating  such officers
in  the  event  of  termination  of  employment  (as a  result  of  resignation,
retirement, change of control, etc.) or a change in responsibilities following a
change of control,  where the value of such  compensation  exceeds  $100,000 per
executive  officer.  See "Item 6. Directors,  Senior  Management and Employees -
Employment Agreements."

PENSION PLAN

The Company  does not provide  retirement  benefits  for  directors or executive
officers.

DIRECTOR COMPENSATION

CASH COMPENSATION

The Company  does not  compensate  its  directors in their  capacities  as such,
although  directors of the Company are reimbursed for their expenses incurred in
connection with their services as directors.

NON-CASH COMPENSATION

The following table sets forth  information  concerning stock options granted to
directors,  as a group,  who are not Named  Executive  Officers  during the most
recently completed fiscal year:

<TABLE>
<CAPTION>

---------------------------------------------------------------------------------------------------------------------
                                                                                   Market Value
                     Securities Under   % of Total Options                        of Securities
                    OPTIONS GRANTED(1)      Granted in          Exercise or     Underlying Options
NAME                       (#)           FINANCIAL YEAR(2)     BASE PRICE(3)    ON DATE OF GRANT      EXPIRATION DATE
                                                                ($/Security)       ($/Security)
---------------------------------------------------------------------------------------------------------------------
<S>                   <C>                   <C>                 <C>                <C>                <C>

Directors as              40,000                9.6                 0.60               0.60           July 11, 2011
a group who are
not Named
Executive Officers
---------------------------------------------------------------------------------------------------------------------
</TABLE>

(1)      All options are for the Company's Common Shares.
(2)      Percentage of all options granted in the year.
(3)      The  exercise  price of the  option is set at not less than the  market
         value of the  Company's  Common  Shares  on the date of  grant,  less a
         discount allowed by the TSX-V. The exercise price may be adjusted under
         certain circumstances, subject to regulatory acceptance.

The following  table sets forth details of all exercises of stock options during
the  financial  year ended  December 31, 2004 by the  directors  who are not the
Named  Executive  Officers,  and the  financial  year end  value of  unexercised
options:
<TABLE>
<CAPTION>

=======================================================================================================
                                                           UNEXERCISED OPTIONS    VALUE OF UNEXERCISED
                                                            AT FINANCIAL YEAR     IN THE MONEY OPTIONS
                        SECURITIES                               END(3)           AT FINANCIAL YEAR END
                        ACQUIRED ON     AGGREGATE VALUE           (#)                   ($)(3)(4)
                        EXERCISE(1)       REALIZED(2)         EXERCISABLE/              EXERCISABLE/
NAME                       (#)               ($)             UNEXERCISABLE             UNEXERCISABLE
--------------------    -----------     ---------------    -------------------    ---------------------
<S>                     <C>              <C>                <C>                       <C>

Directors as a group       Nil               Nil              365,000 / N/A               NA / NA
who are not Named
Executive Officers

=======================================================================================================
</TABLE>

                                     - 62 -
<PAGE>

NOTES:
(1)      Number of common  shares of the  Company  acquired  on the  exercise of
         stock options.
(2)      Calculated  using the closing  price of common shares of the Company on
         the TSX-V.
(3)      As freestanding SARs have not been granted, the number of shares relate
         solely to stock options.
(4)      Value of unexercised  in-the-money options calculated using the closing
         price of common shares of the Company on the TSX-V on December 31, 2006
         of $0.39 per  share,  less the  exercise  price of  in-the-money  stock
         options.

EMPLOYMENT AGREEMENTS

Effective  January 2, 2004,  the  Company  entered  into an  agreement  with Mr.
Nikolaos Cacos, President of the Company, for his services.  Under the agreement
Mr. Cacos was paid $6,125 per month.  Effective April 1, 2006, the agreement was
modified so that the monthly fee was payable to a private company  controlled by
Mr.  Cacos and on May 1, 2006 the monthly fee  increased  to $7,292.  During the
year ended December 31, 2006,  the Company paid $85,833 (2005 - $73,500;  2004 -
$72,400) to Mr. Cacos or to the private  company  controlled by Mr.  Cacos.  The
agreement also provides  that, in the event the services are terminated  without
cause or upon a change in control of the Company,  a  termination  payment would
include  eighteen  months of  compensation  plus a bonus amount agreed to by the
parties.

Mr. David  Terry,  Vice  President,  Exploration  for the Company,  provides his
services as part of the Company's agreement with the Grosso Group. Mr. Terry has
entered into an agreement  with the Grosso Group.  Prior to January 1, 2005, Mr.
Terry had a  consulting  agreement  with the  Company.  See "Item 6.  Directors,
Senior Management and Employees - Management Contracts - Grosso Group Management
Ltd." and "Item 7. Major  Shareholders and Related Party  Transactions - Related
Party Transactions."

Mr. Arthur Lang, Secretary and Chief Financial Officer for the Company, provides
his services as part of the Company's  agreement with the Grosso Group. Mr. Lang
has entered into an agreement  with the Grosso Group.  Prior to January 1, 2005,
Mr.  Lang's  services to the  Company  were  provided  as part of the  Company's
agreement with IMA. See "Item 6.  Directors,  Senior  Management and Employees -
Management  Contracts  - Grosso  Group  Management  Ltd."  and  "Item  7.  Major
Shareholders and Related Party Transactions - Related Party Transactions."

Other than the Company's agreement with Mr. Cacos, there are no other agreements
with any of the Company's  officers or directors which provide for benefits upon
termination of employment.

MANAGEMENT CONTRACTS

GROSSO GROUP MANAGEMENT LTD.

Effective  January 1, 2005,  the Company  engaged Grosso Group  Management  Ltd.
("Grosso Group") to provide  services and facilities to the Company.  The formal
agreement was approved by the TSX-V May 19, 2005.

The Grosso  Group is a private  company  which is owned by the  Company,  Golden
Arrow,  IMA, Gold Point,  Blue Sky and Astral,  each of which own one share. The
Grosso Group  provides its  shareholder  companies  with  geological,  corporate
development,  administrative and management services.  The Grosso Group staff is
available to the  shareholder  companies on a cost  recovery  basis  without the
expense of full time personnel.  The  shareholder  companies pay monthly fees to
the Grosso  Group.  The fee is based upon a  reasonable  prorating of the Grosso
Group's  costs  including  its staff and overhead  costs among each  shareholder
company  with regard to the  mutually  agreed  average  annual level of services
provided to each shareholder  company.  During the year ended December 31, 2006,
the Company  incurred  fees of $533,469  (2005 - $377,410) to the Grosso  Group:
$480,545 (2005 - $290,858) was paid in twelve monthly payments and $52,924 (2005
-  $86,552)  is  included  in  accounts  payable  as a result of a review of the
allocation  of the Grosso Group costs to the member  companies  for the year. In
addition,  included in other  receivables,  prepaids  and  deposits is a $95,000
(2005 - $95,000)  deposit to the Grosso Group for the purchase of equipment  and
leasehold  improvements and for operating working capital.  The fees the Company
pays to the Grosso Group are allocated to various expense items that reflect the
nature of the actual costs: rent, salaries, office and telephone. These fees are
equivalent to costs the Company would have incurred directly.


                                     - 63 -
<PAGE>



The Administration Services Agreement may be terminated by a shareholder company
upon 30 days' written notice to the Grosso Group.

It  is  anticipated  that  upon  termination  of  the  Administration   Services
Agreement,  a shareholder  company will agree to resell its common share back to
the Grosso  Group for $1.00 and the  shareholder  companies  will not be able to
sell, transfer or otherwise dispose of or encumber such share during the term of
the Administration Services Agreement.

The Grosso Group's areas of experience encompass financing,  marketing, property
acquisition,  community relations,  socioeconomic issues, regulatory compliance,
government relations, property exploration and investor relations.  Additionally
the Grosso Group has a number of other support staff at its corporate office and
arrangements with contract providers of accounting and  administrative  services
at the country operations' offices in Argentina and Peru.

The members of the board of directors  of the Grosso Group are  appointed by the
shareholder  companies,  with each  shareholder  company  appointing  one of its
directors to serve as a director of the Grosso Group.  As of March 31, 2007, the
directors of the Grosso Group are Nikolaos  Cacos,  Joseph Grosso,  Arthur Lang,
Nick  DeMare,  Sean Hurd and  Manfred  Kurschner.  Mr.  Grosso is an officer and
director  of the  Company,  a director  and  officer  of IMA and a director  and
officer of Golden Arrow.  Mr. Lang is an officer of the Company,  a director and
officer of IMA and Golden  Arrow and an officer of Astral.  Nikolaos  Cacos is a
director of Blue Sky, an officer of IMA, a director  and officer of Golden Arrow
and a  director  and  officer of the  Company.  Nick  DeMare is an  officer  and
director of Gold Point and Blue Sky. Mr.  DeMare  indirectly  owns 100% of Chase
Management Ltd., a company which provides consulting services to the Company and
other Grosso Group shareholder companies. Mr. Hurd is an officer and director of
Blue Sky and Golden Arrow,  an officer of IMA and a director of Gold Point.  Mr.
Kurschner is a director of Golden Arrow and an officer and a director of Astral.

Each of the public company shareholders of the Grosso Group has its own separate
board of directors (whose members include persons employed by the Grosso Group);
however,  some  directors  will  serve on  multiple  boards  and on the board of
directors of companies which are not shareholders of the Grosso Group.

BOARD PRACTICES

AUDIT COMMITTEE

The Company's Audit Committee must be comprised of at least three directors, the
majority of whom are not employees,  control persons or members of management of
the Company or any of its  associates or  affiliates.  The board of directors of
the Company,  after each annual shareholder'  meeting must appoint or re-appoint
an audit  committee.  As of the date of this annual  report,  the members of the
Audit Committee were Messrs. Minni, Coltura, and Carlson. All the members of the
Audit Committee are  independent  directors who are not officers or employees of
the Company or its affiliates.

The Audit Committee must review the annual  financial  statements of the Company
before they are approved by the board of directors of the Company.  The board of
directors of the Company must review, and if considered appropriate, approve the
annual  financial   statements  of  the  Company  before   presentation  to  the
shareholders of the Company.

REMUNERATION COMMITTEE

The  Company  does not have a separate  remuneration  committee.  The full Board
reviews  the terms and  conditions  of  employment,  management  agreements  and
remuneration levels for officers and directors.

EMPLOYEES

The Company's  officers serve on a part-time  basis and, given the current level
of the Company's  activities,  management does not believe the Company  requires
full-time employees.  See "Item 6. Directors,  Senior Management and Employees -
Directors  and Senior  Management."  During the fiscal year ended  December  31,
2006, the Company  directly  employed  Nikolaos  Cacos and  indirectly  employed
approximately  24 employees  (2005 - 20  employees)  through the  Administration
Services  Agreement  with the Grosso  Group,  including  corporate,  accounting,
geological and administrative  services.  The Company has five employees (2005 -
one part-time employee) in its Lima, Peru office.


                                     - 64 -
<PAGE>


The Company entered into a management agreement with the Grosso Group, effective
January  1, 2005,  pursuant  to which  employees  of the  Grosso  Group  provide
services to the Company. See "Item 6. Directors, Senior Management and Employees
-  Management  Contracts  - Grosso  Group  Management  Ltd." and "Item 7.  Major
Shareholders  and Related  Party  Transactions  - Related  Party  Transactions."
During  the year  ended  December  31,  2004,  the  Company  had five  part-time
employees,  Nikolaos Cacos, Joseph Grosso,  Jerry Minni, David Terry, and Arthur
Lang.  During the fiscal  year ended  December  31,  2003,  the  Company had two
part-time  employees,  Nikolaos  Cacos and Jerry  Minni.  During the fiscal year
ended  December  31,  2003,  the  Company  also  utilized  the  services  of two
geologists.  During the fiscal  years  ended  December  31,  2002 and 2001,  the
Company had one part-time employee,  Nikolaos Cacos. The Company's needs will be
dependent upon its level of exploration programs and financial condition.

SHARE OWNERSHIP

The following table sets forth certain  information  regarding  ownership of the
Company's shares by the Company's officers and directors as of April 30, 2007.

--------------------------------------------------------------------------------
                                        SHARES AND RIGHTS
                                           BENEFICIALLY                PERCENT
TITLE OF CLASS     NAME OF OWNER       OWNED OR CONTROLLED(1)        OF CLASS(1)
--------------------------------------------------------------------------------

Common Stock       Nikolaos Cacos          1,398,413(2)                   6.4%
Common Stock       Joseph Grosso           1,345,680(3)                   6.2%
Common Stock       Robert Coltura            138,332(4)                   0.6%
Common Stock       Jerry Minni               151,549(5)                   0.7%
Common Stock       Gerald Carlson            150,000(6)                   0.7%
Common Stock       David A. Terry            200,000(7)                   0.9%
Common Stock       Arthur Lang                40,000(8)                   0.2%
                                           ---------                     ----
TOTAL                                      3,423,974                     15.8%
                                           =========                     ====
--------------------------------------------------------------------------------
NOTES:
(1)      Where persons listed on this table have the right to obtain  additional
         shares of common stock through the exercise of  outstanding  options or
         warrants within 60 days from March 31, 2007,  these  additional  shares
         are  deemed  to  be  outstanding  for  the  purpose  of  computing  the
         percentage of common stock owned by such persons, but are not deemed to
         be outstanding for the purpose of computing the percentage owned by any
         other person. Based on 21,740,592 shares of common stock outstanding as
         of April 30, 2007.
(2)      Includes the following  shares,  options and warrants held by Mr. Cacos
         and Aspasia  Cacos (Mr.  Cacos'  wife):
         a.       197,636 shares held by Mr. Cacos;
         b.       67,000 shares held by Mrs. Cacos;
         c.       359,277 shares held by NAC Investments Inc.
         d.       Options held by Mr. Cacos to acquire 250,000 shares;
         e.       Options held by Mrs. Cacos to acquire 24,500 shares;
         f.       Warrants  held by Mr.  Cacos to  acquire  200,000  shares at a
                  price of $0.65 per share, exercisable until February 2, 2008
         g.       Warrants  held by Mr.  Cacos to  acquire  200,000  shares at a
                  price of $0.45 per share, exercisable until December 8, 2008
         h.       Warrants  held by NAC  Investments  Inc.  to  acquire  100,000
                  shares  at a price  of  $0.45  per  share,  exercisable  until
                  December 8, 2008 See "Item 6. Directors, Senior Management and
                  Employees  -  Options,  Warrants  and Other  Rights to Acquire
                  Securities."
(3)      Includes the following shares and options held by Mr. Grosso and Evelyn
         Grosso (Mr. Grosso's wife):
         a.       939,680 shares held by Mr. Grosso;
         b.       56,000 shares held by Mr. Grosso in an RRSP Account;
         c.       Options held by Mr. Grosso to acquire 250,000 shares;
         d.       Warrants  held by Mr.  Grosso to acquire  100,000  shares at a
                  price of $0.65 per share,  exercisable  until February 2, 2008
                  See "Item 6.  Directors,  Senior  Management  and  Employees -
                  Options, Warrants and Other Rights to Acquire Securities."
(4)      Includes the following shares, options and warrants held by Mr. Coltura
         and Betty Coltura (Mr. Coltura's wife):
         a.       56,332 shares held by Mr. Coltura


                                     - 65 -
<PAGE>

         b.       7,500 shares held by Mrs. Coltura
         c.       Options held by Mr. Coltura to acquire 50,000 shares;
         d.       Warrants  held by Mr.  Coltura  to acquire  7,000  shares at a
                  price of $0.65 per share  exercisable  until  February 2, 2008
                  and warrants to acquire  10,000 shares at a price of $0.45 per
                  share  exercisable  until  December  8, 2008 and  warrants  to
                  acquire 7,500 shares at a price of $0.45 per share exercisable
                  until April 12, 2009 See "Item 6. Directors, Senior Management
                  and Employees - Options,  Warrants and Other Rights to Acquire
                  Securities."

(5)      Includes the following shares,  options and warrants held by Mr. Minni:
         a.       44,549 shares held by Mr. Minni
         b.       90,000 options; and
         c.       Warrants  held by Mr.  Minni to acquire an  additional  17,000
                  shares shares at a price of $0.65 per share, exercisable until
                  February 2, 2008 See "Item 6. Directors, Senior Management and
                  Employees  -  Options,  Warrants  and Other  Rights to Acquire
                  Securities."
(6)      Includes  50,000  shares held by Mr.  Carlson  and options  held by Mr.
         Carlson to acquire  50,000 shares and warrants to acquire 50,000 shares
         at a price of $0.45 per share,  exercisable until December 8, 2008. See
         "Item 6. Directors, Senior Management and Employees - Options, Warrants
         and Other Rights to Acquire Securities."
(7)      Includes  50,000 shares held by Mr. Terry,  options to acquire  100,000
         shares and  warrants to acquire  20,000  shares at a price of $0.65 per
         share,  exercisable  until  February  2, 2008 and  warrants  to acquire
         30,000 shares at $0.45 per share,  exercisable  until December 8, 2008.
         See "Item 6.  Directors,  Senior  Management  and  Employees - Options,
         Warrants and Other Rights to Acquire Securities."
(8)      Includes  5,000  shares  held by Mr.  Lang,  options to acquire  30,000
         shares and  warrants  to acquire  5,000  shares at a price of $0.65 per
         share,  exercisable  until  February 2, 2008.  See "Item 6.  Directors,
         Senior Management and Employees - Options, Warrants and Other Rights to
         Acquire Securities."

All of the Company's shareholders have the same voting rights.

OPTIONS, WARRANTS AND OTHER RIGHTS TO ACQUIRE SECURITIES

As of April 30,  2007,  the Company had entered  into  property  acquisition  or
option  agreements  pursuant to which up to 900,000 common shares of the Company
may be issued.  See "Item 4.  Information  on the Company - Property,  Plant and
Equipment - Principal  Properties - Mogote Project" and "Item 4.  Information on
the  Company - Property,  Plant and  Equipment  - Other  Properties  - Esperanza
Project."

Additionally,  as of April 30,  2007,  the Company had granted a number of stock
options  and  issued a number of  warrants  pursuant  to which up to  12,293,522
common shares of the Company may be issued.  The following is a brief summary of
these stock options and warrants.

STOCK OPTIONS

The TSX-V requires all TSX-V listed  companies to adopt stock options plans, and
such plans must  contain  certain  provisions.  At the annual and  extraordinary
general  meetings of shareholders of the Company held on June 28, 2006, June 22,
2005 and June 30, 2004,  the  shareholders  approved the Company's  stock option
plan (the "Stock  Option  Plan").  The Stock Option Plan  approved June 30, 2004
replaced the Company's  2003 stock option plan.  The purpose of the Stock Option
Plan is to provide incentive to the Company's  employees,  officers,  directors,
and  consultants  responsible  for the  continued  success of the  Company.  The
following is a summary of the Stock Option Plan.

ADMINISTRATION OF THE STOCK OPTION PLAN

The Stock Option Plan  provides  that it will be  administered  by the Company's
board  of  directors  (the  "Board"),  or  by  a  stock  option  committee  (the
"Committee")  of  the  Company's  Board  consisting  of not  less  than 2 of its
members. The Stock Option Plan is currently administered by the Board.

DESCRIPTION OF STOCK OPTION PLAN

The effective date (the "Effective  Date") of the Stock Option Plan is April 13,
2004,  the date the Board of Directors  approved  the Stock Option Plan,  and it
will terminate ten years from the Effective Date.


                                     - 66 -
<PAGE>


The Stock  Option Plan  provides  that  options may be granted to any  employee,
officer, director or consultant of the Company or a subsidiary of the Company.

The options  issued  pursuant to the Stock Option Plan will be  exercisable at a
price not less than the market value of the Company's  common shares at the time
the option is granted. "Market Value" means:

(a)      for each  organized  trading  facility  on which the common  shares are
         listed,  Market Value will be the closing  trading  price of the common
         shares  on the day  immediately  preceding  the  grant  date  less  any
         discounts permitted by the applicable regulatory authorities;
(b)      if the  Company's  common  shares are listed on more than one organized
         trading  facility,  the  Market  Value  shall  be the  Market  Value as
         determined in accordance  with  subparagraph  (a) above for the primary
         organized  trading  facility on which the common shares are listed,  as
         determined  by the  Board  (or a  committee  thereof),  subject  to any
         adjustments  as may be  required  to secure  all  necessary  regulatory
         approvals;
(c)      if the  Company's  common  shares are  listed on one or more  organized
         trading  facilities  but have not traded  during the ten  trading  days
         immediately  preceding  the grant date,  then the Market  Value will be
         determined  by the  Board  (or a  committee  thereof),  subject  to any
         adjustments  as may be  required  to secure  all  necessary  regulatory
         approvals; and
(d)      if the  Company's  common  shares are not listed for trading on a stock
         exchange or over the counter  market,  the value which is determined by
         the  Board  (or a  committee  thereof)  to be  the  fair  value  of the
         Company's common shares, taking into consideration all factors that the
         Board (or a committee  thereof) deems appropriate,  including,  without
         limitation,  recent sale and offer  prices of the  Company's  shares in
         private transactions negotiated at arms' length.

Options  under the Stock Option Plan will be granted for a term not to exceed 10
years from the date of their grant, provided that if the Company is then a "Tier
2"  company  listed on the TSX-V,  the term of the option  will be not more than
five years.

Options under the Stock Option Plan will be subject to such vesting  schedule as
the  Committee  may  determine.  In the event that an option is to be terminated
prior to expiry of its term due to certain  corporate  events,  all options then
outstanding  shall  become  immediately  exercisable  for 10 days  after  notice
thereof, notwithstanding the original vesting schedule.

Options will also be  non-assignable  and  non-transferable,  provided that they
will be exercisable by an optionee's legal heirs,  personal  representatives  or
guardians for up to 12 months  following the death or termination of an optionee
due to disability,  or up to 12 months following the death of an employee if the
employee  dies  within 12  months of  termination  due to  disability.  All such
options  will  continue  to vest  in  accordance  with  their  original  vesting
schedule.

The maximum  number of common shares to be reserved for issuance under the Stock
Option Plan, including options currently outstanding, will not exceed 10% of the
number of common shares of the Company issued and  outstanding on the applicable
date of grant.

If a material  alteration  in the capital  structure of the Company  occurs as a
result of a recapitalization,  stock split, reverse stock split, stock dividend,
or otherwise,  the Committee shall make adjustments to the Stock Option Plan and
to the options  then  outstanding  under it as the  Committee  determines  to be
appropriate  and  equitable  under  the  circumstances,   unless  the  Committee
determines  that it is not  practical  or  feasible to do so, in which event the
options granted under the Stock Option Plan will terminate as set forth above.

The TSX-V  requires all TSX-V  listed  companies  who have adopted  stock option
plans  which  reserve a  maximum  of 10% of the  number of common  shares of the
Company  issued  and  outstanding  on the  applicable  date of grant,  to obtain
shareholder approval to the Stock Option Plan on an annual basis.

As of April 30,  2007,  an aggregate of  1,907,000  incentive  stock  options to
purchase  shares  of  the  Company's  common  stock  remain  outstanding  to the
following persons:


                                     - 67 -
<PAGE>


--------------------------------------------------------------------------------
                            NATURE          NO. OF     EXERCISE    EXPIRY
OPTIONEE                    OF OPTION(1)   OPTIONS   PRICE/SHARE   DATE
                                                          $
--------------------------------------------------------------------------------

Gerry Carlson               Director        25,000       0.45      Apr. 2, 2009
                                            50,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Nick DeMare                 Consultant      25,000       0.90      Apr 2, 2009
                                           125,000       0.60      Dec 12, 2008
                                            50,000       0.90      Apr, 2, 2009
--------------------------------------------------------------------------------
Nikolaos Cacos              Director        75,000       0.60      July 11, 2011
--------------------------------------------------------------------------------
Art Lang                    Officer         30,000       0.60      July 11, 2011
                                           100,000       0.60      Dec 12, 2008
                                            30,000       0.60      July 11, 2011
--------------------------------------------------------------------------------
Sean Hurd                   Consultant      50,000       0.90      Apr. 2, 2009
                                            75,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Steve Phillips              Consultant      25,000       0.90      Apr. 2, 2009
--------------------------------------------------------------------------------
Juan Carlos Berretta        Consultant      25,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
William Lee                 Consultant      25,000       0.60      Dec 12, 2008
                                           100,000       0.60      Dec 12, 2008
                                            85,000       0.90      Apr. 2, 2009
--------------------------------------------------------------------------------
Joseph Grosso               Director        65,000       0.60      July 11, 2011
--------------------------------------------------------------------------------
Carlo Timossi               Consultant      50,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Evelyn Grosso               Consultant      55,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Robert Coltura              Director        50,000       0.60      Dec 12, 2008
                                            50,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Jerry Minni                 Director        40,000       0.60      July11, 2011
--------------------------------------------------------------------------------
Louis P. Salley             Consultant      25,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Carlos D'Amico              Consultant     100,000       0.60      Dec 12, 2008
--------------------------------------------------------------------------------
Judy Wong                   Consultant      20,000       0.60      Dec 12, 2008
                                            60,000       0.90      Apr 2, 2009
--------------------------------------------------------------------------------
David Terry                 Officer         40,000       0.75      Mar. 21, 2010
--------------------------------------------------------------------------------
Diane Reeves                Consultant      25,000       0.90      Apr 2, 2009
--------------------------------------------------------------------------------
Tookie Angus                Consultant      45,000       0.90      Apr 2, 2009
--------------------------------------------------------------------------------
Aspasia Cacos               Consultant      24,500       0.90      Apr 2, 2009
--------------------------------------------------------------------------------
Campbell Smyth              Consultant      37,500       0.40      Feb. 14, 2012
--------------------------------------------------------------------------------
Claudia Sandoval            Consultant      25,000       0.75      Mar 21, 2010
--------------------------------------------------------------------------------
Oliver Frank                Consultant      25,000       0.60      Jul. 11, 2011
--------------------------------------------------------------------------------
Joerg Schweizer             Consultant     150,000       0.40      Mar. 26, 2008
--------------------------------------------------------------------------------
Kyle Johnson                Consultant      50,000       0.40      Mar. 26, 2008
--------------------------------------------------------------------------------
Mark Chadwick               Consultant      50,000       0.40      Mar. 26, 2008
--------------------------------------------------------------------------------
TOTAL:                                   1,907,000
                                         =========
--------------------------------------------------------------------------------

(1)      Pursuant to the rules of the TSX-V the Company has issued stock options
         to employees, directors, and consultants. The Company, for the purposes
         of  issuing  stock  options,   designates   consultants  as  employees;
         therefore,  certain  persons  designated  as  employees  are,  in fact,
         consultants.

As of April 30, 2007,  the directors and officers of the Company,  as a group (7
persons), held options to purchase 769,500 shares of the Company's common stock,
including options held by their spouses.

WARRANTS

As of April 30, 2007, there were non-transferable common share purchase warrants
exercisable  for the purchase of 10,386,522  common  shares,  1,412,000 of which
expire on February 2, 2008 and may be exercised at $0.65 per share and 2,291,000
of which  expire on December 8, 2008 and may be exercised at $0.45 per share and


                                     - 68 -
<PAGE>


5,850,000 which expire on April 17, 2009 and may be exercised at $0.45 per share
and 833,522  which  expire on April 19, 2009 and may be  exercised  at $0.45 per
share.

As of April 30, 2007,  the directors and officers of the Company,  as a group (7
persons),  held  warrants to purchase  691,500  shares of the  Company's  common
stock.

There are no  assurances  that the option or  warrants  described  above will be
exercised in whole or in part.


ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS.
--------------------------------------------------------------------------------

MAJOR SHAREHOLDERS

The following table sets forth certain  information  regarding  ownership of the
Company's  shares  by all  persons  who  own  five  percent  (5%) or more of the
Company's outstanding shares, as of April 30, 2007.

--------------------------------------------------------------------------------
                                              SHARES AND RIGHTS
TITLE OF CLASS         NAME AND ADDRESS      BENEFICIALLY OWNED       PERCENT OF
                          OF OWNER            OR CONTROLLED(1)          CLASS(1)
--------------------------------------------------------------------------------

Common Stock           Nikolaos Cacos            1,398,413(2)            6.4%
Common Stock           Joseph Grosso             1,345,680(3)            6.2%
                                                 ---------              ----
                       Total                     2,744,093              12.6%
                                                 =========              ====
NOTES:
(1)  Where  persons  listed on this  table  have the right to obtain  additional
     shares of common  stock  through  the  exercise of  outstanding  options or
     warrants within 60 days from March 31, 2007,  these  additional  shares are
     deemed to be  outstanding  for the purpose of computing  the  percentage of
     common stock owned by such  persons,  but are not deemed to be  outstanding
     for the purpose of  computing  the  percentage  owned by any other  person.
     Based on  21,748,592  shares of common  stock  outstanding  as of March 31,
     2007.
(2)  Includes the  following  shares,  options an warrants held by Mr. Cacos and
     Aspasia Cacos (Mr.  Cacos' wife):
     a.   197,636 shares held by Mr. Cacos;
     b.   67,000 shares held by Mrs. Cacos;
     c.   359,277 shares held by NAC Investments Inc.
     d.   Options held by Mr. Cacos to acquire 250,000 shares;
     e.   Options held by Mrs. Cacos to acquire 24,500 shares;
     f.   Warrants  held by Mr.  Cacos to acquire  200,000  shares at a price of
          $0.65 per share, exercisable until February 2, 2008
     g.   Warrants  held by Mr.  Cacos to acquire  200,000  shares at a price of
          $0.45 per share, exercisable until December 8, 2008
     h.   Warrants held by NAC  Investments  Inc. to acquire 100,000 shares at a
          price of $0.45 per share, exercisable until December 8, 2008
     See "Item 6. Directors, Senior Management and Employees - Options, Warrants
     and Other Rights to Acquire Securities."
(3)  Includes the  following  shares and options  held by Mr.  Grosso and Evelyn
     Grosso (Mr. Grosso's wife):
     a.   939,680 shares held by Mr. Grosso;
     b.   56,000 shares held by Mr. Grosso in an RRSP Account;
     c.   Options held by Mr. Grosso to acquire 250,000 shares;
     d.   Warrants  held by Mr. Grosso to acquire  100,000  shares at a price of
          $0.65 per share, exercisable until February 2, 2008
     See "Item 6. Directors, Senior Management and Employees - Options, Warrants
     and Other Rights to Acquire Securities."

None of the Company's  principal  shareholders have voting rights different from
any of the Company's other common shareholders.

CHANGES IN SHAREHOLDINGS

Initially,  the Company had one share issued and outstanding,  which was held by
Joseph Grosso.  Mr. Grosso transferred the single outstanding share to Mr. Cacos
on April  11,  2000.  Subsequently,  Messrs.  Cacos  and  Grosso  have  acquired
additional  shares of the  Company's  common  stock in private  placements,  the
initial  public  offering and  purchases  through the TSX-V.  There have been no
significant  changes in the  percentage  ownership  of either  Mr.  Cacos or Mr.
Grosso within the last three years.

ESCROW SHARES

All escrow shares were released on December 2, 2006.



                                     - 69 -
<PAGE>


UNITED STATES SHAREHOLDERS

As of April 30, 2007,  there was one registered  holder of the Company's  common
shares in the United States, with holdings of 50,000 shares,  representing 0.02%
of the issued shares of the Company on April 30, 2007. The Company does not know
how many  beneficial  shareholders  it has in the United States,  but management
believes there are less than 300 such shareholders.

CONTROL BY FOREIGN GOVERNMENT OR OTHER PERSONS

To the  best  of the  Company's  knowledge,  the  Company  is  not  directly  or
indirectly owned or controlled by another  corporation,  any foreign government,
or any other natural or legal person, severally or jointly.

CHANGE OF CONTROL

As of the date of this annual  report,  there are no  arrangements  known to the
Company  which may at a  subsequent  date  result in a change of  control of the
Company.

RELATED PARTY TRANSACTIONS

Other than as disclosed  below,  from January 1, 2004 through April 30, 2007 the
Company has not entered into any  transactions  or loans between the Company and
any:  (a)  enterprises   that  directly  or  indirectly   through  one  or  more
intermediaries,  control or are controlled by, or are under common control with,
the Company; (b) associates;  (c) individuals owning, directly or indirectly, an
interest  in the  voting  power  of the  Company  that  gives  them  significant
influence over the Company,  and close members of any such individuals'  family;
(d) key management personnel and close members of such individuals' families; or
(e)  enterprises  in which a substantial  interest in the voting power is owned,
directly or indirectly, by any person described in (c) or (d) or over which such
a person is able to exercise significant influence.

1)       On April 8, 2004,  the  Company,  IMA and IMASA  entered into a further
         agreement on the Mogote Property.  On April 8, 2004, Messrs.  Cacos and
         Grosso, were officers,  directors and/or principal  shareholders of the
         Company and  officers and  directors  of IMA. As of April 8, 2004,  Mr.
         Lang was a consultant to the Company and was an officer and director of
         IMA. The Company can earn an additional  24% interest,  for a total 75%
         interest,  after  earning  the  initial  51%  interest,  by  issuing an
         additional  300,000  common  shares  (issued),  with a deemed  value of
         $279,000  and  expending  an  additional  US$3  million on  exploration
         expenditures, as follows:

                                  EXPLORATION
                                  EXPENDITURES
                                      US$                 DATE

                                    1,000,000             May 30, 2005
                                    1,000,000             May 30, 2006
                                    1,000,000             May 30, 2007
                                    ---------
                                    3,000,000
                                    =========

         As a result of the April 8, 2004 agreement,  the aggregate expenditures
         which must be incurred by the Company on the Mogote Property,  in order
         to earn the initial 51% interest and the additional  24% interest,  are
         as follows:

                                          EXPENDITURES              CUMULATIVE
         DATE FOR COMPLETION                   US $                     US $

         July 1, 2004                         250,000                  250,000
         May 30, 2005                       1,000,000                1,250,000
         July 1, 2005                         300,000                1,550,000
         May 30, 2007(1)                    1,000,000                2,550,000
         July 1, 2007(1)                      300,000                2,850,000
         May 30, 2008(1)                    1,000,000                3,850,000
         July 1, 2008(1)                      400,000                4,250,000
                                            ---------
         TOTAL                              4,250,000
                                            =========


                                     - 70 -
<PAGE>


         (1)  The dates  subsequent  to December  31, 2005  reflect the May 2006
              amendment to the  agreement:  Subsequent  to December 31, 2005 the
              Company appointed a special committee of independent  directors to
              re-negotiate  the terms of the Mogote  property  option  agreement
              with Golden Arrow.  According to the  resolutions  adopted by both
              companies Boards, the US$1,000,000  property expenditures required
              by May  30,  2006  are  now  extended  to May  30,  2007  and  the
              US$1,000,000  property  expenditures required May 30, 2007 are now
              extended to May 30, 2008. In return for granting of the extension,
              10% of any  payments,  in terms of cash or stock  received  by the
              Company from a third party who enters into an agreement  regarding
              the Mogote property, will be paid to the Golden Arrow.

         Pursuant to an agreement  dated June 28, 2004,  effective July 7, 2004,
         IMA's and IMASA's  rights and  interests  under these  agreements  were
         transferred  to Golden Arrow and IMAUSA,  respectively.  As of June 28,
         2004, Mr. Grosso was an officer,  director and principal shareholder of
         the Company and an officer and director of IMA and Golden Arrow.  As of
         June  28,  2004,  Mr.  Cacos,   an  officer,   director  and  principal
         shareholder of the Company,  and Mr. Terry,  an officer of the Company,
         were  officers and  directors of IMA. Mr. Lang was a consultant  to the
         Company as of June 28, 2004, and an officer and director of IMA. During
         July  2004,  Messrs.  Cacos  and  Terry,  officers,   directors  and/or
         principal shareholders of the Company, became officers and directors of
         Golden Arrow.  Mr. Lang, an officer of the Company,  became and officer
         and director of Golden Arrow during July 2004.

         See "Item 4.  Information  on the Company - History and  Development of
         the Company" and "Item 4. Information on the Company - Property,  Plant
         and Equipment - Principal Properties - Mogote Project."

2)       During the year ended December 31, 2004,  the Company  purchased a 100%
         undivided  interest from IMA in three mineral  properties  (the "Chubut
         Properties"),  comprising 24,280 hectares,  located in Chubut Province,
         Argentina,  by issuing  500,000 common shares (issued in November 2003)
         for a  fair  value  of  $225,000.  (At  the  time  this  agreement  was
         negotiated  the 500,000  shares had a deemed value of $22,000 which was
         IMA's recorded cost for the properties). In addition, in the event that
         a  decision  is made to place the  Chubut  Properties  into  commercial
         production,  the Company  will pay IMA and IMASA (now Golden  Arrow and
         IMAUSA) a bonus of  US$250,000  and a 3% net smelter  returns  royalty.
         Pursuant to an agreement  dated June 28, 2004,  effective July 7, 2004,
         IMA's and  IMASA's  rights  and  interests  under this  agreement  were
         assigned to Golden Arrow and IMAUSA, respectively. As of June 28, 2004,
         Mr. Grosso was an officer,  director and principal  shareholder  of the
         Company and an officer and director of IMA and Golden Arrow. As of June
         28, 2004, Mr. Cacos, an officer,  director and principal shareholder of
         the Company,  and Mr. Terry,  an officer of the Company,  were officers
         and directors of IMA. As of June 28, 2004, Mr. Lang was a consultant to
         the  Company  and an officer  and  director  of IMA.  During July 2004,
         Messrs.   Cacos  and  Terry,   officers,   directors  and/or  principal
         shareholders  of the Company,  became  officers and directors of Golden
         Arrow. Mr. Lang, an officer of the Company,  also became an officer and
         director of Golden Arrow in July 2004.

         See "Item 4.  Information  on the Company - History and  Development of
         the Company" and "Item 4. Information on the Company - Property,  Plant
         and Equipment - Other Properties - Chubut Project."

3).      Prior to the signing of the Administrative  Services Agreement with the
         Grosso Group in 2005,  the Company shared office  facilities  with IMA.
         During the year ended  December  31,  2004,  the  Company  was  charged
         $108,390  (2003 - $35,110)  by IMA for shared  rent and  administration
         costs.  During the year ended  December  31,  2004,  the  Company  paid
         $113,400  (2003 - $nil)  for  professional  fees  (including  a $25,000
         relocation  allowance),  billed by a director  and by an officer of the
         Company.  Of this amount $42,000 was reimbursed by IMA as an allocation
         of the professional services. See Item 6. "Directors, Senior Management
         and Employees - Management  Contracts" for update effective  January 1,
         2005.

4).      Effective  January 2, 2004, the Company  entered into an agreement with
         the President of the Company for his services.  See "Item 6. Directors,
         Senior  Management  and Employees - Employment  Agreements."  Under the
         agreement the President was paid $6,125 per month.  Effective  April 1,
         2006, the agreement was modified so that the monthly fee was payable to


                                     - 71 -
<PAGE>

         a private  company  controlled  by the President and on May 1, 2006 the
         monthly fee  increased  to $7,292.  During the year ended  December 31,
         2006, the Company paid $85,833 (2005 - $73,500;  2004 - $72,400) to the
         President or to the private company controlled by the President. During
         the three months ended March 31, 2007, the Company paid $21,875 (2005 -
         $21,375) to the  President.  The contract  also  provides  that, in the
         event the services  are  terminated  without  cause or upon a change in
         control of the Company,  a termination  payment would include  eighteen
         months of compensation plus a bonus amount agreed to by the parties.

5).      The  following  table  provides a listing of the  offerings and private
         placements conducted by the Company,  during the period from January 1,
         2006  through  April 30,  2007,  along with the names of the  officers,
         directors and/or principal  shareholders which purchased  securities in
         these offerings and private placements and the use of proceeds:

<TABLE>
<CAPTION>
                                                                                               PURCHASE   MARKET
                                                                               PARTICIPATION     PRICE    PRICE(1)
         PLACEE                                                                 BY INSIDERS        $         $
         ---------------------------------------------------------------------------------------------------------
        <S>                                                                        <C>         <C>       <C>

         Private Placement - 1,412,000 units, announced January 16, 2006                          0.60      0.59

              Each unit  comprised  one  common  share and one  non-transferable
              share purchase  warrant.  Each warrant entitles the holder thereof
              to purchase  one common  share in the capital of the Company on or
              before February 2, 2008 at a purchase price of $0.65.

         Nikolaos Cacos                                                             200,000
         Joseph Grosso                                                              100,000
         Robert Coltura                                                               7,000
         Lindsay Bottomer                                                            10,000
         Jerry Minni                                                                 17,000
         David Terry                                                                 12,000
         Arthur Lang                                                                  5,000
                                                                                    --------
         Total                                                                      351,000
                                                                                    ========


         Private Placement - 2,235,000 units, announced November 15, 2006                         0.35      0.35

              Each unit  comprised  one  common  share and one  non-transferable
              share purchase  warrant.  Each warrant entitles the holder thereof
              to purchase  one common  share in the capital of the Company on or
              before December 8, 2008 at a purchase price of $0.45.

         Nikolaos Cacos                                                             200,000
         Robert Coltura                                                              10,000
         Gerald Carlson                                                              50,000
         Jerry Minni                                                                 15,000
         Vera Minni (wife of Jerry Minni)                                            15,000
         David Terry                                                                 30,000
                                                                                    --------
         Total                                                                      320,000
                                                                                    ========


         Private Placement - 11,700,000 units, announced March 12, 2007                           0.40      0.35

              Each unit comprised one common share and one half non-transferable
              share purchase warrant. 1,100,000 of the full warrants entitle the
              holder  thereof to purchase one common share in the capital of the
              Company on or before  April 12, 2009 at a purchase  price of $0.45
              and 4,750,000 of the full warrants  entitle the holder  thereof to
              purchase  one common  share in the  capital  of the  Company on or
              before April 17, 2009 at a purchase price of $0.45.

         Robert Coltura                                                              15,000
                                                                                    --------
         Total                                                                       15,000
                                                                                    ========
</TABLE>

         (1)  Quoted closing price on date of announcement of private placement
              or offering.

6).      See  "Item  6.   Directors,   Senior   Management   and   Employees   -
         Compensation."


                                     - 72 -
<PAGE>

7).      The Grosso  Group is a private  company  which is owned by the Company,
         Golden Arrow, IMA, Gold Point,  Blue Sky and Astral,  each of which own
         one share.  The Grosso Group  provides its  shareholder  companies with
         geological,   corporate  development,   administrative  and  management
         services.  The  Grosso  Group  staff is  available  to the  shareholder
         companies  on a cost  recovery  basis  without the expense of full time
         personnel.  The  shareholder  companies  pay monthly fees to the Grosso
         Group.  The fee is based  upon a  reasonable  prorating  of the  Grosso
         Group's  costs  including  its  staff and  overhead  costs  among  each
         shareholder  company with regard to the mutually  agreed average annual
         level of services provided to each shareholder company. During the year
         ended December 31, 2006, the Company  incurred fees of $533,469 (2005 -
         $377,410) to the Grosso Group:  $480,545  (2005 - $290,858) was paid in
         twelve  monthly  payments  and $52,924  (2005 - $86,552) is included in
         accounts  payable  as a result  of a review  of the  allocation  of the
         Grosso Group costs to the member  companies  for the year. In addition,
         included in other receivables, prepaids and deposits is a $95,000 (2005
         - $95,000)  deposit to the Grosso  Group for the  purchase of equipment
         and leasehold  improvements and for operating working capital. The fees
         the Company pays to the Grosso Group are  allocated to various  expense
         items that  reflect  the nature of the actual  costs:  rent,  salaries,
         office and  telephone.  These fees are  equivalent to costs the Company
         would have incurred directly.

INDEBTEDNESS OF DIRECTORS, OFFICERS, PROMOTERS AND OTHER MANAGEMENT

As at December 31, 2006,  the  President of the Company and a consultant  of the
Company  each owed  $70,000  to the  Company  for units  purchased  through  the
Company's private placement announced November 15, 2006. These amounts were paid
to the Company on January 29, 2007 and January 24, 2007 respectively.

Except as  mentioned  above,  during the fiscal  years ended  December 31, 2006,
2005, 2004, none of the following were indebted to the Company:

(a)      enterprises   that   directly  or   indirectly   through  one  or  more
         intermediaries,  control  or are  controlled  by, or are  under  common
         control with, the Company;
(b)      associates;
(c)      individuals owning,  directly or indirectly,  an interest in the voting
         power of the Company  that gives them  significant  influence  over the
         Company, and close members of any such individuals' family;
(d)      key  management  personnel  and  close  members  of  such  individuals'
         families; or
(e)      enterprises  in which a  substantial  interest  in the voting  power is
         owned, directly or indirectly, by any person described in (c) or (d) or
         over which such a person is able to exercise significant influence.

INTERESTS OF EXPERTS AND COUNSEL

Not applicable.


ITEM 8.  FINANCIAL INFORMATION.
--------------------------------------------------------------------------------


DESCRIPTION                                                            PAGES
-------------------------------------------------                    -----------
Audited Financial Statements for the Years Ended
December 31, 2006, 2005 and 2004                                     F-1 to F-27


SIGNIFICANT CHANGES

None.

DIVIDEND POLICY

The Company has not paid any  dividends on its common shares and does not intend
to pay dividends on its common shares in the immediate  future.  Any decision to
pay  dividends  on its common  shares in the future will be made by the board of
directors of the Company on the basis of earnings,  financial  requirements  and
other such conditions that may exist at that time.



                                     - 73 -
<PAGE>


LEGAL PROCEEDINGS

None.


ITEM 9.  THE OFFER AND LISTING.
--------------------------------------------------------------------------------

PRICE HISTORY

The Company's  common stock commenced  trading on the TSX-V on December 2, 2003.
The  Company's  stock  currently  trades on the TSX-V under the symbol "AMS" and
CUSIP number 02351P105.

The following table sets forth the market price ranges and the aggregate  volume
of  trading  of the common  shares of the  Company on the TSX-V for the  periods
indicated:

                   TSX-VENTURE EXCHANGE STOCK TRADING ACTIVITY

                                                    ---------------------------
                                                          SALES PRICE ($)
---------------------         ---------             ---------------------------
YEAR ENDED                       VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
December 31, 2006             9,473,300                 0.73            0.32
December 31, 2005            12,673,600                 0.94            0.35
December 31, 2004             7,113,900                 1.12            0.35
December 31, 2003(1)          1,444,847                 0.95            0.60

(1)  Period from December 2, 2003 to December 31, 2003.

                                                    ---------------------------
                                                          SALES PRICE ($)
---------------------         ---------             ---------------------------
QUARTER ENDED                    VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
March 31, 2007                1,889,200                 0.44            0.35
December 31, 2006             2,153,400                 0.44            0.32
September 30, 2006            1,191,400                 0.48            0.34
June 30, 2006                 2,880,400                 0.70            0.32
March 31, 2006                3,248,100                 0.73            0.51
December 31, 2005             3,247,900                 0.80            0.46
September 30, 2005            1,290,900                 0.94            0.35
June 30, 2005                 8,988,100                 0.51            0.37

                                                    ---------------------------
                                                          SALES PRICE ($)
---------------------         ---------             ---------------------------
MONTH ENDED                      VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
April 30, 2007                  860,600                 0.43            0.36
March 31, 2007                  568,100                 0.42            0.35
February 28, 2007               978,300                 0.44            0.35
January 31, 2007                342,800                 0.42            0.36
December 31, 2006               519,900                 0.44            0.35
November 30, 2006             1,151,500                 0.44            0.33


         OVER-THE-COUNTER BULLETIN BOARD AND PINK SHEET TRADING ACTIVITY

The Company's common shares have been listed in the Pink Sheets under the symbol
"AJRSF" since January 2004.  Effective  September 13, 2006, the Company received
clearance for trading on the Over-the-Counter  Bulletin Board ("OTCBB") operated
by the National  Association of Securities Dealers,  continuing under the symbol
"AJRSF".  The  following  tables  set  forth the  market  price  ranges  and the
aggregate volume of trading of the common shares of the Company in the OTCBB and
Pink Sheets for the periods  indicated.  These quotations  reflect  inter-dealer
prices without retail mark-up, mark-down, or commissions and may not necessarily
represent actual transactions.


                                     - 74 -
<PAGE>

                                                    ---------------------------
                                                      CLOSING SALES PRICE (US$)
---------------------         ---------             ---------------------------
YEAR ENDED                       VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
December 31, 2006               684,750                 0.73            0.281
December 31, 2005               365,910                 0.76            0.30
December 31, 2004               330,750                 0.84            0.27

                                                    ---------------------------
                                                      CLOSING SALES PRICE (US$)
---------------------         ---------             ---------------------------
QUARTER ENDED                    VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
March 31, 2007                   85,500                 0.357           0.292
December 31, 2006               195,900                 0.381           0.281
September 30, 2006              155,200                 0.48            0.43
June 30, 2006                   181,750                 0.70            0.32
March 31, 2006                  151,900                 0.73            0.51
December 31, 2005                87,970                 0.68            0.41
September 30, 2005              145,430                 0.76            0.30
June 30, 2005                    76,230                 0.41            0.30

                                                    ---------------------------
                                                      CLOSING SALES PRICE (US$)
---------------------         ---------             ---------------------------
MONTH ENDED                      VOLUME                 HIGH            LOW
---------------------         ---------             ------------   ------------
April 30, 2007                   45,300                 0.351           0.32
March 31, 2007                   14,000                 0.345           0.312
February 28, 2007                40,000                 0.357           0.315
January 31, 2007                 31,500                 0.339           0.292
December 31, 2006                53,200                 0.381           0.292
November 30, 2006                71,300                 0.377           0.281

REGISTRATION, TRANSFER AND PAR VALUE

The  Company's  common  shares,  no par value,  are  registered.  The  Company's
transfer agent is  Computershare  Trust Company of Canada,  510 Burrard  Street,
Vancouver, British Columbia, V6C 3B9, Canada.


ITEM 10.  ADDITIONAL INFORMATION.
--------------------------------------------------------------------------------

MEMORANDUM AND ARTICLES OF ASSOCIATION

Previously reported in the Company's  registration statement on Form 20-F, filed
with the SEC on October 28, 2004.

MATERIAL CONTRACTS

The following  are material  contracts to which the Company is a party and which
were  entered  into  during  the two years  proceeding  the date of this  annual
report:

1.       Agency  Letter  Agreement  between the Company  and  Canaccord  Capital
         Corporation dated February 18, 2005, pursuant to which Canaccord agreed
         to the Company with a portion of an offering for sale of 900,000  units
         at $0.55  per  unit.  Each  unit  consisted  of one  share and one half
         warrant exercisable at $0.60.  Canaccord's  compensation included an 8%
         of the amount placed, payable either in cash or in agent's units at the
         election of the agent.  The  agent's  units will have the same terms as
         the client's units.  In addition,  the Company agreed to issue warrants
         to Canaccord equal to 10% of the units subscribed, each warrant will be
         exercisable  to purchase an  additional  share at $0.60 for a period of
         one year from  closing.  In addition,  the Company will pay Canaccord a
         corporate finance fee, payable by the issuance of 27,000 units,  having
         the  same  terms  as  the  clients'  units.  The  Company  will  pay an
         administration fee plus expenses to Canaccord of $5,000.

                                     - 75 -
<PAGE>


2.       Property  option  agreement  between  the  Company  and  Carlos  Martin
         Thompson Palacoos dated May 11, 2005, pursuant to which the Company may
         earn up to 100% undivided interest in the Cruz de Mayo Property located
         in the southern portion of the Department of Cuzco in Peru. To earn the
         interest in the  property  the Company  must pay  US$150,000  in option
         payments  to  the  Vendor  (US$35,000  paid)  and  incur   US$1,500,000
         expenditures over the period of four years as follows:

          OPTION      EXPLORATION
         PAYMENTS     EXPENDITURES   DATE
            US $           US $

           35,000              -     April 11, 2005 (paid on signing)
           25,000        200,000     April 11, 2007 (extended to June 30, 2007)
           40,000        550,000     April 11, 2008
           50,000        750,000     April 11, 2009
          -------      ---------
          150,000      1,500,000
         ========      =========

3.       Letter of intent  between the Company and Astral dated June 12, 2006 to
         option to Astral its Roy and Hills  properties.  Under the terms of the
         Letter of Intent,  Astral may earn up to an 80%  undivided  interest in
         the Roy and Hills  Properties.  An initial 65%  interest in the project
         may be earned by incurring  US$2,500,000 in work expenditures over four
         years and issuing 500,000 common shares to the Company. Astral may then
         elect to earn an additional 15% interest,  by issuing a further 500,000
         shares and completing a bankable feasibility stage, within three years.
         This Letter of Intent is subject to TSX-V  approval,  upon which Astral
         must issue the first 100,000 shares to the Company.

4.       Effective  January 2, 2004, the Company  entered into an agreement with
         Mr. Nikolaos Cacos,  President of the Company, for his services.  Under
         the agreement Mr. Cacos was paid $6,125 per month.  Effective  April 1,
         2006, the agreement was modified so that the monthly fee was payable to
         a  private  company  controlled  by Mr.  Cacos  and on May 1,  2006 the
         monthly fee increased to $7,292.  The agreement  also provides that, in
         the event the services are terminated without cause or upon a change in
         control of the Company,  a termination  payment would include  eighteen
         months of compensation plus a bonus amount agreed to by the parties.

EXCHANGE CONTROLS

There are no governmental  laws,  decrees,  or regulations in Canada relating to
restrictions on the export or import of capital,  or affecting the remittance of
interest,  dividends, or other payments to non-resident holders of the Company's
common  stock.  Any  remittances  of dividends to United States  residents  are,
however,  subject  to a  15%  withholding  tax  (10%  if  the  shareholder  is a
corporation  owning at least 10% of the outstanding common stock of the Company)
pursuant to Article X of the reciprocal tax treaty between Canada and the United
States. See "Item 10. Additional Information - Taxation".

Except as  provided  in the  Investment  Canada  Act,  there are no  limitations
specific to the rights of  non-Canadians to hold or vote the common stock of the
Company  under the laws of Canada or the Province of British  Columbia or in the
charter documents of the Company.

Management  of the  Company  considers  that the  following  general  summary is
materially  complete and fairly  describes  those  provisions of the  Investment
Canada Act pertinent to an investment by an American investor in the Company.

The following  discussion  summarizes  the principal  features of the Investment
Canada Act for a non-resident who proposes to acquire the common shares.

The Investment  Canada Act generally  prohibits  implementation  of a reviewable
investment  by  an  individual,   government  or  agency  thereof,  corporation,
partnership,  trust or joint venture (each an "entity") that is not a "Canadian"
as defined in the Investment Canada Act (a "non-Canadian"), unless after review,
the  Director of  Investments  appointed  by the  minister  responsible  for the
Investment  Canada Act is satisfied  that the  investment is likely to be of net
benefit to Canada.  An investment in the common shares by a  non-Canadian  other
than a "WTO Investor" (as that term is defined by the Investment Canada Act, and


                                     - 76 -
<PAGE>


which  term  includes  entities  which are  nationals  of or are  controlled  by
nationals of member states of the World Trade Organization) when the Company was
not  controlled by a WTO  Investor,  would be  reviewable  under the  Investment
Canada Act if it was an  investment  to acquire  control of the  Company and the
value of the  assets  of the  Company,  as  determined  in  accordance  with the
regulations  promulgated  under the Investment  Canada Act, equals or exceeds $5
million for direct acquisition and over $50 million for indirect acquisition, or
if an order for review was made by the federal  cabinet on the grounds  that the
investment   related  to  Canada's  cultural  heritage  or  national   identity,
regardless  of the value of the  assets of the  Company.  An  investment  in the
common  shares by a WTO  Investor,  or by a  non-Canadian  when the  Company was
controlled by a WTO Investor,  would be reviewable  under the Investment  Canada
Act if it was an investment  to acquire  control of the Company and the value of
the assets of the Company,  as  determined in  accordance  with the  regulations
promulgated  under  the  Investment  Canada  Act was not less  than a  specified
amount,  which for 2005 was any amount in excess of $250 million. A non-Canadian
would acquire  control of the Company for the purposes of the Investment  Canada
Act  if  the  non-Canadian  acquired  a  majority  of  the  common  shares.  The
acquisition  of one third or more, but less than a majority of the common shares
would be presumed to be an acquisition of control of the Company unless it could
be established that, on the acquisition,  the Company was not controlled in fact
by the acquirer through the ownership of the common shares.

Certain  transactions  relating  to the common  shares  would be exempt from the
Investment Canada Act,  including:  (a) an acquisition of the common shares by a
person in the ordinary course of that person's business as a trader or dealer in
securities;  (b) an acquisition of control of the Company in connection with the
realization of security granted for a loan or other financial assistance and not
for a purpose related to the provisions of the Investment Canada Act; and (c) an
acquisition  of control of the  Company  by reason of an  amalgamation,  merger,
consolidation or corporate reorganization following which the ultimate direct or
indirect  control in fact of the  Company,  through the  ownership of the common
shares, remained unchanged.

TAXATION

MATERIAL CANADIAN FEDERAL INCOME TAX CONSEQUENCES

Management  of the  Company  considers  that  the  following  discussion  fairly
describes the material Canadian federal income tax consequences  applicable to a
holder of common stock of the Company who is a resident of the United States and
who is not a resident of Canada and who does not use or hold,  and is not deemed
to use or hold,  his shares of common  stock of the Company in  connection  with
carrying on a business in Canada (a "non-resident shareholder").

This summary is based upon the current provisions of the Income Tax Act (Canada)
(the  "ITA"),  the  regulations  thereunder  (the  "Regulations"),  the  current
publicly  announced  administrative  and assessing  policies of Revenue  Canada,
Taxation and all specific  proposals (the "Tax  Proposals") to amend the ITA and
Regulations  announced  by the  Minister of Finance  (Canada)  prior to the date
hereof.  This  description  is not exhaustive of all possible  Canadian  federal
income tax  consequences  and, except for the Tax Proposals,  does not take into
account or anticipate any changes in law,  whether by legislative,  governmental
or judicial action.

DIVIDENDS

Dividends  paid on the common  stock of the  Company to a  non-resident  will be
subject  to  withholding  tax.  The  Canada-U.S.  Income Tax  Convention  (1980)
provides that the normal 25% withholding tax rate is reduced to 15% on dividends
paid on shares of a  corporation  resident  in Canada  (such as the  Company) to
residents of the United  States,  and also  provides for a further  reduction of
this rate to 5% where the  beneficial  owner of the  dividends is a  corporation
which is a resident of the United  States  which owns at least 10% of the voting
shares of the  corporation  paying  the  dividend.  In the event of the  Company
declaring and paying dividends it would withhold any applicable taxes.

CAPITAL GAINS

In general,  a  non-resident  of Canada is not subject to tax under the ITA with
respect  to a  capital  gain  realized  upon  the  disposition  of a share  of a
corporation  resident in Canada that is listed on a prescribed  stock  exchange.
For purposes of the ITA, the Company is listed on a prescribed  stock  exchange.
Non-residents  of Canada who dispose of shares of the Company will be subject to
income tax in Canada with respect to capital gains if:


                                     - 77 -
<PAGE>


         (a)  the non-resident holder;
         (b)  persons  with whom the  non-resident  holder  did not deal with at
              arm's length; or
         (c)  the non-resident  holder and  persons  with whom the  non-resident
              holder did not deal with at arm's length,

owned  not less  than 25% of the  issued  shares  of any  class or series of the
Company at any time during the five-year period  preceding the  disposition.  In
the case of a  non-resident  holder  to whom  shares  of the  Company  represent
taxable Canadian  property and who is resident in the United States, no Canadian
taxes will be payable on a capital gain realized on such shares by reason of the
Canada-U.S. Income Tax Convention (1980) (the "Treaty") unless the value of such
shares is derived principally from real property situated in Canada. However, in
such a case, certain transitional relief under the Treaty may be available.

MATERIAL UNITED STATES FEDERAL INCOME TAX CONSIDERATIONS

The following  discussion  summarizes the material  United States federal income
tax  consequences,  under current law,  applicable to a U.S.  Holder (as defined
below)  of  the  Company's  common  stock.  This  discussion  does  not  address
consequences peculiar to persons subject to special provisions of federal income
tax law, such as tax-exempt organizations, qualified retirement plans, financial
institutions,  insurance  companies,  real estate investment  trusts,  regulated
investment companies,  broker-dealers,  nonresident alien individuals or foreign
corporations,  and shareholders owning common stock representing 10% of the vote
and value of the Company. In addition, this discussion does not cover any state,
local or foreign tax consequences.

The following discussion is based upon the sections of the Internal Revenue Code
of 1986,  as amended (the  "Code"),  Treasury  Regulations,  published  Internal
Revenue Service ("IRS") rulings,  published  administrative positions of the IRS
and court decisions that are currently applicable,  any or all of which could be
materially and adversely changed,  possibly on a retroactive basis, at any time.
In addition,  this  discussion  does not consider the  potential  effects,  both
adverse and beneficial of recently proposed legislation which, if enacted, could
be  applied,  possibly  on  a  retroactive  basis,  at  any  time.  Holders  and
prospective holders of the Company's common stock are urged to consult their own
tax advisors about the federal,  state,  local and foreign tax  consequences  of
purchasing, owning and disposing of shares of common stock of the Company.

U.S. HOLDERS

As used herein,  a "U.S.  Holder" is defined as (i) citizens or residents of the
U.S.,  or any state  thereof,  (ii) a  corporation  or other  entity  created or
organized  under the laws of the U.S.,  or any  political  subdivision  thereof,
(iii) an estate  the  income of which is  subject  to U.S.  federal  income  tax
regardless of source or that is otherwise  subject to U.S. federal income tax on
a net  income  basis in  respect  of the  common  stock,  or (iv) a trust  whose
administration  is subject to the primary  supervision of a U.S. court and which
has one or  more  U.S.  fiduciaries  who  have  the  authority  to  control  all
substantial  decisions  of the trust,  whose  ownership  of common  stock is not
effectively  connected  with the  conduct of a trade or  business  in the United
States and  shareholders  who  acquired  their  stock  through  the  exercise of
employee stock options or otherwise as compensation.

DISTRIBUTIONS ON SHARES OF COMMON STOCK

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


                                     - 78 -
<PAGE>


Holder which is a corporation. Dividends paid on the Company's common stock will
not  generally  be eligible for the  dividends  received  deduction  provided to
corporations receiving dividends from certain United States corporations.

FOREIGN TAX CREDIT

A U.S. Holder who pays (or has withheld from distributions)  Canadian income tax
with respect to the ownership of the Company's common stock may be entitled,  at
the option of the U.S.  Holder,  to either a deduction  or a tax credit for such
foreign tax paid or withheld. Generally, it will be more advantageous to claim a
credit  because  a  credit  reduces  United  States  federal  income  taxes on a
dollar-for-dollar  basis, while a deduction merely reduces the taxpayer's income
subject to tax. This election is made on a year-by-year basis and applies to all
foreign  taxes paid by (or  withheld  from) the U.S.  Holder  during  that year.
Subject to certain  limitations,  Canadian  taxes  withheld will be eligible for
credit against the U.S.  Holder's United States federal income taxes.  Under the
Code,  the  limitation  on  foreign  taxes  eligible  for  credit is  calculated
separately  with respect to specific  classes of income.  Dividends  paid by the
Company  generally  will be  either  "passive"  income or  "financial  services"
income,  depending on the particular U.S.  Holder's  circumstances.  Foreign tax
credits  allowable  with respect to each class of income  cannot exceed the U.S.
federal income tax otherwise  payable with respect to such class of income.  The
consequences of the separate  limitations  will depend on the nature and sources
of each U.S.  Holder's  income and the  deductions  appropriately  allocated  or
apportioned  thereto.  The  availability  of the  foreign  tax  credit  and  the
application  of the  limitations on the credit are fact specific and holders and
prospective  holders of common stock are urged to consult their own tax advisors
regarding their individual circumstances.

DISPOSITION OF SHARES OF COMMON STOCK

A U.S.  Holder  will  recognize  gain or loss  upon the sale of shares of common
stock equal to the difference,  if any,  between (i) the amount of cash plus the
fair market value of any property received; and (ii) the shareholder's tax basis
in the  common  stock.  This  gain or loss will be  capital  gain or loss if the
shares  are a capital  asset in the hands of the U.S.  Holder,  and such gain or
loss will be  long-term  capital  gain or loss if the U.S.  Holder  has held the
common  stock for more than one year.  Gains and losses are netted and  combined
according to special rules in arriving at the overall capital gain or loss for a
particular  tax  year.   Deductions  for  net  capital  losses  are  subject  to
significant  limitations.  For U.S.  Holders  who are  individuals,  any  unused
portion of such net  capital  loss may be  carried  over to be used in later tax
years until such net capital loss is thereby  exhausted.  For U.S. Holders which
are corporations (other than corporations  subject to Subchapter S of the Code),
an unused net  capital  loss may be carried  back three years from the loss year
and carried  forward five years from the loss year to be offset against  capital
gains until such net capital loss is thereby exhausted.

OTHER CONSIDERATIONS

The Company has not  determined  whether it meets the  definition  of a "passive
foreign  investment  company" (a "PFIC").  It is unlikely that the Company meets
the  definition  of  a  "foreign  personal  holding  company"  (a  "FPHC")  or a
"controlled foreign corporation" (a "CFC") under current U.S. law.

If more  than  50% of the  voting  power  or value  of the  Company  were  owned
(actually  or  constructively)  by U.S.  Holders  who each  owned  (actually  or
constructively)  10% or more of the voting power of the Company's  common shares
("10%  Shareholders"),  then  the  Company  would  become  a CFC  and  each  10%
Shareholder would be required to include in its taxable income as a constructive
dividend  an amount  equal to its share of certain  undistributed  income of the
Company.  If (1) more  than 50% of the  voting  power or value of the  Company's
common  shares  were  owned  (actually  or  constructively)  by  five  or  fewer
individuals  who are citizens or  residents of the United  States and (2) 60% or
more of the Company's  income consisted of certain  interest,  dividend or other
enumerated  types of income,  then the Company  would be a FPHC.  If the Company
were a FPHC,  then each U.S.  Holder  (regardless of the amount of the Company's
common  shares  owned by such U.S.  Holder)  would be required to include in its
taxable  income  as  a   constructive   dividend  its  share  of  the  Company's
undistributed income of specific types.

If 75% or more of the  Company's  annual gross income has ever  consisted of, or
ever consists of, "passive" income or if 50% or more of the average value of the
Company's  assets in any year has ever consisted of, or ever consists of, assets
that produce, or are held for the production of, such "passive" income, then the
Company would be or would become a PFIC. The Company has not provided assurances
that it has not been and does not expect to become a PFIC.  Please note that the
application of the PFIC provisions of the Code to resource companies is somewhat
unclear.


                                     - 79 -
<PAGE>


If the  Company  or any of its  subsidiaries  is deemed  to be a PFIC,  a United
States  holder  of the  Company's  common  shares  would be  required  to pay an
interest  charge  together  with tax  calculated at maximum tax rates on certain
"excess distributions" (defined to include certain dividends from a PFIC and any
gain on the sale of stock of a PFIC) unless such holder made an election  either
to (1)  include  in his or her  taxable  income his or her pro rata share of the
PFIC's ordinary earnings and net capital gains under the Qualified Electing Fund
rules or (2) mark to market his or her Company  common shares at the end of each
taxable year as set forth in Section 1296 of the Internal  Revenue Code of 1986,
as amended. The elections require certain conditions be met such as filing on or
before the due date, as extended, for filing the shareholder's income tax return
for the first taxable year to which the election will apply.

INFORMATION REPORTING AND BACKUP WITHHOLDING

U.S. information reporting requirements may apply with respect to the payment of
dividends to U.S. Holders of the Company's  shares.  Under Treasury  regulations
currently in effect,  non-corporate holders may be subject to backup withholding
at a 31% rate with respect to dividends when such holder (1) fails to furnish or
certify a correct  taxpayer  identification  number to the payor in the required
manner,  (2) is  notified  by the IRS that it has failed to report  payments  of
interest or dividends  properly or (3) fails,  under certain  circumstances,  to
certify  that it has been  notified  by the IRS  that it is  subject  to  backup
withholding for failure to report interest and dividend payments.

INSPECTION OF DOCUMENTS

Copies of the  documents  referred to in this annual  report may be inspected at
the  Company's  corporate  office  at  Suite  709,  837  West  Hastings  Street,
Vancouver, British Columbia, V6C 3N6, Canada, during normal business hours.

The  Company's  documents  publicly  filed  with  the  Securities  and  Exchange
Commission  may also be viewed and inspected at the SEC's Public  Reference Room
located at 450 Fifth Street,  NW,  Washington,  D.C.  20549.  Copies may also be
obtained from the SEC at prescribed  rates.  Documents may also be viewed on the
SEC's Internet website at www.sec.gov.


ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.
--------------------------------------------------------------------------------

Not applicable.


ITEM 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES.
--------------------------------------------------------------------------------

Not applicable.



                                     PART II


ITEM 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES.
--------------------------------------------------------------------------------

Not applicable.


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

Not applicable.


                                     - 80 -
<PAGE>

ITEM 15.   CONTROLS AND PROCEDURES.
--------------------------------------------------------------------------------

An evaluation was performed under the supervision and with the  participation of
the Company's  management,  including Mr. Cacos,  the Company's  chief executive
officer,   and  Mr.  Lang,  the  Company's  chief  financial  officer,   of  the
effectiveness of the design and operation of the Company's  disclosure  controls
and  procedures  pursuant to Rules  13a-15(b)  and  15d-15(b) of the  Securities
Exchange Act of 1934 (the  "Exchange  Act") as of December 31, 2006.  Based upon
that evaluation, Messrs. Cacos and Lang, concluded that the Company's disclosure
controls and procedures are effective to ensure that information  required to be
disclosed by the Company in reports that it files or submits  under the Exchange
Act is recorded,  processed,  summarized  and  reported  within the time periods
specified in Securities and Exchange Commission rules and forms.

During the fiscal year ended  December  31,  2006,  there were no changes in the
Company's  internal  control  over  financial  reporting  that  have  materially
affected,  or are reasonably likely to materially affect, the Company's internal
control over financial reporting.


ITEM 16A.   AUDIT COMMITTEE FINANCIAL EXPERT.
--------------------------------------------------------------------------------

The Board of Directors  has  determined  that the Company has at least one audit
committee  financial expert,  Mr. Jerry Minni, who serves on the Company's audit
committee.  Mr. Minni is an  independent  director  within the meaning of and as
required  by  the  Ontario  Securities   Commission's   Multilateral  Instrument
52-110--Audit Committees.


ITEM 16B.   CODE OF ETHICS.
--------------------------------------------------------------------------------

Our Audit Committee has adopted a Code of Business Conduct and Ethics to provide
principles for the purpose of promoting:

     o   Honest and ethical conduct, including the ethical handling of actual or
         apparent  conflicts  of  interest  between  personal  and  professional
         relationships;
     o   Full, fair, accurate,  timely, and understandable disclosure in reports
         and  documents  that we file with,  or submit to,  the  Securities  and
         Exchange Commission and in other public communications;
     o   Compliance with applicable governmental laws, rules and regulations;
     o   The prompt  internal  reporting of  violations  of our Code of Business
         Conduct and Ethics; and
     o   Accountability  for  adherence  to our  Code of  Business  Conduct  and
         Ethics.


No waivers of any  provision  of the Code of Business  Conduct and Ethics may be
made except by the Audit Committee.  Only the Audit Committee may amend the Code
of Business  Conduct and Ethics.  Any waiver or  amendment  shall be reported as
required by law or regulation.

The Company also has adopted a Whistleblower  Policy and a Corporate  Disclosure
and Insider Trading Policy.

The  Company's  Code of Business  Conduct and Ethics,  Whistleblower  Policy and
Corporate  Disclosure and Insider  Trading Policy may be viewed at the Company's
website at:
            http://www.ameraresources.com/s/corporategovernance.asp.

Additionally,  each document is available in its entirety,  free of charge, upon
written request to us, attention of our Secretary,  at the address listed on the
front cover of this filing.

                                     - 81 -
<PAGE>


ITEM 16C.   PRINCIPAL ACCOUNTANT FEES AND SERVICES .
--------------------------------------------------------------------------------

AUDIT FEES

For the fiscal year ended December 31, 2006, the Company's principal  accountant
is  expected  to bill  approximately  $35,000,  and for the  fiscal  year  ended
December 31, 2005,  the  Company's  principal  accountant  billed  approximately
$29,500 for the audit of the Company's annual  financial  statements or services
that are normally  provided by the  accountant in connection  with statutory and
regulatory filings or engagements for those fiscal years.

AUDIT RELATED

The Company's principal accountant billed $Nil and $1,785 amounts for the fiscal
years ended December 31, 2006 and 2005,  respectively,  for  assurance,  tax and
related services that were reasonably related to the performance of the audit or
review of the Company's  financial  statements  outside of those fees  disclosed
above under "Audit Fees".

TAX FEES

The  Company's  principal  accountant  billed $Nil and $Nil for the fiscal years
ended December 31, 2006 and 2005, respectively, for tax services performed.


                                     - 82 -
<PAGE>


OTHER ACCOUNTING FEES

The  Company's  principal  accountant  billed $Nil and $Nil for the fiscal years
ended December 31, 2006 and 2005,  respectively,  for other accounting  services
performed.

The above listed services were approved by the Company's audit committee.


ITEM 16D.  EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES.
--------------------------------------------------------------------------------

Not applicable.


ITEM 16E.PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS.
--------------------------------------------------------------------------------

Not applicable.


                                    PART III


ITEM 17.  FINANCIAL STATEMENTS.
--------------------------------------------------------------------------------
                                                                        Pages
Audited Financial Statements for the Years Ended
December 31, 2006, 2005 and 2004                                     F-1 TO F-27


ITEM 18.  FINANCIAL STATEMENTS.
--------------------------------------------------------------------------------

Not applicable.


ITEM 19.  EXHIBITS.
--------------------------------------------------------------------------------
EXHIBIT
NUMBER          DESCRIPTION

1.1      Articles (1)
1.2      Memorandum and Certificate of Incorporation (1)
1.3      Certificate of Change of Name and Altered Memorandum (1)
1.4      Notice of Articles (1)
4.1      Letter Agreement dated October 1, 2002 made between the Company and IMA
         Exploration Inc. (1)
4.2      Letter of Intent made between the  Company,  IMA  Exploration  Inc. and
         Inversiones Mineras Argentinas S.A. dated March 6, 2003 (1)
4.3      Property Purchase  Agreement made between the Company,  IMA Exploration
         Inc. and Inversiones Mineras Argentinas S.A. dated March 6, 2003 (1)
4.4      Stock Option Plan dated April 13, 2004 (1)
4.5      Escrow  Agreement  among the Company,  Computershare  Trust  Company of
         Canada and the Principals of the Company dated April 30, 2003 (1)
4.6      Agency Agreement between the Company and Canaccord Capital  Corporation
         dated July 31, 2003 (1)
4.7      Amending  Letter  Agreement made between the Company,  IMA  Exploration
         Inc. and Inversiones  Mineras  Argentinas S.A. dated September 30, 2003
         (1)
4.8      Agreement with Nikolaos Cacos dated January 2, 2004 (1)


                                     - 83 -
<PAGE>


4.9      Consulting Agreement with David Terry dated February 16, 2004 (1)
4.10     Engagement   Agreement   between  the  Company  and  Canaccord  Capital
         Corporation dated March 8, 2004 (1)
4.11     Amending  Letter  Agreement made between the Company,  IMA  Exploration
         Inc. and Inversiones Mineras Argentinas S.A. dated April 8, 2004 (1)
4.12     Amendment to Consulting  Agreement with David Terry dated June 29, 2004
         (1)
4.13     Assignment  and  Assumption  Agreement  dated  June 28,  2004 among IMA
         Exploration  Inc.,  Inversiones  Mineras  Argentinas S.A., Golden Arrow
         Resources  Corporation,  Inversiones  Mineras  Australes  S.A.  and the
         Company (relating to the Argentinean properties) (1)
4.14     Assignment  and  Assumption  Agreement  dated  June 28,  2004 among IMA
         Exploration  Inc.,  Inversiones  Mineras  Argentinas S.A., Golden Arrow
         Resources  Corporation,  Inversiones  Mineras  Australes  S.A.  and the
         Company (relating to the Mogote Property) (1)
4.15     Letter Agreement dated August 24, 2004 between the Company and Arcturus
         Ventures Inc. (1)
4.16     Acknowledgement  between the Company and Steven K. Jones dated December
         31, 2004 (2)
4.17     Agency Letter Agreement dated February 18, 2005 between the Company and
         Canaccord Capital Corporation (2)
4.18     Form of Agreement  with the Grosso  Group  Management  Ltd.,  effective
         January 1, 2005 (2)
4.19     Agreement  between Recursos de lo Andes S.A.C.,  Company's wholly owned
         subsidiary, and Carlos Martin Thompson Palacoos dated May 11, 2005 (3)
4.20     Amendment to consulting  agreement  with Nikolaos Cacos dated April 12,
         2006 (3)
4.21     Letter of Intent made between the Company and Astral Mining Corporation
         dated June 9, 2006 (3)
8.1      List of Subsidiaries
15.1     Maps inlcuded throughout document - pages 26,31,36,42,45,48
12.1     Certification of Nikolaos Cacos Pursuant to Rule 13a-14(a)
12.2     Certification of Arthur Lang Pursuant to Rule 13a-14(a)
13.1     Certification of Nikolaos Cacos Pursuant to 18 U.S.C. Section 1350
13.2     Certification of Arthur Lang Pursuant to 18 U.S.C. Section 1350

         (1)   Incorporated  by  reference  to the  exhibits  to  the  Company's
               registration statement on Form 20-F filed with the Securities and
               Exchange Commission on October 28, 2004, file number 0-51005.

         (2)   Incorporated  by  reference  to the  exhibits  to  the  Company's
               registration statement on Form 20-F filed with the Securities and
               Exchange Commission on April 28, 2005, file number 0-51005.

         (3)   Incorporated by reference to the exhibits to the Company's annual
               report  on Form  20-F  filed  with the  Securities  and  Exchange
               Commission on June 23, 2006, file number 0-51005.



                                     - 84 -
<PAGE>


                                   SIGNATURES


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



                                         AMERA RESOURCES CORPORATION



Dated:   May 30, 2006                    /s/ NIKOLAOS CACOS
                                         --------------------------------------
                                         Nikolaos Cacos, President and Director


                                     - 85 -
<PAGE>











                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)

                        CONSOLIDATED FINANCIAL STATEMENTS
                               FOR THE YEARS ENDED
                        DECEMBER 31, 2006, 2005 AND 2004

                         (EXPRESSED IN CANADIAN DOLLARS)









                                      F-1
<PAGE>














MANAGEMENT'S RESPONSIBILITY FOR FINANCIAL REPORTING

The  accompanying  consolidated  financial  statements  of the Company have been
prepared by  management  in  accordance  with  accounting  principles  generally
accepted in Canada and reconciled to accounting principles generally accepted in
the  United  States  as set out in Note  11,  and  contain  estimates  based  on
management's  judgment.  Management  maintains an appropriate system of internal
controls to provide  reasonable  assurance  that  transactions  are  authorized,
assets safeguarded, and proper records maintained.

The  Audit  Committee  of the  Board of  Directors  has met  with the  Company's
independent auditors to review the scope and results of the annual audit, and to
review the financial statements and related financial reporting matters prior to
submitting the financial statements to the Board for approval.

The Company's independent  auditors,  Ernst & Young Chartered  Accountants,  are
appointed by the  shareholders  to conduct an audit in accordance with generally
accepted  auditing  standards  in  Canada  and  the  Public  Company  Accounting
Oversight Board (United States), and their report follows.



/s/ NIKOLAOS CACOS                                      /s/ ART LANG

Nikolaos Cacos                                          Art Lang
President                                               Chief Financial Officer






                                      F-2
<PAGE>




REPORT OF INDEPENDENT AUDITORS


To the Shareholders of
AMERA RESOURCES CORPORATION

We have audited the consolidated  balance sheets of AMERA RESOURCES  CORPORATION
as at December 31, 2006 and 2005, and the  consolidated  statement of operations
and deficit and cash flows for the years then ended. These financial  statements
are the  responsibility of the Company's  management.  Our  responsibility is to
express an opinion on these financial statements based on our audits.

We conducted our audit in accordance with Canadian  generally  accepted auditing
standards and the standards of the Public  Company  Accounting  Oversight  Board
(United  States).  Those standards  require that we plan and perform an audit to
obtain  reasonable  assurance  whether  the  financial  statements  are  free of
material misstatement.  We were not engaged to perform an audit of the Company's
internal control over financial  reporting.  An audit includes  consideration of
internal  control  over  financial  reporting  as a basis  for  designing  audit
procedures that are appropriate in the circumstances, but not for the purpose of
expressing an opinion in the  effectiveness  of the Company's  internal  control
over  financial  reporting.  Accordingly,  we express no such opinion.  An audit
includes  examining,  on a test  basis,  evidence  supporting  the  amounts  and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.  We believe that our
audit provides a reasonable basis for our opinion.

In our opinion,  these  financial  statements  present  fairly,  in all material
respects,  the  financial  position of the  Company as at December  31, 2006 and
2005,  and the results of its  operations  and its cash flows for the years then
ended in conformity with Canadian generally accepted accounting principles.



                                                /s/ Ernst & Young LLP

Vancouver, Canada
April 20, 2007                                 Chartered Accountants



                                      F-3
<PAGE>


                           AMERA RESOURCES CORPORATION
                   (AN EXPLORATION STAGE COMPANY - SEE NOTE 1)
                           CONSOLIDATED BALANCE SHEETS
                        AS AT DECEMBER 31, 2006 AND 2005
                         (EXPRESSED IN CANADIAN DOLLARS)


                                                       2006            2005
                                                         $               $

                                     ASSETS

CURRENT ASSETS

Cash                                                    531,126         522,327
Short-term investments (Note 3)                         100,000               -
Marketable securities (Note 4)                           33,000               -
Other receivables, prepaids and deposits (Note 8)       157,318         136,218
Subscription receivable (Notes 6 and 13)                166,250               -
                                                   ------------    ------------
                                                        987,694         658,545

MINERAL PROPERTIES AND DEFERRED COSTS (Note 5)        3,356,158       3,184,844
                                                   ------------    ------------
                                                      4,343,852       3,843,389
                                                   ============    ============


                                   LIABILITIES

CURRENT LIABILITIES

Accounts payable and accrued liabilities (Note 8)       116,963         142,275

FUTURE INCOME TAX LIABILITIES (Note 10)                  61,794         154,881
                                                   ------------    ------------
                                                        178,757         297,156
                                                   ------------    ------------


                              SHAREHOLDERS' EQUITY

SHARE CAPITAL (Note 6)                                7,804,571       5,854,335

WARRANTS (Note 6)                                       498,025               -

CONTRIBUTED SURPLUS (Note 7)                            524,845         433,995

DEFICIT                                              (4,662,346)     (2,742,097)
                                                   ------------    ------------
                                                      4,165,095       3,546,233
                                                   ------------    ------------
                                                      4,343,852       3,843,389
                                                   ============    ============

COMMITMENTS (Note 5)

APPROVED BY THE BOARD

/s/ NIKOLAOS CACOS   , Director
---------------------

/s/ JERRY MINNI      , Director
---------------------


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                      F-4
<PAGE>


                           AMERA RESOURCES CORPORATION
                   (AN EXPLORATION STAGE COMPANY - SEE NOTE 1)
                CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

<TABLE>
<CAPTION>

                                                       2006            2005            2004
                                                         $               $               $
<S>                                               <C>             <C>             <C>

EXPENSES

Accounting and audit                                     38,756          28,385          26,080
Corporate development and investor relations            227,747         252,981         242,804
General exploration                                     296,810         199,264          18,318
Legal                                                    28,841          55,058          63,058
Management fees                                          85,833          73,500          72,400
Office and sundry                                       122,639          92,724          51,173
Rent                                                     90,099          73,573          29,511
Salaries                                                372,063         294,170         154,074
Stock based compensation                                 90,850          52,500         131,805
Transfer agent and regulatory fees                       26,753          28,052          27,258
Travel                                                   42,358          37,721          47,018
                                                   ------------    ------------    ------------
                                                      1,422,749       1,187,928         863,499
                                                   ------------    ------------    ------------
LOSS BEFORE OTHER ITEMS                              (1,422,749)     (1,187,928)       (863,499)
                                                   ------------    ------------    ------------
OTHER EXPENSE (INCOME)

Foreign exchange                                          2,910          36,624          25,104
Interest income                                         (30,924)        (15,001)        (14,271)
Write-off of mineral properties (Notes 5(b)and(d))      525,514         225,000               -
                                                   ------------    ------------    ------------
                                                        497,500         246,623         (10,833)
                                                   ------------    ------------    ------------
LOSS FOR THE YEAR                                    (1,920,249)     (1,434,551)       (874,332)

DEFICIT - BEGINNING OF YEAR                          (2,742,097)     (1,307,546)       (433,214)
                                                   ------------    ------------    ------------
DEFICIT - END OF YEAR                                (4,662,346)     (2,742,097)     (1,307,546)
                                                   ============    ============    ============


BASIC AND DILUTED LOSS PER SHARE                         $(0.10)         $(0.09)         $(0.07)
                                                   ============    ============    ============

WEIGHTED AVERAGE NUMBER OF
     COMMON SHARES OUTSTANDING                       19,169,121      15,916,822      13,192,736
                                                   ============    ============    ============
</TABLE>




              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                      F-5
<PAGE>



                           AMERA RESOURCES CORPORATION
                   (AN EXPLORATION STAGE COMPANY - SEE NOTE 1)
                      CONSOLIDATED STATEMENTS OF CASH FLOWS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


<TABLE>
<CAPTION>

                                                       2006            2005            2004
                                                         $               $               $
<S>                                               <C>             <C>             <C>

CASH PROVIDED FROM (USED FOR)

OPERATING ACTIVITIES

Loss for the year                                    (1,920,249)     (1,434,551)       (874,332)
Adjustment for item not affecting cash
     Write-off of mineral properties                    525,514         225,000               -
     Stock based compensation                            90,850          52,500         131,805
                                                   ------------    ------------    ------------
                                                     (1,303,885)     (1,157,051)       (742,527)
Change in non-cash working capital balances             (46,412)         25,940        (103,461)
                                                   ------------    ------------    ------------
                                                     (1,350,297)     (1,131,111)       (845,988)
                                                   ------------    ------------    ------------
FINANCING ACTIVITIES

Issuance of common shares and warrants                2,179,900       1,232,199       2,851,391
Share and warrant issuance costs                        (23,889)        (61,751)       (210,257)
                                                   ------------    ------------    ------------
                                                      2,156,011       1,170,448       2,641,134
                                                   ------------    ------------    ------------
INVESTING ACTIVITIES

Expenditures on mineral properties and
     deferred costs                                    (696,915)     (1,196,242)     (1,230,962)
(Increase) Decrease in short-term investments          (100,000)      1,000,000      (1,000,000)
Purchase of equipment                                         -               -          (2,797)
                                                   ------------    ------------    ------------
                                                       (796,915)       (196,242)     (2,233,759)
                                                   ------------    ------------    ------------
(DECREASE) INCREASE IN CASH                               8,799        (156,905)       (438,613)
     DURING THE YEAR

CASH - BEGINNING OF YEAR                                522,327         679,232       1,117,845
                                                   ------------    ------------    ------------
CASH - END OF YEAR                                      531,126         522,327         679,232
                                                   ============    ============    ============



SUPPLEMENTARY CASH FLOW INFORMATION

Income taxes paid in cash                                     -               -               -
                                                   ============    ============    ============
Interest paid in cash                                         -               -               -
                                                   ============    ============    ============
</TABLE>


ADDITIONAL SUPPLEMENTARY CASH FLOW INFORMATION (Note 12)


              The accompanying notes are an integral part of these
                       consolidated financial statements.


                                      F-6
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)




1.       NATURE OF OPERATIONS AND GOING CONCERN

         The  Company  was  incorporated  on April 11,  2000 in the  Province of
         British Columbia and was transitioned  under the Business  Corporations
         Act (BC) on June 17, 2004.  The Company is a natural  resource  company
         engaged in the acquisition  and  exploration of resource  properties in
         the Americas.  The Company presently has no proven or probable reserves
         and on the  basis of  information  to date,  it has not yet  determined
         whether these properties contain economically recoverable ore reserves.
         Consequently the Company  considers  itself to be an exploration  stage
         company.

         The  amounts  shown  as  mineral  property  interests  represent  costs
         incurred to date, less amounts amortized and/or written off, and do not
         necessarily represent present or future values. The underlying value of
         the mineral  properties and deferred costs is entirely dependent on the
         existence   of   economically   recoverable   reserves,   securing  and
         maintaining  title  and  beneficial  interest  in the  properties,  the
         ability of the Company to obtain the necessary financing to advance the
         properties  beyond the exploration  stage, and future  profitability of
         the  properties.  The  Company  presently  has  adequate  resources  to
         maintain its core  activities for the next fiscal year but may not have
         sufficient  working  capital  to  fund  all  its  planned   exploration
         activities.   The  Company  will  continue  to  rely  on   successfully
         completing additional equity financing (see note 13).

         These consolidated  financial  statements have been prepared on a going
         concern basis in accordance with Canadian generally accepted accounting
         principles  ("Canadian  GAAP"). The going concern basis of presentation
         assumes the Company will continue to operate for the foreseeable future
         and will be able to realize its assets and  discharge  its  liabilities
         and  commitments in the normal course of business.  These  consolidated
         financial  statements do not reflect  adjustments to the carrying value
         of assets and liabilities, the reported income and expenses and balance
         sheet classifications used that would be necessary if the going concern
         assumption were not appropriate. Such adjustments could be material.


2.       SIGNIFICANT ACCOUNTING POLICIES

         BASIS OF PRESENTATION

         These   consolidated   financial   statements  have  been  prepared  in
         accordance  with Canadian  GAAP.  Significant  measurement  differences
         between  Canadian  GAAP and those that would be  applied  under  United
         States  generally  accepted  accounting  principles ("US GAAP") as they
         affect the Company are disclosed in Note 11.

         USE OF ESTIMATES

         The  preparation  of financial  statements in conformity  with Canadian
         GAAP requires  management to make estimates and assumptions that affect
         the  reported  amount of  assets  and  liabilities  and  disclosure  of
         contingent  assets  and  liabilities  at  the  date  of  the  financial
         statements and the reported  amount of revenues and expenses during the
         period.  Significant  areas  requiring the use of management  estimates
         relate  to  the   determination  of  environmental   obligations,   the
         recoverability of mineral  properties,  and the assumptions used in the
         determination  of the fair value of stock  based  compensation.  Actual
         results may differ from these estimates.

         PRINCIPLES OF CONSOLIDATION

         These  consolidated  financial  statements  include the accounts of the
         Company and its wholly-owned  subsidiaries.  The principal subsidiaries
         are  Recursos  de  los  Andes  S.A.C.   (Peru),   Amera-Chile  Sociedad
         Contractual  Minera (Chile) and Amera  Resources Inc. (US). The Company
         operates  in  Argentina  as  a  registered  branch.  All  inter-company
         balances and transactions have been eliminated.


                                      F-7
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)



2.       SIGNIFICANT ACCOUNTING POLICIES (continued)

         SHORT-TERM INVESTMENTS

         Short-term   investments  include  money  market  investments  maturing
         between 3 and 12 months from the date of initial investment.

         MINERAL PROPERTIES AND DEFERRED COSTS

         Direct costs  related to the  acquisition  and  exploration  of mineral
         properties  held  or  controlled  by the  Company  are  deferred  on an
         individual  property  basis  until  the  viability  of  a  property  is
         determined.  Administration  costs and  general  exploration  costs are
         expensed  as  incurred.   When  a  property  is  placed  in  commercial
         production,    deferred    costs   will   be    depleted    using   the
         units-of-production  method.  Management  of the  Company  periodically
         reviews  the  recoverability  of the  capitalized  mineral  properties.
         Management takes into consideration various information including,  but
         not limited to,  results of exploration  activities  conducted to date,
         estimated  future  metal  prices,  and reports and  opinions of outside
         geologists, mine engineers and consultants.  When it is determined that
         a project or property will be abandoned then costs are written-off,  or
         if its  carrying  value has been  impaired,  then the costs are written
         down to fair value.

         Mineral  property  acquisition  costs  include  cash costs and the fair
         market value of common shares, based on the trading price of the shares
         issued for  mineral  property  interests,  pursuant to the terms of the
         related property  agreements.  Payments relating to a property acquired
         under  an  option  or  joint  venture  agreement  are  made at the sole
         discretion  of the  Company,  and  are  recorded  as  mineral  property
         acquisition costs upon payment.

         The  Company  accounts  for  foreign  value added taxes paid as part of
         mineral properties and deferred costs. The recovery of these taxes will
         commence on the  beginning  of foreign  commercial  operations.  Should
         these  amounts be  recovered  they would be treated as a  reduction  in
         carrying costs of mineral properties and deferred costs.

         For  certain  acquisitions  and other  payments  for  mineral  property
         interests,  the Company  records a future  income tax  liability  and a
         corresponding adjustment to the related asset carrying amount.

         Although  the  Company  has  taken  steps to  verify  title to  mineral
         properties  in  which  it  has an  interest,  these  procedures  do not
         guarantee the Company's title.  Such properties may be subject to prior
         agreements  or  transfers  and  title  may be  affected  by  undetected
         defects.

         From time to time,  the Company  acquires  or  disposes  of  properties
         pursuant to the terms of option  agreements.  Options  are  exercisable
         entirely  at the  discretion  of the  optionee  and,  accordingly,  are
         recorded as mineral  property costs or recoveries when the payments are
         made or received.

         ASSET RETIREMENT OBLIGATIONS

         Asset   retirement   obligations   are  recognized   when  a  legal  or
         constructive  obligation  arises.  This  liability is recognized at the
         fair value of the asset  retirement  obligation.  When the liability is
         initially  recorded the Company  capitalizes the cost by increasing the
         carrying  amount  of the  related  long-lived  assets.  Over  time  the
         liability  is  accreted  to its  present  value  each  period,  and the
         capitalized  cost is  amortized  over the  useful  life of the  related
         asset.  Upon settlement of the liability,  the Company may incur a gain
         or loss.  As at December  31, 2006 the Company  does not have any asset
         retirement obligations.

                                      F-8
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

2.       SIGNIFICANT ACCOUNTING POLICIES (continued)

         LONG-LIVED ASSETS IMPAIRMENT

         Long-lived assets are reviewed for impairment when events or changes in
         circumstances   suggest  their  carrying  value  has  become  impaired.
         Management  considers  assets  to be  impaired  if the  carrying  value
         exceeds the estimated undiscounted future cash flows expected to result
         from the use of the asset and its eventual  disposition.  If impairment
         is deemed to exist, the assets will be written down to fair value. Fair
         value is generally determined using a discounted cash flow analysis.

         TRANSLATION OF FOREIGN CURRENCIES

         The Company's  foreign  operations  are  integrated  and are translated
         using the temporal method.  Under this method,  the Company  translates
         monetary  assets and liabilities  denominated in foreign  currencies at
         period-end rates. Non-monetary assets and liabilities are translated at
         historical rates. Revenues and expenses are translated at average rates
         in effect during the period except for  depreciation  and  amortization
         which are translated at historical rates. The resulting gains or losses
         are reflected in operating results in the period of translation.

         FAIR VALUES OF FINANCIAL INSTRUMENTS

         The fair value of the  Company's  financial  instruments  consisting of
         short-term investments, other receivables,  subscription receivable and
         accounts  payable and accrued  liabilities  approximate  their carrying
         values  due  to the  short-term  nature  of  those  instruments.  As of
         December  31,  2006,  the market  value of  marketable  securities  was
         $40,000.

         CONCENTRATION OF CREDIT RISK

         Financial  instruments  that  potentially  subject  the  Company  to  a
         significant  concentration  of credit risk  consist  primarily of cash,
         short-term  investments and other  receivables.  The Company limits its
         exposure to credit loss by placing its cash and short-term  investments
         with major financial institutions.

         INCOME TAXES

         The Company uses the liability  method of accounting  for future income
         taxes.  Under  this  method  of  tax  allocation,   future  income  tax
         liabilities   and  assets  are   recognized   for  the   estimated  tax
         consequences  attributable to differences  between the amounts reported
         in the  consolidated  financial  statements  and their  respective  tax
         bases, using substantively enacted tax rates and laws that are expected
         to be in effect in the periods in which the future income tax assets or
         liabilities  are  expected to be settled or  realized.  The effect of a
         change in income tax rates on future income tax  liabilities and assets
         is recognized in income in the period that the change occurs. Potential
         future income tax assets are not recognized, as they are not considered
         likely to be realized.

         LOSS PER SHARE

         Loss per share is calculated on the weighted  average  number of common
         shares issued and outstanding  during the year. The effect of potential
         issuances of shares under options and warrants  would be  anti-dilutive
         and therefore basic earnings and diluted losses per share are the same.
         Information  regarding  securities that could potentially  dilute basic
         earnings per share in the future is presented in Note 6.



                                      F-9
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


2.       SIGNIFICANT ACCOUNTING POLICIES (continued)

         STOCK BASED COMPENSATION

         Stock-based  compensation  is accounted for at fair value as determined
         by the  Black-Scholes  option  pricing  model  using  amounts  that are
         believed to  approximate  the  volatility  of the trading  price of the
         Company's   stock,   the  expected   lives  of  awards  of  stock-based
         compensation,  the fair value of the Company's  stock and the risk-free
         interest  rate.  The  estimated  fair  value of awards  of  stock-based
         compensation  is charged  to  expense  over the  vesting  period,  with
         offsetting amounts recognized as contributed surplus.

         COMPARATIVE FIGURES

         Certain  of the  prior  year  comparatives  have been  reclassified  to
         conform with the current year's presentation.


3.       SHORT-TERM INVESTMENTS

         As at December  31,  2006,  the  Company  held  short-term  investments
         comprised of the following:

                                                         DECEMBER 31, 2006
                                                   ----------------------------
                                                     MATURITY        PRINCIPAL
                                                                         $
                                                   ----------------------------

         12 month term deposit
            - 3.7% annual interest rate            March 27, 2007       100,000
                                                   ============================

         The  term  deposit  is  fully  redeemable  in  full or  portion  at the
         Company's option without penalty.  Interest is paid on amounts redeemed
         subsequent to 30 days from the date of investment.


4.       MARKETABLE SECURITIES

         At December 31, 2006,  marketable  securities had a quoted market value
         of $40,000.  The Company holds these marketable  securities as a result
         of  entering  into an option  agreement  for its  Walker  Lane  mineral
         property holdings (see Note 5 (e)).





                                      F-10
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

5.       MINERAL PROPERTIES AND DEFERRED COSTS
<TABLE>
<CAPTION>

                                   --------------------------------------------    --------------------------------------------
                                                 DECEMBER 31, 2006                               DECEMBER 31, 2005
                                   --------------------------------------------    --------------------------------------------
                                    ACQUISITION     EXPLORATION                     ACQUISITION     EXPLORATION
                                       COSTS       EXPENDITURES        TOTAL           COSTS       EXPENDITURES        TOTAL
                                         $               $               $               $               $               $
                                   --------------------------------------------    --------------------------------------------
        <S>                       <C>             <C>             <C>             <C>             <C>             <C>

         Argentina
            Mogote Property           1,056,309       1,255,195       2,311,504         891,062       1,242,942       2,134,004
         Peru
            Cocha                        28,768         401,918         430,686          10,211          14,094          24,305
            Cruz de Mayo                 99,566          54,910         154,476          26,079          27,754          53,833
            Other                        50,664          52,988         103,652          25,930          43,251          69,181
            Esperanza Property                -               -               -         186,741         279,615         466,356
         USA
            Walker Lane, Nevada          97,010          21,336         118,346          97,010          21,173         118,183
                                   ------------    ------------    ------------    ------------    ------------    ------------
                                      1,332,317       1,786,347       3,118,664       1,237,033       1,628,829       2,865,862
         Proceeds on optioning of       (33,000)              -         (33,000)              -               -               -
             mineral properties
         Foreign value added tax              -         208,700         208,700               -         164,101         164,101
         Future income tax               36,540          25,254          61,794          81,270          73,611         154,881
                                   ------------    ------------    ------------    ------------    ------------    ------------
                                      1,335,857       2,020,301       3,356,158       1,318,303       1,866,541       3,184,844
                                   ============    ============    ============    ============    ============    ============
</TABLE>

         See attached Mineral Property Interests and Deferred Costs Schedules.

         (a)      The  Company  has  an  option   agreement  with  Golden  Arrow
                  Resources  Corporation ("Golden Arrow") to earn a 51% interest
                  in eight mineral  concessions,  comprising 8,009 hectares (the
                  "Mogote Property"),  located in San Juan Province,  Argentina.
                  The Company must issue a total of 1,650,000  common shares and
                  conduct  a  minimum  of  US  $1.25   million  of   exploration
                  expenditures,  including work programs and  underlying  option
                  payments (the final underlying option payment was paid on June
                  6, 2005), as follows:

                          SHARES TO     EXPLORATION
                          BE ISSUED     EXPENDITURES    DATE
                                             US $

                            100,000               -     Issued in 2003
                            100,000         250,000     Issued in 2004
                            250,000         300,000     Issued in 2005
                            300,000         300,000     Issued on July 7, 2006
                            900,000         400,000     July 1, 2007
                          ---------       ---------
                          1,650,000       1,250,000
                          =========       =========

                  On April 8, 2004,  the Company and Golden Arrow entered into a
                  further agreement on the Mogote property. The Company can earn
                  an additional  24% interest,  for a total 75% interest,  after
                  earning the initial 51% interest,  by issuing  300,000  common
                  shares  (issued) and conducting an additional US $3 million of
                  exploration expenditures, as follows:




                                     F-11
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

5.       MINERAL PROPERTIES AND DEFERRED COSTS (continued)

                             US $        DATE

                          1,000,000      Completed
                          1,000,000      May 30, 2006 (revised to May 30, 2007)
                          1,000,000      May 30, 2007 (revised to May 30, 2008)
                          ---------
                          3,000,000
                          =========

                  The Company  records the exchange  amount of the shares issued
                  at the time of the  issuance as  acquisition  costs in mineral
                  properties and deferred costs  representing  the fair value of
                  consideration given.

                  During the year ended  December  31,  2006,  the  Company  and
                  Golden Arrow revised  certain terms of option  agreement,  the
                  US$1,000,000  property  expenditures  required by May 30, 2006
                  are now extended to May 30, 2007 and the US$1,000,000 property
                  expenditures  required by May 30, 2007 are now extended to May
                  30, 2008. In return for granting of the extension,  10% of any
                  payments  in terms of cash or stock  received  by the  Company
                  from a third party who enters into an agreement  regarding the
                  Mogote property, will be paid to Golden Arrow.

         (b)      On  August  24,  2004  the  Company  entered  into  an  option
                  agreement with Arcturus Ventures Inc.  ("Arcturus") whereby it
                  may earn up to an 80% undivided  interest in the 3,000 hectare
                  Esperanza  Property  located in  northern  Arequipa  Province,
                  Peru.  The Esperanza  property  carrying value of $511,883 was
                  written off during the year ended  December 31, 2006,  and the
                  Company has terminated its option agreement with Arcturus.

         (c)      On April 11, 2005 the Company entered into an option agreement
                  whereby it may earn up to 100% undivided  interest in the Cruz
                  de  Mayo  project  located  in  the  southern  portion  of the
                  Department  of  Cuzco in Peru.  To earn  the  interest  in the
                  property the Company  must pay US $150,000 in option  payments
                  over  the  period  of  four  years  and  incur  US  $1,500,000
                  expenditures over the four years as follows:

                   OPTION   EXPLORATION
                  PAYMENTS  EXPENDITURES      DATE
                    US $        US $
                   35,000          -  April 11, 2005 (paid on signing)
                   25,000    200,000  April 11, 2007 (extended to June 30, 2007)
                   40,000    550,000  April 11, 2008
                   50,000    750,000  April 11, 2009
                  -------  ---------
                  150,000  1,500,000
`                 =======  =========

         (d)      During the year ended December 31, 2006, the Company wrote off
                  the  carrying  value of $13,631  of a property  in Peru as the
                  Company decided to drop the mineral claim for the property.




                                     F-12
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


5.       MINERAL PROPERTIES AND DEFERRED COSTS (continued)

         (e)      During the year ending December 31, 2006, the Company optioned
                  to  Astral  Mining  Corporation  ("Astral")  the  Walker  Lane
                  Properties in Nevada. Under the terms of the agreement, Astral
                  may earn up to an 80%  undivided  interest  in the Walker Lane
                  Properties.  An initial 65% interest in the  properties may be
                  earned by incurring  US$2,500,000  in work  expenditures  over
                  four years and issuing  500,000 common shares  (100,000 shares
                  were issued on August 4, 2006) to the Company. Astral may then
                  elect to earn an additional 15% interest, by issuing a further
                  500,000  shares and completing a bankable  feasibility  study,
                  within three years.  The Company  received  approval  from TSX
                  Venture Exchange (TSX.V) for this agreement.

         See Note 13.


6.       SHARE CAPITAL

         Authorized - unlimited common shares without par value

                                                      NUMBER             $
         Issued - common shares

         Balance, December 31, 2003                   9,086,832       1,228,395

         Private placements                           4,007,000       2,891,350
         Exercise of warrants                           288,750         143,650
         Greenshoe option                               225,000         101,250
         For agent's fees                                55,300          44,240
         For mineral properties                         425,000         329,250
         Less share issue costs                              -         (210,257)
                                                   ------------    ------------
         Balance, December 31, 2004                  14,087,882       4,527,878

         Private placements                           1,650,000         907,500
         Exercise of warrants                           508,248         326,649
         Exercise of options                             11,000           8,250
         For agent's fees                                41,962          23,078
         For mineral properties                         300,000         143,500
         Contributed surplus reallocated
                  on exercise of options                      -           2,310
         Less share issue costs                               -         (84,830)
                                                   ------------    ------------
         Balance, December 31, 2005                  16,599,092       5,854,335

         Private placements                           3,647,000       1,629,450
         Warrants valuation                                   -        (503,765)
         Exercise of warrants                         1,194,500         716,700
         For agent's fees                                 8,000           2,800
         For mineral properties                         300,000         126,000
         Less share issue costs                               -         (20,949)
                                                   ------------    ------------
         Balance, December 31, 2006                  21,748,592       7,804,571
                                                   ============    ============





                                     F-13
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


6.       SHARE CAPITAL (continued)

         (a)      During  the  year  ended   December  31,  2006,   the  Company
                  completed:

                  i)       a private  placement  financing of 1,412,000 units at
                           $0.60 per unit, for gross proceeds of $847,200.  Each
                           unit    comprised    one   common   share   and   one
                           non-transferable share purchase warrant. Each warrant
                           entitles the holder to purchase one additional common
                           share  at a price  of $0.65  per  share on or  before
                           January  30,  2008.  The fair value  assigned  to the
                           warrants  was  $352,012 net of issue costs of $6,675.
                           The  warrants  were  valued  using the  Black-Scholes
                           Pricing  Model at $0.25 per warrant on the  following
                           assumptions:  dividend yield 0%, risk-free rate 4.0%,
                           expected  volatility  115%  and  expected  life of 12
                           months.

                  ii)      a private  placement  financing of 2,235,000 units at
                           $0.35 per unit, for gross proceeds of $782,250.  Each
                           unit    comprised    one   common   share   and   one
                           non-transferable share purchase warrant. Each warrant
                           entitles the holder to purchase one additional common
                           share  at a price  of $0.45  per  share on or  before
                           December 8, 2008.  In  addition,  the Company  issued
                           48,000  Agent's  Warrants at $0.45 and 8,000  Agent's
                           Units at $0.35 per Unit as a Corporate  Finance  Fee.
                           There were also cash  commissions and  administration
                           fees paid of $14,000.

                           The fair value of warrants and agent's  warrants were
                           as follows:

                           1)       value  assigned to  2,235,000  warrants  was
                                    $142,378, net of issue costs of $2,670

                           2)       value   assigned   to  the  48,000   agent's
                                    warrants and the 8,000 warrants granted as a
                                    component of the agent's units was $3,635

                           The Black-Scholes Pricing Model was used to value the
                           warrants  and  agent's  warrants.  The  warrants  and
                           agents  warrant's  were  valued at $0.07 based on the
                           following  assumptions:  dividend yield 0%, risk-free
                           rate 4.0%,  expected volatility 66% and expected life
                           of 12 months.

                           At December  31,  2006,  the  Company has  recorded a
                           subscription  receivable balance of $166,250 relating
                           to proceeds from this private placement which had not
                           been  received  at  year  end.  These  proceeds  were
                           received in January 2007 (see Note 13 below).

         (b)      During the year ended December 31, 2005, the Company completed
                  a private  placement of 1,650,000 units at $0.55 per unit, for
                  gross proceeds of $907,500.  Each unit consisted of one common
                  share and one half  non-transferable  share purchase  warrant.
                  Each whole  warrant  entitles  the holder to purchase a common
                  share for $0.60 per  share on or before  March 18,  2006.  The
                  Company  also  issued  66,750  Agent's  Warrants  at $0.60 and
                  14,962  Agent's  Units at $0.55 per Unit and  27,000  Units at
                  $0.55 per Unit as a  Corporate  Finance  Fee.  There were also
                  cash commissions and administration fees paid of $61,751.

                  The Company  applied the residual  approach and  allocated the
                  total  proceeds to the common  shares and $nil to the attached
                  warrants.




                                     F-14
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


6.       SHARE CAPITAL (continued)

         (c)      During the year ended December 31, 2004, the Company:

                  i)       completed a private placement  financing of 1,257,000
                           units  at $0.55  per  unit,  for  gross  proceeds  of
                           $691,350.  Each unit  comprised  one common share and
                           one  non-transferable  share purchase  warrant.  Each
                           warrant   entitles   the  holder  to   purchase   one
                           additional common share at a price of $0.67 per share
                           on or before  January 20,  2005.  As at December  31,
                           2003,  $658,350  had been  received by the Company on
                           account  of  the  private   placement  and  had  been
                           recorded as share subscriptions received;

                  ii)      completed a private placement  financing of 2,750,000
                           units  at $0.80  per  unit,  for  gross  proceeds  of
                           $2,200,000.  Each unit comprised one common share and
                           one  non-transferable  share purchase  warrant.  Each
                           warrant   entitles   the  holder  to   purchase   one
                           additional common share at a price of $1.00 per share
                           for a period  of one year  from  date of issue and at
                           $1.20 per  share for a period of two years  from date
                           of issue.  In connection  with the private  placement
                           the Company paid cash  commissions  and finder's fees
                           totalling  $96,560,  issued  55,300 units on the same
                           terms and basis as the private placement,  and issued
                           168,000 warrants. Each warrant entitles the holder to
                           purchase one common share of the Company at $0.90 per
                           share on or before March 31, 2006;

                  iii)     issued  225,000  units on the exercise of a greenshoe
                           option,  which has been granted  under the  Company's
                           initial  public  offering,  at $0.45  per  unit,  for
                           $101,250.  Each unit  comprised  one common share and
                           one-transferable share purchase warrant. Two warrants
                           entitle the agent to purchase one  additional  common
                           share,  at a price of $0.50 per  share,  on or before
                           September 1, 2004. During the year ended December 31,
                           2004, the warrants expired without exercise.

         (d)      Stock options and stock based compensation

                  The Company has  established  a rolling stock option plan (the
                  "Plan"),  in which the maximum  number of common  shares which
                  can be  reserved  for  issuance  under  the Plan is 10% of the
                  issued and  outstanding  shares of the  Company.  The exercise
                  price of the  options is set at the  Company's  closing  share
                  price  on  the  grant  date,   less  allowable   discounts  in
                  accordance with the policies of the TSX Venture Exchange.  The
                  stock options  granted during 2006 are subject to a four month
                  hold  period and  exercisable  for a period of five  years.  A
                  summary of the Company's  outstanding  options at December 31,
                  2006,  2005 and 2004 and the changes  for the years  ending on
                  those dates is presented below:





                                     F-15
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


6.       SHARE CAPITAL (continued)

         (d)      Stock options and stock based compensation (continued)

<TABLE>
<CAPTION>

                                          ---------------------    ---------------------    ----------------------
                                                   2006                     2005                      2004
                                          ---------------------    ---------------------    ----------------------
                                            OPTIONS    WEIGHTED      OPTIONS    WEIGHTED      OPTIONS     WEIGHTED
                                          OUTSTANDING   AVERAGE    OUTSTANDING   AVERAGE    OUTSTANDING    AVERAGE
                                              AND      EXERCISE        AND      EXERCISE        AND       EXERCISE
                                          EXERCISABLE    PRICE     EXERCISABLE    PRICE     EXERCISABLE     PRICE
                                                           $                        $                         $
                 <S>                     <C>           <C>         <C>           <C>         <C>           <C>


                  Balance,
                       Beginning of year     1,504,500    0.70        1,354,500    0.70          900,000     0.60
                  Granted                      415,000    0.60          250,000    0.75          454,500     0.90
                  Exercised                          -      -           (11,000)   0.75                -       -
                  Cancelled                    (75,000)   0.75          (89,000)   0.75                -       -
                  Forfeited                    (20,000)   0.60                -      -                 -       -
                                          ------------             ------------             ------------
                  Balance, end of year       1,824,500    0.68        1,504,500    0.70        1,354,500     0.70
                                          ============             ============             ============
</TABLE>

                  Stock  options  outstanding  and  exercisable  at December 31,
                  2006, are as follows:

                  NUMBER OF OPTIONS
                   OUTSTANDING AND           EXERCISE
                     EXERCISABLE               PRICE           EXPIRY DATE

                        900,000                $0.60           December 12, 2008
                        454,500                $0.90           April 2, 2009
                         75,000                $0.75           March 21, 2010
                        395,000                $0.60           July 11, 2011
                     ----------
                      1,824,500
                     ==========

                  During fiscal 2006, the Company granted stock options at $0.60
                  per  share to its  directors,  employees  and  consultants  to
                  acquire 415,000 common shares (2005 - 250,000; 2004 - 454,500)
                  and recorded stock based compensation expense of $90,850 (2005
                  - $52,500,  2004 - $131,805).  The fair value of stock options
                  granted  is  estimated  on  the  dates  of  grants  using  the
                  Black-Scholes   Option   Pricing   Model  with  the  following
                  assumptions used for the grants made during the year:

                                               2006          2005         2004

                  Risk-free interest rate      4.00%         3.10%       2.18%
                  Estimated volatility          97%           75%         36%
                  Expected life              2.5 years    2.5 years    2.5 years
                  Expected dividend yield        0%            0%         0%


                  The weighted  average  fair value per share of stock  options,
                  calculated  using  the  Black-Scholes  Option  Pricing  Model,
                  granted  during  the year was $0.23  per share  (2005 - $0.21;
                  2004 -  $0.29).  Option  pricing  models  require  the  use of
                  estimates and assumptions  including the expected  volatility.
                  Changes in the underlying  assumptions  can materially  affect
                  the fair value  estimates and,  therefore,  existing models do
                  not necessarily  provide reliable measure of the fair value of
                  the Company's stock options.




                                     F-16
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

6.       SHARE CAPITAL (continued)

         (e)      Warrants

                  A continuity summary of warrant equity is presented below:

                                                                         $

                  Balance, December 31, 2005                                  -
                      Warrant valuation from private placement
                          warrants granted                              503,765
                      Warrant valuation from agent's warrants
                          granted                                         3,635
                      Warrant issue costs                                (9,375)
                                                                   ------------
                  Balance, December 31, 2006                            498,025
                                                                   ============

                  A summary of the number of common shares reserved  pursuant to
                  the  Company's   outstanding   warrants  and  agents  warrants
                  outstanding  at  December  31,  2006,  2005  and  2004 and the
                  changes for the years ending on those dates is as follows:
<TABLE>
<CAPTION>

                                                       2006            2005            2004
                                                      NUMBER          NUMBER          NUMBER
                 <S>                              <C>             <C>             <C>

                  Balance, beginning of year          3,687,783       4,230,300         965,000
                  Issued                              3,703,000         912,731       4,342,800
                  Exercised                          (1,194,500)       (508,248)       (288,750)
                  Expired                            (2,493,283)       (947,000)       (788,750)
                                                   ------------    ------------    ------------
                  Balance, end of year                3,703,000       3,687,783       4,230,300
                                                   ============    ============    ============
</TABLE>

                  During the year ended December 31, 2006 the Company  requested
                  and was granted  permission  by the TSXV to amend the exercise
                  price for 2,750,000 of $1.20  warrants with March 24, 2006 and
                  March 31, 2006 expiry  dates.  The amended price was $0.60 per
                  warrant. There was no extension to the term of the warrants.

                  Common shares reserved pursuant to warrants and agent warrants
                  outstanding at December 31, 2006 are as follows:

                     NUMBER        EXERCISE PRICE          EXPIRY DATE
                                          $

                    1,412,000            0.65              January 30, 2008
                    2,291,000            0.45              December 8, 2008
                    ---------
                    3,703,000
                    =========





                                     F-17
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

7.       CONTRIBUTED SURPLUS

<TABLE>
<CAPTION>

         A continuity summary of contributed surplus is presented below:
                                                                                         $
        <S>                                                                       <C>

         Balance, December 31, 2003                                                     252,000
             Contributed Surplus as a result of stock options granted                   131,805
                                                                                   ------------
         Balance, December 31, 2004                                                     383,805
             Contributed Surplus as a result of stock options granted                    52,500
             Contributed Surplus reallocated on exercise of stock options                (2,310)
                                                                                   ------------
         Balance, December 31, 2005                                                     433,995
             Contributed Surplus as a result of stock options granted                    95,450
             Contributed Surplus reversed as a result of stock options forfeited         (4,600)
                                                                                   ------------
         Balance, December 31, 2006                                                     524,845
                                                                                   ============
</TABLE>


8.       RELATED PARTY TRANSACTIONS

         Effective  January 1, 2005, the Company engaged Grosso Group Management
         Ltd.,  ("Grosso  Group")  to provide  services  and  facilities  to the
         Company.  The Grosso Group is a private  company  equally  owned by the
         Company,  IMA Exploration Inc. (IMA),  Golden Arrow,  Gold Point Energy
         Corp and Astral.  The Grosso Group provides its  shareholder  companies
         with geological,  corporate development,  administrative and management
         services on a cost recovery basis.

         During the year ended December 31, 2006,  the Company  incurred fees of
         $533,469  (2005 -  $377,410)  to the  Grosso  Group:  $480,545  (2005 -
         $290,858)  was paid in twelve  monthly  payments  and  $52,924  (2005 -
         $86,552) is included in accounts payable as a result of a review of the
         allocation  of the Grosso Group costs to the member  companies  for the
         year. In addition, included in other receivables, prepaids and deposits
         is a $95,000  (2005 -  $95,000)  deposit  to the  Grosso  Group for the
         purchase of equipment  and  leasehold  improvements  and for  operating
         working capital.

         Effective  January 2, 2004, the Company  entered into an agreement with
         the President of the Company for his services.  Under the agreement the
         President was paid $6,125 per month.  On April 15, 2006,  the agreement
         was  modified so that the monthly fee was payable to a private  company
         controlled  by  the  President  and  on May 1,  2006  the  monthly  fee
         increased  to $7,292.  During the year ended  December  31,  2006,  the
         Company paid $85,833 (2005 - $73,500;  2004 - $72,400) to the President
         or to the private  company  controlled by the President.  The agreement
         also provides  that, in the event the services are  terminated  without
         cause or upon a change in control of the Company, a termination payment
         would  include  eighteen  months of  compensation  plus a bonus  amount
         agreed to by the parties. During the year the Company paid $Nil (2005 -
         $4,298;  2004 - $540) for  consulting  services  performed  by a former
         director of the Company.

         Prior to the signing of the Administrative  Services Agreement with the
         Grosso Group in 2005 the Company  shared  office  facilities  with IMA.
         During the year ended  December  31,  2004,  the  Company  was  charged
         $108,390 by IMA for shared rent and  administration  costs.  During the
         year  ended   December  31,  2004,   the  Company  paid   $111,000  for
         professional fees (including a $25,000 relocation allowance), billed by
         an officer of the Company. Of this amount $42,000 was reimbursed by IMA
         as an allocation of the professional services.

         All  of  the  related   party   transactions   and  balances  in  these
         consolidated  financial  statements  arose  in  the  normal  course  of
         operations and are measured at the exchange amount, which is the amount
         of consideration established and agreed to by the related parties.


                                     F-18
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


9.       SEGMENTED INFORMATION

         The Company is primarily involved in mineral exploration  activities in
         Argentina,  Peru and the USA. The Company is in the  exploration  stage
         and,  accordingly,  has no  reportable  segment  revenues or  operating
         revenues for the years ended December 31, 2006 and 2005.

         The Company's total assets are segmented geographically as follows:
<TABLE>
<CAPTION>

                                   ----------------------------------------------------------------------------
                                                                DECEMBER 31, 2006
                                   ----------------------------------------------------------------------------
                                     CORPORATE
                                      CANADA         ARGENTINA          PERU            USA            TOTAL
                                         $               $               $               $               $
        <S>                       <C>             <C>             <C>             <C>             <C>

         Current assets                 923,326             714          63,654               -         987,694
         Mineral properties and
             deferred costs                   -       2,450,504         774,353         131,301       3,356,158
                                   ------------    ------------    ------------    ------------    ------------
                                        923,326       2,451,218         838,007         131,301       4,343,852
                                   ============    ============    ============    ============    ============
</TABLE>

<TABLE>
<CAPTION>

                                   ----------------------------------------------------------------------------
                                                                DECEMBER 31, 2005
                                   ----------------------------------------------------------------------------
                                     CORPORATE
                                      CANADA         ARGENTINA          PERU            USA            TOTAL
                                         $               $               $               $               $
        <S>                       <C>             <C>             <C>             <C>             <C>

         Current assets                 572,465          54,120          31,960               -         658,545
         Mineral properties and
             deferred costs                   -       2,270,735         731,983         182,126       3,184,844
                                   ------------    ------------    ------------    ------------    ------------
                                        572,465       2,324,855         763,943         182,126       3,843,389
                                   ============    ============    ============    ============    ============
</TABLE>


10.      INCOME TAXES

         The recovery of income taxes shown in the  consolidated  statements  of
         operations  and deficit  differs from the amounts  obtained by applying
         statutory  rates to the loss before  provision  for income taxes due to
         the following:
<TABLE>
<CAPTION>

                                                   --------------------------------------------
                                                       2006            2005            2004
                                                         $               $               $
        <S>                                       <C>             <C>             <C>

         Statutory tax rate                              34.12%          34.12%          35.62%
                                                   ============    ============    ============

         Loss for the year                           (1,920,249)     (1,434,551)       (874,332)
                                                   ============    ============    ============

         Provision for income taxes based on
              statutory Canadian combined federal
                   and provincial income tax rates     (655,189)       (489,469)       (311,137)
         Differences in foreign tax rates                30,315          (7,210)         (1,170)
         Non-deductible items                           228,677               -               -
         Losses for which an income tax benefit
              has not been recognized                   396,197         496,679         312,307
                                                   ------------    ------------    ------------
                                                              -               -               -
                                                   ============    ============    ============
</TABLE>



                                     F-19
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


10.      INCOME TAXES (continued)

         The  significant  components of the Company's  future tax assets are as
         follows:

                                                   ----------------------------
                                                       2006            2005
                                                         $               $
                                                   ----------------------------
         Future income tax assets
              Share and warrant issuance costs           60,826          95,867
              Resource deductions                        84,526               -
              Operating loss carryforward             1,113,246         659,044
                                                   ------------    ------------
                                                      1,258,598         754,911
                                                   ------------    ------------
         Valuation allowance for future tax assets   (1,258,598)       (754,911)
                                                   ------------    ------------
                                                              -               -
                                                   ============    ============

         The  realization of income tax benefits  related to these potential tax
         deductions  is uncertain  and cannot be viewed as more likely than not.
         Accordingly,  no future  income tax  assets  have been  recognized  for
         accounting purposes in 2006 and 2005.

         FUTURE INCOME TAX LIABILITIES

         For  certain  acquisitions  and other  payments  for  mineral  property
         interests,  the Company  records a future  income tax  liability  and a
         corresponding  adjustment to the related asset carrying amount.  During
         the year ended December 31, 2006,  the Company  recorded a reduction of
         future income tax liability of $93,087 (2005 - increase of $55,124) and
         a corresponding adjustment to mineral properties.

                                                   ----------------------------
                                                       2006            2005
                                                         $               $
                                                   ----------------------------

         Future Income Tax Liabilities                   61,794         154,881
                                                   ============    ============

         The Company has Canadian  non-capital loss  carryforwards of $3,153,016
         that may be available for tax purposes. The losses expire as follows:

                    EXPIRY DATE                             $

                       2007                               1,084
                       2008                                 116
                       2009                              26,258
                       2010                             195,857
                       2014                             852,555
                       2015                             978,627
                       2016                           1,098,519
                                                   ------------
                                                      3,153,016
                                                   ============




                                     F-20
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


11.      DIFFERENCES  BETWEEN  CANADIAN  AND UNITED  STATES  GENERALLY  ACCEPTED
         ACCOUNTING PRINCIPLES

         (a)      The financial  statements of the Company have been prepared in
                  accordance with Canadian GAAP which differ in certain material
                  respects from US GAAP.  Material  differences between Canadian
                  and US  GAAP  and  their  effect  on the  Company's  financial
                  statements are summarized in the tables below.
<TABLE>
<CAPTION>

                                                                                   --------------------------------------------
                                                                                       2006            2005            2004
                                                                                         $               $               $
                                                                                   --------------------------------------------
                 <S>                                                              <C>             <C>             <C>

                  CONSOLIDATED STATEMENTS OF OPERATIONS

                  Loss for the year under Canadian GAAP                              (1,920,249)     (1,434,551)       (874,332)
                  Mineral properties and deferred costs for the year (i)               (696,828)     (1,394,866)     (1,330,719)
                  Reversal of future income tax liability (i)                           (93,087)         55,124          99,757
                  Mineral properties and deferred costs written off during
                        the year which would have been expensed in the year
                               incurred (i)                                             525,514         225,000               -
                                                                                   ------------    ------------    ------------
                  Loss for the year under US GAAP                                    (2,184,650)     (2,549,293)     (2,105,294)
                  Unrealized gains (losses)
                        on available-for-sale securities (ii)                             7,000               -               -
                                                                                   ------------    ------------    ------------
                  Comprehensive loss (iii)                                           (2,177,650)     (2,549,293)     (2,105,294)
                                                                                   ============    ============    ============

                  Basic and diluted loss per share under US GAAP                         ($0.11)         ($0.16)         $(0.16)
                                                                                   ============    ============    ============

                  Weighted average number of common shares outstanding               19,169,121      15,916,822      13,192,736
                                                                                   ============    ============    ============
</TABLE>
<TABLE>
<CAPTION>

                                                                                   ----------------------------
                                                                                       2006            2005
                                                                                         $               $
                                                                                   ----------------------------
                 <S>                                                              <C>             <C>

                  CONSOLIDATED BALANCE SHEETS

                  Shareholders' equity

                  Balance per Canadian GAAP                                           4,165,095       3,546,233
                  Mineral properties and deferred costs (i)                          (3,356,158)     (3,184,844)
                  Reversal of future income tax liability (i)                            61,794         154,881
                  Accumulated other comprehensive income (ii)                             7,000               -
                                                                                   ------------    ------------
                  Balance per US GAAP                                                   877,731         516,270
                                                                                   ============    ============

                  Mineral properties and deferred costs

                  Balance per Canadian GAAP                                           3,356,158       3,184,844
                  Mineral property interests and deferred costs under US GAAP (i)    (3,356,158)     (3,184,844)
                                                                                   ------------    ------------
                  Balance per US GAAP                                                         -               -
                                                                                   ============    ============

                  Future Income Tax Liabilities

                  Balance per Canadian GAAP                                              61,794         154,881
                  Reversal of future income tax liability (i)                           (61,794)       (154,881)
                                                                                   ------------    ------------
                  Balance per US GAAP                                                         -               -
                                                                                   ============    ============
</TABLE>




                                     F-21
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

11.      DIFFERENCES  BETWEEN  CANADIAN  AND UNITED  STATES  GENERALLY  ACCEPTED
         ACCOUNTING PRINCIPLES (continued)
<TABLE>
<CAPTION>

                                                                                   --------------------------------------------
                                                                                       2006            2005            2004
                                                                                         $               $               $
                                                                                   --------------------------------------------
                 <S>                                                              <C>             <C>             <C>

                  CONSOLIDATED STATEMENTS OF CASH FLOWS

                  Operating activities

                  Cash used per Canadian GAAP                                        (1,350,297)     (1,131,111)       (845,988)
                  Mineral property interests and deferred costs (i)                    (696,915)     (1,196,242)     (1,230,962)
                                                                                   ------------    ------------    ------------
                  Cash used per US GAAP                                              (2,047,212)     (2,327,353)     (2,076,950)
                                                                                   ============    ============    ============

                  Investing activities

                  Cash used per Canadian GAAP                                          (796,915)       (196,242)     (2,233,759)
                  Mineral property interests and deferred costs (i)                     696,915       1,196,242       1,230,962
                                                                                   ------------    ------------    ------------
                  Cash provided (used) per US GAAP                                     (100,000)      1,000,000      (1,002,797)
                                                                                   ============    ============    ============

</TABLE>

                  (i)      Mineral property interests and deferred costs

                           Mineral  property  interests  and deferred  costs are
                           accounted  for in  accordance  with  Canadian GAAP as
                           disclosed in Note 5. The Company has  determined  for
                           US GAAP  purposes to expense the option  payments and
                           exploration costs relating to unproven mineral claims
                           as incurred and in addition has a related  income tax
                           recovery.   In  addition,   US  GAAP   requires  that
                           exploration costs not be capitalized until a positive
                           feasibility study is completed. The capitalized costs
                           of such claims would then be measured,  on a periodic
                           basis,  to  ensure  that the  carrying  value  can be
                           recovered on an undiscounted  cash flow basis. If the
                           carrying value cannot be recovered on this basis, the
                           mineral   claims   would  be  written   down  to  net
                           recoverable value on a discounted cash flow basis.

                  ii)      Marketable securities

                           For the 2006 fiscal year,  the  Company's  marketable
                           securities  were  classified  as   available-for-sale
                           investments under US GAAP and carried at the lower of
                           cost and market  value for  Canadian  GAAP  purposes.
                           Such  investments  are not held  principally  for the
                           purpose of selling in the near term and,  for US GAAP
                           purposes, must have holding gains and losses reported
                           as a separate component of shareholders' equity until
                           realized or until an other than temporary  impairment
                           in value occurs.

                  (iii)    Other Comprehensive Income

                           US GAAP  requires  that a statement of  comprehensive
                           income be displayed with the same prominence as other
                           financial statements and that the aggregate amount of
                           comprehensive  income,   excluding  the  deficit,  be
                           disclosed   separately   in   shareholders'   equity.
                           Comprehensive  income,  which  incorporates  the  net
                           loss,  includes all changes in  shareholders'  equity
                           during  a  period   except   those   resulting   from
                           investments by and distributions to owners. Effective
                           January 1, 2007,  the  Company  will be  required  to
                           disclose comprehensive income under Canadian GAAP.





                                     F-22
<PAGE>

                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)


11.      DIFFERENCES  BETWEEN  CANADIAN  AND UNITED  STATES  GENERALLY  ACCEPTED
         ACCOUNTING PRINCIPLES (continued)

                  (iv)     Income Tax

                           Under  Canadian  GAAP,  future  income tax assets are
                           calculated based on enacted or substantially  enacted
                           tax rates applicable to future years.  Under US GAAP,
                           only  enacted  rates are used in the  calculation  of
                           deferred  income taxes.  This  difference in GAAP did
                           not have any  effect  on the  financial  position  or
                           results of  operations  of the  Company for the years
                           ended December 31, 2006, 2005 and 2004.

         (b)      Recent Accounting Pronouncements

                  FINANCIAL INSTRUMENTS

                  On January  27,  2005,  the CICA  issued  Section  3855 of the
                  Handbook  titled  "Financial  Instruments  -  Recognition  and
                  Measurement".  It expands  Handbook  section 3860,  "Financial
                  Instruments - Disclosure and Presentation" by prescribing when
                  a  financial  instrument  is to be  recognized  on the balance
                  sheet and at what  amount.  It also  specifies  how  financial
                  instrument gains and losses are to be presented. All financial
                  instruments  will be required to be  classified  into  various
                  categories. Held to maturity investments loans and receivables
                  are measured at amortized cost with amortization of premium or
                  discounts and losses and impairment included in current period
                  interest income or expense.  Held for trading financial assets
                  and  liabilities  are  measured at fair market  value with all
                  gains and losses included in net income in the period in which
                  they  arise.  All  available  for sale  financial  assets  are
                  measured  at fair  market  value  with  revaluation  gains and
                  losses included in other comprehensive  income until the asset
                  is  removed  from the  balance  sheet  except  that other than
                  temporary losses due to impairment are included in net income.
                  All other financial liabilities are to be carried at amortized
                  cost. This new Handbook  section will bring Canadian GAAP more
                  in line  with US GAAP.  The  mandatory  effective  date is for
                  fiscal  years  beginning  on or after  October 1,  2006,  with
                  optional early  recognition  for fiscal years  beginning on or
                  after  December  31,  2004.  At present,  the  Company's  most
                  significant   financial   instruments  are  cash,   short-term
                  investments,  other  receivables  and  accounts  payable.  The
                  Company  will adopt this  Handbook  section in its fiscal 2007
                  year.  The  Company  is  currently  reviewing  the  section to
                  determine the potential  impact,  if any, on its  consolidated
                  financial statements.

                  HEDGE ACCOUNTING

                  Handbook   Section   3865,   "Hedges"   provides   alternative
                  treatments to Handbook  Section 3855 for entities which choose
                  to designate qualifying  transactions as hedges for accounting
                  purposes.  The  effective  date of this  section is for fiscal
                  years  beginning on or after October 1, 2006. The Company does
                  not currently have any hedging relationships.

                  COMPREHENSIVE INCOME

                  Handbook Section 1530,  "Comprehensive  Income",  introduces a
                  requirement  to temporarily  present  certain gains and losses
                  outside of income.  Section 1530 defines  comprehensive income
                  as a change  in value of net  assets  that is not due to owner
                  activities.  Assets that are  classified as available for sale
                  will have  revaluation  gains  and  losses  included  in other
                  comprehensive  income  until  the  asset is  removed  from the
                  balance sheet.


                                     F-23
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

11.      DIFFERENCES  BETWEEN  CANADIAN  AND UNITED  STATES  GENERALLY  ACCEPTED
         ACCOUNTING PRINCIPLES (continued)

                  At present,  the Company  has  investments  in shares of arm's
                  length  corporations  that may be  classified as available for
                  sale  investments.  The Company would be required to recognize
                  unrealized  gains and losses on such  securities  and  include
                  these amounts in comprehensive  income.  The effective date of
                  this section is for fiscal years beginning on or after October
                  1, 2006.  Implementation  of this  section  will more  closely
                  align Canadian GAAP with US GAAP.

                  ACCOUNTING FOR UNCERTAINTY IN INCOME TAXES

                  In July 2006, the Financial  Accounting Standards Board (FASB)
                  issued FIN 48,  Accounting for Uncertainty in Income Taxes, an
                  Interpretation  of FASB  Statement  109.  This  Interpretation
                  applies to all tax  positions  related to income taxes subject
                  to  SFAS  109,  Accounting  for  Income  Taxes.  FIN 48 uses a
                  two-step  approach for  evaluating  tax  positions.  The first
                  step, recognition,  occurs when an enterprise concludes that a
                  tax position,  based solely on its technical  merits,  is more
                  likely than not to be sustained upon  examination.  The second
                  step,  measurement,  is  only  addressed  if  the  recognition
                  threshold is met; under this step, the tax benefit is measured
                  as  the  largest  amount  of  the  benefit,  determined  on  a
                  cumulative  probability basis, that is more likely than not to
                  be realized  upon  settlement.  FIN 48's use of the term "more
                  likely  than  not"   represents  a  greater  than  50  percent
                  likelihood of occurrence.

                  The  cumulative  effect of  applying  the  provisions  of this
                  Interpretation  shall  be  reported  as an  adjustment  to the
                  opening balance of retained  earnings for fiscal year in which
                  the enterprise adopts the Interpretation.  FIN 48 is effective
                  for fiscal years  beginning  after December 15, 2006.  Earlier
                  application  is permitted if the reporting  enterprise has not
                  publicly  issued  financial   statements,   including  interim
                  financial statements,  for that fiscal year. Accordingly,  the
                  Company will adopt the  provisions of this  Interpretation  in
                  its fiscal 2007 year.  The Company is currently  reviewing the
                  provisions to determine the potential  impact,  if any, on its
                  consolidated financial statements.

                  FAIR VALUE MEASUREMENTS

                  In  September  2006,  FASB issued  SFAS No.  157,  "Fair Value
                  Measurements",  which  establishes  a framework  for measuring
                  fair  value.  It also  expands  disclosures  about  fair value
                  measurements  and is effective  for the first quarter of 2008.
                  The Company is currently  reviewing  the guidance to determine
                  the potential  impact,  if any, on its consolidated  financial
                  statements.





                                     F-24
<PAGE>


                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                   NOTES TO CONSOLIDATED FINANCIAL STATEMENTS
              FOR THE YEARS ENDED DECEMBER 31, 2006, 2005 AND 2004
                         (EXPRESSED IN CANADIAN DOLLARS)

12.      SUPPLEMENTARY CASH FLOW INFORMATION

         Non-cash  investing  and  financing  activities  were  conducted by the
         Company  during the years ended  December 31, 2006,  2005,  and 2004 as
         follows:
<TABLE>
<CAPTION>
                                                                   --------------------------------------------
                                                                       2006            2005            2004
                                                                         $               $               $
                                                                   --------------------------------------------
        <S>                                                       <C>             <C>             <C>

         Investing activities

             Expenditures on mineral property interests and
                  deferred costs                                       (126,000)       (143,500)       (329,250)
             Shares issued for mineral properties                       126,000         143,500         329,250
             Proceeds on the optioning of mineral properties             33,000               -               -
             Investment in marketable securities                        (33,000)              -               -
                                                                   ------------    ------------    ------------
                                                                              -               -               -
                                                                   ============    ============    ============

         Financing activities

             Share and warrant issuance costs                            (6,435)        (23,078)        (44,240)
             Warrants                                                     3,635               -               -
             Shares issued for payment of agent's fees                    2,800          23,078          44,240
                                                                   ------------    ------------    ------------
                                                                              -               -               -
                                                                   ============    ============    ============
</TABLE>


13.      SUBSEQUENT EVENTS

         Subsequent to December 31, 2006:

         (a)      the Company completed a brokered financing of 11,700,000 units
                  at a price of $0.35,  for total proceeds of  $4,095,000.  Each
                  unit  consists of one common  share and one half common  share
                  purchase  warrant.  Each full  warrant will entitle the holder
                  thereof to purchase one additional common share in the capital
                  of the  Company  for a period of 2 years at $0.45  per  share.
                  Additionally,  once the resale restrictions on the shares have
                  expired,  and upon the Company's  shares trading at or above a
                  weighted  average  trading  price of $0.75 for 20  consecutive
                  trading  days,  the Company may give notice that the  warrants
                  will expire 30 days from the date of providing such notice.

                  The Agents were paid a commission  of 7.5% cash and 8% Agents'
                  Warrants.  The Agents'  Warrants will be exercisable  into one
                  common share at a price of $0.45 per warrant,  for a period of
                  2 years.  The  Agents'  Warrants  will not be subject to early
                  expiry.

         (b)      the Company signed a letter of intent with Chancadora Centauro
                  S.A.C.  to enter into an option  agreement  to acquire up to a
                  90% interest in the 11,184  hectare Laguna Gold Project in the
                  Pasco  Department of west central Peru. Under the terms of the
                  letter of intent,  an initial  51%  interest  may be earned by
                  incurring  US$650,000 in work  expenditures  and US$900,000 in
                  option  payments  over 2 years.  The Company may then elect to
                  earn  an  additional   39%  interest,   by  making  a  further
                  US$4,000,000  in option  payments  and  completing  a bankable
                  feasibility  study,  within  seven years after the exercise of
                  the initial option. The letter of intent provides for a 90 day
                  legal and technical due diligence period.

         (c)      the Company  received the subscription  receivable  balance of
                  $166,250  relating to proceeds from a private  placement which
                  was outstanding as at December 31, 2006.



                                     F-25
<PAGE>






                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                            CONSOLIDATED SCHEDULE OF
                  MINERAL PROPERTY INTERESTS AND DEFERRED COSTS
                      FOR THE YEAR ENDED DECEMBER 31, 2006
                         (EXPRESSED IN CANADIAN DOLLARS)



<TABLE>
<CAPTION>
                              ---------  -----------------------------------------------------  ---------
                              ARGENTINA                           PERU                             USA
                              ---------  -----------------------------------------------------  ---------
                                                                                                  WALKER
                                                                CRUZ DE                            LANE,   ---------
                               MOGOTE    ESPERANZA  KORIMARCA     MAYO      COCHA      OTHER      NEVADA     TOTAL
                                  $          $          $          $          $          $          $          $
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
<S>                          <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>

Balance,
    beginning of year         2,270,734    563,613     32,125     61,585     27,917     46,744    182,126  3,184,844
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Expenditures during the year

    Acquisition costs           165,247     20,070      1,696     73,487     18,557     23,038          -    302,095
    Assays                            -          -          -          -     42,288          -         65     42,353
    Communications                4,268          -         11        350      4,214        456          -      9,299
    Drilling                          -          -          -          -    139,493          -          -    139,493
    Geophysics                        -          -          -          -          -          -          -          -
    Office                        2,556         97          -         12     19,989      2,332          -     24,986
    Salaries and contractors      5,429      3,311      1,378     23,527    113,125     13,141         97    160,008
    Supplies and equipment            -         94         36        115     13,372        545          -     14,162
    Transportation                    -        807        171      3,152     54,728      3,367          -     62,225
    Imagery and base maps             -          -          -          -        615      1,931          -      2,546
    Foreign value added tax       2,270      2,088        365     11,132     44,788      5,105          -     65,748
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                179,770     26,467      3,657    111,775    451,169     49,915        162    822,915
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Proceeds on the optioning
      of mineral properties           -          -          -          -          -          -   (33,000)   (33,000)
Future income tax (Note 10)           -   (78,197)       (76)    (1,059)      6,963    (2,731)   (17,987)   (93,087)
Write-off of mineral
    properties                        -  (511,883)          -          -          -   (13,631)          -  (525,514)
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Balance, end of year          2,450,504          -     35,706    172,301    486,049     80,297    131,301  3,356,158
                              =========  =========  =========  =========  =========  =========  =========  =========
</TABLE>





                                     F-26
<PAGE>



                           AMERA RESOURCES CORPORATION
                         (AN EXPLORATION STAGE COMPANY)
                            CONSOLIDATED SCHEDULE OF
                  MINERAL PROPERTY INTERESTS AND DEFERRED COSTS
                      FOR THE YEAR ENDED DECEMBER 31, 2005
                         (EXPRESSED IN CANADIAN DOLLARS)



<TABLE>
<CAPTION>
                              --------------------  -----------------------------------------------------  ---------
                                    ARGENTINA                                PERU                             USA
                              --------------------  -----------------------------------------------------  ---------
                                                                                                             WALKER
                                MOGOTE     CHUBUT                          CRUZ DE                            LANE,   ---------
                                         PROPERTIES ESPERANZA  KORIMARCA     MAYO      COCHA      OTHER      NEVADA     TOTAL
                                  $          $          $          $          $          $          $          $          $
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
<S>                          <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>        <C>

Balance,
    beginning of year         1,468,904    225,000    200,999          -          -          -          -    120,075  2,014,978
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------

Expenditures during the year
    Acquisition costs           223,365          -     83,744     11,844     26,079     10,211     14,086     19,706    389,035
    Assays                       31,687          -      6,361          -        803      3,020      1,415        198     43,484
    Communications                4,057          -      2,659          -         48          -        252          -      7,016
    Drilling                    312,063          -          -          -          -          -          -          -    312,063
    Geophysics                        -          -     35,490          -          -          -          -      9,368     44,858
    Office                       11,885          -      8,662        550      1,861        412        125          -     23,495
    Salaries and contractors    113,166          -    130,272      6,754     18,347      6,545     20,612     11,607    307,303
    Supplies and equipment        3,276          -     24,389      2,527      1,752      1,178        536          -     33,658
    Transportation               59,177          -     26,592      8,056      1,954      1,591      2,424          -     99,794
    Imagery and base maps             -          -      4,174          -      2,989      1,348          -          -      8,511
    Foreign value added tax      43,154          -     19,059      1,956      1,615      1,350      3,391          -     70,525
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
                                801,830          -    341,402     31,687     55,448     25,655     42,841     40,879  1,339,742
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Future income tax (Note 7)            -          -     21,212        438      6,137      2,262      3,903     21,172     55,124
Write-off of mineral
    properties                        -   (225,000)         -          -          -          -          -          -   (225,000)
                              ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------  ---------
Balance, end of year          2,270,734          -    563,613     32,125     61,585     27,917     46,744    182,126  3,184,844
                              =========  =========  =========  =========  =========  =========  =========  =========  =========
</TABLE>


                                     F-27
<PAGE>