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


                                  FORM 10-KSB/A


    Annual Report Pursuant to Section 13 or 15(d) of the Securities Exchange
                                  Act of 1934

                        For the Period of August 31, 2003

                         Commission file number: 0-26217

                            CHINA NETTV HOLDINGS INC.
                        --------------------------------
        (Exact name of small business issuer as specified in its charter)

             Nevada                                     98-02031-70
             ------                                     -----------
(State or other jurisdiction of                (IRS Employee Identification No.)
 incorporation or organization)

           Suite 830 - 789 West Pender Street, Vancouver, B.C. V6C 1H2
          -------------------------------------------------------------
                    (Address of principal executive offices)

                                 (604) 689-4407
                                 --------------
                           (Issuer's telephone number)

Securities Registered pursuant to section 12(g) of the Act:   None

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 and 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
    -----                  -----

Check if disclosure of delinquent filers pursuant to Item 405 of Regulation S-B
is not contained in this form, and no disclosure will be contained, to the best
of Registrant's knowledge, in definitive proxy or information statements
incorporated by reference in Part III of this Form 10-KSB or any amendment to
this Form 10-KSB.

     X
   -----

State issuer's revenues for its most recent fiscal year.      $0

Aggregate market value of the voting stock held by non-affiliates of the
registrant as of August 31, 2003.                             $2,293,443

Number of outstanding shares of the registrant's par value $0.001 common stock,
as of August 31, 2003.                                        44,285,200

<PAGE>

                            CHINA NETTV HOLDINGS INC.
                                   FORM 10-KSB
                                      INDEX

                                                                            Page
                                                                            ----
                                     Part I

Item 1.   Description of Business..............................................3

Item 2.   Description of Properties............................................6

Item 3.   Legal Proceedings....................................................6

Item 4.   Submission of Matters of a Vote of Security Holders..................6

                                 Part II

Item 5.   Market for Registrant's Common Equity and Related Stockholder
          Matters..............................................................6

Item 6.   Management's Discussion and Analysis or Plan
          of Operation.........................................................7

Item 7.   Financial Statements................................................12

Item 8.   Changes in and Disagreements with Accountants on
          Accounting and Financial Disclosure.................................12

Item 8A.  Controls and Procedures.............................................13

                                Part III

Item 9.   Directors, Executive Officers, Promoters, and Control
          Persons; Compliance with Section 16(a) of the Exchange Act..........13

Item 10.  Executive Compensation..............................................16

Item 11.  Security Ownership of Certain Beneficial Owners and Management
          and Related Stockholder Matters.....................................17

Item 12.  Certain Relationships and Related Transactions......................19

                                 Part IV

Item 13.  Exhibits and Reports on Form 8-K....................................19


Signatures....................................................................20

                                        2

<PAGE>

                                     Part I

ITEM 1.  DESCRIPTION OF BUSINESS

When used in this Form 10-KSB, the words "expects," "anticipates," "estimates"
and similar expressions are intended to identify forward-looking statements.
Such statements are subject to risks and uncertainties, including those set
forth below under "Risks and Uncertainties," that could cause actual results to
differ materially from those projected. These forward-looking statements speak
only as of the date hereof. The Company expressly disclaims any obligation or
undertaking to release publicly any updates or revisions to any forward-looking
statements contained herein to reflect any change in the Company's expectations
with regard thereto or any change in events, conditions or circumstances on
which any statement is based. This discussion should be read together with the
financial statements and other financial information included in this Form
10-KSB.

(a)      General Description and Development of Business

HISTORY OF COMPANY

The Company was incorporated on September 15, 1998 as Vancouver's Finest Coffee
Company for the purpose of building a retail premium coffee business that sells
premium quality coffee drinks through Company-owned and operated retail kiosks.
In early 2000, the Company commissioned a study into the viability of the coffee
kiosk business and, at the Company's Annual General Meeting in March, 2000, the
shareholders approved a resolution for the directors to pursue another line of
business other than the originally proposed coffee kiosk business.

In May 2000, the Company acquired 100% control of China NetTV Inc., a British
Virgin Islands company. China NetTV has a Letter of Intent to form a Joint
Venture in China with Sichuan QianFeng Digital Audio/Video Equipment Co. Ltd.

In June 2000, China NetTV Inc. signed a Joint Venture contract with Sichuan
QianFeng Digital Audio/Video Equipment Co. Ltd.

In September 2000, the Joint Venture Company Chengdu Qianfeng NetTV Co., Ltd.
was formed after receiving approval from Moftec (Ministry of Foreign Trade and
Economic Cooperation).

Since approval from Moftec for the Joint Venture Company, the Company has
continued to fund the Joint Venture with Sichuan QianFeng Digital Audio/Video
Equipment Co. Ltd., in the production of trial digital set-top boxes for Nanning
TV in Guangxi Province and to look for other opportunities relating to the
growing demand for digital data transmission technology and solutions for the
television broadcasting and cable industries in China

As of August 31, 2002 the Company had paid $1,280,000 of the $1,500,000 due to
complete the purchase of the initial interest in the joint venture, however, we
have been unable to complete the terms of the agreement and, therefore,
management has elected to expense the initial payment from the company's books.
Discussions with QianFeng has led management to believe there will be no further
liability and if and when we can raise the necessary funding that we can pick
the contract up again.


                                        3

<PAGE>

BUSINESS

CORPORATE OVERVIEW

The Company structure and major subsidiaries is as follows, with the
jurisdiction of incorporation of each subsidiary included in parentheses:

                            ---------------------------
                            |CHINA NETTV HOLDINGS INC.|
                            |      (Nevada, USA)      |
                            /--------------------------
-------------------------- /
|China NetTV Inc.        |
|(100% owned)            |
|(British Virgin Islands)|
--------------------------
          |
          |
--------------------------               -------------------------------------
|China Net TV (H.K.) Ltd.|               | Chengdu Qianfeng NetTV Co., Ltd.   |
|(100% owned)            |               | Joint Venture with Qianfeng Digital|
|(Hong Kong)             |---------------| Audio/Video Equipment Co. Ltd.     |
|                        |               | (51% max. owned)                   |
|                        |               | (Sichuan, CHINA)                   |
--------------------------               -------------------------------------

GENERAL OPERATIONS

The Company was formed with the intent of construction and promotion of coffee
kiosks in and around Vancouver, B.C. The Company was initially incorporated as
Vancouver's Finest Coffee Company on September 15, 1998. Pursuant to an
independent study on the business potential of the coffee kiosk business in
Vancouver indicating that the business no longer presented the potential
initially anticipated, the Company's management abandoned the coffee kiosk
business in March of this year.

On May 4, 2000, the Company signed an agreement to acquire China NetTV Corp., a
company organized under the laws of the British Virgin Islands, who in turn had
signed a letter of intent with Sichuan Qianfeng Digital Audio/Video Equipment
Co. Ltd. ("QF Digital") of China, to form a co-operative Joint Venture in China.

On May 30, 2000, the Company changed its name to China NetTV Holdings Inc. to
reflect its change in business. The Company intends to develop digital set-top
box technologies in China through its Joint Venture Agreement with QF Digital.

As of August 31, 2002, the Company has paid $1,280,000 of the $1,500,000 due to
complete the purchase of the initial interest in the joint venture, however, the
Company has been unable to complete the terms of the agreement and, therefore,
management has elected to expense the initial payment from the company's books.
Discussions with QianFeng has led management to believe there will be no further
liability and if and when we can raise the necessary funding then we can pick
the contract up again.

CURRENT BUSINESS

On July 4, 2003, the Company entered into a stock for stock exchange agreement
to  acquire all the outstanding stock of Honglu Investment Holdings, Inc.
("Honglu"), a Chinese mining company, that owns prospecting permits and licenses
on mineral properties in Tibet. On July 23, 2003, the Company issued 97,7000,000
of its common shares into escrow, pending completion of the agreement, and
therefore the shares are not shown as outstanding for this report. The agreement
is expected to be completed by December 31, 2003.  In connection with the
agreement the Company issued 6,839,000 restricted common shares as payment for
acquisition costs, which are shown with no value, pending the completion of the
exchange.  For reporting purpose, the acquisition will be treated as a business
combination, and accounted for as a reverse takeover, with the purchase method
of accounting being used.  Honglu will be the accounting parent and the Company
will be the accounting subsidiary.  The historical operating statements prior to
the acquisition date will be those of Honglu.  Financial statements of Hunglu
were not available on this report date and therefore no pro-forma financial
statements, including the prior operations of Honglu, have been included.

                                       4

<PAGE>


On November 28, 2003, the Board of Directors has approved to abandon the
inactive subsidiary, China NetTV Inc.

HONGLU

Honglu's major asset is a 65% interest in Danlu Resource Development Co. Ltd.
("Danlu"). The remaining 35% interest in Danlu is controlled by two entities:
The Geological Mines Office of the Tibet Automomous Region (30%) and the Beijing
Headman Mining Evaluation Firm (5%). Directly and through Danlu, a subsidiary
65% owned by Honglu, Honglu controls a significant portfolio of mineral prop-
erties with mining and/or prospecting permits and licenses in Tibet and retains
the rights to conduct exploration on and to develop these properties.  These
minerals prospects represent a broad array of potential minerals including:
gold, silver, platinum, copper, iron, lead, zinc, molybdenum, tin, tantalum,
titanium and the rare earths, niobium and osmium. Other minerals could include
corundum, borax, and salt and high quality green granite. Building materials
also include gravel and marble. Several of these properties are at an advanced
exploration stage or have completed pre-feasibility studies.

MINERAL EXPLORATION AND EXTRACTION BUSINESS

The business of mineral deposit exploration and extraction involves a high
degree of risk. Few properties that are explored are ultimatedly developed into
production. At present, none of the Honglu's properties has a known body of
commercial ore. Other risks facing the Company include competition, reliance on
third parties and joint venture partners, environmental and insurance risks,
political and environmental instability, statutory and regulatory requirements,
fluctuations in mineral prices and foreign currency, share price volatility,
title risks, and uncertainty of additional financing.

The Company has sought to identify what it believes to be the most significant
risks to its business, but cannot predict whether or to what extent any of such
risks may be realized nor can there be any assurances that the Company has
identified all possible risks that might arise. Investors should carefully
consider all of such risk factors before making an investment decision with
respect to the Company's stock.

CURRENT SITUATION

After completion the acquisition of Honglu, the Company will concentrate its
efforts on drilling and regional exploration work on the mineral claims
currently held by Honglu and will consider additional projects if and when
opportunities arise. Market conditions have improved substantially with copper
and spot gold prices increasing to multi-year highs and significant attention
has been drawn to exploration companies is China due to the country's record
growth rates and strong demand for basic raw materials and precious metals.
Through the acquisition of Honglu, the Company is well positioned to conduct its
activities and capitalize on opportunities
in China.


                                        5

<PAGE>


EMPLOYEES

As of August 31, 2003, the Company currently has no employees. The Company
continues to rely on the expertise of the officers and directors to carry out
its business strategy. The Company anticipates the need for increased
administrative and other staff as the business of the Company grows.


ITEM 2.  DESCRIPTION OF PROPERTIES

The Company currently maintains an office at Suite 830 - 789 West Pender Street,
Vancouver, B.C., Canada as its corporate headquarters.

As of August 31, 2003, The Registrant had the following tangible assets.
(The amount is quoted in US Dollar)

(a) Real Estate.  None

(b) Computer and Office Equipment $0


ITEM 3.  LEGAL PROCEEDINGS

The Company is not, and does not anticipate being a party to any legal
proceedings in the foreseeable future.


ITEM 4.  SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS

No matters were submitted during the fiscal year covered by this report to a
vote of security holders of the Company, through the solicitation of proxies or
otherwise.

                                     Part II

ITEM 5.  MARKET FOR COMMON EQUITY AND RELATED STOCKHOLDER MATTERS

(a) The Company's common stock is traded on the NASD Electronic Bulletin Board
under the symbol "CTVH.OB". Prices reported represent prices between dealers, do
not include markups, markdowns or commissions and do not necessarily represent
actual transactions. The market for the Company's shares has been sporadic and
at times very limited.

The following table sets forth high and low bid quotations of the Company's
common stock for the fiscal yeas ended August 31, 2003 and 2002 as follows:

                                       Bid

                                         2003

                                         High              Low
                                         ----              ---
First Quarter                            0.01              0.01
Second Quarter                           0.09              0.01
Third Quarter                            0.03              0.01
Fourth Quarter                           0.21              0.02



                                        6


<PAGE>

                                       Bid

                                         2002

                                         High              Low
                                         ----              ---
First Quarter                            1.50              0.24
Second Quarter                           0.43              0.055
Third Quarter                            0.09              0.02
Fourth Quarter                           0.04              0.03

Such Bulletin Board quotations reflect interdealer prices, without mark up, mark
down or commission and may not necessarily represent actual transactions.

(b) As of August 31, 2003, the Company had approximately 400 shareholders of
record of the common stock.

(c) No dividends on outstanding common stock have been paid within the last two
fiscal years, and interim periods. The Company does not anticipate or intend
upon paying dividends for the foreseeable future.

On December 17, 2001, the Company's Board of Directors announced a forward stock
split of 5 shares for 2 shares, increasing the number of the Company's shares
issued and outstanding from 14,978,480 to 37,446,200. The Company believes the
forward split will enhance the marketability of its shares.

On August 14, 2002, the Company's Board of Directors announced a reduction in
the exercise price of the Series "A" Share Purchase Warrants from $0.60 (after
stock split of 5 to 2) to $0.10 and from $1.00 (after stock split of 5 to 2) to
$0.15 for "B" Share Purchase Warrants. The expiry of the "A" Warrant was
extended to the earlier of August 15, 2004 or the 90th day after the weighted
average trading price of the Company shares exceed $0.13 per share for 10 con-
secutive trading days and "B" Warrant will expire one year after the exercise of
"A" Warrant. As of December 12, 2003, 50,000 "A" Warrants have been exercised
and the remaining "A" Warrants will expire on January 12, 2004.

On October 16, 2003, the Company completed a non-brokered private placement of
15,000,000 units at $0.06 and received $900,000. Each unit consists of one share
and a non-transferable warrant to purchase one additional share within the first
year at $0.08 or $0.25 in the second year. Upon exercise of a warrant the purch-
aser will receive an additional non-transferable warrant to purchase an addition
-al share for $0.75 until September 30, 2006. A finders fee of 7%, of the
15,000,000 units, will be paid by the issuance of an additional 1,050,000 units
having the same terms as above.


ITEM 6.  MANAGEMENT'S DISCUSSION AND ANALYSIS OR PLAN OF OPERATION

The information presented here should be read in conjunction with China NetTV
Holdings Inc.'s financial statements and other information included in this Form
10-KSB. When used in this Form 10-KSB, the words "expects," "anticipates,"
"estimates" and similar expressions are intended to identify forward-looking
statements. Such statements are subject to risks and uncertainties, including
those set forth below under "Risks and Uncertainties," that could cause actual
results to differ materially from those projected. These forward-looking
statements speak only as of the date hereof. The Company expressly disclaims any
obligation or undertaking to release publicly any updates or revisions to any

                                       7

<PAGE>

forward-looking statements contained herein to reflect any change in the
Company's expectations with regard thereto or any change in events, conditions
or circumstances on which any statement is based.

Plan of Operations

The Company used proceeds from private placements to fund the Company's joint
venture with Chengdu Qianfeng Digital AV Equipment Co. Ltd. ("Qianfeng"), in the
production of trial digital set-top boxes for Nanning TV in Guangxi Province of
China and to fund other opportunities relating to the growing demand for digital
data transmission technology and solutions for the television broadcasting and
cable industries in China. The Company paid $1,280,000 of the $1,500,000 due to
complete the purchase of the initial interest in the joint venture. However, we
have been unable to complete the terms of the agreement and, therefore, we
elected to expense the initial payment from the company's books and abandoned
the project in the fiscal year ended August 31, 2002. We believe that there will
be no further liability in connection with the agreement.

On July 4, 2003, the Company entered into a stock for stock exchange agreement
to acquire all the outstanding stock of Honglu Investment Holdings, Inc.
("Honglu"), a Chinese mining company that owns prospecting permits and licences
on mineral properties in Tibet, China. On July 23, 2003, the Company issued
97,700,000 shares of its common stock under escrow arrangement pending the
completion of the agreement. The agreement is expected to be completed by
December 31, 2003. In connection with the agreement the Company issued 6,839,000
common shares as payment for the legal cost for the acquisition.

The Company intends to develop gold and other mineral deposits in Tibet and
other areas of China recognizing that China's recent economic growth rate has
placed an increasing demand on the need for domestic production of metals.
Currently, China places fourth in the world wide production of copper but
substantially falls short of its domestic requirements. The development of
partially developed base and precious metal deposit in South Western China is
seen as an opportunity to aid China in meeting its domestic requirements.

The Company has had no revenues from operations since inception. The operations
of the Company have been financed through private placements and loans.

                                       8

<PAGE>

Honglu

Honglu's major asset is a 65% interest in Danlu Resource Development Co. Ltd.
("Danlu"). The remaining 35% interest in Danlu is controlled by two entities:
The Geological Mines Office of the Tibet Autonomous Region (30%) and the Beijing
Headman Mining Evaluation Firm (5%). Directly and through Danlu, a subsidiary
65% owned by Honglu, Honglu controls a significant portfolio of mineral
properties with mining and/or prospecting permits and licenses in Tibet and
retains the rights to conduct exploration on and to develop these properties.
These minerals prospects represent a broad array of potential minerals
including: gold, silver, platinum, copper, iron, lead, zinc, molybdenum, tin,
tantalum, titanium and the rare earths, niobium and osmium. Other minerals could
include corundum, borax, and salt and high quality green granite. Building
materials also include gravel and marble. Several of these properties are at an
advanced exploration stage or have completed pre-feasibility studies.


Change of Management

Mark Hung has resigned as Director effective July 1, 2003. Ernest Cheung has
resigned from the Board of Directors effective July 9, 2003. Maurice Tsakok
continues as a Director. Ronald Xiuru Xie has been appointed to the Board
effective July 5, 2003. Zhi Wang, Jie Yang and Anthony Garson have been
appointed to the Board on August 4, 2003.

Ronald Xiuru Xie has become President of the Company since July 5, 2003. Ernest
Cheung has resigned as President and Treasurer effective July 4, 2003. Maurice
Tsakok continues to act as Secretary of the Company.


Results of Operations


The Company has had no operations during the fiscal year ended August 31, 2003.
The Company received no revenue and incurred expenses of $334,197 stemming from
general, administrative and consulting expenditures as compared to $79,397 for
the same period of last year. The increase was mainly due to the consulting
fees paid to the directors and consultants for their services and legal fees
incurred.


The Company expects the trend of losses to continue at an increasing rate after
the acquisition of Honglu until we can achieve commercial production on some of
the mineral properties or sell some of mineral properties, of which there can be
no assurance.

                                       9

<PAGE>

Liquidity and Working Capital

As of August 31, 2003, the Company had total current assets of $48 and total
liabilities of $254,838. The Company has a negative working capital of $254,790.

The Company has no other capital resources other than the ability to use its
common stock to achieve additional capital or exercise of the warrants by the
holders. It did not raise any additional capital during the fiscal year ended
August 31, 2003.

On October 16, 2003, the Company completed a non-brokered private placement of
15,000,000 units at $0.06 for $900,000. Each unit consists of one share and a
non-transferable warrant to purchase one additional share within the first year
at $0.08 or $0.25 in the second year. Upon exercise of a warrant, the purchaser
will receive an additional non-transferable warrant to purchase an additional
share for $0.75 until September 30, 2006. A finders fee of 7% will be paid by
the issuance of 1,050,000 units with the same terms and conditions. The amount
raised will be used for working capital purpose and we expect that it is
sufficient to meet the operating expenses of the coming twelve months.


Recent Accounting Pronouncements

The Financial Accounting Standards Board ("FASB") has issued the following
pronouncements, none of which are expected to have a significant affect on the
financial statements:

January 2003 - FASB issued FASB Interpretation No. 46 ("FIN 46"), "Consolidation
of Variable Interest Entities, an Interpretation of ARB No. 51." FIN 46 requires
certain variable interest entities to be consolidated by the primary beneficiary
of the entity if the equity investors in the entity do not have the
characteristics of a controlling financial interest or do not have sufficient
equity at risk for the entity to finance its activities without additional
subordinated financial support from other parties. FIN 46 is effective for all
new variable interest entities created or acquired after January 31, 2003. For
variable interest entities created or acquired prior to February 1, 2003, the
provisions of FIN 46 must be applied for the first interim or annual period
beginning after June 15, 2003.

April 2003 - SFAS No. 149, "Accounting for Amendment of Statement 133 on
Derivative Instruments and Hedging Activities," which amends and clarifies
financial accounting and reporting for derivative instruments, including certain
derivative instruments embedded in other contracts and for hedging activities
under FASB Statement No. 133, Accounting for Derivative Instruments and Hedging
Activities. This Statement is generally effective for contracts entered into or
modified after June 30, 2003, and all provisions should be applied
prospectively. This statement does not affect the Company.

May 2003 - SFAS No. 150, "Accounting for Certain Financial Instruments with
Characteristics of both Liabilities and Equity," which establishes standards for
how an issuer classifies and measures certain financial instruments with
characteristics of both liabilities and equity. It requires that an issuer
classify a financial instrument that is within its scope as a liability (or an
asset in some circumstances). This statement is effective for financial
instruments entered into or modified after May 31, 2003, and otherwise is
effective at the beginning of the first interim period beginning after June 15,
2003. It is to be implemented by reporting the cumulative effect of a change in
an accounting principle for financial instruments created before the issuance
date of the statement and still existing at the beginning of the interim period
of adoption. Restatement is not permitted. This statement does not affect the
Company.


                                       10

<PAGE>

Limited Operating History; Anticipated Losses; Uncertainty of Future Results

China NetTV Holdings Inc. has only a limited operating history upon which an
evaluation of the Company and its prospects can be based. The Company's
prospects must be evaluated with a view to the risks encountered by a company in
an early stage of development, particularly in light of the uncertainties
relating to the new and evolving distribution methods with which the Company
intends to operate and the acceptance of the Company's business model. To the
extent that such expenses are not subsequently followed by commensurate
revenues, the Company's business, results of operations and financial condition
will be materially adversely affected. There can be no assurance that the
Company will be able to generate sufficient revenues from the sale of its
products. If cash generated by operations is insufficient to satisfy the
Company's liquidity requirements, the Company may be required to sell additional
equity or debt securities. The sale of additional equity or convertible debt
securities would result in additional dilution to the Company's stockholders.

Limited Public Market, Possible Volatility of Share Price

The Company's Common Stock is currently quoted on the NASD OTC Bulletin Board
under the ticker symbol CTVH. As of August 31, 2003, there were approximately
44,285,200 shares of Common Stock outstanding. There can be no assurance that a
trading market will be sustained in the future.

Management of Growth

Upon completion of the acquisition of Honglu, the Company expects to experience
significant growth in the number of employees and the scope of its operations.
In particular, the Company intends to hire additional staff for mineral
exploration and administrative support. Such activities can result in increased
responsibilities for management. The Company expects to experience difficulty in
filling its needs for qualified personnel.

The Company's future success depends upon its ability to raise adequate
financing to meet its mineral exploration and operation expenses. This need to
manage its expenses will place a significant strain on the Company's management
and operational resources. If the Company is unable to manage its expenses
effectively, the Company's business, results of operations, and financial
condition will be materially adversely affected.

Need for Additional Financing

The Company believes it has sufficient capital to meet its short-term cash
needs, including the costs of compliance with the continuing reporting
requirements of the Securities Exchange Act of 1934. However, if losses continue
it may have to seek loans or equity placements to cover longer term cash needs
to continue operations and expansion.

No commitments to provide additional funds have been made by management or other
stockholders. Accordingly, there can be no assurance that any additional funds
will be available to the Company to allow it to cover operation expenses.

If future operations are unprofitable, it will be forced to develop another line
of business, or to finance its operations through the sale of assets it has, or
enter into the sale of stock for additional capital, none of which may be
feasible when needed. The Company has no specific management ability or
financial resources or plans to enter any other business as of this date.

The effects of inflation have not had a material impact on its operation, nor is
it expected to in the immediate future.


Political Risks

The market in China is monitored by the government, which could impose taxes or
restrictions at any time which would make operations unprofitable and infeasible
and cause a write-off of investment in the mineral properties. Other factors
include political policy on foreign ownership, political policy to open the
doors to foreign investors, and political policy on mineral claims and metal
prices.

                                       11

<PAGE>

Market Risk

The Company does not hold any derivatives or other investments that are subject
to market risk. The carrying values of any financial instruments, approximate
fair value as of those dates because of the relatively short-term maturity of
these instruments which eliminates any potential market risk associated with
such instruments.


Other Risks and Uncertainties

The business of mineral deposit exploration and extraction involves a high
degree of risk. Few properties that are explored are ultimately developed into
production. At present, none of Honglu's prospects has a known body of
commercial ore. Other risks facing the Company include competition, reliance on
third parties and joint venture partners, environmental and insurance risks,
political and environmental instability, statutory and regulatory requirements,
fluctuations in mineral prices and foreign currency, share price volatility,
title risks, and uncertainty of additional financing.

The Company has sought to identify what it believes to be the most significant
risks to its business, but cannot predict whether or to what extent any of such
risks may be realized nor can there be any assurances that the Company has
identified all possible risks that might arise. Investors should carefully
consider all of such risk factors before making an investment decision with
respect to the Company's stock.

Proposed Operations

After completion the acquisition of Honglu, the Company will concentrate its
efforts on drilling and regional exploration work on the mineral claims
currently held by Honglu and will consider additional projects if and when
opportunities arise. Market conditions have improved substantially with copper
and spot gold prices increasing to multi-year highs and significant attention
has been drawn to exploration companies in China due to the country's record
growth rates and strong demand for basic raw materials and precious metals.
If the acquisition is completed, management intends to pursue mineral explora-
tion and joint ventures with as yet unidentified parties.


ITEM 7.  FINANCIAL STATEMENTS AND SUPPLEMENTARY DATA

The response to this Item is included as a separate Exhibit to this report.
Please see pages F-1 through F-10.


ITEM 8.  CHANGES IN AND DISAGREEMENTS WITH ACCOUNTANTS ON ACCOUNTING AND
         FINANCIAL DISCLOSURE

In connection with the audits of the most recent fiscal years and any interim
period preceding resignation, no disagreements exist with any former accountant
on any matter of accounting principles or procedure, which disagreements if not
resolved to the satisfaction of the former accountant would have caused them to
make reference in connection with their report to the subject matter of the
disagreement(s).

                                       12


<PAGE>

The principal accountant's report on the financial statements for any of the
past two years contained no adverse opinion or a disclaimer of opinion nor was
qualified as to uncertainty, audit scope or accounting principles.

Item 8A.  CONTROLS AND PROCEDURES


Under the supervision and with the participation of our management, including
our chief executive officer, we conducted an evaluation of the effectiveness of
the design and operation of our disclosure controls and procedures, as defined
in Rules 13a-14(c) and 15(d)-14(c) under the Securities Exchange Act of 1934,
within 90 days of the filing date of this report (the "Evaluation Date"). Based
on this evaluation, our chief executive officer concluded as of the Evaluation
Date that our disclosure controls and procedures were effective such that the
material information required to be included in our Securities and Exchange
Commssion ("SEC") reports is recorded, processed, summarized and reported within
the time periods specified in SEC rules and forms relating to the Company, and
was made known to them by others within those entities, particularly during the
period when this report was being prepared.

Additionally, there were no significant changes in the Company's internal
controls or in other factors that could significantly affect these controls
subsequent to the Evaluation Date. We have not identified any significant
deficiencies or material weaknesses in our internal controls, and therefore
there were no corrective actions taken.


                                    Part III

ITEM 9.  DIRECTORS, EXECUTIVE OFFICERS, PROMOTERS, AND CONTROL PERSONS;
COMPLIANCE WITH SECTION (16a) OF THE EXCHANGE

(a) The following table furnishes the information concerning the Company's
directors and officers as of August 31, 2003. The directors of the Company are
elected every year and serve until their successors are elected and qualify.

Name                   Age       Title                                Term
------------------     ---       ------------------                   ---------

Ronald Xiuru Xie       41        President & Director                  Annual

Jie Yang               40        Vice President & Director             Annual

Zhi Wang               46        Director                              Annual

Anthony Garson         60        Director                              Annual

Loong Keng Lim         56        Director                              Annual

Maurice Tsakok         52        Director                              Annual

The following table sets forth the portion of their time the Officers and
Directors devote to the Company:

Ronald Xiuru Xie           40%
Jie Yang                   80%
Zhi Wang                   10%
Anthony Garson             30%
Loong Keng Lim             5%
Maurice Tsakok             25%


The term of office for each director is one (1) year, or until his/her successor
is elected at the Company's annual meeting and is qualified. The term of office
for each officer of the Company is at the pleasure of the board of directors.

The board of directors does not have a nominating committee. Therefore, the
selection of persons or election to the board of directors was neither
independently made nor negotiated at arm's length.

(b) Identification of Certain Significant Employees.

Strategic matters and critical decisions are handled by the directors and
executive officers of the Company.

                                       13

<PAGE>

(c) Family Relationships. None

(d) Business Experience.

The following is a brief account of the business experience during the past five
years of each director and executive officer of the Company, including principal
occupations and employment during that period and the name and principal
business of any corporation or other organization in which such occupation and
employment were carried on.

Ronald Xiuru Xie graduated from Beijing University of International Business &
Economics, Beijing, China, with a Bachelor of Economics (1984) and Master of Law
(1986), and subsequently from Faculty of Law, Queen's University, Ontario,
Canada with a LL.B. degree (1992). He has been a Founding Partner of Allied Law
Office, Beijing, China (1998 to present); Senior Partner, Great Wall Law Firm,
Beijing, China (1995 to 1998); legal counsel, Department of Treaties & Law,
Ministry of Foreign Economic Relations & Trade of China (1986-89); Chinese
Governmental Expert at International Institute for the Unification of Private
Law ("UNIDROIT"), Rome, for the preparation of International Conventions on
International Financial Leasing and International Factoring (1987). He has been
a member of the Chinese Bar since 1988 and was admitted to the Bar of Ontario,
Canada in 1993. He has been President and director of Drucker, Inc. since June
2003, and a director of Honglu Investment Holdings, Inc. since May, 2003. He
will approximately devote 40% of his time to the operation of the Company.

JIE  YANG,  age  40,   Director.   He  graduated  from  Beijing   University  of
International  Business  &  Economics,  Beijing,  China in 1984 and  obtained  a
Bachelor  of  Economics.  He has been  director  and Vice  President  of  Honglu
Investment Holdings,  Inc. since 2001;  President of Sundecine  Enterprises Inc.
(1997-2001);  General Manager,  Jianxin Trading Co., 1988-97;  Assistant Customs
Supervisor, Beijing Customs Administration, 1984-87.

Maurice Tsakok, Director since May 2000, age 52, was employed, from 1976 to
1994, by Bank of Montreal as Systems Analyst, from 1994 to 1996, by Sagit Mutual
Funds, a mutual fund company who as a Vice-President was responsible for
computer operations and research on global technology companies. From 1997 to
present, he acted as a consultant on the high-tech industry and provides
technical analysis on high-tech companies. He holds a Mechanical Engineering
degree (1974 University of Minnesota) as well as an MBA specializing in
Management Information Systems (MIS) (1976 Hofstra University). From 1997 to
date he has been a principal director in Gemsco Management, Ltd. He has been a
Director of the Company since 1996. He is currently a Director of Xin Net Corp.
since 1997, and was a director of Richco Investors Inc. from 1995 to October 31,
2003.

ZHI WANG, age 46, Director. Finished diploma in business administration at China
Radio & Television  University  ("CRTVU") in 1984 and pursued further studies in
business  administration  under exchange program in Australia 1988. From 2001 to
present, he has been Chairman and President of Honglu Investment Holdings, Inc.,
Tianyubofeng  Science &  Technology,  Inc.,  a Chinese  company in aluminum  and
carbon  coke  producing  business,  and  Standard  Hotel  Management,  Co. He is
President and General Manager,  Ziyuewentao  Enterprises  Inc., 1997 to present;
General Manager,  Tianjin Zangtong Trading Co., 1993;  Managing Director of Hong
Kong Zangtong Trading Co., 1990; CEO of Tibet Autonomous Region Economic & Trade
Bureau,  Beijing Office,  1987; Member, the Leading Team on Tibetan Economy, the
State Council of China, 1984.

ANTHONY  GARSON,  age 60,  Director,  obtained a BS in 1969 from  University  of
Waterloo,  Ontario.  He received and MBA from University of Toronto,  Ontario in
1983.  For the past 30 years,  Mr. Garson has been  extensively  involved in the
brokerage industry having served as Equity Analyst, Equities Investment Division

                                       14

<PAGE>

of Bank of Nova Scotia,  Toronto  (1975-80);  Vice  president  and Senior Mining
Analyst for Canadian Operations of Dean Witter Reynolds (Canada) Ltd. (1981-85);
Senior Mining Analyst at Haywood  Securites, Vancouver, BC (1986); VP and Senior
Mining Analyst at Continental  Securities (1987) and  Vice-President  and Senior
Mining Analyst of Canaccord Capital (1993);  London,  England.  Mr. Garson was a
principal and founding partner of Union Capital Market (U.K.)Ltd, Licensed under
the Securities and Futures Authority of London, England (1993-95);  Chairman and
director of Pacific  Minerals, Vancouver, BC (1995-97). He was licensed to trade
securities in the United Kingdom,  Ontario and British Columbia, and also served
as a director  and officer  of Global Pacific Minerals,  Anthian Resources Corp.
He has been  President and Director of  International  Arimex  Resource Inc. and
Director of Grayd Resources  Corporation  since 2003,  partner of Mining Capital
Corporation from 2002,  President and Director of Disfactories  Corporation from
1999 and also Lecturer of Centennial College from 1999.

LOONG KENG LIM, age 56, Director.  Mr. Lim was born in Thailand, and educated in
Singapore,  Australia  and the  United  States.  He  obtained  an MBA  from  the
University of Arkansas in 1972. He is both a Canadian and an American citizen.

Mr. Lim has extensive  business  interests  and  experience in Asia and in North
America. He has built a distinguished  career in property  development  spanning
over 20 years.  Since 1979 he has operated as an independent  property developer
in  Los  Angeles,  U.S.A.  as  President  and  a  director  of  Eastern  Phoenix
Corporation.  He moved to Vancouver,  Canada in 1990 to do property  development
with the Kuok Group. He served as President and Chief Executive Officer of Abbey
Woods  Developments  Ltd.  from 1990 to 1993.  Abbey  Woods is a public  company
listed on both the Vancouver and Toronto Stock  Exchanges  which  specializes in
condominium and commercial construction.

He is  currently  the  Chairman  of the  Board,  President,  and  CEO of  Native
Strategic Investments Ltd ("NSI"). NSI was established in 1993, and is listed on
the  TSX.  NSI is  primarily  involved  with  the  Kuok  Group  in  real  estate
developments in partnership with Native bands in British Columbia,  Canada. This
is considered to be the first such venture in Canada.

(e)      Directors' Compensation

Directors who are also officers of the Registrant receive no cash compensation
for services as a director. On May 31, 2000, the Company granted 2,000,000 stock
options at $1.00 per share with an expiry date of May 31, 2005, of which 500,000
of the options were issued indirectly to the Company's Officers and Directors
through separate management companies. As of August 31, 2003, no options have
yet been exercised.

Section 16(a) of the Securities Exchange Act of 1934, as amended (The "Exchange
Act"), requires the Registrant's officers and directors, and persons who own
more than 10% of a registered class of the Registrant's equity securities, to
file reports of ownership and changes in ownership of equity securities of the
Registrant with the Securities and Exchange Commission and NASDAQ. Officers,
directors and greater-than 10% shareholders are required by the Securities and
Exchange Commission regulation to furnish to Registrant with copies of all
Section 16(a) that they file.  All of the current officers and directors have
filed Sec. 16(a) disclosures.

                                       15

<PAGE>


ITEM 10. EXECUTIVE COMPENSATION

The following persons filed late: None

Other persons who hold more than 10% of the outstanding shares who have not
filed or filed late:  None

Some of the officers and directors of the Company will not devote more than a
portion of their time to the affairs of the Company. There will be occasions
when the time requirements of the Company's business conflict with the demands
of their other business and investment activities. Such conflict may require
that the company attempt to employ additional personnel. There is no assurance
that the services of such persons will be available or that they can be obtained
upon terms favorable to the Company.

EXECUTIVE COMPENSATION

(a) Cash Compensation.

Compensation paid by the Company for all services provided up to August 31, 2003
to each of its executive officers:

<TABLE>
<CAPTION>

                              SUMMARY COMPENSATION TABLE OF EXECUTIVES

                           Annual Compensation                          Long Term Compensation
                           -------------------                          ----------------------
(a)                        (b)      (c)     (d)      (e)                (f)              (g)
Name and                   Year     Salary  Bonus    Other              Restricted       Securities
Principal                           ($)     ($)      Annual             Stock            Underlying/
Position                                             Compensation       Awards           Options
                                                     ($)                ($)              (#)

<S>                        <C>      <C>     <C>      <C>                <C>              <C>
Ronald Xuiru Xie           2003     0       0        0                  0                0
President and Director

Jie Yang                   2003     0       0        0                  0                0
Vice President &
Director

                                       16

<PAGE>


                                               DIRECTORS' COMPENSATION

                           Annual       Meeting         Consulting      Number          Number of
                           Retainer     Fees ($)        Fees/Other      of              Securities
                           Fee ($)                      Fees ($)        Shares (#)      Underlying
                                                                                        Options
                                                                                        SARS (#)

Ronald Xuiru Xie           0            0               $40,000         0               0
President and Director

Jie Yang                   0            0               $20,000         0               0
Vice President &
Director

Zhi Wang                   0            0               0               0               0
Director

Anthony Garson             0            0               $2,888          0               0
Director

Loong Keng Lim             0            0               0               0               0
Director

Maurice Tsakok             0            0               0               0               0
Director

Marc Hung                  0            0               0               0               0
Director
</TABLE>

(h) The Company has made no Long Term Compensation payouts (LTIP or other)

ITEM 11. SECURITY OWNERSHIP OF CERTAIN BENEFICIAL OWNERS AND MANAGEMENT AND
RELATED STOCKHOLDER MATTERS

a) Beneficial owners of five percent (5%) or greater, of the Company's common
stock: (No preferred stock is outstanding at the date of this report.) The
following sets forth information with respect to ownership by holders of more
than five percent (5%) of the Registrant's common stock known by the Registrant
based upon 44,285,200 shares outstanding at August 31, 2003.

                                       17

<PAGE>
<TABLE>
<CAPTION>

Title of          Name and Address of           Amount of Beneficial        Percent
Class             Beneficial Owner              Interest                    of Class
-----             ----------------              --------                    --------
<S>      <C>                                    <C>                         <C>
Common   Ronald Xuiru Xie                       0                           0%
         Suite 830 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Common   Richco Investors Inc.                  15,000,000                  33.9%
         Suite 950 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Common   Farmind Link Corp.                     3,697,000                   8.3%

</TABLE>

b) The following sets forth information with respect to the Company's common
stock beneficially owned by each Officer and Director, and by all Directors and
Officers as a group, at August 31, 2002.

<TABLE>
<CAPTION>

Title of          Name and Address of                  Amount of                 Percent
Class             Beneficial Owner                     Beneficial Interest       of Class
-----             ----------------                     -------------------       --------
<S>      <C>                                           <C>                       <C>
Common   Maurice Tsakok                                15,105,500(1)              4.1%
         Suite 830 - 789 West Pender Street
         Vancouver, B.C. V6C 1H2

Common   Jie Yang                                      0                          0%
         Suite 830 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Common   Zhi Wang                                      0                          0%
         Suite 830 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Note (1) - Shares including 15,000,000 common shares owned indirectly by Richco
Investors Inc.

Title of          Name and Address of                  Amount of                 Percent
Class             Beneficial Owner                     Beneficial Interest       of Class
-----             ----------------                     -------------------       --------

Common   Anthony Garson                                0                          0%
         Suite 830 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Common   Loong Keng Lim                                0                          0%
         Suite 830 - 789 W. Pender St.
         Vancouver, BC  V6C 1H2

Total as a group                                       15,105,500                 4.1%
</TABLE>

                                       18

<PAGE>


ITEM 12. CERTAIN RELATIONSHIPS AND RELATED TRANSACTIONS

Officers and directors or their controlled entities, have acquired 42.4% of the
Company's common shares and have made non interest bearing, demand loans to the
Company of $94,055.

                                     Part IV

ITEM 13. EXHIBITS AND REPORTS ON FORM 8-K

        A.  Exhibits

            Exhibit 32 - Sarbanes Oxley Certification
            Exhibit 32 - Sarbanes Oxley Certification

        B.  Reports on Form 8-K

            8-K filed July 30, 2003
            8-K/A filed on August 12, 2003
            8-K filed on August 21, 2003



                                       19

<PAGE>

                                   SIGNATURES

Pursuant to the requirements of Section 13 or 15(d) of the Securities Exchange
Act of 1934, the registrant has duly caused this report to be signed on its
behalf by the undersigned, thereunto duly authorized.

Date:    April 22, 2004                     CHINA NETTV HOLDINGS INC.

                                            By: /s/ Ronald Xuiru Xie
                                                ----------------------------
                                                Ronald Xuiru Xie
                                                President

Pursuant to the requirements of the Securities Exchange Act of 1934, this report
has been signed below by the following persons on behalf of the registrant and
in the capacities and on the dates indicated.

/s/ Ronald Xuiru Xie               President and Director     April 22, 2004
-------------------------
Ronald Xuiru Xie


/s/ Maurice Tsakok                 Director                   April 22, 2004
-------------------------
Maurice Tsakok


/s/ Jie Yang                       Vice President & Director  April 22, 2004
-------------------------
Jie Yang


/s/ Zhi Wang                       Director                   April 22, 2004
-------------------------
Zhi Wang


/s/ Anthony Garson                 Director                   April 22, 2004
-------------------------
Anthony Garson


                                       20


<PAGE>



<TABLE>
<CAPTION>

                            CHINA NETTV HOLDINGS INC.
                          INDEX TO FINANCIAL STATEMENTS

===============================================================================================================
<S>                                                                                          <C>
Independent Auditors' Report of Clancy and Co., P.L.L.C....................................  F-1

Independent Auditors' Sellers & Andersen, LLC..............................................  F-2

Consolidated Balance Sheet.................................................................  F-3

Consolidated Statements of Operations......................................................  F-4

Consolidated Statements of Changes in Stockholders' Equity (Deficiency)....................  F-5

Consolidated Statements of Cash Flows......................................................  F-6

Notes to the Consolidated Financial Statements.............................................  F-7 - F-13
</TABLE>


<PAGE>





                          INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
China NetTV Holdings Inc.

We have audited the consolidated balance sheet of China NetTV Holdings Inc. (a
development stage company) (a Nevada corporation) as of August 31, 2003, and the
related consolidated statement of operations, changes in stockholders' equity
(deficiency), and cash flows for the year then ended, and the cumulative amounts
from inception. 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 audit. The related consolidated statements of
operations, stockholders' equity (deficiency), and cash flows from inception of
the development stage on September 6, 1998 through August 31, 2002, were audited
by other auditors whose report, dated December 4, 2002, expressed an unqualified
opinion, qualified with a going concern uncertainty. Our opinion on the
consolidated statements of operations, stockholders' equity (deficiency) and
cash flows from inception of the development stage through August 31, 2003,
insofar as it relates to amounts for prior periods through August 31, 2002, is
based solely on the report of other auditors.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated financial position of China
NetTV Holdings Inc. at August 31, 2003, and the consolidated results of their
operations and their cash flows for the year then ended, in conformity with
accounting principles generally accepted in the United States of America.

As discussed in Note 2 to the consolidated financial statements, the Company has
been in the development stage since its inception on September 15, 1998, and has
incurred significant losses since inception resulting in a deficit accumulated
during the development stage. Unless the Company attains future profitable
operations and/or obtains additional financing, there is substantial doubt about
the Company's ability to continue as a going concern. Management's plans in
regards to these matters are discussed in Note 2. The consolidated financial
statements do not include any adjustments that might result from the outcome of
this uncertainty.

/s/ Clancy and Co., P.L.L.C.
Clancy and Co., P.L.L.C.
Phoenix, Arizona

April 13, 2004

                                      F-1

<PAGE>





Board of Directors
China NetTV Holdings, Inc. and Subsidiary
Vancouver B. C. Canada

               REPORT OF INDEPENDENT CERTIFIED PUBLIC ACCOUNTANTS

We have audited the accompanying consolidated statement of operations,
stockholders' equity, and cash flows for the year ended August 31, 2002, and the
cumulative amounts for the period September 15, 1998 (date of inception) to
August 31, 2002 of China NetTV Holdings, Inc. and subsidiary (development stage
company). 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 audit.

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

In our opinion, the consolidated financial statements referred to above present
fairly, in all material respects, the consolidated statement of operations and
cash flows of China NetTV Holdings, Inc. and subsidiary for the year ended
August 31, 2002, and the period September 15, 1998 (date of inception) to August
31, 2002, in conformity with accounting principles generally accepted in the
United States of America.

The accompanying consolidated financial statements have been prepared assuming
that the Company will continue as a going concern. The Company will need
additional working capital to service its debt and for its planned activity,
which raises substantial doubt about its ability to continue as a going concern.
Management's plans in regard to these matters are described in Note 7. These
financial statements do not include any adjustments that might result from the
outcome of this uncertainty.

Salt Lake City, Utah                            /s/ SELLERS & ANDERSEN, LLC
December 4, 2002

                                      F-2

<PAGE>


<TABLE>
<CAPTION>

                            CHINA NETTV HOLDINGS INC.
                          (A Development Stage Company)
                           CONSOLIDATED BALANCE SHEET
                                 AUGUST 31, 2003

Stated in U.S. dollars
------------------------------------------------------------------------------------------
<S>                                                                  <C>
ASSETS
Current Assets
   Cash                                                              $                 48
                                                                      --------------------
Total Current Assets                                                                   48
                                                                      --------------------

Total Assets                                                         $                 48
                                                                      ====================

LIABILITIES AND STOCKHOLDERS' DEFICIENCY

Current Liabilities
   Accounts payable                                                  $             97,895
   Accrued expenses - related parties (Note 3)                                     62,888
   Due to related parties (Note 3)                                                 94,055
                                                                      --------------------
Total current liabilities                                                         254,838

Total liabilities                                                                 254,838

Commitments and contingencies (Notes 7, 8)

Stockholders' Deficiency
  Common stock : $0.001 par value, authorized: 200,000,000
      Issued and outstanding: 44,285,200 shares (Note 8)                           44,285
  Additional paid-in capital                                                    1,567,963
  Accumulated deficit during the development stage                            (1,867,038)
                                                                      --------------------
Total Stockholders' Deficiency                                                  (254,790)
                                                                      --------------------

Total Liabilities and Stockholders' Equity                           $                 48
                                                                      ====================

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

                                      F-3

</TABLE>

<PAGE>

<TABLE>
<CAPTION>



                            CHINA NETTV HOLDINGS INC.
                          (a Development Stage Company)
                      CONSOLIDATED STATEMENTS OF OPERATIONS
                FOR THE YEARS ENDED AUGUST 31, 2003 AND 2002, AND
                        CUMULATIVE AMOUNTS FROM INCEPTION

                                                                Cumulative
Stated in U.S. dollars                                        From Inception          2003                    2002
---------------------------------------------------------------------------------------------------------------------------
<S>                                                         <C>                     <C>               <C>
Revenues                                                            $     1,448        $         -             $         -

General and administrative expenses                                     580,783            334,197                  79,397
                                                            ---------------------------------------   ---------------------

Operating loss                                                        (579,335)          (334,197)                (79,397)

Other expenses
   Interest                                                             (7,703)            (7,703)                       -
   Loss on investment (Note 7)                                      (1,280,000)                  -             (1,280,000)
                                                            ---------------------------------------   ---------------------
Total other expenses                                                (1,287,703)            (7,703)             (1,280,000)

Provision for income taxes                                                    -                  -                       -
                                                            ---------------------------------------   ---------------------

Net loss available to common stockholders                        $  (1,867,038)     $    (341,900)         $   (1,359,397)
                                                            ===============================================================

Basic and diluted loss per share                                   $     (0.06)      $      (0.01)           $      (0.04)
                                                            ===============================================================

Weighted average common shares outstanding                           30,963,112         38,176,942              37,446,200
                                                            ===============================================================







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

                                                      F-4
</TABLE>


<PAGE>
<TABLE>
<CAPTION>


                                                     CHINA NETTV HOLDINGS INC.
                                                   (a Development Stage Company)
                              CONSOLIDATED STATEMENTS OF CHANGES IN STOCKHOLDERS' EQUITY (DEFICIENCY)
                                          FOR THE PERIOD FROM INCEPTION TO AUGUST 31, 2003

                                                                     Stock       Additional
                                                        Common     Amount At      Paid-In       Accumulated
Stated in U.S. dollars                                  Shares     Par Value      Capital         Deficit          Total
-------------------------------------------------------------------------------------------------------------------------------
<S>                                                  <C>            <C>            <C>           <C>              <C>
Balance, September 15, 1998 (inception)                         -      $     -       $       -      $       -        $       -
Issuance of common stock for cash @ $0.004 on
    February 5, 1999                                   15,000,000       15,000         (9,000)              -            6,000
Issuance of common stock for cash @ $0.008 on
    February 7, 1999                                   18,750,000       18,750         (3,750)              -           15,000
Issuance of common stock for cash @ $0.04 on
    February 23, 1999                                     156,200          156           6,092              -            6,248
Capital contributions - expenses paid by officers               -            -           4,500              -            4,500
Comprehensive loss:
   Net loss, year ended August 31, 1999                         -            -               -       (18,593)         (18,593)
                                                     --------------------------------------------------------------------------
Balance, August 31, 1999                               33,906,200       33,906         (2,158)       (18,593)           13,155
Capital contributions - expenses paid by officers               -            -           4,500              -            4,500
Comprehensive loss:
   Net loss, year ended August 31, 2000                         -            -               -       (78,995)         (78,995)
                                                     --------------------------------------------------------------------------
Balance, August 31, 2000                               33,906,200       33,906           2,342       (97,588)         (61,340)
Issuance of common stock for cash @ $0.40 - December
    2000 through June 2001                              2,902,500        2,903       1,158,097              -        1,161,000
Comprehensive loss:
   Net loss, year ended August 31, 2001                         -            -               -       (68,153)         (68,153)
                                                     --------------------------------------------------------------------------
Balance, August 31, 2001                               36,808,700       36,809       1,160,439      (165,741)        1,031,507
Issuance of common stock for cash @ $0.40 on October
    17, 2001                                              387,500          387         154,613              -          155,000
Issuance of common stock for expenses @ $0.20 on
    November 2, 2001                                      250,000          250          49,750              -           50,000
Comprehensive loss:
   Net loss, year ended August 31, 2002                         -            -               -    (1,359,397)      (1,359,397)
                                                     --------------------------------------------------------------------------
Balance, August 31, 2002                               37,446,200       37,446       1,364,802    (1,525,138)        (122,890)
Issuance of common stock for acquisition costs on
    July 23, 2003 - related party (Note 8)              6,839,000        6,839         (6,839)              -                -
Compensation cost - stock options                               -            -         210,000              -          210,000
Comprehensive loss:
   Net loss, year ended August 31, 2003                         -            -               -      (341,900)        (341,900)
                                                     --------------------------------------------------------------------------
Balance, August 31, 2003                               44,285,200    $  44,285    $  1,567,963  $ (1,867,038)     $  (254,790)
                                                     ==========================================================================




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

                                                       F-5

</TABLE>

<PAGE>
<TABLE>
<CAPTION>



                                                  CHINA NETTV HOLDINGS INC.
                                                (a Development Stage Company)
                                            CONSOLIDATED STATEMENTS OF CASH FLOWS
                                      FOR THE YEARS ENDED AUGUST 31, 2003 AND 2002, AND
                                              CUMULATIVE AMOUNTS FROM INCEPTION

                                                                      Cumulative
Stated in U.S. dollars                                              from inception           2003                2002
------------------------------------------------------------------------------------------------------------------------------
<S>                                                              <C>                       <C>                <C>
Cash flows from operating activities
  Net loss                                                            $   (1,867,038)      $    (341,900)     $   (1,359,397)
  Adjustments to reconcile net loss to net cash
        used in operating activities
    Loss on investment                                                      1,280,000                   -           1,280,000
    Capital contribution for expenses                                           9,000                   -                   -
    Compensation cost - stock options                                         210,000             210,000
    Depreciation
    Common stock issued for expenses                                           50,000                   -              50,000
    Changes in assets and liabilities:
      Increase (decrease) in accounts payable                                  97,895              52,523              10,080
      Increase (decrease) in accrued expenses - related party                  62,888              62,888                   -
                                                                 -------------------------------------------------------------
  Net cash flows used in operating activities                               (157,255)            (16,489)            (19,317)

Cash flows from investing activities
    Investment in joint venture                                           (1,280,000)                   -                   -
                                                                 -------------------------------------------------------------
  Net cash flows used in investing activities                             (1,280,000)                   -                   -

Cash flows from financing activities
    Advances from related party                                                94,055              14,655               3,207
    Proceeds from the issuance of common stock                              1,343,248                   -                   -
                                                                 -------------------------------------------------------------
  Net cash flows provided by financing activities                           1,437,303              14,655               3,207
                                                                 -------------------------------------------------------------

Increase (decrease) in cash and cash equivalents                                   48             (1,834)            (16,110)
Cash and cash equivalents - beginning of period                                     -               1,882              17,992
                                                                 -------------------------------------------------------------
Cash and cash equivalents - end of period                                 $        48         $        48        $      1,882
                                                                 =============================================================

Supplemental information
Cash paid for:
    Interest                                                                        -                   -                   -
    Income taxes                                                                    -                   -                   -

Non-cash investing and financing activities:
    Capital contributions on expenses paid by officer                    $      9,000                   -                   -
                                                                 =============================================================
    Common stock issued for expenses                                    $      50,000                   -                   -
                                                                 =============================================================
    Common stock issued for a acquisition costs                                     -                   -                   -
                                                                 =============================================================








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

                                                       F-6

</TABLE>

<PAGE>



                            CHINA NETTV HOLDINGS INC.
                          (a Development Stage Company)
                        NOTES TO THE FINANCIAL STATEMENTS
                                 AUGUST 31, 2003

NOTE 1 - NATURE OF BUSINESS AND SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Nature of Business

China NetTV Holdings Inc. ("the Company") was incorporated under the laws of the
State of Nevada on September 15, 1998, under the name "Vancouver's Finest Coffee
Company," with an authorized capital of 200,000,000 shares of $0.001 par value
common stock. On May 30, 2000, the name was changed to China NetTV Holdings Inc.

The Company was originally organized for the purpose of marketing retail
specialty coffee. The Company later changed its business direction to the
operations of digital technology in May 2000 and then to the acquisition of
interests in mineral properties in July 2003. (See Note 8) The Company is a
development stage company as defined by Financial Accounting Standards Board No.
7.


Summary of Significant Accounting Policies

Principals of consolidation - The consolidated financial statements shown in
this report includes the operating information of the parent and its
wholly-owned subsidiary. All intercompany transactions have been eliminated

Accounting method - The financial statements are prepared under the accrual
method of accounting.

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

Cash and cash equivalents - The Company considers all highly liquid debt
instruments with original maturities of three months or less to be cash
equivalents.

Advertising costs - Advertising costs are expensed as incurred. There were no
advertising costs for the periods presented.

Offering costs - Costs directly attributable to any proposed or actual offering
of securities are charged against the gross proceeds of the offering. Costs of
an aborted offering are expensed.

Revenue recognition - Revenue is recognized on the sale and delivery of a
product or the completion of a service rendered.

Income taxes - The Company accounts for income taxes under the provisions of
Statement of Financial Accounting Standards ("SFAS") No. 109, "Accounting for
Income Taxes." Under SFAS No. 109, deferred income tax assets and liabilities
are computed for differences between the financial statements and tax bases of
assets and liabilities that will result in taxable or deductible amounts in the
future, based on enacted tax laws and rates applicable to the periods in which
the differences are expected to affect taxable income. Valuation allowances are
established when necessary, to reduce deferred income tax assets to the amount
expected to be realized.

                                      F-7

<PAGE>


Foreign currency translations - The assets and liabilities of the Company's
foreign operations are generally translated into U.S. dollars at current
exchange rates, and revenues and expenses are translated at average exchange
rates for the year. Resulting translation adjustments are reflected as a
separate component of stockholders' equity. Transaction gains and losses that
arise from exchange rate fluctuations on transactions denominated in a currency
other than the functional currency, except those transactions which operate as a
hedge of an identifiable foreign currency commitment or as a hedge of a foreign
currency investment position, are included in the results of operations as
incurred.

Fair value of financial instruments - For certain of the Company's financial
instruments, including cash, accounts payable and accrued expenses, the carrying
amounts approximate fair value due to their short maturities.

Earnings per share - Basic earnings or loss per share are based on the weighted
average number of common shares outstanding. Diluted earnings or loss per share
is based on the weighted average number of common shares outstanding and
dilutive common stock equivalents. Basic earnings/loss per share is computed by
dividing income/loss (numerator) applicable to common stockholders by the
weighted average number of common shares outstanding (denominator) for the
period. All earnings or loss per share amounts in the financial statements are
basic earnings or loss per share, as defined by SFAS No. 128, "Earnings Per
Share." Diluted earnings or loss per share does not differ materially from basic
earnings or loss per share for all periods presented. Convertible securities
that could potentially dilute basic earnings per share in the future such as
options and warrants are not included in the computation of diluted earnings per
share because to do so would be antidilutive. All per share and per share
information are adjusted retroactively to reflect stock splits and changes in
par value.

Stock-based compensation - The Company accounts for stock-based compensation
using the intrinsic value method prescribed in Accounting Principles Board
("APB") Opinion No. 25, "Accounting for Stock Issued to Employees." Compensation
cost for stock options, if any, is measured as the excess of the quoted market
price of the Company's stock at the date of grant over the amount an employee
must pay to acquire the stock. SFAS No.123, "Accounting for Stock-Based
Compensation," established accounting and disclosure requirements using a
fair-value-based method of accounting for stock-based employee compensation
plans. The Company has elected to remain on its current method of accounting as
described above, and has adopted the disclosure requirements of SFAS No. 123. In
December 2002, the FASB issued SFAS No. 148, "Accounting for Stock-Based
Compensation - Transition and Disclosure, amending FASB No. 123, and "Accounting
for Stock-Based Compensation". This statement amends Statement No. 123 to
provide alternative methods of transition for an entity that voluntarily changes
to the fair value based method of accounting for stock-based employee
compensation. SFAS No. 148 amends APB Opinion No. 28 "Interim Financial
Reporting" to require disclosure about those effects in interim financial
information. The Company adopts the disclosure provisions and the amendment to
APB No. 28 effective for interim periods beginning after December 15, 2002.

Comprehensive income - The Company includes items of other comprehensive income
(loss) by their nature, such as translation adjustments, in a financial
statement and displays the accumulated balance of other comprehensive income
separately from retained earnings and additional paid-in capital in the equity
section of the balance sheet. The Company discloses total comprehensive loss,
its components and accumulated balances on its statement of stockholders'
equity.

                                      F-8

<PAGE>


Related party transaction - A related party is generally defined as (i) any
person that holds 10% or more of the Company's securities and their immediate
families, (ii) the Company's management, (iii) someone that directly or
indirectly controls, is controlled by or is under common control with the
Company, or (iv) anyone who can significantly influence the financial and
operating decisions of the Company. A transaction is considered to be a related
party transaction when there is a transfer of resources or obligations between
related parties.

Recent Accounting Pronouncements - The FASB issued the following pronouncements
during 2003, none of which are expected to have a significant affect on the
financial statements:

In January 2003, the Financial Accounting Standard Board issued FASB
Interpretation No. 46 (FIN 46), "Consolidation of Variable Interest Entities -
An Interpretation of Accounting Research Bulletin (ARB) No. 51". This
interpretation addressed the requirements for business enterprises to
consolidate related entities in which they are determined to be the primary
economic beneficiary as a result of their variable economic interest. The
interpretation is intended to provide guidance in judging multiple economic
interests in an entity and in determining the primary beneficiary. The
interpretation outlines disclosure requirements for variable interest entities
in existence prior to January 31, 2003, outlines consolidation requirements for
variable interest entities created after January 31, 2003. The company has
reviewed its major commercial relationship and its overall economic interests
with other companies consisting of related parties, manufacture vendors, loan
creditors and other suppliers to determine the extent of its variable economic
interest in these parties. The review has not resulted in a determination that
the Company would be judged to be the primary economic beneficiary in any
material relationships, or that any material entities would be judged to be
variable interest entities of the Company.

The American Institute of Certified Public Accountants has issued an exposure
draft SOP "Accounting for Certain Costs and Activities Related to Property,
Plant and Equipment ("PP&E")". This proposed SOP applies to all non-government
entities that acquire, construct or replace tangible property, plant and
equipment including lessors and lessees. A significant element of the SOP
requires that entities use component accounting retroactively for all PP&E
assets to the extent future component replacement will be capitalized. At
adoption, entities would have to option to apply component accounting
retroactively for all PP&E assets, to the extent applicable, or to apply
component accounting as an entity incurs capitalizable costs that replace all or
a portion of PP&E. The Company cannot evaluate the ultimate impact of this
exposure draft until it becomes final.

In April 2003, the FASB issued SFAS No. 149, "Accounting for Amendment of
Statement 133 on Derivative Instruments and Hedging Activities," which amends
and clarifies financial accounting and reporting for derivative instruments,
including certain derivative instruments embedded in other contracts and for
hedging activities under FASB Statement No. 133, Accounting for Derivative
Instruments and Hedging Activities. This Statement is generally effective for
contracts entered into or modified after June 30, 2003, and all provisions
should be applied prospectively. This statement does not affect the Company.

In May 2003, the FASB issued SFAS No. 150, "Accounting for Certain Financial
Instruments with Characteristics of both Liabilities and Equity". SFAS No. 150
establishes standards for how an issuer classifies and measures certain
financial instruments with characteristics of both liabilities and equity. SFAS
No. 150 is effective for financial instruments entered into or modified after
May 31, 2003, and otherwise is effective at the beginning of the first interim
period beginning after June 15, 2003. The Company does not believe that the
implementation of SFAS No. 150 will have a material impact on the financial
condition, results of operations or cash flows.

                                      F-9

<PAGE>


NOTE 2 - GOING CONCERN
----------------------

The accompanying financial statements have been prepared in conformity with
generally accepted accounting principles, which contemplates continuation of the
Company as a going concern. However, the Company has limited operations and has
sustained substantial operating losses in recent years resulting in a
substantial accumulated deficit. In view of these matters, realization of a
major portion of the assets in the accompanying balance sheet is dependent upon
the continued operations of the Company, which in turn is dependent upon the
Company's ability to meet its financing requirements, and the success of its
future operations.

To meet these objectives, the Company plans to seek additional equity and
expects to raise funds through private or public equity investment in order to
support existing operations and expand the range and scope of its business.
There is no assurance that such additional funds will be available for the
Company on acceptable terms, if at all. Subsequent to year-end, the Company
raised approximately $1,300,000 to meet its current and future financial
requirements. (See Note 8) Management believes that actions presently taken to
revise the Company's operating and financial requirements provide the
opportunity for the Company to continue as a going concern. The Company's
ability to achieve these objectives cannot be determined at this time.


NOTE 3 - RELATED PARTY TRANSACTIONS
-----------------------------------

During the year ended August 31, 2003, the Company incurred consulting fees of
$62,888 to certain directors and/or officers of the Company. Accrued expenses -
related parties at August 31 2003 was $62,888.

As of August 31, 2003, Due from related parties represents a demand loan from a
major shareholder of $94,055 (includes accrued interest) with interest at prime
plus 1% compounded on a semi-annual basis.

Officers, directors or their controlled entities, hold approximately 42% of the
Company's common stock issued and outstanding as of August 31, 2003, and 31%
after the private placement of 15,000,000 shares and issuances of common stock
from the exercise of warrants as discussed in Note 8. Upon completion of the
Honglu acquisition, the percentage approximates 25% based on total issued and
outstanding shares after release of 97,700,000 escrowed shares. (See Note 8)


NOTE 4 - INCOME TAXES
---------------------

There is no current or deferred tax expense for the periods presented due to the
Company's loss position. The Company has fully reserved for any benefits of
these losses. The deferred tax consequences of temporary differences in
reporting items for financial statement and income tax purposes are recognized,
as appropriate. Realization of the future tax benefits related to the deferred
tax assets is dependent on many factors, including the Company's ability to
generate taxable income within the net operating loss carryforward period.
Management has considered these factors in reaching its conclusion as to the
valuation allowance for financial reporting purposes.

The income tax effect of temporary differences comprising the deferred tax
assets on the accompanying balance sheet is as follows:

Deferred tax asset from net operating loss carryforwards             $ 635,000
Valuation allowance                                                  (635,000)
                                                                ---------------
                                                                ---------------
Net deferred tax assets                                              $      -
                                                                ===============


                                      F-10

<PAGE>


The Company has available net operating loss carryforwards of approximately
$1,900,000 for tax purposes to offset future taxable income, which expire
beginning in the year 2019. Pursuant to the Tax Reform Act of 1986, annual
utilization of the Company's net operating loss carryforwards may be limited if
a cumulative change in ownership of more than 50% is deemed to occur within any
three-year period.

The difference between income taxes at statutory rates and the amount presented
in the financial statements for the years ended August 31, 2003 and 2002, and
cumulative from inception, is a result of the following approximated amounts:

<TABLE>
<CAPTION>

                                                                                                             Cumulative
                                                                  2003                    2002                  From
                                                                                                              Inception
                                                            ------------------     -------------------     ----------------
<S>                                                         <C>                    <C>                     <C>
Statutory federal income tax rate - expense (benefit)       $       (116,000)           $   (462,000)          $ (635,000)
Change in valuation allowance                                         116,000                 462,000              635,000
                                                            ------------------     -------------------     ----------------
                                                                            -                       -                    -
                                                            ==================     ===================     ================
</TABLE>

NOTE 5 - STOCK-BASED COMPENSATION
---------------------------------

Stock options.

On May 31, 2000, the Company's board of directors approved a stock option plan
for the sale of 5,000,000 shares of the Company's common stock at $0.40 per
share. There are 5,000,000 options outstanding under the plan and none have been
exercised to date. The stock option plan will expire on May 31, 2005 and the
directors have retained the right to cancel the plan at any time before May 31,
2005 and can make awards to the officers and directors, employees, and others as
designated by the directors. The fair value of the stock options granted was
approximately $1,619,000 and has been recorded as compensation expense for pro
forma purposes only.

On July 5, 2003, the Company granted stock options to three directors of the
Company for the sale of 6,000,000 shares of the Company's common stock at $0.05
per share with expiry date on August 1, 2006 for their services in the past.
Compensation cost recognized in these financial statements for options granted
below fair market value amounted to $210,000. The fair value of the stock
options granted was approximately $477,149 and has been recorded as compensation
expense for pro forma purposes only.

                                      F-10

<PAGE>

As of August 31, 2003, there are 11,000,000 stock options outstanding. No
options were canceled, forfeited, or exercised during years ended August 31,
2003 and 2002. The weighted average exercise price of the options outstanding
and exercisable is $0.21 and the weighted average remaining contractual life is
2.39 years. The Company accounts for stock-based compensation using the
intrinsic value method prescribed by Accounting Principles Board Opinion No. 25,
"Accounting for Stock Issued to Employees," under which no compensation cost for
stock options is recognized for stock options awards granted at or above fair
market value.

Had compensation expense for the Company's stock-based compensation plans been
determined under FAS No. 123, based on the fair market value at the grant dates,
the Company's pro forma net loss and pro forma net loss per share would have
been reflected as follows at August 31:

<TABLE>
<CAPTION>

                                                                        2003                2002
                                                                   ----------------    ----------------
<S>                                                                <C>                 <C>
Net loss
   As reported                                                         $ (341,900)       $ (1,359,397)
   Stock-based employee compensation cost, net of tax                    (477,149)                   -
                                                                   ----------------    ----------------
   Pro forma                                                           $ (819,049)       $ (1,359,397)
                                                                   ================    ================

Loss per share
   As reported                                                          $   (0.01)          $   (0.04)
                                                                   ================    ================
   Pro forma                                                          $     (0.02)          $   (0.04)
                                                                   ================    ================

</TABLE>


The fair value of each option grant during the years ended August 31, 2003, was
$0.08 and was estimated on the date of grant using the Black-Scholes option
pricing model with the following weighted-average assumption used for those
options granted during the period: dividend yield of 0%, expected volatility of
307.11%, risk-free interest rate of 2.422%, and an expected life of 3 years.


Stock warrants.

The Company has issued 3,540,000 Series "A" Stock Purchase Warrants with an
exercise price of $0.10 each that can be exercised at the earlier of:

1.       August 15, 2004; or
2.       the 90th day after the day on which the weighted average trading price
         of the Company's shares exceed $0.13 per share for 10 consecutive
         trading days.

                                      F-11

<PAGE>

Upon exercise of the Series "A" Stock Purchase Warrant at $0.10, the holder will
receive one Common Share of the Company and an Additional Series "B" Stock
Purchase Warrant exercisable at $0.15. The term of the Additional warrant will
be adjusted accordingly to expire one year after the occurrence of either (i) or
(ii) as described above.

As of August 31, 2003, the Company has 3,540,000 Series "A" Stock Purchase
Warrants outstanding. (See Note 8)


NOTE 6 - STOCKHOLDERS' EQUITY
-----------------------------

On December 12, 2001, the Company completed a forward common stock split of 2
1/2 shares for 1 outstanding share. The financial statements have been
retroactively restated to reflect the split.

Since its inception, the Company has received cash proceeds of $1,343,248 from
private placement offerings and the exercise of warrants for 37,196,200 post
split-shares of common stock.

On July 23, 2003, the Company issued 6,839,000 restricted common shares as
described in Note 8.


NOTE 7 - COMMITMENTS AND CONTINGENCIES
--------------------------------------

Contingencies - During June 2000, the Company, through a former subsidiary,
entered into a joint venture agreement with a Chinese partner to develop the
network technology and information appliance products in the City of Chengdu,
Peoples Republic of China ("China"). The Company, through its former subsidiary,
had paid $1,280,000 of $1,500,000 due to complete the initial interest in the
joint venture. However, the Company was unable to complete the terms of the
agreement and therefore, the Company elected to expense the initial payment and
abandon the project. The Company believes that, on advice of counsel, that there
will be no further liability in connection with the agreement.


Stock options and warrants - See details in Notes 5 and 8.


NOTE 8 - SUBSEQUENT EVENTS
--------------------------

Operating leases - In December 2003, the Company entered into a lease for office
space under non-cancelable operating lease for a term of 5 years beginning
January 2004, with two free months rent. Future commitments for the years ended
August 31 are approximately as follows: (2004: $8,502; 2005-2008: $17,000 per
year; 2009:$11,336).

                                      F-12

<PAGE>

Subsidiary.  On November 28, 2003, the Company's board of directors voted to
abandon the Company's inactive subsidiary, China NetTV Inc. with immediate
effect. There were no assets or liabilities in this inactive subsidiary.

Common stock and Warrants. On October 16, 2003, the Company completed a
non-brokered private placement of 15,000,000 units of common stock at $0.06 per
share for cash proceeds of $900,000. Each unit consist of one common share and
one non-transferable Series "C" Stock Purchase Warrant entitling the holder to
purchase one common share for two years, at $0.08 per share in the first year or
$0.25 per share in the second year. Upon exercising each warrant, the holder of
each warrant will receive one additional non-transferable Series "D" Stock
Purchase Warrant to purchase an additional share for $0.75 until September 30,
2006. The Company paid a 7% finder's fee by issuing 1,050,000 units with the
same terms and conditions. The finder's fee common stock issued was valued at
the fair market value of the common stock, $63,000 and charged against
additional paid-in capital as a cost of the offering.

As of the date of issuance of these financial statements, the Company has
received $366,500 in cash proceeds from the issuance of common stock through the
exercise of warrants as follows:

o        3,290,000 Series A Stock Purchase Warrants were exercised, resulting in
         3,290,0000 Series B Stock Purchase Warrants being granted, and the
         remaining 250,000 Series A Stock Purchase Warrants expired;
o        250,000 Series B Stock Purchase Warrants were exercised, and 3,040,000
         Series B Stock Purchase Warrants remain outstanding; and
o        16,050,000 Series C Stock Purchase Warrants remain outstanding.


Honglu Investment Holdings, Inc. On July 4, 2003, the Company entered into an
agreement to acquire all of the issued and outstanding shares of Honglu
Investment Holdings, Inc. ("Honglu"), a Chinese mining company that owns
prospecting permits and licenses on mineral properties in Tibet, China. On July
23, 2003, the Company issued 97,700,000 shares of its common stock, held in
escrow pending completion of the transaction. Since the shares are held in
escrow and will be released only upon closing of the transaction, such shares
are not yet considered issued. In connection with the agreement, the Company
issued 6,839,000 restricted shares of common stock as payment for acquisition
costs, which is shown with no value, pending completion of the agreement. The
agreement was completed on February 27, 2004, and 97,700,000 were released from
escrow for delivery to the shareholders of Honglu.

For reporting purposes, the acquisition will be treated as a business
combination and accounted for as a reverse merger. The purchase method of
accounting will be used. Honglu will be the accounting parent and the Company
will be the accounting subsidiary. The historical operating statements prior to
the acquisition date will be those of Honglu.

                                      F-12

<PAGE>


Honglu's major asset is a 65% interest in Danlu Resource Development Co. Ltd.
("Danlu"). The remaining 35% interest in Danlu is controlled by two entities:
The Geological Mines Office of the Tibet Autonomous Region (30%) and the Beijing
Headman Mining Evaluation Firm (5%). Directly and through Danlu, a subsidiary
65% owned by Honglu, Honglu controls a significant portfolio of mineral
properties with mining and/or prospecting permits and licenses in Tibet and
retains the rights to conduct exploration on and to develop these properties.
These minerals prospects represent a broad array of potential minerals
including: gold, silver, platinum, copper, iron, lead, zinc, molybdenum, tin,
tantalum, titanium and the rare earths, niobium and osmium. Other minerals could
include corundum, borax, and salt and high quality green granite. Building
materials also include gravel and marble. Several of these properties are at an
advanced exploration stage or have completed pre-feasibility studies.

Generally accepted accounting principals in the United States of America require
that if a business combination is closed subsequent to year end but prior to the
time that the financial statements are issued, then a condensed balance sheet
disclosing the amount assigned to each major asset and liability caption of the
acquired entity at the acquisition date and certain other items be disclosed
unless it is not practicable to do so. That condensed balance sheet and certain
other information are not currently available and have not been presented.

Exclusive option to acquire property rights. The Company has granted to Hunter
Dickinson, Inc. an exclusive Option to acquire an aggregate 50% of the Property
Rights to the Xietongmen Gold-Copper Prospect in Tibet and a further Option to
acquire up to a further 10% of the Property Rights, for an aggregate 60% of such
Property Rights on the terms and conditions hereinafter set forth below.

(a) Hunter Dickinson, Inc. will make the following cash payments totaling
$2,000,000 (the "Acquisition Costs") to the Company:

o        $500,000 on the date of acceptance of by the TSX Venture Exchange
         ("Effective Date") or under certain circumstances contemplated in the
         Agreement; and
o        $250,000 every four (4) months thereafter until the full balance of the
         Acquisition Costs are paid in full;
         and

(b) Hunter Dickinson, Inc. will expend $5,000,000 in exploration costs within
twenty-four (24) months following the Effective Date; and a minimum of
$3,000,000 is to be expended within twelve (12) months following the Effective
Date. The total expenditures shall be incurred in accordance with a work
program, which shall include an estimated thirty (30) drill holes during the
first twelve (12) months following the Effective Date.

(c) Hunter Dickinson, Inc. must give the Company notice in writing of the
exercise of the Option to acquire the additional 10%.  Hunter Dickinson, Inc.
shall not be entitled to exercise the Option at a time when it is in default.





                                      F-13