UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549



FORM 20-F

(Mark One)



[ ]

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



OR



[X]

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the fiscal year ended September 30, 2004



OR



[ ]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934



For the transition period from  to



Commission file number: 000-23650



CDG Investments Inc.



(Exact name of Registrant as specified in its charter)



CDG Investments Inc.



(Translation of Registrant's name into English)



ALBERTA, CANADA



(Jurisdiction of incorporation or organization)



#500 - 926 - 5th AVENUE, S.W., CALGARY, ALBERTA, T2P 0N7



(Address of principal executive offices)



Securities registered or to be registered pursuant to Section 12(b) of the Act.



None



Securities registered or to be registered pursuant to Section 12(g) of the Act.



Common shares without nominal or par value



(Title of Class)



Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act.



None



Indicate the number of outstanding shares of each of the issuer's classes of capital or common stock as of the close of the period covered by the annual report.



28,154,081 common shares as at September 30, 2004.









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2



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

Yes    XX   No





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



Item 17XX   Item 18











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PART I



In this Annual Report, unless the context indicates otherwise, the "Company" refers to CDG Investments Inc. (CDG) and all direct and indirect subsidiaries.  The consolidated financial statements and financial information stated herein include the accounts of the Company and all direct and indirect subsidiaries.



Glossary of Terms



In addition to the terms defined in the 2004 Annual Report, certain terms used throughout this annual report are defined below:



|Affiliate                     | One who, directly or indirectly, either controls, is controlled by or is under common control with, the specified person or entity.                                                                                                                                                                                                             
|------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|AMT                           | Audio magneto tellurides.                                                                                                                                                                                                                                                                                                                       
|                                |                                                                                                                                                                                                                                                                                                                                                 
|ASL                           | Above sea level.                                                                                                                                                                                                                                                                                                                                
|BQ                            | Becquerel.                                                                                                                                                                                                                                                                                                                                      
|                                |                                                                                                                                                                                                                                                                                                                                                 
|BTW                           | Drill core size of 1.654 inches in diameter.                                                                                                                                                                                                                                                                                                    
|                                |                                                                                                                                                                                                                                                                                                                                                 
|CDG                           | CDG Investments Inc.                                                                                                                                                                                                                                                                                                                            
|EM                            | Electro-magnetics.                                                                                                                                                                                                                                                                                                                              
|                                |                                                                                                                                                                                                                                                                                                                                                 
|Eskers                        | Fluvially deposited gravels associated to retreating glaciers.                                                                                                                                                                                                                                                                                  
|                                |                                                                                                                                                                                                                                                                                                                                                 
|g/T                           | Grams per metric tonne.                                                                                                                                                                                                                                                                                                                         
|ICP                           | Induced coupled plasma.                                                                                                                                                                                                                                                                                                                         
|                                |                                                                                                                                                                                                                                                                                                                                                 
|listwanitic                   | Silica-carbonate altered ultramafic rocks.                                                                                                                                                                                                                                                                                                      
|                                |                                                                                                                                                                                                                                                                                                                                                 
|kimberlite                    | The host rock for diamonds.  An alkalic peridotite containing abundant phenocrysts of olivine (commonly altered to serpentine or carbonate) and phlogopite (commonly chloritized), in a fine-grained groundmass of calcite, second-generation olivine, and phlogopite; with accessory ilmenite, serpentine, chlorite, magnetite, and perovskite.
|mineralization                | A natural aggregate of one or more valuable minerals.                                                                                                                                                                                                                                                                                           
|net profit interest, or NPI | A specified percentage of the entire proceeds received from a mines production less capital costs, labour and materials for the mining and treating of ore.  Costs also usually include transportation to the point of sale, geological, assaying and local overhead expenses.                                                                 
|







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|operator            | The party in a joint venture which carries out the operations of the joint venture, subject at all times to the direction and control of the management committee.                         
|--------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|ore                 | A natural aggregate of one or more minerals which may be mined and sold at a profit.                                                                                                       
|QA/QC               | Quality assurance/quality control.                                                                                                                                                         
|                      |                                                                                                                                                                                            
|SEDEX               | Sedimentary exhalative deposit.                                                                                                                                                            
|                      |                                                                                                                                                                                            
|ppm                 | Parts per million.                                                                                                                                                                         
|TEM                 | Time
    electromagentics.                                                                                                                                                                 
|                      |                                                                                                                                                                                            
|ton                 | Short ton (2,000 lb.).                                                                                                                                                                     
|tonne               | Metric tonne (2,204.6 lb. or 1,000 kg.)                                                                                                                                                    
|tonnage and grade | The quality of ore reserves and the amount of gold and silver (or other products) contained in such reserves and include estimates for mining dilution but not for other processing losses.
|VLF-EM              | Very low frequency-electromagnetic.                                                                                                                                                        
|                      |                                                                                                                                                                                            
|VMS                 | Volcanogenic massive sulfide.                                                                                                                                                              



Conversion Table



In this annual report both Imperial and metric measures are used with respect to mineral properties located in Canada.  Conversion rates from Imperial measure to metric and from metric to Imperial are provided below:



|Imperial Measure        | Metric Unit  | Metric Measure
=  | Imperial Unit     
|----------------------- | ------------ | ----------------- | ------------------
|2.47 acres              | 1 hectare    | 0.4047 hectares   | 1 acre            
|3.28 feet               | 1 metre      | 0.3048 metres     | 1 foot            
|0.62 miles              | 1 kilometre  | 1.609 kilometres  | 1 mile            
|0.032 ounces (troy)     | 1 gram       | 31.1 grams        | 1 ounce (troy)    
|1.102 tons (short)      | 1 tonne      | 0.907 tonnes      | 1 ton             
|0.029 ounces (troy)/ton | 1 gram/tonne | 34.28 grams/tonne | 1 ounce (troy/ton)



NOTE OF CAUTION REGARDING FORWARD-LOOKING INFORMATION. As noted, the future conduct of the business of CDG and its subsidiaries is dependent upon a number of factors, and there can be no assurance that any of these companies will be able to conduct their operations as contemplated herein.  Certain statements contained in this report using the terms may, expects to, and other terms denoting future possibilities, are forward-looking statements.  The accuracy of these statements cannot be guaranteed as they are subject to a variety of risks including, but not limited to: the possibility that the described operations, reserves, or exploration or production activities will not be completed on economic terms, if at all.  The Companys significant assets are investments in mineral exploration companies.  The exploration of mineral properties is subject to high risk, including risk of fluctuating prices for the minerals being sought, the risks of not encountering adequate resources despite expending large sums of money, and the risk that test results may not be accurate, notwithstanding appropriate precautions. Other risks associated with CDGs operations include lack of any operating revenues and continuing significant losses. Many of these risks are described herein, and it is important that each person reviewing this report understand the significant risks attendant to the operations of CDG, its subsidiaries, and companies in which it invests.



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Item 1:IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS



Not required.



Item 2:OFFER STATISTICS AND EXPECTED TIMETABLE



Not required.



Item 3:

KEY INFORMATION



A.

SELECTED FINANCIAL DATA



The selected financial data set forth in the following table is expressed in Canadian dollars.  A history of the exchange rates for Canadian dollars in terms of U.S. Dollars follows. The financial information set forth in the following table includes the accounts of the Company and subsidiaries on a consolidated basis.  This financial information was prepared in accordance with accounting principles generally accepted in Canada, the application of which conforms in all material respects for the periods presented with accounting principles generally accepted in the United States, except to the extent noted in Note 15 to the Consolidated Financial Statements appearing elsewhere in this Annual Report. The selected financial data should be read in conjunction with and is qualified by such Consolidated Financial Statements and the Notes thereto.



YEAR ENDED SEPTEMBER 30

(In $000S Cdn except for per/share and number of shares information)



20042003200220012000Operating SummaryRevenueInterest and other$24$21$24$61$71Income (loss) continuing operationsCanadian GAAP870(805)(991)(6,016)(4,920)US GAAP1,5992,674(908)(619)(2,963)Net income (loss)Canadian GAAP870(805)(991)(6,016)(4,920)United States GAAP1,5992,674(908)(619)(2,963)Financial StatusTotal assetsCanadian GAAP3,2193,5874,2455,18211,184United States GAAP3,5443,1896761,5312,137Working capital (deficiency)Canadian GAAP15978(260)132391United States GAAP19078(260)132391Long term liabilitiesCanadian GAAP5171,6911,4841,4841,484United States GAAP5501,7501,4841,4841,484Shareholders equity (net assets)Canadian GAAP2,5061,6362,3693,3599,375United States GAAP2,7991,179(1,200)(292)327Capital Stock- amount$42,644$42,644$42,644$42,644$47,596- number28,154,08128,154,08128,154,08128,154,08126,154,081Dividends per share-----Net earnings (loss) per common share:Canadian GAAPBasic and  diluted3¢(3)¢(4)¢(21)¢(18)¢United States GAAPBasic
Diluted6¢
5¢9¢
8¢(3)¢
(3)¢(2)¢
(2)¢(11)¢
(11)¢Net earnings (loss) per Common share  continuing operationsCanadian GAAP-Basic and Diluted3¢(3)¢(4)¢(21)¢(18)¢United States GAAP
Basic
Diluted6¢
5¢9¢
8¢(3)¢
(3)¢(2)¢
(2)¢(11)¢
(11)¢




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Exchange Rates



In this Annual Report, unless otherwise specified, all dollar amounts are expressed in Canadian dollars.



The exchange rates for Canadian dollars expressed in US dollars are as follows:



i)

March 24, 2005 - $0.82



ii)

High and low exchange rates for each month during the previous six months:



MonthLowHighFebruary, 2005.80.81January, 2005.81.83December, 2004.81.84November, 2004.82.85October, 2004.79.82September, 2004.77.79




iii)

Average rates for the five most recent financial years:



Years Ended September 30:20042003200220012000Average rate.75.69.64.65.68




B.

CAPITALIZATION AND INDEBTEDNESS  Not applicable



C.

REASONS FOR THE OFFER AND USE OF PROCEEDS  Not applicable



D.

RISK FACTORS



Any person considering the purchase of the Companys common stock should understand that such purchase and ownership involves a high degree of risk.  You should purchase our common stock only if you can afford a complete loss of your investment.  Among the risks that you should consider in determining whether to invest in the Companys common stock are the following:



Change of Business



During fiscal 2004, the Company sold its last remaining mineral asset; its approximate 40% interest in the Bahuerachi, Mexico mineral property.  During fiscal 2003, the Company divested itself of its remaining Saskatchewan mineral exploration assets, the most significant being the Jolu Mill.  During the fiscal year ended September 30, 2002, the Company sold its Saskatchewan mineral property portfolio in exchange for common shares in the purchaser, a Canadian publicly listed company. These sales have resulted in the majority of the Companys assets consisting of investments in resource based companies (investees). The Company believed that its efforts were best focused on enhancing the value of its investments rather than conducting exploration activities directly. Accordingly, the business of the Company was changed to that of an Investment Company, concentrating on the mineral exploration sector, and the name was changed to CDG Investments Inc.  You should be aware that the Company has little experience or operating history as an Investment Company and there can be no assurance that it will be successful.  Because of our registration as a foreign private issuer under the laws of the United States, the U.S. Investment Company Act of 1940 may impact our ability to do this business.



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Lack of Profitability and Shortage of Working Capital



With the exception of the current year income that resulted from the non  recurring sale of an interest in Waddy Lake Resources Inc., and the gain on sale of investments during 2004, to date the Company has not been profitable and has incurred significant operating losses and negative cash flow.  The Companys ability to generate revenues and raise capital in the future will be dependent on a number of factors, including the abilities of the companies in which it has or may acquire equity interests to identify precious and base minerals that are capable of commercial extraction. The Companys future success will also depend upon the market price of certain precious and base minerals.  At September 30, 2004, the Company had enough working capital to fund its operations for 6 months without the sale of additional securities.



None of the Companys investees have identified any mineral reserves.  We cannot offer any assurances that the investees will be able to extract precious or base minerals from the investees properties on an economic basis. The equity markets for junior mineral exploration companies have historically been highly volatile. While current market conditions are favorable, due in part to favorable base and precious metal prices, there are no assurances that the market value of the Companys investments will increase or remain at their current level.



It is possible that the inability to sell our investments and a corporate decision to expand the Companys business activities through capital investment or acquisition, may adversely impact the Companys available working capital and materially adversely impact the Companys ability to continue its business operations.



Although the Company has been successful in the past in obtaining financing through the sale of equity securities and debt issues, there can be no assurance that it will be able to obtain adequate financing in the future. Failure to obtain such additional financing could result in the Companys inability to expand its investment portfolio, and more importantly, its inability to continue operating.  See Item 5 Operating and Financial Review and Prospects.



Loss on Sale of Investments



There is no assurance that the Company will be able to sell its interests in its investee companies, or if the Company is able to sell its interests in its investee companies, that the Company will be able to sell such investments at a profit.  In addition, under applicable accounting guidelines, the Company is required to write-down certain of its investments based upon the market price of such investments and is required to record its proportionate share of the losses of certain of its investee companies.  The result of which may lead to significant losses for the Company.



Risk of Dilution



Companies in which we invest may be required to raise additional capital.  If investees raise additional working capital through equity issues, the Companys investment in these corporations will be diluted.



Risk of Non-Compliance with the US Investment Company Act and Risk of Sanctions



Currently, the Company may be considered an investment company as that term is defined in the United States Investment Company Act of 1940 (the 1940 Act).  An investment company is generally a company that is engaged in the business of investing, holding, reinvesting, or trading of investment securities.  The 1940 Act requires that investment companies formed under the laws of the United States, or its states, register as such with the Securities and Exchange Commission and become subject to some fairly complex governance rules.  The registration requirements do not appear to apply to non-U.S. companies except in the limited case when the non-U.S. company intends to raise capital within the United States  an action that CDG does not intend to take.  Furthermore, as an investment company in Canada, we are subject to regulation under Canadian law and we believe that U.S. regulation would be redundant and potentially incompatible with our obligations under Canadian law.  Conversations with the staff of the Securities and Exchange Commission indicate that they can offer no clear guidance.



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Should the U.S. Securities and Exchange Commission attempt to impose the provisions of the 1940 Act on our activities, our shareholders may lose their ability to trade our stock in the over-the-counter market in the United States.  In addition, the Securities and Exchange Commission may attempt to appoint a receiver for our affairs or impose other sanctions.  We intend to vigorously resist classification as an investment company in the United States, and to take advantage of any exemptions or exceptions from application of the 1940 Act.  The necessity of asserting any such resistance, or making any claim of exemption, could be time consuming and costly, or even prohibitive, given our limited resources.



Market and Price Volatility

The Companys common stock and the value of its investments are vulnerable to pricing and purchasing actions that are beyond its control.  Volatile market price and trading volume for the Companys common stock make it difficult to profit from an investment in the Companys common stock.  High volume of trading and market volatility may result in an inability to compile adequate information before engaging in trading activities, execution delays, and executions at prices significantly different from the market price quoted when an order is entered.  The securities markets themselves have from time to time and recently experienced significant price and volume fluctuations that may be unrelated to the operating performance of particular companies. As a result, shareholders may suffer market losses during periods of volatility in the price and volume.   In addition, the realization of any of the risks described in these Risk Factors could have a significant and adverse impact on such market prices.



Classification as a Penny Stock and Decreased Liquidity



The Companys common shares currently have a market price of less than $5.00 (US) and, pursuant to the Securities Enforcement Remedies and Penny Stock Reform Act of 1990, its equity securities are be classified as penny stock.  Since the common shares are classified as penny stock the common shares are subject to Rules 15g-2 through 15g-9 (the Penny Stock Rules) under the Securities Exchange Act of 1934, as amended (the Exchange Act).  The Penny Stock Rules impose additional reporting, disclosure and sales practice requirements on brokers and dealers before they can recommend the common shares for purchase by their customers, and require that such brokers and dealers make a special suitability determination for their customers, and require that such brokers and dealers make a special suitability determination for each purchaser and obtain the purchasers written consent to the purchase or sale of the common shares.



The additional risk disclosures and documentation imposed by the Penny Stock Rules could have an adverse effect on the market for and/or the valuation of the Companys common shares.



Exploration and Mining Risks  Significant Costs for Exploration



The Companys investments are in companies conducting mineral exploration and development, which involves a high degree of risk, and few properties that are explored are ultimately developed into producing mines. The long-term profitability of the Companys activities and the value of its investments will be, in part, directly related to the cost and success of the exploration programs of its investee companies.



All of the Companys investees property interests are in the exploration stage and do not contain any reserves, as that term is defined in Industry Guide 7 adopted by the Securities and Exchange Commission (the SEC).  The term reserves is defined in Industry Guide 7 as [t]hat part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination.  Industry Guide 7 is available from the SECs website at http://www.sec.gov/divisions/corpfin/forms/industry.htm#secguide7.



Mineral exploration involves significant risk and few properties that are explored are ultimately developed into producing mines.  The probability of an individual prospect ever having reserves that meet the requirements of Industry Guide 7 is extremely remote. The Companys property interests, in all probability, do not contain any reserves and any funds spent on exploration of the Companys property interests will probably be lost.  If any of





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the Company's exploration programs are successful, the Company will require additional funds to advance the property beyond the exploration stage.  Substantial expenditures are required to establish reserves through drilling, to develop metallurgical processes to extract the metal from the ore and, in the case of new properties, to develop the mining and processing facilities and infrastructure at any site chosen for mining. No assurance can be given that minerals will be discovered in sufficient quantities to justify commercial activities or that the funds required to advance a property beyond the exploration stage can be obtained on a timely basis.  If the Companys investees are unable to secure additional funding, the investees may lose their interest in one or more of their mineral claims and/or may be required to cease operations, which would negatively impact the Companys investments in its investee companies.



Mineral Reserves



There can be no assurance that the Companys investees will ever be able to identify mineral reserves on their properties, recover minerals from any of their properties or that the recovery of any minerals will be economical.



Foreign Exploration Risks



The Company has a significant investment in Tyler Resources Inc. (Tyler), a company whose primary mineral property is situated in Mexico.



The Investees most important prospects are in Mexico. Exploration and mining activities on these prospects may be affected in varying degrees by political stability and government regulations relating to the mining industry.  Changes in regulation or shifts in political conditions may adversely affect its business.  Mexico is, to a degree, a developing country, which may make it more difficult for the Investee to obtain any required exploration, development and production financing for prospects located there.

Exploration activities on its prospects in each country of the Investees operations, is subject to various laws and regulations administered by federal, provincial, state and local governmental authorities.  The current operations of the Investee will not only require regulatory compliance, but also having in place various licenses and permits for proposed exploration and development activities.  The laws and regulations include those governing prospecting, labor standards, occupational health, waste disposal, toxic substances, land use, environmental protection and mine safety.  Companies engaged in the exploration for mineral prospects and related extractive facilities generally experience increased costs and delays in schedules as a result of the need to comply with applicable laws and regulations and to obtain licenses and permits which may impose additional standards of compliance.  These laws, regulations and permitting requirements change from time to time, often becoming more stringent.  There is the possibility that the Investee may not meet these various requirements resulting in enforcement actions, injunctions, fines and penalties or curtailment or cessation of operations.  Additionally, the Investee may have to take remedial measures requiring unanticipated capital expenditures, installation of additional equipment or restoration.  The Investee also may be required to compensate those suffering loss or damage by reason of its activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations.

The Investees operations will be subject to environmental regulation. This body of law provides for restrictions and prohibitions on spills, releases or emissions of various substance produced in association with certain mining industry operations.  This regulation also governs aspects of operations, including water use, tailings, and reclamation.  Under these regulations, the Investee will have to obtain licenses and permits, which will require expenditure on consultants, preparation of impact studies, and fees and which will take substantial time.  Additionally, a breach of these regulations may result in the imposition of fines and penalties or force curtailment of activities.  Environmental legislation continues to evolve and is increasingly stringent with stricter standards, more investigation, and the greater likelihood of enforcement actions, fines and penalties for non-compliance. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in environmental regulations has the potential to reduce the profitability of operations or, in some events, limit operations.



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There is no guarantee that title in its Mexican prospect will not be challenged or impugned by third parties or that the applicable governmental authorities will not revoke, or significantly alter the ownership conditions of the mineral prospects. There is no certainty that the current rights represented by the mineral prospects or any additional rights applied for, will be granted or renewed on terms satisfactory to the Investee.  The prospects in Mexico are important to the business plan of the Investee, and if their ownership is impaired or questioned, it will be a significant set back to the Investee.



Title Risks in Canada



There is no guarantee that title to its Canadian prospects will not be challenged or impugned.  The Investee has not conducted boundary surveys of the claims in which it holds direct or indirect interests, and therefore, the precise area and location of such claims may be in doubt.  The Investees claims may be subject to prior unregistered agreements or transfers or native land claims and title may be affected by undetected defects. Native land claim settlements are more advanced in the Northwest Territories than they are in most other areas of Canada and the Federal Crown proposes to transfer some mineral rights to First Nations.



Permits and Licenses Risks



Mineral exploration may require licenses and permits from various governmental authorities. There can be no assurance that the Companys investees will be able to obtain all necessary licenses and permits that may be required to carry out exploration, development and mining operations.



Government and Environmental Regulations



The Companys investees could be subject to regulations by federal, state and local agencies relating to such matters as environmental protection, health, safety and labour, mining law reform, restrictions on production, price controls, tax increases, maintenance of claims, tenure, expropriation of property, and laws that impose liability without fault.  Compliance with these regulations could produce working capital shortages.  Regulations that become applicable to future operations could require the investees to incur significant expenses to comply with governmental regulations.



Inability to Influence the Direction or Actions of Management



The Company holds investments in other corporations, which are controlled by other persons.  One of the Companys investments is in a company (Golden Band Resources Inc. (Golden Band)) over which the Company does not exercise significant control.  Consequently the Company cannot influence the direction or actions of management and Golden Bands interests in various mineral properties.  The inability to control the actions of investee companies may cause the value of the Companys investments to decrease.



Funding Through Equity and Asset Sales



The Company at this time expects to rely on selling its investments in investee companies to generate funds for the Companys operations and to acquire interests in other investee companies.  There can be no assurance that a market for the securities of the investee companies will be sufficiently liquid to permit potential resales by the Company at prices which will be acceptable to management or which will not cause a loss on resale.  None of the companies in which the Company invests have ever paid a dividend, nor are they expected to.  The Company will not rely upon dividend income from its investments.



Competition with Other Companies



Other companies with greater financial resources and/or expertise are in competition with the Company for investment opportunities.  The Company may not be able to compete with these other companies and may be limited in the investments it can make.  If the Company is unable to identify other investee companies, the Company may not generate a sufficient return, if any, on its capital.



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Thinly Traded Public Market



The Companys shares trade on the Over-the-Counter Bulletin Board system (the OTCBB). The Company has only 1,137 registered shareholders as at March 24, 2005, and its shares are relatively thinly traded. There can be no assurance that a stable market for the Companys common shares will ever develop or, if it should develop, be sustained. It should be assumed that the market for the Companys common shares will continue to be highly illiquid, sporadic and volatile. The Company is required to maintain its status as a "reporting issuer" under theSecurities Exchange Act of 1934, as amended, in order to be quoted on the OTCBB. The Company is also listed on the CNQ-Canadian Trading and Quotation System Inc. (CNQ) exchange in Canada, and its shares are relatively thinly traded.  There can be no assurance that a stable market for the Companys common shares will ever develop ir, if it should develop, be sustained.  It should be assumed that the market for the Companys common shares will continue to be highly illiquid, sporadic and volatile.



Dealings with Associated Companies and Conflicts of Interest



The Company is associated through common directors, common officers and common shareholdings with its investee companies.  Persons who are not willing to rely on the discretion and judgment of management and the boards of directors of the Company and the investee companies should not consider a purchase of the Companys securities.  See Item 7: Major Shareholders and Related Transactions."



Certain of the Companys directors are also directors, officers or shareholders of other companies that are engaged in the business of acquiring interests in other companies, and/or are officers, directors and/or shareholders of the Companys investees.  Such associations may give rise to conflicts of interest from time to time.  Such a conflict poses the risk that the Company may enter into a transaction on terms which place the Company in a worse position than if no conflict existed.  The directors and officers of the Company are aware of the existence of laws governing accountability of directors and officers for corporate opportunity and requiring disclosures by directors of conflicts of interest and the Company will rely upon such laws in respect of any directors and officers conflicts of interest or in respect of any breaches of duty by any of its directors or officers. All such conflicts must be disclosed by such directors or officers in accordance with the Company Act (Alberta) (the Company Act).  Generally, the Company Act requires a director with a direct or indirect interest in a contract or transaction to disclose the nature and extent of the directors interest at a meeting of the directors.  A director which has an interest in such a transaction is accountable to the corporation for which the director serves for any profit the director receives as a result of the transaction unless the director has previously disclosed the interest in accordance with the Company Act, the board of directors subsequently approves the transaction or contract, and the interested director does not vote on the approval, or the contract or transaction was reasonable and fair to the Company at the time it was entered into, and after full disclosure of the nature and extent of the directors interest, it is approved by special resolution.



If a conflict of interest arises at a meeting of the board of directors, any director in a conflict will disclose his interest and abstain from voting on such matter. In determining whether or not the Company will participate in any project or opportunity, the board of directors will primarily consider the degree of risk to which the Company may be exposed and its financial position at that time.



The Company has no specific internal policy governing conflicts of interest.  See Item 7:  Major Shareholders and Related Party Transactions.



Risks Associated With Investments



The Company has made significant investments in resource companies. Acquisitions of interests in investee companies involve numerous risks, including difficulties in assessing the operations and financial condition of investee companies. We may be unable to find a sufficient number of additional attractive opportunities to meet our investment objectives. In addition, investments may require significant management time and capital resources. There are no assurances that the Company will have access to the capital required to finance potential investments on satisfactory terms or that any investment would result in long-term benefits to the Company. The Company may not be able to successfully address these problems. Moreover, the Companys future operating results will depend to a significant degree on its ability to successfully manage growth and investments. In addition, many of the Companys investments are and will continue to be in early-stage companies with limited operating histories and limited or no revenues. The Company may not be able to successfully assist these early-stage companies in pursuing their business plans and becoming profitable.



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Concentration of Investments in Resource Industry



The Companys investees are concentrated in the resource industry. Concentration in a single industry involves risks that are not generally associated with diversified investments, including potential significant fluctuations in returns. Such risks may lead to decreased returns or increased losses on the Companys investments.



Dependence upon Performance of Investee Companies



The Companys success is dependent upon the success of the companies in which it invests.  If the investees are not able to successfully implement their business plans and/or if the value of the investees securities decreases, the Company may suffer significant losses on its investments.  Economic, governmental, industry and internal company factors outside the Companys control affect each of its investee companies. The material risks relating to the Companys investee companies discussed elsewhere in RISK FACTORS may prevent the Companys investee companies from succeeding. Additionally, many of the Companys investees are early-stage companies with limited operating histories, and they may never be profitable.



Liquidity of Investees



The Companys investees may not have sufficient funds to retain their property interests and/or to conduct exploration on their properties.  If an investee loses its property interests, the value of the investees securities, and consequently the value of the Companys investment in the investee, would be negatively impacted and the Company could lose its investments.  If an investee is unable to conduct exploration on any of its properties, the investee may be required to sell all or a portion of the property interest, may lose the property interest, or may not be able to identify a commercially feasible mineral interest, in which case the value of the investees securities and the value of the Companys investment in the investee may be negatively impacted and the Company may lose all of its investment in the investee.  Such events could have a negative impact on the price of the Companys shares and may negatively impact an investment in the Companys shares.



The Companys investees may need to obtain funding from outside sources. If an investee were unable to obtain needed outside funding, its business would be materially and adversely affected. In addition, even if it were to find outside funding sources, the investee might be required to issue securities to the outside funding sources with greater rights than those that the Company currently possesses. The Companys investees might also be required to take other actions that could lessen the value of their stock, including borrowing money on terms that are not favorable to them.



The Company may be deemed to be a Passive Foreign Investment Company



The Company may be deemed to be a Passive Foreign Investment Company (PFIC).  See Item 10:  Additional Information - Taxation.  If the Company is deemed to be a PFIC, a United States holder of the Companys common shares would be required to pay an interest charge together with tax calculated at maximum tax rates on certain excess distributions (defined to include certain dividends from a PFIC and any gain on the sale of stock of a PFIC) unless such holder made an election either to (1) include in his or her taxable income his or her pro rata share of the PFICs ordinary earnings and net capital gains under the Qualified Electing Fund rules or (2) mark to market his or her Company common shares at the end of each taxable year as set forth in Section 1296 of the Internal Revenue Code of 1986, as amended. The elections require certain conditions be met such as filing on or before the due date, as extended, for filing the shareholders income tax return for the first taxable year to which the election will apply.



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Item 4:

INFORMATION ON THE COMPANY



A.

HISTORY AND DEVELOPMENT

1.   Legal and commercial name  CDG Investments Inc.

2.

Incorporation date  October 12, 1979

3.

Incorporated under the Business Corporations Act of Alberta, Canada

-Address/Telephone:

Suite 500, 926-5th Ave. S.W., Calgary, Alberta, Canada,

T2P 0N7, Phone 403-233-7898.



Name and Business Change  May 2002 from Golden Rule Resources Ltd. to CDG Investments Inc.  In connection with the name change, the business of the Company was changed to that of an Investment Company, concentrating on the mineral exploration sector.   There was no change in management and/or a change in control in connection with the name change.



4.

Significant changes or events



THE FOLLOWING SIGNIFICANT CHANGES OR IMPORTANT EVENTS OCCURRED IN THE LAST FIVE YEARS:



a)

Subsequent to September 30, 2004  Conversion of Debentures



Subsequent to September 30, 2004, the Convertible Debentures described in (e) below were converted into 5,499,091 common shares and 5,499,091 share purchase warrants. Warrants were exercised to purchase 500,000 common shares at $0.11 per share. In connection with the conversion of the debentures, certain officers and directors of the Company converted debentures held by them into common shares.  Item 7: Major Shareholders and Related Party Transactions - B. Related Party Transactions. The remaining 4,999,091 warrants may be exercised to purchase 4,999,091 common shares at prices ranging from $0.12 per share to $0.14 per share, depending upon the year of exercise. 4,990,000 warrants expire December 16, 2006 and 9,091 warrants expire December 21, 2006.



b)

September 30, 2004  Bahuerachi Sale



During the year ended September 30, 2004, the Company sold its approximate 40% interest in the Bahuerachi property in Mexico to Tyler.  The Company is related to Tyler by virtue of certain common officers and directors.  See Item 7: Major Shareholders and Related Party Transactions - B. Related Party Transactions.  Tyler issued 13,336,000 shares at a price of $0.06 per share in payment of the purchase price.  The price was negotiated and agreed to by independent committees of the board of directors of both companies.  The Bahuerachi property was written-down to $800,000 at September 30, 2003 to reflect the value assigned to the property, a value that was within the range assigned to the property by an independent valuator. The sale closed on January 29, 2004, upon shareholder and regulatory approval.  After the sale, the Company no longer holds interests in any mineral properties.



c)

September 30, 2004  Waddy Lake debt settlement and investment sale



A statement of Claim that had been filed against the Company, its 100% - owned subsidiary, Waddy Lake Resources Ltd., (Waddy Lake), and certain current and past directors and officers of the two companies, seeking to recover $1,154,133 for mine contracting services as well as damages, court costs and interest on all sums unpaid, was settled effective April 30, 2004 by mutual release. See Item 8.  No amount will be payable by any of the parties named in the suit. Pursuant to the Settlement Agreement the Company sold 49% of its 100% share position in Waddy Lake for nominal consideration, and granted an option to acquire an additional 1% of the issued and outstanding Waddy Lake shares for nominal consideration.



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Pursuant to the agreement the Company is to receive $800,000 over four years: $200,000 upon execution of the agreement, (received), and $200,000 in each of June 2005, 2006 and 2007. This will be the Companys only claim to the assets of Waddy Lake. The Company will not have the right to any income earned through Waddy Lake. The acquiring company will make all operating decisions regarding future business conducted through Waddy Lake and will appoint a majority of the board members. As a result, effective April 30, 2004, the Company ceased to consolidate the operations of Waddy Lake, recorded the gain on partial sale of their investment and recorded the remaining investment at cost in a nominal amount. The Company will record its future $200,000 installment proceeds on an as received basis as a result of uncertainty regarding collection.



d)

September 30, 2003  Wind-up of GR Capital Corporation



Effective September 30, 2003, the Company wound-up its wholly-owned subsidiary, GR Capital Corporation (GR Capital), acquiring its assets and liabilities.  GR Capital held certain of the Companys investments in other companies.  These were its only significant assets and it had no significant liabilities at the time of wind-up.  As the operations and assets of GR Capital have always been consolidated with those of the parent, the wind-up did not result in a change to the consolidated financial statements.  There were no significant tax pools in GR Capital at the time of wind-up.



e)

Year ended September 30, 2003  Convertible Debenture Financings



During the year ended September 30, 2003 the Company closed two debenture financings aggregating $550,000.  Directors, or companies over which they have control or direction, subscribed to $450,000 of the debentures.  See Item 7: Major Shareholders and Related Party Transactions - B. Related Party Transactions.  The debentures bear interest at 6% per annum, payable semi-annually on March 31 and September 30, are due December 17, 2005 and are secured by a floating charge over substantially all of the assets of the Company.  The debentures are convertible into units comprised of one common share and one share purchase warrant, at $0.10 per unit until December 17, 2004 and $0.11 per unit during the year ended December 17, 2005.  The warrants expire two years after conversion of the debenture and may be exercised to purchase one common share at prices ranging from $0.10 per share to $0.14 per share depending on the year of exercise.  The debentures are redeemable at the option of the Company after December 17, 2003 provided that stock volumes and price meet specified levels and the stock continues to be listed on a recognized exchange.



Without the written consent of the debenture holders, the Company may not advance monies by way of a loan to any company or conduct exploration activities of any nature, except for its commitment to fund exploration costs relating to the 2003 program on the Bahuerachi property in Mexico.



See Item 4(A)(4)(a) regarding the conversion of these debentures.



f)

Year ended September 30, 2003  Sale of Jolu Mill



Effective February 18, 2003 the Jolu Mill and equipment were sold to Jolu Development Corp. (JDC), a new corporation whose sole shareholder immediately prior to the transaction was Golden Band, a publicly listed company.  At the time of the transaction the Company owned 32% of Golden Band and one of the Companys directors was also a director of Golden Band.  Item 7: Major Shareholders and Related Party Transactions - B. Related Party Transactions. In consideration for the sale of the mill and equipment, JDC agreed to assume the liabilities associated with the mill, past, present and future, issue shares in its capital stock valued at $350,000 and assign a royalty to the Company based on $10 per tonne of ore processed through the mill, not to exceed $400,000 in total.  The mill had previously





14

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been written-off in the Companys books and the equipment had a net book value of $8,400.  The value of the current liabilities net of any offsetting current assets that was assumed by JDC was $211,000.  In addition JDC assumed $330,000 of the total site restoration liability that was estimated on the Companys books, and $329,000 of the reclamation deposit was transferred to JDC. The price was determined by negotiation  all board members are disinterested.  The transaction was approved by the TSX Venture Exchange.



Subsequent to September 30, 2003, pursuant to a shareholders agreement with Golden Band, the Company gave notice to Golden Band that it must acquire all of the Companys shares in JDC in exchange for 1,166,667 common shares of Golden Band. The Company received the Golden Band shares in exchange for the JDC shares on September 30, 2004.



g)

Year ended September 30, 2002  Business and name change



At the Annual & Special Meeting on March 21, 2002, the shareholders approved a change in our business from that of a Natural Resources Company to that of an Investment Company and a change in name from Golden Rule Resources Ltd. to CDG Investments Inc.  There was no change of control and/or a change in management in connection with the name change.



h)

Year ended September 30, 2002  Sale of Saskatchewan exploration property portfolio



During the year ended September 30, 2002, the Company entered into an agreement to sell its mineral holdings within the La Ronge Gold Belt, Saskatchewan, to Golden Band.  Item 7: Major Shareholders and Related Party Transactions - B. Related Party Transactions.  The proceeds of the sale were comprised of 11,569,202 shares of Golden Band and share purchase warrants to acquire a further 2,892,202 common shares of Golden Band at a price of $0.15 per share in the first year, $0.20 per share in the second year and $0.30 per share in the third year. The value assigned to the proceeds was $1,048,292, based on the average trading price of the Golden Band shares during a reasonable period before and after the announcement of the transaction. The mineral properties that were the subject of this agreement were carried on the Company's books at September 30, 2001 at $1,048,292, as they were written-down at that time to approximate the value of the transaction that was not yet finalized at that date.  (For U.S. accounting purposes, the related property costs were written-off in the years incurred, therefore the vended property had a carrying value of $NIL when the sale occurred.)



The sale agreement closed subsequent to September 30, 2002 when final regulatory approval was received. The transaction was recorded at the Company's 2002 year-end resulting in the elimination of the Saskatchewan properties and the recording of the investment in Golden Band.  For US GAAP purposes, the transaction is recorded in fiscal 2003 and results in recording the investment in Golden Band of $2,777,000 and a gain on sale of mineral properties of $2,777,000.



i)

Year ended September 30, 2001  Procon Lawsuit:



A Statement of Claim was filed against the Company, its 100% owned subsidiary, Waddy Lake Resources Inc., (Waddy Lake), and certain current and past directors and officers of the two companies seeking to recover $1,154,133 for mine contracting services as well as damages, court costs and interest on all sums unpaid. See Item 8: Financial Information - Legal Proceedings. The Company reached a settlement during the year ended September 30, 2004 as described in item 4(A) (4)(c) above.

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j)

Year ended September 30, 2001 - Hixon Gold Resources Inc. reverse take-over:



CDG owned a 36% interest in Hixon Gold Resources Inc. at September 30, 2000. In February 2001, Hixon purchased all of the issued and outstanding common shares of Aloak Corp. for an aggregate purchase price of $3,500,000. Hixon paid the purchase price by issuing 35,000,000 common shares of Hixon at a deemed price of $0.10 per share. CDG had no prior affiliation with Aloak Corp.



Concurrent with the closing of the reverse take-over, CDG purchased 5,300,000 units of Hixon at an ascribed price of $0.10 per unit for aggregate gross proceeds to Hixon of $530,000.   Each unit consisted of one Hixon common share and one warrant (Warrant). The Warrants expired without exercise February 19, 2003. Concurrent with the closing of this private placement the Company sold its present holdings of 5,300,000 Hixon common shares to subscribers resident in the provinces of Alberta, British Columbia and Ontario through a cross of shares on the facilities of the Canadian Venture Exchange (now TSX Venture Exchange).



After completion of the aforementioned transactions Hixons name was changed to Aloak Corp. At September 30, 2004 CDGs interest in Aloak Corp. was approximately 7%.  CDG does not control the operations of Aloak Corp. (formerly known as Hixon), which is now under the control of persons not related to CDG.



k)

Year ended September 30, 2000  Lawsuit Settlement



On or about February 23, 1998, certain persons commenced a lawsuit (the Action) in the United States District Court for the Eastern District of Pennsylvania (the Court) alleging, inter alia, that CDG and certain of its directors (the Defendants) had failed to disclose certain facts in violation of United States securities laws.  The Action was brought as a purported class action on behalf of all purchasers of the Companys common stock during the purported class period from October 3, 1996 through May 14, 1997. The Action sought damages in an unspecified amount.



On July 27, 2000 the United States District Court for the Eastern District of Pennsylvania issued a final judgment and an order of dismissal of the Action.



The Court determined that the terms of the settlement of the class action were fair, reasonable and adequate and in the best interest of the members of the plaintiff class. Pursuant to the settlement agreement the Company issued to the qualifying claimants 1,500,000 common shares of the Company and Settlement Warrants to purchase 3,000,000 shares at an exercise price of CDN $0.65 per share for a term of five years from the Distribution Date.



The share transactions and estimated legal settlement expenses were recorded in the Companys financial statements during the year ended September 30, 2000. Based on a share price of $0.055, the settlement resulted in a charge to earnings of $192,500, including a $110,000 administration fee, and an increase to share capital of $67,500 after deducting estimated share issue expenses of $15,000.



During the five years ended September 30, 2004, neither the Company nor any subsidiary of the Company has been involved in any bankruptcy, receivership or similar proceedings.  Except as described above, neither the Company nor any subsidiary has completed any material reclassification, merger, or consolidation, or acquired or disposed of any material amount of their assets (except in the ordinary course of business), or have made any material changes in their mode of conducting business.

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5.  Principal capital expenditures and divestitures



The following is a list of all securities/shares of investee companies and purchases during the last 3 fiscal years:



Year ended September 30, 2004

The Company subscribed for 1,000,000 units of Manson Creek Resources Ltd. in a non-brokered private placement at $0.10 per unit for total consideration of $100,000.  Each unit consisted of one common share and one-half of a non-transferable share purchase warrant.  Each warrant entitles CDG to purchase one common share for each full warrant at a price of $0.15 per share until December 24, 2005.   Subsequent to year end, the Company exercised its warrant for 500,000 shares at $0.15 per share for total consideration of $75,000.



Year ended September 30, 2004

Acquired 2,300,000 shares of Golden Band for $345,000 pursuant to the exercise of warrants.  CDG Investments Inc. subscribed for 242,397 units of Golden Band Resources Inc. at $0.23 per unit.  Each unit consisted of one common share of Golden Band and one common share purchase warrant, entitling CDG to purchase an additional common share of Golden Band for a period of two years from the date of issuance of August 23, 2004 at a price of $0.25 in the first year and $0.27 in the second year.   Warrants for 242,397 units are still outstanding.



Year ended September 30, 2004

CDG Investments Inc. purchased 5,000 shares of Ultima Energy Trust during the year ended September 30, 2004 and later sold the shares for a gain of $2,900.



Subsequent to the Year ended September 30, 2004

The Company purchased 90,000 shares of RSX Energy Inc. and later sold them subsequent to the year ended September 30, 2004 for a gain of $47,016.





The Company did not obtain debt financing for any of its capital expenditures during the years in question with the exception of the fiscal 2003 mineral property expenditures that were partially financed by the debentures issued in the year.



Year ended September 30, 2004

The Company sold its property interest in the Bahuerachi, Mexico mineral property as described in Item 4(A)(4)(b).



Year ended September 30, 2003

The Company sold the Jolu Mill as described in Item 4(A)(4)(f).



The Company expended $133,000 on the Bahuerachi, Mexico property as described in Item 4(B).



Year ended September 30, 2002

The Company sold its portfolio of Saskatchewan mineral properties as described in Item 4(A)(4)(h).



The Company expended $38,000 to terminate an option agreement regarding the Don David property in Mexico.





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Year ended September 30, 2001

The Company sold all of its shares in Hixon Gold Resources Inc. and repurchased shares in the company that became Aloak Corp.  See Item 4(A)(4)(j).



The Company sold 1,100,000 shares of Tyler Resources Inc. for proceeds of $235,000 and purchased 600,000 shares of Tyler Resources Inc. for $69,000.



The Company incurred exploration expenditures on Canadian mineral properties aggregating $9,000.  Expenditures on the Companys Mexican properties, primarily Bahuerachi, aggregated $15,000 and its share of option payments on the Bahuerachi property amounted to $19,000.



6.  Takeover offers

- Not applicable.



B.          BUSINESS OVERVIEW



The Company



The Companys current business consists of holding investments in mineral exploration companies. The Companys investment policy could be described as buy-and-hold.  If the Company determines that it can realize greater value in selling an investment than maintaining it, it will dispose of the investment.  Since the shares in the investees derive their value from the perceived potential value of exploration properties on their books, the investees exploration properties and plans are relevant to the value of the Company. The Company will also, from time to time make small investments in companies with the goal of making short-term gains.



Investment Strategy



The Company has acquired and manages a portfolio of securities of public companies and may invest in a private issuer if an opportunity becomes available.



The main emphasis of the current portfolio is junior mineral exploration companies, with small investments in an oil and gas company and an Internet communications company.  The Company intends to expand its portfolio as resources and opportunities exist to invest in emerging and junior corporations in a diversified cross section of the economy (i.e. industrial, financial, resource, communication, etc.).



Managements interpretation of emerging and junior corporations are those corporations that can be characterized as companies that are not widely followed by the investment community due to their size and short operating histories, but which are perceived by the Companys management to be entering a strong growth phase of their development cycle.  Some of these companies may be in their development stages with only short operating histories and which may have generated little or no revenues at the date of investment.



The Companys business philosophy is to maximize its financial return on investments while limiting, to the greatest extent practicable, the Companys exposure to the risks inherent in the industry.  See "Risk Factors".



The Company intends to acquire and hold securities for capital appreciation. Should the Company be required to sell investments for working capital, it may dispose of a portion of its investment holdings.  No assurance can be given that the Company will be able to realize its objective of achieving capital appreciation in any or all of its investments.



Management believes each member of the board of directors is able to contribute expertise and a wide range of knowledge to the Companys activities and some of them have experience in the management of investment portfolios. The board of directors are experienced in the initiation and structuring of public and private corporations, debt and equity financings, corporate mergers and acquisitions and in providing corporate, financial and planning services.  Management believes the Company has the capability to appraise and structure transactions from both a technical and financial point of view.



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While securities of public issuers are intended to be the Companys primary investment focus, depending upon market, financial or other conditions, the Company may, from time to time, for brief periods hold short-term obligations and any other types of securities issued or guaranteed by the governments of Canada, any province thereof, the Government of the United States of America or agencies thereof, or short-term paper and certificates of deposit issued by Canadian chartered banks.



The following table summarizes the investment sale proceeds and purchase costs for the year ended September 30, 2004 as well as the gain (loss) on sale for financial statement purposes for these investments:



|Investment          | Number of Shares
Or Units | Purchase Price | Proceeds on
Disposal | Gain (loss) on
Disposal
|------------------- | ------------------------- | -------------- | -------------------- | -----------------------
|Golden Band         |                           |                |                      |                        
|Exercise Warrants   | 2,300,000                 | $345,000       |                      |                        
|Private Placement   | 242,397                   | $55,751        |                      |                        
|Sales               | (2,917,000)               |                | $637,440             | $344,321               
|Aloak               |                           |                |                      |                        
|Sales               | (1,100,000)               |                | $26,722              | $21,239                
|Ultima Energy Trust |                           |                |                      |                        
|Purchase            | 5,000                     | $33,800        |                      |                        
|Sale                | (5,000)                   |                | $36,700              | $2,900                 
|RSX Energy Inc.     |                           |                |                      |                        
|Purchase            | 100,000                   | $83,000        |                      |                        
|Sale                | (10,000)                  |                | $10,509              | $2,209                 
|Waddy Lake          |                           |                |                      |                        
|Procon Payment      |                           |                | $200,000             |                        
|Manson Creek        |                           |                |                      |                        
|Private Placement   | 1,000,000                 | $100,000       |                      |                        
|Total 2004          |                           | $617,551       | $911,371             | $370,669               



There were no significant investments sold in 2003 and 2002.



Investment Holdings



The Companys significant investment holdings, as of March 24, 2005, are summarized below. The investments in Manson Creek Resources Ltd. (Manson), Tyler Resources Inc., (Tyler), and Northern Abitibi Mining Corp. (Northern Abitibi) are recorded as equity investments since the Company, and each of Manson, Tyler and Northern Abitibi, share common officers and directors, allowing the Company to exercise significant influence over operating decisions.  The investment in Golden Band, although representing a significant percentage interest in Golden Band, at September 30, 2004, (25%), was recorded at cost.  The reason for this accounting is that the Company has minority representation on the board of directors, (one director of 6), does not share common officers, and cannot exert significant influence over operating, exploration or investment decisions.  Subsequent to year-end the Companys investment in Golden Band was reduced to 16%.



|Subsidiaries/ Investees       | Percentage
Ownership | Potential
Product       | Exploration Property
Locations
|----------------------------- | -------------------- | ----------------------- | ------------------------------
|Waddy Lake Resources Inc.     | 51%(1)               | Inactive                | N/A                           
|Golden Band Resources Inc.    | 16%                  | Gold                    | Saskatchewan,                 
|Manson Creek Resources Ltd.   | 25.7%                | Gold/Copper/Silver/Zinc | Yukon, British Columbia       
|Northern Abitibi Mining Corp. | 20.6%                | Gold/Nickel/Diamonds    | Quebec, Labrador              
|Tyler Resources Inc.          | 18%                  | Copper/Gold/Diamonds    | Mexico, Northwest Territories 



(1)

Effective April 30, 2004, the companys wholly-owned subsidiary, Waddy Lake Resources Inc. commenced to be carried at cost due to the sale of 49% of its interest and the surrender of operating decisions to the acquirer. See Item 4(A)(4)(c).



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The value of the Companys investments will be influenced by the investees mineral reserves, if any, and the price of the minerals/metals represented by those reserves.  As of the date of this annual report, all of the investees properties are without known reserves and the proposed programs are exploratory in nature.  As the price of gold and other metals/minerals rise, there tends to be a corresponding rise in the market price of the investees capital stock and increased interest by investors in the advancement of projects which translates into improved opportunities for the investees to raise necessary capital to advance promising projects.  This further enables the Company to raise equity capital as needed and enables it to sell investments in a favorable environment.  The fortunes of the investees and consequently the Company are therefore highly susceptible to changes in the market prices of metals and minerals.



The economics of whether or not an existing project with mineralization or a newly discovered one is advanced beyond the exploration stage is influenced by the price of minerals, gold and other metals.  The Company believes that companies in which it invests, have identified a number of projects with sufficient exploration work and assessment work filed to keep the projects in good standing to the year 2005 and beyond.  The value of the mineral properties is affected by increasing or declining metals prices.



The Companys significant investments consist of the following companies:



1.

Golden Band Resources Inc.

2.

Tyler Resources Inc.

3.

Manson Creek Resources Inc.

4.

Northern Abitibi Mining Corp.



Golden Band Resources Inc.



The information provided on Golden Band has been compiled from publically available documents located at www.sedar.com



Golden Band is publicly listed on the TSX Venture Exchange under the trading symbol GBN.  Golden Band is a mineral exploration company that is in the exploration stage, and all of its property interests are without known reserves and its proposed programs are exploratory in nature.  The underlying value of Golden Bands mineral properties and related deferred costs is dependent on the existence of economically recoverable reserves, the ability of the company to obtain the necessary financing to advance its properties beyond the exploration stage, and upon future profitable activities.  Substantially all of Golden Bands mineral properties are in the La Ronge area of Saskatchewan, Canada, where the companys major focus is a long-term, systematic gold exploration program.



Golden Band does not have operating sources of revenues and relies on equity financings and occasionally debt to finance exploration on its properties.  There has been no significant revenue in the immediately three preceding fiscal years ended April 30.  In the six months ended October 31, 2004, (the most recently published quarterly financial statements), Golden Band had interest revenue of $3,000.



According to Golden Bands quarterly financial statements and quarterly regulatory filing, at October 31, 2004, Golden Band had working capital of $207,000.  Golden Bands administrative costs net of its small interest income are approximately $45,000 per month and it has no internal sources of funding.  The future of Golden Band depends on its ability to raise funds, to finance its exploration programs and administrative expenditures.  There is no guarantee that Golden Band will be able to raise funds when required.



Golden Band has no material tangible fixed assets except as disclosed below and has not disclosed in its most recent quarterly financial statements for the six months ended October 31, 2004 any commitments to acquire significant tangible capital assets.  Substantially all of Golden Bands assets are mineral property acquisition costs and deferred exploration costs related thereto.  A summary of mineral property expenditures, all having been incurred in Saskatchewan, in the preceding three years ended April 30 and for the most recently reported year-to-date period in fiscal 2004 are as follows:



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|            | Balance
Apr30/01 | Costs Fiscal
2002 | Costs
Fiscal
2003 | Costs
Fiscal 2004 | Balance
Apr30/04 | Costs
May1/04
To Oct31/04 | Balance
October 31, 2004
|----------- | ---------------- | ----------------- | ----------------- | ----------------- | ---------------- | ------------------------- | ------------------------
|Acquisition | $132,275         | $81,616           | $2,329,635        | $30,000           | $2,573,526       | $       -                 | $2,573,526              
|Exploration | $995,708         | $83,700           | $790,870          | 1,345,213         | 3,215,491        | 785,971                   | 4,001,462               
|Total       | $1,127,983       | $165,316          | $3,120,505        | $1,375,213        | $5,789,017       | $  785,971                | $6,574,988              



Golden Band acquired interests in a number of Saskatchewan prospects during calendar 2002, including 100% of the Companys Saskatchewan property portfolio.  Golden Bands acquisition program resulted in it holding 100% interests in prospective gold properties aggregating over 60,000 hectares in the Greenstone Belt of Saskatchewan.  The first exploration on these properties was undertaken in the 1930s and extensive exploration had occurred sporadically since then, with peaks during high gold prices and favorable equity-financing environments.



Golden Bands main objective is to advance its existing prospects beyond the exploration stage.  Golden Bands short-term plan is to advance the Bingo deposit and other high-grade gold deposits beyond the exploration stage, with processing, if any, to occur at Golden Bands 100%-owned Jolu mill.  A scoping study is planned to assess the potential opportunities for a proposed central mill complex in the Greater Waddy Lake area.



Golden Band is also continuing its exploration work.  During the 2004 summer, several significant gold-in-till dispersion trains were newly discovered or confirmed.  This work focused between Waddy and Tower lakes and near the former Star Lake and Jolu gold mines.  A number of these anomalies were traced to their likely bedrock sources and are potential targets for the 59,000 metre 2004-2005 winter drilling program that began in December 2004.



Golden Bands near-term objective is to delineate 100,000 ounces of high-grade gold mineral occurrence within trucking distance of the companys Jolu mill.  It is anticipated that within a few months of obtaining a positive feasibility study and receipt of the necessary government approvals Golden Band could begin the preparation to extract the minerals with a relatively low capital investment.  Golden Band has not informed the Company, nor has it publically announced, what approvals are necessary nor how long it will be until a positive feasibility study is obtained or how long it would be until Government approvals are received.  Current plans call for an underground exploration program on the Bingo deposit to test for grade and continuity of the gold mineralization.



The longer-term objective is to advance Golden Bands gold deposits in the Greater Waddy Lake area beyond the exploration stage.  The consolidation of the majority of gold occurrences under one ownership has been a key factor to achieving this plan.



Golden Bands Management believes that such consolidation within a short distance of a central mill could support a long-term mining complex.  It is expected that such a new mill would likely require a capacity in excess of 2,000 tonnes per day along with the construction of matching tailing facilities.  In order to ensure sufficient mill feed, several deposits may need to be sequentially mined by open pit and/or underground methods to supply the feedstock to the mill.  A scoping study is planned, the objective of which will be to outline the feasibility of supporting a new mill from these deposits.



The improvement in the gold price has re-focused the company away from its initial objective of exploration aimed at increasing the resource base, to one of advancing its existing mineral deposits beyond the exploration stage.  Under the lower gold price environment, additional reserves were necessary to support a decision to advance a property beyond the exploration stage.  With current and anticipate higher gold prices, it is considered likely that the company is approaching the threshold ounces required to advance certain deposits beyond the exploration stage.



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Golden Band has an option to earn an interest in Tyler Resources Inc.s Weedy Lake Property.  See Tyler Resources Inc., Weedy Lake Property, Saskatchewan, Page 38.



The following summarizes the officers and directors of Golden Band as at February 28, 2005:



|Name, Municipality of Residence and
Position                                             | Principal Occupation or employment and, if not a previously elected director, occupation during the past 5 years                                       | Previous Service
as a Director
|---------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------ | ------------------------------
|ROBERT G. INGRAM, C.A.
Edmonton, Alberta
Director                                        | Self-employed Chartered Accountant.  Director and President of Southesk Energy Ltd. and Yellowhead Equities Inc., Director of CDG Investments Inc.     | Since January 24, 2004        
|KLAUS LEHNERT-THIEL
Saskatoon, Saskatchewan
Vice-President Exploration, COO and Director | Exploration and mining consultant.                                                                                                                     | Since May 1993                
|ROY LLOYD
Saskatoon, Saskatchewan
Director                                               | Retired Management Consultant.                                                                                                                         | Since May 2002                
|RONALD K. NETOLITZKY
Victoria, B. C.
Director, President and CEO                         | Geologist; Director of Skeena Resources
Limited, Chairman and Director of Viceroy Exploration Ltd. And a Director of other resource companies.         | Since June 1989               
|RODNEY ORR, MBA, P.GEO
Saskatoon, Saskatchewan
Vice-President Operations, CFO            | Vice-President Exploration, Executive Vice-President Mindoro Resources, 1996-1999; Uranerz Exploration and Mining Ltd., (Canada), Geologist, 1977-1996 | Since February 3, 2004        
|ROBSON GARDEN, QC, BA, LLB
Regina, Saskatchewan
Director                                 | Senior Partner, MacPherson, Leslie and Tyerman                                                                                                         | Since January 24, 2004        



The following table sets forth the annual high and low market prices for Golden Bands common shares for its five most recent full financial years:



|TSX Venture Exchange
Year ended April 30, | 2004
Cdn$ | 2003
Cdn$ | 2002
Cdn$ | 2001
Cdn$ | 2000
Cdn$ | 1999
Cdn$
|----------------------------------------- | --------- | --------- | --------- | --------- | --------- | ---------
|High                                      |           | .36       | .32       | .19       | .11       | .19      
|Low                                       |           | .17       | .18       | .04       | .03       | .04      



The following table sets forth the high and low market price for Golden Bands common shares during each fiscal quarter of Golden Band for the two most recent fiscal years:



|                 | Sale Price GBN
|---------------- | --------------
|Quarter Ended    |               
|Fiscal 2005      | Low Cdn$      
|January 31, 2005 | .215          
|October 31, 2004 | .17           
|July 31, 2004    | .18           
|Fiscal 2004      | Low Cdn$      
|April 30, 2004   | .22           
|January 31, 2004 | .24           
|October 31, 2003 | .17           
|July 31, 2003    | .21           
|Fiscal 2003      | Low Cdn       
|April 30, 2003   | .21           
|January 31, 2003 | .21           



22

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The following table sets forth the high and low market prices for Golden Bands common shares for each month during the most recent six months:



|Month Ended     | Low Cdn$ | High Cdn$
|--------------- | -------- | ---------
|February, 2005  | .22      | .37      
|January, 2005   | .215     | .31      
|December, 2004  | .215     | .265     
|November, 2004  | .23      | .32      
|October, 2004   | .185     | .30      
|September, 2004 | .17      | .22      



Tyler Resources Inc.



The information provided on Tyler has been compiled from publically available documents located at www.sedar.com



Tyler is publicly listed on the TSX Venture Exchange under the trading symbol TYS.  Tyler is a mineral exploration company that is in the exploration stage, and all of its property interests are without known reserves and all of its proposed programs are exploratory in nature.  The underlying value of Tylers mineral properties and related deferred costs is dependent on the existence of economically recoverable reserves, the ability of the company to obtain the necessary financing to advance its properties beyond the exploration stage, and upon future profitable activities.



Tyler does not have significant sources of revenue from its activities and it relies on equity financings finance exploration on its properties.  The only sources of revenue in the immediately three preceding fiscal years ended July 31 were overhead fees received as compensation for administrative costs incurred in acting as operator for certain joint ventures and interest income derived from holding cash in short-term investment vehicles such as term deposits and brokerage cash accounts.  Tylers revenue for the past three fiscal years ended July 31, and the six months ended January 31, 2005 is summarized as follows:



|                 | 2002    | 2003    | 2004    | Six months ended January 31, 2005
|---------------- | ------- | ------- | ------- | ---------------------------------
|Overhead fees    | $16,134 | $5,539  | $9,224  | $   -                            
|Interest revenue | $4,800  | $5,063  | 25,460  | $19,292                          
|Total            | $20,934 | $10,602 | $34,684 | $19,292                          



At January 31, 2005, Tyler had positive working capital of $3,083,000. Tylers management believes it has more than sufficient cash available to fund operations in the next twelve months and to continue to fund its current drilling program in Mexico.  If the current drill program increases Tyler may need to raise additional cash to fund its operations.



Tyler does not have significant tangible capital assets except as disclosed below and no commitments to acquire same.  Its most substantial asset is its mineral properties.  Expenditures on these properties for the most recent three fiscal years and the six months ended January 31, 2005 are summarized below:



23

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|                                        | Balance
July 31/01 | Costs Fiscal
2002 |   | Costs
Fiscal
2003 |   | Costs
Fiscal 2004 |   | Balance
July 31, 2004 | Costs
Aug 1/04
To Jan 31/05 |   | Balance
Jan.31,
2005
|--------------------------------------- | ------------------ | ----------------- | - | ----------------- | - | ----------------- | - | --------------------- | --------------------------- | - | --------------------
|Acquisition                             |                    |                   |   |                   |   |                   |   |                       |                             |   |                     
|Bahuerachi - Mexico                     | 156,026            | 65,439            |   | 27,148            |   | 875,246           |   | 1,123,859             | 60,180                      |   | $1,184,039          
|Weedy Lake  Saskatchewan               | 637,844            | -                 |   | -                 |   | -                 |   | 637,844               | -                           |   | 637,844             
|Carat and Kelsey, Northwest Territories | 246,112            | -                 |   | -                 |   | -                 |   | 246,112               | -                           |   | 246,112             
|Other                                   | 302,075            | (239,717)         | a | (495)             |   | (54,594)          | d | 7,269                 | -                           |   | 7,269               
|Total Acquisition                       | 1,342,057          | (174,278)         |   | 26,653            |   | 820,652           |   | 2,015,084             | 60,180                      |   | 2,075,264           
|Exploration                             |                    |                   |   |                   |   |                   |   |                       |                             |   |                     
|Bahuerachi - Mexico                     | 994,867            | 31,716            |   | 22,319            |   | 762,204           |   | 1,811,106             | 899,533                     |   | 2,710,639           
|Weedy Lake - Saskatchewan               | 1,743,240          | 462               |   | 100               |   | 357               |   | 1,744,159             | -                           |   | 1,744,159           
|Carat and Kelsey, Northwest Territories | 2,166              | 413,647           |   | 282,434           |   | (591,975)         | e | 106,272               | (119,000)                   | g | (12,728)            
|Other                                   | 1,805,768          | (1,541,726)       | b | (46,706)          | c | (209,374)         | f | 7,362                 | -                           |   | 7,362               
|Total Exploration                       | 4,545,441          | (1,095,901)       |   | 258,147           |   | (38,788)          |   | 3,668,899             | 780,533                     |   | 4,449,432           



(a)

Costs of $58,061 net of write-offs of $297,778.

(b)

Costs of $249,241 net of write-offs of $1,790,967

(c)

Costs of $16,478 net of recoveries and write-offs of $63,184.

(d)

Costs of $1,018 net of write-offs of $55,612.

(e)

Costs of $37,772 net of cost recoveries of $546,247 that pertained to an arbitration award of reimbursed joint venture over-expenditures and reimbursed arbitration costs, all of which had been capitalized to the property, and option payments of $83,500.

(f)

Write-offs and recoveries of $212,127 net of costs of $2,753.

(g)

Option payments.



The following describes Tylers significant mineral properties:



Bahuerachi Property, Mexico



The principal exploration property in Mexico is Bahuerachi, located in the state of Chihuahua roughly 8 kilometers north of the town of La Reforma, Sinaloa. The base and precious metals of interest on the property are copper, gold, zinc and silver. The Bahuerachi property is subject to an option agreement with a Mexican national, (the Optionor). At October 31, 2004, Tyler had an approximate 95% interest in the property, subject to verification by the Optionor. The property interest is held through Recursos Tyler S.A. de C.V., (Recursos Tyler), a Mexican corporation that holds the mineral claims in trust for Tyler. The Optionor holds the remaining 5% interest in the property at January 31, 2005. This 5% property interest is convertible into a 10% net profits interest. The 5% property interest or the 10% net profits interest, as the case may be, can be purchased by Tyler for $700,000 US.



In February, 2004, an airborne geophysical survey was completed.  Initial plotting and review indicated a good correlation between the airborne geophysical data and known geology, as well as with previously recognized mineralization at the projects Main Zone. During April, 2004 the company conducted reconnaissance work and hand trenching in areas to be drilled.  Assay results from this testing were published in the news release 04-09 released April 20, 2004  see assay results on page 33.  Field mapping confirmed an extension of the Main Zone that had been indicated by the airborne geophysical data.



24

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Tyler commenced its Phase 1 drilling program in May, 2004 and concluded in June with the completion of 12 drill holes for a cumulative 1,084 meters of drilling.  Due to generally poor ground conditions, all drill holes were terminated before reaching their full planned target depths, often within mineralized zones.  Phase 2 drilling confirmed the extensive and continuous nature of high grade copper, gold, silver and locally zinc-bearing breccia and skarn bodies.  High-grade breccia/skarn zones have been traced at surface over a strike length exceeding 1,200 metres, and have been traced by drilling over a strike length of 500 metres, to depths of up to 100 metres.  The average width of this unit in drilling to date is approximately 24 metres and the weighted average grade of drill sections is 2.29% copper, 0.12 g/t gold, 15.9 g/t silver and 0.40% zinc.  The breccia unit remains open along strike and at depth. Encouraging grades within stockworked veined main mineralized porphiry in the northern part of the area tested during Phase 1 include 3.05 metres grading 0.73% copper and 3.05 metres grading 0.18% copper and 0.35 g/t gold at the end of drill hole #11.  Combined with surface chip samples in variably leached intrusion grading 0.51% copper over 24 metres and 36 metres grading 0.40% copper, this provides an excellent porphyry copper target to be tested during Phase 2.   The detailed results of drill holes one through twelve can be found in four news releases:  04-11, 04-12, 04-13, and 04-14 which were published in May through July, 2004  see assay results on page 33.



Tylers private placement in March, 2004 was used to finance the May/June 2004 drill program and will finance the 2004/2005 Phase 2 drill program, initially budgeted in the range of $1.2 million to $1.5 million Cdn.  The budget was increased by approximately $1.4 million Cdn., with the receipt of additional working capital from the exercise of warrants and options.  The Phase 2 Program will continue to test the strike, width, and depth potential at Bahuerachi, and aims to clearly demonstrate the bulk tonnage potential of the system.  There are currently two drill rigs on the property; a reverse circulation drill and a core drill.  The Phase 2 program is budgeted to cover approximately 3,500 meters of core drilling and 7,300 meters of reverse circulation drilling during the months of January through April, 2005.   Drill results are being released in batches as drilling progresses.  Samples are shipped to ALS Chemex in Hermosillo with final assay work conducted by ALS Chemex labs in Vancouver.



As discussed in news release 04-19 dated December 14, 2004, drill hole #13 was completed to a depth of 77 meters where it was stopped before its planned depth due to deteriorating ground conditions  see assay results on page 33.   Drill hole #14 was completed to its planned target depth.  The results from these two holes included a skarn/breccia section grading 1.2% copper, 0.35% zinc, 0.13 g/t gold and 13 g/t silver over 18 meters within a larger interval grading 0.42% copper and 0.16% zinc over 105 meters.   Tylers Management felt that these results confirmed the continuity both geologically and in terms of grades at depth within the three main mineralized units identified on the project to December 14, 2004.  In addition to solid copper and molybdenum grades, the addition of potential credits in the form of silver, lead and zinc mineralization in the porphyry was unexpected and considered a positive development. See assay results on page 33.



The first reverse circulation drill results for hole # 04-RC-1 included 30.4 meters grading an average of 0.28% copper and a further 15.2 meters grading an average of 0.25% copper and 0.13% zinc with the hole ending in mineralization.  These results were believed to significantly understate the true grades of mineralization within the intersected mineralized units as the hole was a twin of core hole #13 for which results were significantly better.  Some of the variability was caused by generally difficult drilling and poor ground conditions.  Tylers Management determined that further twinning would be conducted to determine the range of variability.



Core drill hole #15 returned an intersection of 143 meters with an average grade of 0.71% copper from 16 to 159 meters.  This was followed by 5.6 meters grading 2.15% copper, 0.24 g/t gold, 31 g/t silver and 0.62% zinc from 160.7 meters to 166.3 meters where the hole ended in mineralization.



Tyler implemented changes to the Reverse Circulation drilling program with the objective of bringing the accuracy of reverse circulation drilling to within 10% to 20% of core drilling and to establish a good control over geostatistical assay result variability with further twinning of core holes.   The Reverse Circulation Drill was used to twin core drill hole #15 as a second variability test.  The RC rig will be used to do first pass prospecting drilling on targets which are outside of the Main Zone porphyry and require further investigation.    See assay results on page 33.



25

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Assay results for Reverse Circulation drill holes 2 through 5  are available on page 34. Drill hole 04-RC-2 returned an average grade of 1.3% copper, 1.07% zinc and 27 g/t silver over 112.78 meters, including 48.78 meters grading 1.81% copper, 0.14 g/t gold, 22 g/t silver and 2.03% zinc in the main mineralized skarn breccia and associated QFP  hosted endoskarn complex.  Hole RC-2 ended in mineralization.  Tyler believes that there remains a possibility that results from RC 2 to 5 may still understate the true grade of the intervals drilled due to loss of fines during the sample recovery process.  However, results from these holes are within the range of values expected for the areas drilled as well as the geological environment and continue to indicate clear bulk mining potential.



News release 05-05 dated February 14, 2005, summarizes results from Reverse Circulation drill holes  see assay results on page  34.  Reverse Circulation drill hole 05-RC-8 to 11 were drilled to do a first pass testing of the Los Alisos epithermal system located approximately 1.2 kilometers west of the area of the Main Zone drilling to date on the property.  All holes intersected strong quartz vein and veinlet stockwork zone alteration. Holes RC 8 and 9 intersected high-grade mineralization related to quartz vein emplacement in a coarse grained, altered porphyritic rock.  Holes RC 10 and 11 intersected weakly mineralized zones.  RC 7 was not completed to depth due to groundwater conditions and the test remains inconclusive.  RC 6 was a Reverse Circulation drill hole designed to twin core drill hole #15 in order to test the new sampling cyclone used to minimize fines loss.  Initial review of the results shows that Reverse Circulation drilling can show a significant downwards bias in grades compared to core assay results for comparable intervals.    Further adjustments have been made to the Reverse Circulation portion of the drilling program and incorporated into an additional twin test.  The new samples will be assayed for verification that sample recovery has further improved and can be considered statistically reliable.



Core drill results were published in news release 05-06 on February 24, 2005  see assay results page 34. The bottom portion of drill hole #16 was completed from 152 meters to its target depth of 217 meters.  Drill hole #17 ended in sheared QFP grading 0.28% copper and 0.017% molybdenum at a depth of 215.9 meters.   Significant intervals from the drill cores ranged from grades of 0.35% copper to 0.80% copper, 0.03 to 0.07 g/t gold, 2 to 13.7 g/t silver and 0.14% to 0.31% zinc.



(i)

Property Location And Description



Property Location



Bahuerachi lies in southwestern Chihuahua state, Mexico, about 5 km northeast of the Sinaloa state boundary (Figure 2.1). The closest town is La Reforma, Sinaloa, located some 8 km to the south.  A small village of less than 100 inhabitants (Bahuerachi) is located on the western portion of the permit area.



Property Description



The Property presently consists of three mining concessions totaling 3,318 ha as follows:



|Concession      | Title Number | Area (Ha) | Date Issued | Expiry        | Type        
|--------------- | ------------ | --------- | ----------- | ------------- | ------------
|Bahuerachi      | T 211761     | 500       | 2000        | July 2050     | Exploitation
|Bahuerachi Dos  | T 215572     | 2788      | 2002        | March 2052    | Exploitation
|Bahuerachi Tres | T 215511     | 30        | 2002        | February 2008 | Exploration 



The prospect is under three contiguous concessions, which were issued in 2000 and 2002.  The majority of the prospect, 3,288 hectares, is under two exploitation type concessions, which  expire in 2050 and 2052.  About 30 hectares are under an exploration concession which expires in February 2008; however, the concession may be converted to an exploitation permit.



26

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[cdg20f002.gif]





Figure 2.1-General Location Map





Permits and Liabilities



Tyler maintains the necessary annual environmental reporting on the prospects, and the last inspection was conducted in 2001.  Tyler has the necessary permits for its current program of drilling.  The joint venture is responsible for the maintenance in good standing of the prospects under the agreement, including all statutory filings and tax payments.  Tyler currently pays annual mining duties of US$14,952.



27

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[cdg20f004.gif]





Concession Blocks - The latest survey plans utilized to register the Bahuerachi Tres exploration concession.





(ii)

Accessibility, Climate, Physiography, Local Resources And Infrastructure Access



The Bahuerachi prospect lies in the south-western portion of Chihuahua State, about five kilometers northeast of the Sinaloa State border.  The closest town is La Reforma, Sinaloa, located about eight kilometers to the south.    The prospect is accessed by secondary unpaved roads from Choix, Sinaloa which takes about four hours and requires a ferry crossing of Rio Fuerte.  Access to Choix is by paved roads.  Access to the property is possible year round.  Access throughout the prospect is by a network of foot/burro trails, including well developed trails in Arroyo Reforma and several major tributary drainages. A few of these have been partially upgraded to allow the use of all terrain vehicles.

The closest town, La Reforma, offers limited health services (nursing station) as well as phone/fax services and a poorly stocked country store which sells essential supplies.  Supplies such as food, electrical/mechanical supplies and fuel are typically sourced out of the city of Choix where a wide range of products can be found. Supply trips to Choix from the property can usually be completed in one day when ferry service across the El Fuerte reservoir is available.



28

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Electrical power is not presently available on the property, and the closest hydroelectric power generating facility is located roughly 25 kilometers to the south west of the property, at Huites on the El Fuerte river. The current power grid extends to the village of La Reforma, eight kilometers south of the property.

Water is present year round throughout the concessions in the major arroyos, such as Arroyo Reforma which crosses the property in a north-south direction. Drinking water is available either by filtering water from local arroyos or obtained from artesian wells at the village of Bahuerachi.



Climate and Physiography



The climate on the property is typical of this area of the Sierra Madre with a dry, arid climate for most of the year punctuated by typically heavy rains during the period from September to November.



Terrain is rugged to extreme, rising abruptly from main valleys at about 200 m ASL to peaks at 1,300 m.



(iii)

Property History



According to available records, the prospect has been visited by numerous large companies over the years, but their limited exploration efforts appear to have yielded little actual modern exploration data.  It also appears that the work done by these companies was concentrated on the main zone of the prospect and not in the farther reaches of the concessions.  Thus, Tyler will be required to conduct a full range of exploration studies and evaluations to properly assess the potential of the overall prospect.  The historical workings and explorations of the concessions at best can only serve as a guide to where Tylers activities might first commence.



(iv)

Geological Setting



Regional Geology



The geology of northwestern Mexico is dominated by the Sierra Madre Occidental, a belt of Cretaceous to Tertiary volcanic rocks extending southeasterly from the US border for 1,400 km. These rocks comprise a lower (45 to 100 million year old) sequence of andesitic flows and pyroclastic rocks, uncomformably overlain by a distinctive, upper (27 to 34 million year old) ignimbrite complex.  The upper complex, probably the most extensive of its type on earth, is up to 1 km thick.  A thick sequence of Triassic-Cretaceous volcano-sedimentary sequence is exposed between the Pacific Coast and the western slopes of the Sierra Madre. Cretaceous and Tertiary intrusive rocks occur in a belt, 60 km-100 km wide, immediately inland of the coast.



Property Geology



At the property scale, a large range of the units previously described are exposed by the presence of an erosional window through the late Tertiary volcanic sequence.



At the base of the sequence, the Triassic-Jurassic-Cretaceous volcano sedimentary units are well exposed and consist of interbedded sediments (conglomerates, sandstones, siltstones), carbonates and limy sediments as well as andesitic volcanic flows. Field observations where bedding relationships can readily be observed indicate that these units were folded although fold geometry and amplitude have not yet been defined.  Evidence for thrusting is also present on a regional scale.



These units are locally overlain by the Tertiary andesitic, pyroclastic and ignimbrite flows and are intruded by a series of intrusions ranging in composition from dioritic to
rhyolitic.





29

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An important intrusive complex consisting of multiple intrusions ranging in composition from mafic (dioritic/andesitic) to felsic (rhyolitic) is present on the property. The core of this complex is exposed over a north-south distance of at least 10 km by a minimum width of 3 km although its total extent is not known at present.  The best exposures of this complex occur along arroyo Reforma from the north end of the property to the town of La Reforma and then southerly to the El Fuerte River. Most of the intrusive complex consists of fault bound (post emplacement faults?) dyke like bodies with a volumetrically dominant dacitic core. The dacitic bodies have been observed at the Propertys Main Zone as varying in widths from 50 m to over 200 m in width.  Numerous andesitic or rhyolitic dykes with widths in the 1 m-10 m range are seen cutting the dacitic core in both north-south and locally east-west orientations. These later dykes have been observed to the east of the property cutting the base of the tertiary sequence providing an age constraint on these intrusive events.  It can be noted that the late dykes are predominantly observed as fresh, unaltered rocks at the Main Zone and are therefore considered as being post-mineralization.



Large scale faulting is observed on the property and some of the late faults have been intruded by flow-banded rhyolite dykes.  Important fault systems occur in both roughly north-south and east-west directions.  Important displacement in the >100 m range can be inferred using the base of the uncomformably tertiary ignimbrite complex as a marker horizon. To the north-east of the property, Cretaceous carbonate units and sedimentary rocks can be seen at the same topographic level as tertiary ignimbrites across the valley of arroyo Cieneguita which marks a major north-south fault structure.  This particular fault structure, which is well exposed in the dry creek bed, is characterized by a thick section of coarse polymictic fault breccia. The importance of faulting is crucial in terms of the exploration model as creating zones of structural weakness and/or dilation propitious for the emplacement of magmas and subsequent mineralizing fluids.



Detailed mapping to date has only been carried out at the site of identified mineralization.



(v)

Mineralization

Currently, there are seven significant zones of mineralization identified within the entire prospect.  Two of the zones will be the focus of the next phase of exploratory work.  In the main zone, it is expected that copper and gold, along with other base metals, may be present at levels that will be commercially viable for later work.  In the Los Alisos zone, there appears to be a gold-silver hydrothermal system, which has had some mapping and sampling at the surface, and indicates levels of mineralization that support initial drilling.

Work to date has only been on specific areas within the prospect.  This work has outlined a mineralized complex with overall surface widths and grades comparable to that of historical or present economic producers within a mineralized porphyry-style complex.



(vi)

Exploration



Company Exploration

Since the acquisition of its interest in the Bahuerachi prospect in 1994, Tyler has pursued activities designed to commence exploration of the concession area.  Tyler initially built a rudimentary road access to the area. Tyler then initiated drilling in an effort to define a small near-surface copper oxide mineralization within the main zone.  This initial drilling campaign was conducted in 1997 to evaluate the near surface copper-oxide potential of the prospect.  It was conducted on a theoretical 50 meter centre grid to cover an area of roughly 400 meters by 200 meters over what was believed to be the core of the mineralized system in the main zone.  Initial holes were planned as vertical holes to evaluate a possible near-surface, sub-horizontal zone of copper oxide enrichment (oxide blanket). Although mineralization was found to be widespread, even outside the higher grade replacement zones, drill hole location and drilling directions did not allow for adequate testing of the higher grade zones or the mineralized intrusion as defined by subsequent work. Core recovery also reportedly averaged only 70% over the program with heavy losses in altered, mineralized sections as well as within intrusive sections.

Plotting of the 1997 drill holes shows that 10 of the 18 holes were located in the sediments and volcanics outside of the main skarns or mineralized dacitic porphyry. Only two holes were collared in the high grade replacement skarn zones but were poorly oriented in terms of recently established geological controls. Regardless of this deficiency, results of the 1997 drilling include the following reported statistics which remain valid in the context of future exploration on the prospect, in the main zone: cumulative 166.06 m of drill intersections in the exoskarn averaged 1.17% copper with a range of 0.23%-2.34% copper, cumulative 111.43 m in altered andesites and sediments was found to average 0.58% copper with a range of 0.28%-0.86% copper and a cumulative 59.7 m of intersections of copper mineralization in the altered dacitic porphyry intrusion  was found to grade 0.67% copper with a range of 0.28%-1.28% copper.  All of these ranges are considered within the type of values expected in an economic porphyry style system and associated high grade skarn zones.



30

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1997 Drill Hole Data Summary



|DRILL HOLE DATA | MINERALIZATION (sections above 0.50% copper in bold)
|--------------- | ----------------------------------------------------
|Drill hole#     | Total depth                                         
|T-97-1          | 41.46                                               
|                |                                                     
|T-97-1-A        | 116.77                                              
|                |                                                     
|T-97-2          | 101.52                                              
|                |                                                     
|T-97-3          | 101.52                                              
|                |                                                     
|                |                                                     
|T-97-4          | 89.33                                               
|                |                                                     
|T-97-5          | 101.52                                              
|                |                                                     
|                |                                                     
|                |                                                     
|T-97-6          | 101.52                                              
|                |                                                     
|                |                                                     
|T-97-7          | 101.52                                              
|                |                                                     
|T-97-8          | 101.52                                              
|                |                                                     
|                |                                                     
|T-97-9          | 101.52                                              
|T-97-10         | 46.65                                               
|                |                                                     
|T-97-11         | 69.82                                               
|                |                                                     
|                |                                                     
|T-97-12         | 60.06                                               
|T-97-13         | 27.44                                               
|                |                                                     
|T-97-14         | 89.33                                               
|                |                                                     
|                |                                                     
|                |                                                     
|T-97-15         | 55.79                                               
|                |                                                     
|T-97-16         | 101.52                                              
|                |                                                     
|                |                                                     
|                |                                                     
|                |                                                     
|                |                                                     
|                |                                                     
|T-97-17         | 45.73                                               
|                |                                                     
|                |                                                     
|T-97-18         | 54.88                                               
|                |                                                     
|                |                                                     



31

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Other prospecting programs conducted during this period allowed for the accumulation of local to regional scale data that has greatly enhanced the understanding of the mineralization and its potential at Bahuerachi.  A greater understanding of regional stratigraphy and structure allows for the integration of punctual data and evaluation of overall potential for each occurrence.  Numerous mineralized showings have been identified on the property outside of the main zone

In 2001 there was a surface exploration program to examine known showings with the objective of determining geological controls and settings for existing mineralization.  Previous datasets from prospecting programs offered punctual data in terms of mineralized occurrences but without further mapping, this data cannot be used to outline the potential of any one area as true widths of mineralized systems could not be determined with reasonable certainty.  The 2001 program was successful in outlining minimum surface length and widths for mineralization at the main zone  and the Mina Mexicana and Los Alisos areas.  It also provided for greater understanding of the geological context and controls on the known mineralization and as such, created the base necessary for drilling recommendations on the property.



A short program of underground sampling was conducted in August 2003 in conjunction with a number of field property visits with third parties.  The short program centered on the partial rehabilitation of an historical adit.  The program objective was to collect data at depths which, in conjunction with the 2001 surface data, would allow for the generation of an interpretative cross-section across the system.



Tyler conducted an airborne geophysical survey on the property in February 2004 in preparation for an exploratory drilling program that commenced in April 2004.



The Phase 2004 Phase 1 program consisted of 1,084 meters of diamond drilling as well as mechanized trenching.  Field work started in March and lasted through to early June 2004.  The program successfully  confirmed the extensive and continuous nature of high grade copper, gold, silver and locally zinc bearing breccia and skarn bodies.  These occur locally within, on the edges, and away from the main mineralized porphyry (QFP).  The mineralized intrusive complex, including mineralized sediments and high grade breccia and skarn zones in the core of the complex, has now been outlined at surface over an area in excess of 4 kilometres in strike length with widths varying between 200 metres to in excess of 700 metres. These results continue to confirm the presence of mineralization with bulk mining potential in a world class sized porphyry setting at the Bahuerachi Property.



32

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Significant drill intersects for drill holes 3 through 17 are presented below.  The drilling has confirmed continuation of the mineralized zones and continues to demonstrate the depth extension of sections sampled at surface.  Due to poor ground conditions, all the drill holes were terminated or lost before reaching their planned target depths, often within mineralized zones.  Data for drill holes 1 and 2 are not included as generally poor core recovery did not allow for proper sampling to be carried out.



Drill holes # 3 through 12, significant intervals:



|DRILL HOLE # | FROM  (m) | TO (m) | Interval (m) | Copper (%) | Gold (g/t) | Silver (g/t) | Zinc (%) | Rock type                                   
|------------ | --------- | ------ | ------------ | ---------- | ---------- | ------------ | -------- | --------------------------------------------
|04BAH-03     | 28.04     | 49.38  | 21.34        | 3.11 %     | .09        | 19.42        | 1.25     | breccia pipe/skarn                          
|04BAH-04     | 21        | 79     | 58           | 0.72 %     |            |              |          | Chalcocite blanket/QFP/breccia skarn        
|Including    | 21        | 45     | 24           | 1.16 %     | .02        | 3.23         | .02      | Chalcocite blanket/skarn/QFP                
|Including    | 63        | 79     | 16           | 0.76 %     | .05        | 9.67         | 0.60     | breccia pipe/skarn                          
|04BAH-05     | 14        | 122.43 | 108.43       | 0.63 %     |            |              |          | Chalcocite blanket/QFP/marble/
breccia skarn
|Including    | 14        | 32     | 18           | 0.69 %     | .02        | 4.83         | .14      | Chalcocite blanket/skarn/QFP                
|Including    | 101.19    | 122.43 | 21.24        | 1.61 %     | 0.10       | 21.39        | 0.58     | breccia pipe/skarn                          
|O4BAH-06     | 1.5       | 37     | 35.5         | 3.08 %     | 0.14       | 15.37        | 0.09     | breccia pipe/skarn                          
|04BAH-07     | 2.74      | 44.00  | 41.26        | 2.18 %     | .13        | 15.59        | 0.11     | breccia pipe/skarn                          
|04BAH-08     |           |        |              |            |            |              |          | abandonned                                  
|04-BAH-09    | 12.8      | 19.1   | 6.3          | 0.63       | 0.05       | 4.3          | 0.08     | QFP/Skarn                                   
|             | 76.6      | 87.5   | 10.9         | 0.63       | 0.03       | 6.4          | 0.11     | skarn                                       
|04-BAH-10    | 18.9      | 31.5   | 12.6         | 0.65       | 0.02       | 1.3          | 0.2      | Seds/skarn                                  
|             | 39.3      | 49.2   | 9.9          | 0.68       | 0.06       | 4.4          | 0.19     | Skarn                                       
|             | 64.6      | 76.9   | 12.3         | 0.34       | .04        | 2.6          | 0.07     | Skarn                                       
|04-BAH-11    | 37.2      | 60.1   | 22.9         | 1.14       | 0.18       | 6.9          | 0.06     | Sediments/Skarn breccia/QFP                 
|including    | 41.3      | 51.2   | 8.9          | 2.07       | 0.22       | 9.6          | 0.10     | Skarn breccia                               
|04-BAH-12    |           |        |              |            |            |              |          | abandonned                                  



Drill holes #13 and 14, significant intervals:



|Hole #      | From (m) | To
(m)       | Interval (m) | Copper (%) | Mo (%) | Zinc (%) | Lead (g/t) | Silver (g/t) | Gold (g/t) | Rock Type         
|----------- | -------- | ------------ | ------------ | ---------- | ------ | -------- | ---------- | ------------ | ---------- | ------------------
|BAH13*      | 53.3     | 77.05
(EOH)  | 23.75        | 0.41       |        |          |            |              |            | Chalcocite blanket
|BAH-14      | 7.3      | 60           | 52.7         | 0.25       |        |          |            | 2.3          |            | Chalcocite blanket
|            | 120      | 225.15       | 105.15       | 0.42       | 0.008  | 0.16     |            | 5.2          | 0.04       | Mixed             
|Including   | 162      | 180          | 18           | 1.20       |        | 0.35     |            | 13           | 0.13       | Breccia/skarn     
|Including** | 216      | 225.15
(EOH) | 9.15         | 0.37       | 0.032  | 0.29     | 0.40       | 6            | 0.02       | PORPHYRY          



Drill hole 15, significant intervals:



|Hole #      | From (m) | To
(m)      | Interval (m) | Copper (%) | Zinc (%) | Silver (g/t) | Gold
(g/t) | Rock Type         
|----------- | -------- | ----------- | ------------ | ---------- | -------- | ------------ | ---------- | ------------------
|04-BAH-15   | 16       | 159         | 143          | 0.71       | 0.22     | 6            |            | Mixed             
|Including   | 28       | 60          | 32           | 1.17       |          | 4            |            | Chalcocite blanket
|Including   | 120      | 159         | 39           | 1.02       | 0.69     | 13           | 0.10       | Breccia/skarn     
|            | 159      | 160.7       | 1.7          |            |          |              |            | No sample*        
|Including** | 160.7    | 166.3
(EOH) | 5.6          | 2.15       | 0.62     | 31           | 0.24       | Breccia/skarn     



33

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Drill holes #16 and 17, significant intervals:



|Hole #  | From (m) | To (m)      | Interval (m) | Copper (%) | Gold (g/t) | Silver (g/t) | Zinc (%) | Mo (%) | Rock Type                    
|------- | -------- | ----------- | ------------ | ---------- | ---------- | ------------ | -------- | ------ | -----------------------------
|BAH-16* | 32       | 148         | 116          | 0.35       |            | 2            |          |        | Seds+minor QFP               
|BAH-16  | 158      | 186.8       | 28.8         | 0.37       | 0.04       | 4            | 0.14     | 0.05   | QFP+/-skarn                  
|BAH-16  | 186.8    | 217.2
(EOH) | 30.4         | 0.57       | 0.03       | 5            | 0.17     | 0.023  | QFP, minor skarn, sheared QFP
|        |          |             |              |            |            |              |          |        |                              
|BAH-17  | 174.5    | 191.4       | 16.9         | 0.80       | 0.07       | 13.7         | 0.31     |        | Skarn/breccia                





RC Drill holes #2-5, significant intervals:



|Hole #    | From (m) | To (m) | Interval (m) | Copper (%) | Gold (g/t) | Silver (g/t) | Zinc (%) | Rock Type         
|--------- | -------- | ------ | ------------ | ---------- | ---------- | ------------ | -------- | ------------------
|RC-2      | 1.52     | 10.67  | 9.15         | 0.18       | 0.03       | 8.92         | 0.27     | Lst/skarn         
|Including | 10.67    | 13.72  |              |            |            |              |          | No sample (adit)  
|RC 2      | 13.72    | 126.5  | 112.78       | 1.29       | 0.12       | 26.58        | 1.07     | Mixed             
|Including | 48.78    | 85.37  | 36.59        | 1.81       | 0.14       | 22           | 2.03     | Skarm/breccia     
|RC-3      | 27.44    | 73.17  | 45.73        | 0.92       |            |              |          | Chalcocite blanket
|          | 83.37    | 96.04  | 12.67        | 0.77       | 0.11       | 12.65        | 0.73     | Sedimetns/breccia 
|          | 96.04    | 140.24 | 44.20        | 0.15       |            |              |          | QFP               
|RC-4      | 44.21    | 70.12  | 25.91        | 0.60       |            |              |          | Chalcocite blanket
|          | 79.27    | 89.94  | 10.67        | 0.33       |            |              |          | Mixed sed/QFP     
|          | 123.48   | 150.91 | 27.43        | 0.27       |            |              |          | Mixed Sed/QFP     
|RC-5      | 12.20    | 32.01  | 19.81        | 0.53       |            |              |          | Sediments         
|          | 96.04    | 160.06 | 64.02        | 0.31%      |            | 2.35         |          | QFP               



*Drill holes RC3, 4 and 5 all ended in low grade mineralization.



Los Alisos Low Sulphidation gold-silver epithermal target, (+/- 1.2 Km west of Main Zone porphyry Complex)



RC Drill holes #8-11, significant intervals:





|Hole #    | From (m) | To (m) | Interval (m) | Gold g/t | Silver g/t | Zinc %   
|--------- | -------- | ------ | ------------ | -------- | ---------- | ---------
|05-RC-8   | 16.76    | 24.38  | 7.62         | 3.0      | 34         | 0.53     
|including | 19.81    | 21.33  | 1.52         | 9.84     | 18.6       | 0.94     
|05-RC-9   | 22.86    | 32     | 9.14         | 2.18     | 182        | Anomalous
|including | 25.9     | 27.43  | 1.52         | 9.62     | 822        | Anomalous
|and       | 35.05    | 47.24  | 12.19        | 2.7      | 38.7       | 1.57     
|including | 44.2     | 45.72  | 1.52         | 9.53     | 111        | 4.32     

05-RC 10 and 11: strong quartz veining with anomalous gold, silver and zinc



Further surface sampling was also conducted in areas of new mechanized trenching.  Significant results for those sections include the following results, along with the drill hole vicinity in which the sampling was performed.





34

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|Trench area        | Composite interval length | Copper (%) | Gold (g/t) | Silver (g/t) | Zinc (%) | Rock type        
|------------------ | ------------------------- | ---------- | ---------- | ------------ | -------- | -----------------
|Section, hole # 10 | 18 metres                 | 1.25       |            |              |          | Endo and exoskarn
|Section, hole #12  | 15 metres                 | 1.21       | 0.18       | 19.7         | 0.14     | Skarn breccia    
|Section, Hole #9.  | 24 metres                 | 0.51       |            |              |          | Oxidized porphyry
|Section, Hole #9.  | 21 metres                 | 1.12       | 0.06       | 9.26         | 0.38     | Endo and exoskarn
|Section,
Hole #9.  | 30 metres                 | 0.72       | 0.04       | 7.9          | 0.35     | Endo and exoskarn



Tylers Management believes that Phase 1 has accomplished its objectives, which were to confirm the continuity and grade of surface mineralization and obtain a better understanding of the geologic controls on mineralized zones. High grade breccia-skarn zones have been traced at surface over a strike length exceeding 1,200 metres, and have been traced by drilling over a strike length of 500 metres, to depths of up to 100 metres.  The average width of this unit in drilling to date is approximately 24 metres and the weighted average grade of drill sections is 2.29% copper, 0.12 g/t gold, 15.9 g/t silver and 0.40% zinc. The breccia unit remains open along strike and at depth.  A supergene enrichment blanket has also been confirmed although its extent remains poorly defined.  Encouraging grades within stockwork veined QFP in the northern part of the area tested during Phase 1 include 3.05 metres grading 0.73% Cu and 3.05 metres grading 0.18% Copper and 0.35 g/t gold at the end of drill hole #11.  Combined with surface chip samples in variably leached intrusion grading 0.51% Cu over 24 metres and 36 metres grading 0.40% copper, this provided an excellent porphyry copper target currently being tested during Phase 2.



(vii)

Sampling Methodology And Data Verification



2001 Sampling



Sampling during the 2001 program was conducted within the Main Zone as representative, continuous chip samples in 11 sections. Grab samples have been treated as point data which do not allow for true width/grade determinations.



Four sections within the Main Zone were partially re-sampled in duplicate during 2001 with one set of samples collected by a third party consultant who maintained custody of samples during the program. Comparison analysis of the assay results by the author confirms that sampling methodology was adequate during the program and that sample results are reliable for the current stage of exploration.



Estimates of minimum interpreted true widths for continuous chip sample sections was made by consensus by the three geologists involved on the project and have taken into account the following factors: geology, topography, geological controls on mineralization and degree of exposure along particular sections. Estimated true widths of mineralization as reported for the 2001 program disclosure are generally considered by Tyler to be accurate to conservative.



Sample security and integrity during the field program and subsequent transport of samples to the Chemex lab facilities to Hermosillo was insured through the use of individually numbered, tamper proof plastic tags.  No issues of tampering or missing tags were reported by the Hermosillo lab upon receipt of the samples from the field and samples were in the custody of Tyler personnel at all times before delivery to ALS-Chemex.



2003 Underground Sampling



Data verification for the August 2003 underground sampling program was carried out, independently, by Keith McCandlish, P.Geol., of Associated Mining Consultants Ltd. (AMCL).



Underground channel/chip samples were collected by staff from Mineras Cascabel S.A. de C.V. (a consulting/exploration services group based in Hermosillo, Mexico) and Tyler. Keith McCandlish was present during the sample collection phase.



35

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Approximately 280 m of adit was cleaned by the removal of bat guano (dry bat guano may be a significant health risk due to the presence of the histoplasmosis parasite) and permitting dammed water to freely exit. One wall of the adit was cleaned of all secondary oxide mineralization to expose a fresh face. The secondary oxides are clear evidence of continued leaching of copper and zinc minerals from the host rock.



Continuous chip samples ranging in length between 1 m-2 m were chiseled by hand from the freshly exposed wall and collected in a sample rig placed directly under the sample interval. The hard nature of the host material precluded this being considered as a true channel sample, however, in AMCLs opinion the samples were representative.



The samples were bagged, labeled, sealed and returned to the base camp. At the camp the samples were opened and logged, photographed and representative chips collected for mineral identification by J.P. Jutras. Keith McCandlish selected 11 samples from different lithologies which were then split in the field and the split re-bagged with a different field sample number. Tyler was not permitted to observe this procedure. All of the samples bags were sealed by Keith McCandlish and subsequently placed in 20 plastic pails which were then sealed using AMCL tamper proof seals. The pails were shipped by burro to the village of La Reforma and by truck to the ALS-Chemex sample preparation facility in Hermosillo, Mexico accompanied at all times by Keith McCandlish. Some plastic pails were opened and inspected by Mexican Federal Police in a routine drug inspection. Opened pails were re-sealed and all were delivered to ALS-Chemex.



At the ALS-Chemex sample preparation facility, the received samples were weighed, dried and crushed to 70% <2 mm. After riffle splitting the coarse samples were shipped to the ALS-Chemex facility in North Vancouver, British Columbia, Canada, where the samples were pulverized to 85% <75μm.



The samples were subjected to two analytical procedures: gold was determined using a 30 g fire assay fusion with an atomic absorption spectroscopic finish (Method Code Au-AA25). The samples were also subject to analysis for 34 individual elements using a single acid (aqua regia) digestion followed by analysis by inductively coupled plasma-atomic emission spectroscopy (Method Code ME-ICP41).



Some discrepancies in the analytical results between the original samples and the field splits were considered to be of significance, not withstanding the coarse nature of the mineralization and the crude method of field splitting (cone and quarter). Coarse rejects of the split samples were shipped from the ALS-Chemex facility in Hermosillo directly to SGS-Lakefield in Lakefield, Ontario. As well, pulp rejects of the same samples were shipped from ALS-Chemex in North Vancouver to SGS-Lakefield.



These samples were analyzed for gold using a 30 g fire assay fusion with a gravimetric finish. The remnant material was subject to a three acid digestion with analytical determination for copper, zinc, and silver by X-ray fluorescence (XRF). A multi-acid digestion was chosen since it results in a more complete digestion of the host material (particularly important given the complex mineralogy) and should result in more representative results.



As a result of this check assay program, it was determined that the discrepancies in results were due to the coarse nature of the mineralization and poor sampling technique (in terms of field splitting) rather than any problem with sample preparation or analytical method.



(viii)

Mineral Processing And Metallurgical Testing



Samples from previous programs (both the surface and drilling) have been evaluated for copper and gold recovery. As neither a mineral resource nor an economic reserve has yet been delineated on the property to date, this work is considered to be of little present use as the characteristics of a potentially economic ore body have yet to be defined.



36

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Data is available in previous reports concerning numerous SC 10 and SC 30 soluble copper analyses. These analyses were used to determine the amount of soluble copper and cobalt that could be extracted using a 10% and 30% sulphuric acid leach solution in given samples.  A number of bottle roll tests and sequential copper analyses were also carried out on some of the drill cores from the 1997 program.  Although of little use at this stage of exploration, the soluble copper tests carried out to date have not indicated that significant metallurgical problems should be anticipated for copper oxide recoveries at the Main Zone.



(ix)

Mineral Resource And Mineral Reserve Estimates



Work to date has not outlined a mineral resource or a reserve according to currently accepted Canadian Institute of Mining, Metallurgy and Petroleum guidelines.  As of the date of this report, there are no known reserves on the property and Tylers proposed programs are exploratory in nature.



(x)

Interpretations And Conclusions



Interpretations



Work to date has outlined a mineralized complex with overall surface widths and grades comparable to that of historical or present economic producers within a mineralized porphyry-style complex. Both high grade skarns and a stockworked, mineralized porphyritic intrusion of significant extent have been outlined by surface work to date on the Main Zone of the property.



The presence of mineralized outcrops over a wide topographic range along the system, relatively numerous and extensive historical underground workings and the 1997 drilling data outline the fact that significant continuity both at depth, and, areally can be expected within the system.



The presence of mineralization similar to or potentially genetically related to that seen at the Main Zone outline mineralization forming processes active over an area of more than 25 km2.



In many instances, the isolated nature of particular mineralized zones is a function of lack of data at this time.  The potential exists for the Mina Mexicana, Main Zone and Colome showings to all be part of a larger complex which would span some 3.5 km in length and up to1 km in width. Several areas have been demonstrated to contain mineralization of potentially economic grade.  Similarly, potential continuity between the San Juan and San Marcos occurrences as well as between the Cuesta Colorada and Los Alisos occurrences are promising exploration targets.  Numerous other grassroots stage copper and gold occurrences have been identified on the property.



Conclusions



Further exploration is warranted on the property with the objective to establish a resource base within the Main Zone complex.  Both the mineralized intrusions and related high grade skarns should be adequately drilled over the span of the system known to date.  Drilling is being conducted to also permit the evaluation of the host volcano-sedimentary sequence. The availability of heavy equipment (bulldozer) during a drilling program should provide an excellent opportunity to extend mechanized trenching of the Main Zone to the north as well as initiate proper trenching of the East skarn body.



(xi)

Recommendations



Phase 2 work will include further mechanized trenching and a minimum initial 3,000 to 5,000 metres of drilling to expand the area of present discoveries along strike to the north and south, to the west and at depth. An independent technical evaluation of drilling techniques and relatively poor performances in terms of core recoveries conducted during Phase 1 is expected to lead to an improved drilling rate and core recoveries in Phase 2.



Other targets to be drilled evaluated outside of the main zone include an electromagnetic geophysical conductor in excess of 1 km in length believed to be related to unexposed sulphide bearing mineralization in the north west corner of the property, the Los Alisos epithermal gold-silver occurrence in the center of the property, and the Mina Mexicana high grade copper-gold bearing skarn/breccia complex located to the immediate south east of the area tested during Phase 1.



37

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Tyler will continue drilling and other exploration activities on the property so long as exploration results so warrant, and capital is available.



Weedy Lake Property, Saskatchewan



(i)

Location, Size and Net Interest



The Weedy Lake Property had been a lease, however, it was restaked as a claim in 1999 and the claims will expire in approximately nine years without further exploration work.  Annual assessment work of $11,925 is required, however an excess expenditure credit of $240,000 is available to be applied against this obligation.



Tyler acquired its interest in the Weedy Lake Property pursuant to an option and joint venture agreement with CDG.  CDG subsequently sold its 49.9% interest in the property to Golden Band. Tyler has incurred a total of $2,000,000 in exploration expenditures to earn a total interest of 50.1%.  As at July 31, 2004 the joint venture interests in the Weedy Lake Property were as follows:



|Name of Participant        | Interest
|-------------------------- | --------
|Tyler                      | 50.1%   
|Golden Band Resources Inc. | 49.9%   
|TOTAL                      | 100.0%  



During the year ended July 31, 2002, Tyler entered into an option agreement with Golden Band, whereby Golden Band can earn 50% of Tylers interest in the property (a 25.05% interest).  In order to earn the interest, Golden Band must incur a minimum of $100,000 of exploration expenditures on the property in each of the first three years and a minimum of $1,500,000 in aggregate over the four years ending December 31, 2005.  Golden Band was notified by Tyler that it is in a default position with regards to the option agreement, and that it intends to renegotiate the agreement.  Golden Band did not incur the minimum amount of exploration expenditures to keep its option in good standing.  Tyler has agreed that Golden Band will undertake a scoping study which will serve as the basis for negotiations on the acquisition by Golden Band of Tylers remaining 50.1% equity in the Weedy Lake property by Golden Band and that, in the meantime, Tyler will temporarily suspend the non-compliance provisions of the Weedy Lake option agreement.



(ii)

Known Reserves



There are no known reserves on the Weedy Lake Property and the proposed exploration program is exploratory in nature.



(iii)

Summary of Exploration and Development Results



On October 1, 1986, Tyler entered into an option and joint venture agreement (the JVA) with CDG which had participated in exploration activities on the Weedy Lake Property since 1980.  During the period 1986 to 1990, Tyler drilled a total of 88 holes (for a total of 15,532 metres (50,959 feet)) on the Weedy Lake Property.  No exploration programs were carried out during the period 1990 to September 30, 1995.  During fiscal 1996, Tyler carried out a two phase diamond drill program in which it drilled an additional 57 holes.  The purpose of the program was to complete the evaluation of the previously defined gold mineralization and to generate the information necessary to determine whether or not economic levels of mineralization were present to consider an underground exploration program.  During fiscal 1997, a re-compilation and re-interpretation of all diamond drill hole data was undertaken.  No work was carried out in the period of 1998 to 2002.



In 2002 and 2003, Golden Band conducted some till sampling on the property and recompiled historical data in order to generate new exploration targets.





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Carat and Kelsey Properties, Northwest Territories



Tyler has entered into an option agreement with a non-related company, whereby the optionee can acquire Tylers interest in its Carat and Kelsey, Northwest Territories diamond properties. The optionee must pay $300,000 cash ($150,000 received), issue 300,000 (200,000 received, with a deemed value of $52,500), of its shares and 200,000 warrants (100,000 received, with a deemed value of $Nil) over approximately two years in order to earn its interests.



Business in General



(i)

Competitive Conditions



Significant competition exists for mineral exploration opportunities.  As a result of this competition, some of which is with large, established mining companies with substantial capabilities and greater financial and technical resources than Tyler, Tyler may be unable to acquire rights to exploit additional attractive exploration properties on terms it considers acceptable.



(ii)

Research and Development Expenditures



Mineral exploration expenditures incurred in the last three fiscal years ended July 31, 2004 and to January 31, 2005 refer to page 25.



(iii)

Environmental Protection



Environmental legislation is evolving in a manner such that standards, enforcement, fines and penalties for non-compliance are becoming stricter.  Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees.  The cost of compliance with changes in government regulations has the potential to reduce the profitability of future operations.  To Tylers knowledge, it is in compliance with all environmental laws and regulations in effect in Mexico, the Northwest Territories and Saskatchewan.



DIRECTORS AND OFFICERS OF TYLER



The following are the full names, municipality of residence, positions with Tyler and principal occupations within the preceding five years of all of the directors and officers of the Tyler:



|Name, Municipality of Residence   | Current (or First and Last) Position with Issuer | Principal Occupation for the Past Five Years                                                                                                                                                                                                 
|--------------------------------- | ------------------------------------------------ | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|James Devonshire
Calgary, Alberta | Chief Executive Officer and Director             | Self-employed Chartered Accountant and Management Consultant. Director and President of CDG Investments Inc., Northern Abitibi Mining Corp. and Manson Creek Resources Ltd.                                                                  
|Gregory Smith
Calgary, Alberta    | Director                                         | Chartered Accountant and partner with Smith Cageorge Perry, Chartered Accountants, Calgary.  Chief Financial Officer of CDG Investments Inc., Maglin Furniture Systems Ltd. and Aloak Corp., and President of Alberta-Pacific Management Ltd.





39

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|Name, Municipality of Residence     | Current (or First and Last) Position with Issuer | Principal Occupation for the Past Five Years                                                                                                                                                                        
|----------------------------------- | ------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Lesley Hayes
Calgary, Alberta       | Director                                         | Self-employed consultant from 2002 to date. From 1999 to 2002 Practice Manager Creative Services, Burntsand Inc.  Director of Northern Abitibi Mining Corp.                                                         
|Jean Pierre Jutras
Calgary, Alberta | President, Chief
Operating Officer and
Director  | Self-employed Professional Geologist, Vice President and Director of Manson Creek Resources Ltd. and Northern Abitibi Mining Corp.                                                                                  
|Shane Ebert
Burnaby, B.C.           | Director                                         | Consulting Geologist and Research Associate at the Mineral Deposit Research Unit (MDRU) University of British Columbia.  President of Hot Spring Gold Corporation and consulting geologist 1996 to present.         
|Regan Chernish
Calgary, Alberta     | Vice President of
Exploration                    | Self-employed Professional Geologist.  From 1997 to 2001 Project Geologist for Diavik Diamond Mines Inc. Worked as a Geologist for Giant Gold Mine for 1997 and for Covello, Bryan and Associates from 1993 to 1997.
|Barbara ONeill
Airdrie, Alberta    | Secretary                                        | Corporate Secretary of Tyler, Manson Creek Resources Ltd., Northern Abitibi Mining Corp. and Aloak Corp.; Executive Assistant; Secretary of CDG Investments Inc.                                                    



The following table sets forth the annual high and low market prices for Tylers stock on the Toronto Stock Exchange under the symbol TYS (until August 2000) and then under the symbol TYS on the TSX Venture Exchange (from August 2000 to date) for Tylers five most recent full financial years:



|Year ended July 31, | 2004     Cdn$ | 2003
Cdn$ | 2002
Cdn$ | 2001
Cdn$ | 2000
Cdn$
|------------------- | ------------- | --------- | --------- | --------- | ---------
|High                |               | .40       | .07       | .17       | .24      
|Low                 |               | .035      | .03       | .06       | .03      



The following table sets forth the high and low market price for Tylers common shares during each fiscal quarter of Tyler for the two most recent fiscal years:



|                 | Sale Price
|---------------- | ----------
|                 | TYS       
|Quarter Ended    |           
|Fiscal 2005      | Low Cdn$  
|January 31, 2005 | .33       
|October 31, 2004 | .19       
|Fiscal 2004      | Low Cdn$  
|July 31, 2004    | .17       
|April 30, 2004   | .19       
|January 31, 2004 | .06       
|October 31, 2003 | .035      
|Fiscal 2003      | Low Cdn$  
|July 31, 2003    | .025      
|April 30, 2003   | .03       
|January 31, 2003 | .03       
|October 31, 2002 | .04       



The following table sets forth the high and lost market prices for Tylers common shares for each month during the most recent six months:



40

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|Month Ended     | Low Cdn$ | High Cdn$
|--------------- | -------- | ---------
|September, 2004 | .20      | .30      
|October, 2004   | .25      | .44      
|November, 2004  | .33      | .90      
|December, 2004  | .55      | 1.22     
|January, 2005   | .68      | 2.18     
|February, 2005  | 1.41     | 1.93     



Manson Creek Resources Ltd.



The information provided on Manson has been compiled from publically available documents located at www.sedar.com



Manson is publicly listed on the TSX Venture Exchange under the trading symbol MCK.  Manson is a mineral exploration company that is in the exploration stage, and all of its property interests are without known reserves and its proposed programs are exploratory in nature.  The underlying value of Mansons mineral properties and related deferred costs is dependent on the existence of economically recoverable reserves, the ability of the company to obtain the necessary financing to advance its properties beyond the exploration stage, and upon future profitable activities.



Manson does not have significant sources of revenue from its activities and relies on equity financings to finance exploration on its properties.  The only source of revenue in the immediately three preceding fiscal years ended September 30, 2004, 2003, and 2002 was interest income derived from holding cash in short-term investment vehicles such as term deposits and brokerage cash accounts.  Mansons revenue for the past three fiscal years ended September 30, and the three months ended December 31, 2004 is summarized as follows:



|                 | 2002    | 2003   | 2004   | Three months ended December 31, 2004
|---------------- | ------- | ------ | ------ | ------------------------------------
|Interest revenue | $12,670 | $6,799 | $5,801 | $904                                



At December 31, 2004, Manson had positive working capital of $140,000.  Due to a recent private placement that contributed approximately $725,000 to Manson, management of Manson believes, there is sufficient cash available to fund operations in the next twelve months as well as an exploration and acquisition program.





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Manson does not have significant tangible capital assets, except as disclosed below. Its most substantial assets are its mineral properties.  Expenditures on these properties for the most recent three fiscal years and the three months ended December 31, 2004 are summarized below:



|                     | Balance
Sept 30/01 | Costs Fiscal 2002 |  | Costs
Fiscal
2003 |   | Costs
Fiscal 2004 |  | Balance
Sept 30, 2004 | Costs
Oct 1/04 to
Dec 31/04 |   | Balance
Dec 31, 2004
|-------------------- | ------------------ | ----------------- |  | ----------------- | - | ----------------- |  | --------------------- | --------------------------- | - | --------------------
|Acquisition          |                    |                   |  |                   |   |                   |  |                       |                             |   |                     
|NAD, Yukon           | 22,991             | -                 |  | 9                 |   | -                 |  | 23,000                | (23,000)                    | e | -                   
|Tanner, Yukon        | 5,610              | 9,580             |  | -                 |   | 10,000            |  | 25,190                | -                           |   | 25,190              
|JRS, Yukon           | 286                | 599               |  | -                 |   | -                 |  | 885                   | -                           |   | 885                 
|Other                | 42,372             | 435               |  | (42,807)          | a | -                 |  | -                     | -                           |   | -                   
|CR, British Columbia | -                  | -                 |  | -                 |   | 12,675            |  | 12,675                | -                           |   | 12,675              
|Total Acquisition    | 206,412            | 10,614            |  | (42,798)          |   | 22,675            |  | 61,750                | (23,000)                    |   | 38,750              
|Exploration          |                    |                   |  |                   |   |                   |  |                       |                             |   |                     
|NAD, Yukon           | 501,671            | 7,448             |  | 1,025             |   | -                 |  | 510,144               | (510,144)                   | e | -                   
|Tanner, Yukon        | 102,935            | 101,256           |  | (3,511)           | b | 7,170             |  | 207,850               | 887                         |   | 208,737             
|JRS,Yukon            | 120,505            | 94,847            |  | (12,701)          | c | -                 |  | 202,651               | -                           |   | 202,651             
|CR, British Columbia | -                  | -                 |  | -                 |   | 77,337            |  | 77,337                | 8,496                       |   | 85,833              
|Other                | 204,156            | 72,601            |  | (276,757)         | d | -                 |  | -                     | -                           |   | -                   
|Total Exploration    | 929,267            | 276,152           |  | (291,944)         |   | 84,507            |  | 997,982               | (500,761)                   |   | 497,221             

a)

Costs of $5,909 net of write-offs of $48,716.

b)

Costs of $12,089 net of exploration incentives of $15,600.

c)

Costs of $2,099 net of exploration incentives of $14,800.

d)

Costs of $18,475 net of exploration incentives of $11,300 and write-offs of $283,932.

e)

Mansons Management determined that the NAD property should be written-off during the period as Mansons management believed financial resources were better devoted to other properties.



Manson has been concentrating its exploration in the past three years on prospective silver/lead/zinc properties in the Yukon Territory, Canada.  It currently has a 100% interest in three mineral properties covering approximately 6,200 hectares.  Further, during fiscal 2004 Manson entered into an option agreement to acquire the CR property in British Columbia.  Manson has paid $7,500 and issued 50,000 common shares, with a deemed value of $5,000 pursuant to the option agreement and is further committed to issue 525,000 common shares and pay $85,000 over the next 5 years in order to acquire the property.



Manson plans to undertake a prospecting program on the Tanner property with a budget of $30,000.  With a portion of the $725,000 net private placement proceeds from the February, 2005 private placement Manson will undertake a drill program on the CR property estimated to aggregate $150,000 and will investigate other prospective properties.



The following provides details of Mansons most significant properties:



JRS Property, Yukon



(i)

Location, Size and Interest



The JRS property, located in the Yukon Territory was acquired through staking by Manson in 2001 and is 100% owned by Manson. It consists of 25 claims covering 522 hectares (1,290 acres) and is located approximately 10 kilometers south west of the Rusty Property.  The property is located on NTS map sheets 106 C/4 and 106D/1.



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(ii)

Accessibility, Climate, Local Resources, Infrastructure and Physiography

Access to the properties is by helicopter either from Whitehorse (400 Km), Mayo (110  Km) or from the Rackla Airstrip (30 Km)  where Manson maintains a summer field camp and staging area accessible by fixed wing aircraft.



Whitehorse is the nearest populated center out of which logistical support for the property is available.  There is no local infrastructure that could support a mining operation.



The JRS property is located within the Southern Wernecke Mountains of the Yukon Territory.  The area is characterized by wide U shaped drift filled valleys and deeply cut V shaped upland valleys.  Peaks in the area average 1500 meters ASL in elevation and rise fairly abruptly from the major valleys.

Exploration work in the area is restricted to the summer months between June and September when winter snow loads have diminished enough to permit access.

(iii)

History



Grassroots exploration work consisting of stream and soil sampling is known to have been conducted in this area in the late 1970s.  The claims were known at the time as the ROD/COOKER and later EDINA claims.  This work led to the identification of a small carbonate hosted silver-lead-zinc showing which was drilled with no success.  All previous claims in this area lapsed in the period from 1978 to 1985.



(iv)

Geological Setting

Published regional maps show the area of the property to be underlain by Hyland group carbonate rocks to the south and Earn Group Shales to the north.  Field mapping in 2001 outlined the presence of quartz-sericite-schists interpreted to be metamorphosed felsic volcanics, siliceous exhalative horizons or volcanically derived tuffs. These units occur at the base of the exposed shale sequence and may represent a sub-unit of the shale package or a transition to a volcanic sequence.  Further mafic volcaniclastic rocks have also been recognized stratigraphically higher in the sequence, near the transition between the shales and overlying clastic and carbonate units.

Regional geology maps show the shales identified on the JRS property as part of the Earn Group.

(v)

Exploration

Field exploration commenced in the JRS property area  in the summer of 1998 and consisted of helicopter supported stream sediment geochemical sampling and prospecting

The stream geochemical program was carried out by consultants to Manson and a total of some 600 stream sediment samples were collected in 1998, a portion of which came from the Craig and NAD properties.  Sampling was generally carried out along a 500 meter interval over drainages found on the properties.  The samples were dried and sent to the lab where they were sieved and the 80 mesh portion was analyzed for 32 elements with a standard ICP procedure.  A number of anomalies were observed in the JRS area which were not explained by previously identified mineralization.

In 2001, a 40 man day mapping program was carried out at the head of stream geochemical anomalies and led to the identification of a broad oxidation zone located at the interface between black shales and underlying quartz sericite schists interpreted to be metamorphosed felsic volcanics or siliceous tuffs.  It is exposed discontinuously over some 150 meters in strike length with apparent thicknesses varying between 0.5 to over 2 meters where exposed.  Grab sampling of pyrite bearing quartz sericite schists overlying the oxidation zone has returned a value of 0.8 g/t gold and 0.39% copper to date. An active transported gossan is emanating from the oxidation zone and being redeposited in the creek draining the anomaly.  The staking of 25 claims followed the identification of this anomaly.



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A limited airborne geophysical survey covered the area of the JRS claims in 2001.  Extremely high conductivities were recorded over the shale package but the widespread presence of graphite within the shales precludes the positive identification of potential sulphide mineralization within that lithological unit.

(vi)

Mineralization



Historical mineralization previously targeted at JRS consisted predominantly of irregular fracture/fault controlled coarse galena+/-sphalerite+/-tetrahedrite mineralization hosted in carbonate units.



Three further styles of mineralization were identified during the 2001 field program.  A large oxidation zone at the transition between black shales and quartz-sericite schists remains to be tested by drilling to establish if the unoxidized protolith of this zone corresponds to Marg style VMS mineralization.  Sulphide bearing shales were also recognized and grab sampled, often returning highly anomalous values of lead and zinc in the 1,000s of ppm range.  Thirdly, nickel and zinc bearing shales (0.35% Zinc, 0.45% Nickel) have been recognized on the JRS property and may be related to stratabound Nick style mineralization as recorded in other parts of the Selwyn basin.



Gold mineralization has also been identified at the JRS property both at surface and in drilling.  The gold mineralization is  exposed in a zone of shale hosted quartz stockworking with abundant veining carrying gold, arsenopyrite and stibnite outlined at surface over some 25 by 100 meters.  At surface, values were found to be as high as 4.27 g/t gold and 10.6 g/t silver across in a grab sample of vein material but surface exposure remains poor in the area of the discovery.  A single quartz-barite-pyrite-arsenopyrite-stibnite vein grading 0.30 g/t gold over 0.46 meters was intersected near the bottom of the first drill hole at JRS, 2.4 kilometers from the known surface gold showings.



(vii)

Drilling



Drilling in 2002 at the JRS property has positively identified new mineralized massive sulphide occurrences. Numerous intervals of pyrite dominated syngenetic massive sulphide that were intersected are now known to carry precious and base metals.  Gold values ranged from nil up to 0.38 g/t in massive sulphides, silver ranged up to 27.6 g/t, zinc values ranged up to 4180 ppm (0.42%) and copper values ranged up to 2760 ppm (0.28%).  Nickel, tin, arsenic, molybdenum and mercury were also found to be anomalous.  Highly anomalous metal values occur through intervals of shales and semi-massive to massive sulphides and the distribution of the metals is still poorly understood at present.  It would appear at this time that higher copper and gold values are often related to massive sulphide intervals while higher zinc values are found in black shale sections with disseminated to semi-massive sulphide bands and minor barite.



Over 32 distinct massive sulphide intervals intersected in the initial three drill holes ranged between 3 to 40 centimeters in thickness. The distribution of mineralization at this time is still poorly understood with massive sulphides occurring both in black shales and quartz-sericite schists.



Gold mineralization was also intersected at depth during drilling where a sample of a quartz-barite vein with abundant pyrite and arsenopyrite in black shales returned an assay value of  0.30 g/t gold over 0.45 meter, indicating that gold mineralization may be more extensive than recognized to date on the property.



(viii)

Sampling and analysis



QA/QC programs appropriate for the level of exploration being conducted were put in place during each phase of work.  Procedures included the systematic insertion of blanks and duplicates in samples being sent to laboratories for assay.  All assaying work was conducted using accredited Canadian laboratories (Chemex).  Concentrations of base metals and other elements were determined by ICP and gold values were determined using industry standard fire assay methods.  Internal checks using standards were also conducted in-house by the laboratories during assaying.



Analysis of the sample results, including checks, duplicates and standards, indicate that the data generated during each phase of work was reliable in the context of the work being conducted on the property.





44

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(ix)

Security of Samples



All samples were sealed in the field before being sent to laboratories.  The measures taken were considered sufficient to ensure the validity and security of samples during these phases of work.



(x)

Mineral Resource and Mineral Reserve Estimates



There are no resource or reserve estimates available for the historical or new mineralization found on the JRS properties



(xi)

Mining Operations



No mining is being planned or carried out on the property at this time.



(xii)

Exploration



Although there remains potential for exploration of further targets for each style of mineralization at JRS, in the present absence of clear indications of richer mineralization and given the high logistical cost of exploration activities on the property at this time, no further work is planned in the near future on the JRS property.



Tanner Property, Yukon



(i)

Location, Size and Interest



The Tanner property was acquired through an initial purchase agreement with a local prospector for 8 claims in 2000 and the further staking by Manson of 36 claims in 2001 and a further 70 claims in 2002 which are 100% owned by Manson. The property vendor retained a 2% Net Profits Interest in 8 claims of the property which is repurcheasable by Manson for $600,000.  The property now consists of 114 claims covering 2,382 hectares (5,884 acres) and is located approximately.  The property is located on NTS map sheet 106 C/3.



(ii)

Accessibility, Climate, Local Resources, Infrastructure and Physiography

Access to the properties is by helicopter either from Whitehorse (400 Km), Mayo (110  Km) or from the Rackla Airstrip (18 KM)  where Manson maintains a summer field camp and staging area accessible by fixed wing aircraft.



Whitehorse is the nearest populated center out of which logistical support for the property is available.  There is no local infrastructure that could support mining activities.



The Tanner property is located within the Southern Wernecke Mountains  of the Yukon Territory.  The area is characterized by wide U shaped drift filled valleys and deeply cut V shaped upland valleys.  Peaks in the area average 1500 meters ASL in elevation and rise fairly abruptly from the major valleys.

Exploration work in the area is restricted to the summer months between June and September when winter snow loads have diminished enough to permit access.

(iii)

History



No exploration work is believed to have historically been conducted in the area of the Tanner property.



(iv)

Geological Setting

Published regional maps show the area of the property to be underlain by Hyland group carbonate rocks.  Field mapping in 2000 outlined the widespread presence of black shales similar to Earn Group shales as recognized on the NAD and JRS properties.  Minor volcanic rocks (basalts, quartz-sericite schists) as well as bedded barite horizons are known to occur within the shales at Tanner.



45

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Clastic and carbonate rocks similar to those on JRS occur above the shales and exhibit the same structural relationship with the underlying lithologies than that observed on other properties in the area.  The target area on the Tanner property occurs within the shale package.

(v)

Exploration

Field exploration commenced in the Tanner area in the summer of 1998 and consisted of helicopter supported stream sediment geochemical sampling and prospecting.

The stream geochemical program was carried out by consultants to the company and a total of some 600 stream sediment samples were collected in 1998, a portion of which came from the Craig and NAD properties.  Sampling was generally carried out along a 500 meter interval over drainages found on the properties.  The samples were dried and sent to the lab where they were sieved and the 80 mesh portion was analyzed for 32 elements with a standard ICP procedure.  Although no high geochemical signatures were recognized on Tanner, a very significant transported gossan was noted to occur at the head of a stream covered by the regional sampling work.

In 2000, a 40 man day mapping program was carried out in the vicinity of the gossan identified in 1998.  Two similar gossans were found within a 3 kilometer radius of the first such occurrence.  Bedded barite was identified in the vicinity of two of these gossan occurrences and the presence of finely laminated pyrite beds within the shales was noted.  The absence of any significant oxidizing sulphides in the area that could account for the large gossans observed at the head of creeks prompted Manson to include the Tanner area as part of the airborne geophysical coverage in 2001.

A limited airborne geophysical survey covered the area of the Tanner claims in 2001.  The objective of the survey was to identify a geophysical signature that would indicate the presence of buried sulphide mineralization.  A large airborne geophysical conductivity anomaly with resistivity values within the range of published values expected for massive sulphide mineralization was outlined.  The conductive zone, outlined over some 4,000 meters by some 300 meters in width, coincides with active transported gossans and bedded barite horizons.  Although graphite occurrences have been documented within the shale package, further testing will be required to determine if the conductivity values may reflect the presence of unexposed sulphide mineralization which would be the causative source of the gossanous deposits.



The 2002 summer drill program was successful in identifying potential sources for the airborne geophysical conductivity anomaly and sulphide sources responsible for gossan formation at shallow depths.  The program was also successful in identifying new lithological units which support the interpretation that a potentially significant SEDEX  or VMS style system may be present on the property and that further exploration is warranted within the system.



(vi)

Mineralization



Barite mineralization has been outlined on the Tanner claims. The significance of this mineralization is that barite is highly indicative of ancient exhalative systems and often occurs stratigraphically above massive sulphide VMS style deposits as a late stage exhalative phase.  Laminated pyrite dominated semi-massive to massive sulphide horizons were intersected in drilling in 2002, as well as pyritic synsedimentary breccias and a significant bedded barite horizon.  Those are further described in the section below.



The claim block was extended in 2002 to cover an old showing (Tell) located to the east of the initial Tanner block where surface zinc values were historically recorded in excess of 10% Zn in grab samples.



46

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(vii)

Drilling



Two drill holes totaling 306 meters were completed in 2002. The first tested the Tanner conductor within 100 meters of gossanous seeps originating from shale stratigraphy and responsible for gossan formation.  The second hole tested the conductor some 750 meters to the south east of the first hole.



In both drill holes, a sequence of grey to black graphitic shales characterized by abundant millimeter to centimeter scale massive pyrite laminaes which locally grade into semi-massive sulphide intersections over a few meters was encountered. A coarse, conformable polymictic synsedimentary breccia unit was found to underlay the shales in both drill holes.  Drilling was stopped within this unit in the first hole.  The breccia unit was found to be underlain by further black, locally graphitic shales and a thick section of bedded laminated barite with minor pyrite in the second hole.



Description of geological units and summary of assay results:

Black shales (mudstones to argillites, locally moderate to strongly graphitic): These units consistently display mm to cm scale bedding constrained pyritic layers which make up between 4 to 8% of the rock on average.  Significant increases in the amount of sulphide mineralization can be seen in a number of intervals in both holes leading to sections a few meters in length where total laminated sulphide content of the shales can be up to 50-70% of the host rock.  The shales are characterized by elevated values of gold (to 0.13 ppm), silver (to 5.2 ppm), arsenic (to 240 ppm), mercury (to 4 ppm), molybdenum (to 83 ppm), antimony (to 21 ppm), strontium (to 176 ppm), vanadium (to 377 ppm) and zinc (to 1370 ppm).



Synsedimentary breccias: These coarse, polymictic, matrix to clast supported units typically display significant clay alteration and locally contain significant amount of pyrite over short intervals.  Local silicification and quartz veining are present.  Background values for these units are distinct from the shales and only manganese can be seen to be locally elevated.  A small number of intervals within the breccia units show elevated gold over 1 meter intervals (to 0.15 g/t Au) without any other clear corresponding metal enrichment.  Bedding relationships show grading near the transition from the breccia unit to the overlying shales.



Bedded barite unit: This unit was encountered stratigraphically below the breccia on the second drill hole, the first drill hole having stopped within the breccia unit.  It consists of grey to black shales with thin rhythmic laminae of pyrite throughout and 50 to 70% barite in layers ranging from a few mm to 2-3 cm.  The complete 20 meter section through this unit returned 26.9% barium oxicide by fusion analysis.  A few intervals also returned anomalous gold values (0.01 to 0.11 g/t Au).



In no instance was potentially ore grade mineralization identified during the drilling program.



(viii)

Sampling and analysis



QA/QC programs appropriate for the level of exploration being conducted were put in place during each phase of work.  Procedures included the systematic insertion of blanks and duplicates in samples being sent to laboratories for assay.  All assaying work was conducted using accredited Canadian laboratories (Chemex).  Concentrations of base metals and other elements were determined by ICP and gold values were determined using industry standard fire assay methods.  Internal checks using standards were also conducted in-house by the laboratories during assaying.



Analysis of the sample results, including checks, duplicates and standards indicate that the data generated during each phase of work was reliable in the context of the work being conducted on the property.



(ix)

Security of Samples



All samples were sealed in the field before being sent to laboratories.  The measures taken were considered sufficient to ensure the validity and security of samples during these phases of work.

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(x)

Mineral Resource and Mineral Reserve Estimates



As no mineralization has been found to date in this area, there have been no resource or reserve estimates previously calculated.  This property is without known reserves and Mansons proposed programs are exploratory in nature.



(xi)

Mining Operations



No mining is being planned or carried out on the property at this time.



(xii)

Exploration



Further exploration on the property will focus on extending the known geology and related target areas to the east along the newly staked ground as well as generating further drill targets along the area previously drilled on the initial Tanner claims as well as in the newly staked area at the historical Tell showing.  This work is expected to consist largely of ground mapping and ground geophysical surveys.



Although evidence exists at this time for a significant mineralized environment at the Tanner Property, the ongoing work is of a scale such that it cannot be fully undertaken by Manson in present market conditions.  As any further major undertakings on the project will require further financing, and with base metal prices remaining weak in the current period, Manson will endeavor to attract an industry partner to further exploration on the property in the short term.



CR Property, British Columbia



The CR property consists of 38 staked and contiguous registered units totaling approximately 950 hectares and is considered prospective for base and precious metal bearing porphyry, vein and skarn type deposits.  The property is road accessible.



The 100% interest in CR is to be purchased by Manson Creek over 6 years for cash consideration of $92,500 and the issuance of 575,000 shares.  The property vendor will retain a 1.5% NSR (Net Smelter Royalty), 1% of which Manson Creek may elect to repurchase for the amount of $1,000,000.



The CR property is a grass roots property located 17 km southwest of Houston, British Columbia. Field work to date has identified a large prospective coincident copper in soils and geophysical anomaly in previously untested areas of the property. The anomaly is interpreted to be related to a mineralized porphyry style system under shallow cover and warrants further work, including drill testing.



A large zone of porphyry Cu-Mo mineralization had historically been outlined at the South porphyry zone associated with an east-west trending zone of porphyritic intrusions. The South zone mineralized porphyry has now been mapped over 700 meters in length by 100 to 180 meters in width. Historic drill results from exploration programs in 1966 and 1967 encountered numerous mineralized intervals within the porphyry, with grades of 0.25 to 0.36% copper and 0.03 to 0.038% molybdenum.



The 2004 field program, conducted from August 11thto the 28th, included geologic mapping, 412 meters of backhoe trenching, rock and soil sampling, and a ground magnetometer survey. A total of 172 rock and 510 soil samples were collected and analyzed by ALS Chemex in Vancouver. Trenches encountered significant mineralized intervals in the porphyry complex including 30 meters grading 0.12% copper and 0.036% molybdenum and 18 meters grading 0.25% copper and 0.031% molybdenum in continuous representative chip sampling. All trenches in the South porphyry zone were dug into partially oxidized rocks over the porphyry and confirmed the presence of large zones of low-grade porphyry copper-molybdenum-gold mineralization with locally higher grades.







48

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Manson has reported that a large prospective soil geochemical and geophysical anomaly, called the Burn anomaly, has been identified in a shallow covered area immediately west of, and on strike with, the South porphyry zone. The Burn anomaly encompasses a zone 500 by 200 meters with copper in soils greater than 100 ppm, including a core 280 meters by 70 meters with copper in soils ranging in values from 750 ppm to 16,500 ppm (1.65% copper). The geochemical signature at the Burn anomaly is significantly stronger than the copper in soil anomaly associated with the previously documented adjacent South porphyry zone, and coincides with a magnetic anomaly that is interpreted to reflect an unexposed intrusive body. Manson considers that a buried intrusive body with higher grades than the ones previously documented at the south zone may be the source of the geochemical anomaly and that it provides a strong target for further testing.



Two coincident soil geochemical and geophysical anomalies have also been identified at the North zone. One anomaly is centered over outcrops of porphyritic intrusion where past shallow drill holes have encountered grades of 0.1 to 0.39% Cu, and consists of a 225 by 60 meter zone with Cu in soils greater than 250 ppm. With the exception of 2 shallow (less than 24 meters depth) narrow diameter X-ray core holes this anomaly has not been drill tested previously. A similar anomaly is located 200 meters to the northeast and contains a 400 by 60 meter zone with Cu in soils greater than 100 ppm.



Manson is very encouraged by the results of its first phase of exploration at the CR property. The program has confirmed the presence of a large zone of low-grade porphyry copper-molybdenum-gold mineralization at the South porphyry zone, expanded targets at the North porphyry zone, and identified a new high-priority exploration target at the Burn anomaly.



Business in General



(i)

Competitive Conditions



Significant competition exists for mineral exploration opportunities.  As a result of this competition, some of which is with large, established mining companies with substantial capabilities and greater financial and technical resources than Manson, Manson may be unable to acquire rights to exploit additional attractive exploration properties on terms it considers acceptable.  Accordingly, there can be no assurance that Manson will acquire any interest in additional projects.



(ii)

Research Expenditures



Refer to page 44/45 re. mineral exploration expenditures.



(iii)

Environmental Protection



Environmental legislation is evolving in a manner such that standards, enforcement, fines and penalties for non-compliance are becoming stricter.  Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees.  The cost of compliance with changes in government regulations has the potential to reduce the profitability of future operations.  To Mansons knowledge, it is in compliance with all environmental laws and regulations in effect in the Yukon and British Columbia.



Federal requirements are administered by Environment Canada; Fisheries and Oceans; the Department of Indian Affairs and Northern Development and Transport Canada.  Environmental laws and regulations that have a potential impact on Mansons properties include those that protect air quality, water quality, archaeological sites, migratory birds, animals, marine mammals and fish.  Other important laws and regulations are those that regulate mine developmental land use, water use and disposal, release of contaminants, water spills, spill response, the transport of dangerous goods and the maintenance of navigable channels.



Territorial requirements are administered by the Departments of Education, Culture and Employment;  Renewable Resources, Transportation and Safety and Public Services.  Laws and regulations that might impact Mansons properties include those that protect heritage resources, wildlife, the environment and those that regulate workplace safety, mine safety, training in the handling of dangerous materials, road transportation, air quality, and the use of hazardous substances and pesticides.





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DIRECTORS AND OFFICERS OF MANSON



The following are the full names, municipality of residence, positions with Manson and principal occupations within the preceding five years of all of the directors and officers of Manson:



|Name, Municipality of Residence     | Current (or First and Last) Position with Issuer | Principal Occupation for the Past Five Years                                                                                                                                                                                                                                                                                                                                                                                                                                    
|----------------------------------- | ------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|James Devonshire 
Calgary, Alberta  | President and Director                           | Self-employed Chartered Accountant and Management Consultant. Director and President of CDG Investments Inc., Northern Abitibi Mining Corp.; and Chairman, Director and CEO of Tyler Resources Inc.                                                                                                                                                                                                                                                                             
|Dr. Shane Ebert
Burnaby, B.C.       | Director                                         | Currently a Research Associate with the Mineral Deposit Research Unit (MDRU) of the University of British Columbia, coordinating an industry funded research program concentrating on intrusion related gold mineralization in the Yukon and Alaska.  President of Hot Spring Gold Corporation which acquires and explores for epithermal precious metal prospects in the Western United States.  Director of Tyler Resources Inc. and Director of Northern Abitibi Mining Corp.
|Jean P. Jutras     Calgary, Alberta | Vice-President and
Director                      | Self employed Professional Geologist. Vice-President and Director of Northern Abitibi Mining Corp. and President, Director and COO of Tyler Resources Inc.                                                                                                                                                                                                                                                                                                                      
|Pauline Woodrow
Prince Rupert, B.C. | Director                                         | Business Woman                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|Shari Difley
Calgary, Alberta       | Chief Financial
Officer                          | Self-employed Chartered Accountant and Chief Financial Officer for Northern Abitibi Mining Corp.  Previously Chief Financial Officer for Hixon Gold Resources Inc.                                                                                                                                                                                                                                                                                                              
|Regan Chernish
Calgary, Alberta     | Director                                         | Self-employed Professional Geologist.  From 1997 to 2001 Project Geologist for Diavik Diamond Mines Inc. Worked as a Geologist for Giant Gold Mine for 1997 and for Covello, Bryan and Associates from 1993 to 1997. Vice-President Exploration  Tyler Resources Inc.                                                                                                                                                                                                           
|Barbara ONeill
Airdrie, Alberta    | Secretary                                        | Executive Assistant and Corporate Secretary of CDG Investments Inc.  Corporate Secretary of Northern Abitibi Mining Corp., Aloak Corp., Tyler Resources Inc. and Manson.                                                                                                                                                                                                                                                                                                        



The following table sets forth the annual high and low market prices for Mansons stock on the Toronto Stock Exchange under the symbol MCK (until August 2000) and then under the symbol MCK on the TSX Venture Exchange (from August 2000 to date) for Mansons five most recent full financial years:



50

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|Year ended September 30, | 2004
Cdn$ | 2003
Cdn$ | 2002
Cdn$ | 2001
Cdn$ | 2000
Cdn$
|------------------------ | --------- | --------- | --------- | --------- | ---------
|High                     |           | .18       | .08       | .11       | .15      
|Low                      |           | .04       | .04       | .04       | .03      



The following table sets forth the high and low market price for Mansons common shares during each fiscal quarter of Manson for the two most recent fiscal years:



|                   | Sale Price
|------------------ | ----------
|                   | MCK       
|Quarter Ended      |           
|Fiscal 2005        | Low Cdn$  
|December 31, 2004  | .08       
|Fiscal 2004        | Low Cdn$  
|December 31, 2003  | .04       
|March 31, 2004     | .08       
|June 30, 2004      | .085      
|September 30, 2004 | .07       
|Fiscal 2003        | Low Cdn$  
|December 31, 2002  | .03       
|March 31, 2003     | .04       
|June 30, 2003      | .03       
|September 30, 2003 | .035      



The following table sets forth the high and low market prices for Mansons common shares for each month during the most recent six months:



|Month Ended     | Low Cdn$ | High Cdn$
|--------------- | -------- | ---------
|September, 2004 | .07      | .14      
|October, 2004   | .085     | .12      
|November, 2004  | .08      | .12      
|December, 2004  | .09      | .12      
|January, 2005   | .105     | .25      
|February, 2005  | .14      | .275     



Northern Abitibi Mining Corp.



The information provided on Northern Abitibi  has been compiled from publicly available documents located at www.sedar.com



Northern Abitibi is publicly listed on the TSX Venture Exchange under the trading symbol NAI.  Northern Abitibi is a mineral exploration company that is in the exploration stage, and all of its properties are without known reserves and its proposed programs are exploratory in nature.  The underlying value of Northern Abitibis mineral properties and related deferred costs is dependent on the existence of economically recoverable reserves, the ability of the company to obtain the necessary financing to advance its properties beyond the exploration stage, and upon future profitable activities.



Northern Abitibi does not have significant sources of revenue from its activities and relies on equity financings to finance exploration on its properties.  The only source of revenue in the immediately three preceding fiscal years ended September 30, 2004, 2003 and 2002 was interest income derived from holding cash in short-term investment vehicles such as term deposits and brokerage cash accounts.  Northern Abitibis revenue for the past three fiscal years ended September 30, 2004, 2003, and 2002 and the three months ended December 31, 2004 is summarized as follows:







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|                 | 2002   | 2003   | 2004   | Three months ended December 31, 2004
|---------------- | ------ | ------ | ------ | ------------------------------------
|Interest revenue | $7,212 | $2,037 | $1,217 | $151                                



At December 31, 2004, Northern Abitibi had positive working capital of approximately $32,000.  Northern Abitibi has reduced discretionary costs wherever possible, however its management determined that equity or debt financing would be required in order to cover administrative expenditures for the 2005 fiscal year.  Northern Abitibi completed a private placement in early March 2005 that netted approximately $725,000.  These funds will be used to investigate and acquire new mineral properties and to fund its activities.



Northern Abitibi does not have significant tangible capital assets and no commitments to acquire same.



During the year-ended September 30, 2004, Northern Abitibi wrote-off all of its mineral properties. The Keni property was returned to the vendor during the year. Although Northern Abitibi continues to hold interests in a prospective gold property in Quebec and a prospective nickel/copper/cobalt property in Newfoundland and Labrador, it did not have sufficient funds to further exploration, and has been unable to interest a third party in financing further exploration on these properties.



Business in General



(i)

Competitive Conditions



Significant competition exists for mineral exploration opportunities.  As a result of this competition, some of which is with large, established mining companies with substantial capabilities and greater financial and technical resources than Northern Abitibi, Northern Abitibi may be unable to acquire rights to exploit additional attractive exploration properties on terms it considers acceptable.  Accordingly, there can be no assurance that Northern Abitibi will acquire any interest in additional projects that would yield reserves or result in commercial mining operations.

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(ii)

Research and Development Expenditures



Northern Abitibi wrote-off all its mineral properties in 2004.  There were no costs incurred in the three months ended December 30, 2004.  The following summarizes mineral exploration expenditures during the three years ended September 30, 2004:



|                           | Balance
Sept 30/01 |  | Costs
Fiscal
2002 |   | Costs
Fiscal 2003 |   | Costs Fiscal 2004 |   | Balance Sept. 30, 2004
|-------------------------- | ------------------ |  | ----------------- | - | ----------------- | - | ----------------- | - | ----------------------
|Acquisition                |                    |  |                   |   |                   |   |                   |   |                       
|South Voisey Bay, Labrador | 150,126            |  | -                 |   | -                 |   | (150,126)         | e | -                     
|Douay Joutel, Quebec       | 141,960            |  | 10                |   | 2,810             |   | (144,780)         | f | -                     
|Keni, Nunavut              | -                  |  | 51,771            |   | 5,250             |   | (57,021)          | g | -                     
|Other                      | 868                |  | 3,520             |   | (4,388)           | b | -                 |   | -                     
|Total Acquisition          | 292,954            |  | 55,301            |   | 3,672             |   | (351,927)         |   | -                     
|Exploration                |                    |  |                   |   |                   |   |                   |   |                       
|South Voisey Bay, Labrador | 1,946,355          |  | 6,639             |   | 1,600             |   | (1,954,594)       | h | -                     
|Douay Joutel, Quebec       | 87,243             |  | (6,350)           | a | 3,613             |   | (84,506)          | i | -                     
|Keni, Nunavut              | -                  |  | 258,564           |   | (37,190)          | c | (221,374)         | j | -                     
|Other                      | 40,514             |  | 34,624            |   | (75,138)          | d | -                 |   | -                     
|Total Exploration          | 2,074,112          |  | 293,477           |   | (107,115)         |   | (2,260,474)       |   | -                     

a)

Cost recoveries of $6,350.

b)

Costs of $1,451 less write-offs of $5,839.

c)

Costs of $3,200 net of write-offs of $17,890 and cost recoveries of $22,500.

d)

Costs of $2,101 net of exploration incentives of $19,531 and write-offs of  $57,708.

e)

Write-off of $150,126.

f)

Write-off of $144,780.

g)

Write-off of $57,021.

h)

Net recoveries of $4,800 and write-offs of $1,949,794.

i)

Costs of $312 net of write-offs of $84,818.

j)

Write-off of $221,374.



(iii)

Environmental Protection



Environmental legislation is evolving in a manner such that standards, enforcement, fines and penalties for non-compliance are becoming stricter.  Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees.  The cost of compliance with changes in government regulations has the potential to reduce the profitability of future operations.  To Northern Abitibis knowledge, Northern Abitibi is in compliance with all environmental laws and regulations in effect in Labrador and Quebec.



Federal requirements are administered by Environment Canada; Fisheries and Oceans; the Department of Indian Affairs and Northern Development and Transport Canada.  Environmental laws and regulations that have a potential impact on Northern Abitibis properties include those that protect air quality, water quality, archaeological sites, migratory birds, animals, marine mammals and fish.  Other important laws and regulations are those that regulate mine developmental land use, water use and disposal, release of contaminants, water spills, spill response, the transport of dangerous goods and the maintenance of navigable channels.



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Territorial requirements are administered by the Departments of Education, Culture and Employment; Renewable Resources, Transportation and Safety and Public Services.  Laws and regulations that might impact Northern Abitibis properties include those that protect heritage resources, wildlife, the environment and those that regulate workplace safety, mine safety, training in the handling of dangerous materials, road transportation, air quality, and the use of hazardous substances and pesticides.



DIRECTORS AND OFFICERS OF NORTHERN ABITIBI



The following are the officers and directors of Northern Abitibi:



|Name, Present Office Held
And Municipality of Residence         |  | Principal Occupation or Employment for the Last Five Years                                                                                                                                                                                                                          |  | Director Since 
|--------------------------------------------------------------- |  | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- |  | ---------------
|James Devonshire
Director and President
Calgary, Alberta        |  | Self employed Chartered Accountant and Management Consultant. Director and President of CDG Investments Inc. and Manson Creek Resources Ltd.; Chairman and CEO/Director of Tyler Resources Inc.                                                                                     |  | Dec. 20, 2000  
|Jean Pierre Jutras
Director and Vice-President
Calgary, Alberta |  | Self-employed Professional Geologist. President and Chief Operating Officer of Tyler Resources Inc. and Vice-President and Director of Manson Creek Resources Ltd.                                                                                                                  |  | October 4, 2000
|Dr. Shane Ebert, Phd
Director
Burnaby, British Columbia         |  | Consulting Geologist and Research Associate at the Mineral Deposit Research Unit (MDRU)  University of British Columbia.  President of Hot Spring Gold Corporation and consulting geologist 1996 to present.  Director of Manson Creek Resources Ltd. and Tyler Resources Inc.      |  | March 13, 2003 
|Lesley Hayes
Director
Calgary, Alberta                          |  | Self-employed consultant from 2002 to date.  From 1999 to 2002 Practice Manager Creative Services, Burntsand Inc.  From 1996 to 1999 self-employed investor relations consultant, 1992 to 1996 Vice-President of operations of Vicom Multimedia.  Director of  Tyler Resources Inc. |  | Dec. 6, 1996   
|Shari Difley
Chief Financial Officer
Calgary, Alberta           |  | Self-employed Chartered accountant, Chief Financial Officer of Manson Creek Resources Ltd., previously Chief Financial Officer for Hixon Gold Resources Inc.                                                                                                                        |  | February, 1997 
|Barbara ONeill
Secretary
Airdrie, Alberta                      |  | Corporate Secretary of Manson Creek Resources Ltd., Tyler Resources Inc., Aloak Corp. and CDG Investments Inc.                                                                                                                                                                      |  | May 1993       



The following table sets forth the annual high and low market prices for Northern Abitibis common shares on the TSX Venture Exchange under the symbol NAI for Northern Abitibis five most recent full financial years:



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|Year ended September 30, | 2004   Cdn$ | 2003
Cdn$ | 2002
Cdn$ | 2001
Cdn$ | 2000
Cdn$
|------------------------ | ----------- | --------- | --------- | --------- | ---------
|High                     |             | .12       | .13       | .17       | .08      
|Low                      |             | .035      | .07       | .07       | .03      



The following table sets forth the high and low market price for Northern Abitibis common shares during each of fiscal quarter of Northern Abitibi for the two most recent fiscal years:



|                   | Sale Price
|------------------ | ----------
|                   | NAI       
|Quarter Ended      |           
|Fiscal 2005        | Low Cdn$  
|December 31, 2004  | .035      
|Fiscal 2004        | Low Cdn$  
|December 31, 2003  | .06       
|March 31, 2004     | .075      
|June 30, 2004      | .05       
|September 30, 2004 | .035      
|Fiscal 2003        | Low Cdn$  
|December 31, 2002  | .05       
|March 31, 2003     | .07       
|June 30, 2003      | .07       
|September 30, 2003 | .08       



The following table sets forth the high and lost market prices for Northern Abitibis common shares for each month during the most recent six months:



|Month Ended     | Low Cdn$ | High Cdn$
|--------------- | -------- | ---------
|September, 2004 | .035     | .040     
|October, 2004   | .035     | .045     
|November, 2004  | .04      | .055     
|December, 2004  | .045     | .095     
|January, 2005   | .07      | .12      
|February, 2005  | .08      | .12      



Other Investments



The Company held a 7% interest in Aloak Corp., with a carrying value of $21,000 at September 30, 2004.  The investment was sold subsequent to year-end for proceeds of $65,000.



The Company purchased 90,000 shares of RSX Energy Inc. and sold them subsequent to the year ended September 30, 2004 for a gain of $47,016.



C.

Subsidiaries



Waddy Lake Resources Inc. ("Waddy") was incorporated under the laws of the Province of Ontario on October 5, 1960.  On March 14, 1979, Waddy was continued under the provisions of the Canada Business Corporations Act.



The Company holds 51% of Waddy and prior to April 30, 2004 held 100% of Waddy since September 30, 1995.



The Company ceased to consolidate the operations of Waddy effective April 30, 2004 as the purchaser of 49% of the Waddy shares has taken over all operating decisions for Waddy. The Company has ceased to have significant influence over management and operating decisions.





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The Company has invested in the following companies:



|Subsidiaries/Investees        | Percentage
Ownership
March 24/05 | Jurisdiction of Organization
|----------------------------- | -------------------------------- | ----------------------------
|Waddy Lake Resources Inc.     | 51%                              | Federal                     
|Golden Band Resources Inc.    | 16%                              | British Columbia            
|Manson Creek Resources Ltd.   | 25.7%                            | Alberta                     
|Northern Abitibi Mining Corp. | 20.6%                            | Quebec                      
|Tyler Resources Inc.          | 18%                              | Alberta                     



D.

PROPERTY, PLANTS AND EQUIPMENT



The Company entered into a sublease agreement with Manson Creek Resources Ltd., a company related by virtue of certain common officers and directors, effective January 1, 2002, whereby it has agreed to pay its 25% share of lease costs plus lease operating costs until the termination of the lease on December 31, 2006.  The lease covers for 900 square feet of office space.  Annual base lease costs payable by the Company aggregate to $12,150.  The lease operating costs vary from year to year.  For Fiscal 2004 the Companys portion of these costs aggregated to $10,000; committed amounts in each fiscal year ended September 30, until the lease terminates, are as follows:



2005

$12,150

2006

$12,150

2007

$3,050



See Item 7(B).



Item 5:

OPERATING AND FINANCIAL REVIEW AND PROSPECTS



General



With the sale of the Companys Saskatchewan property portfolio to Golden Band, effective November 7, 2002, the Company became largely a holding company for investments in mineral exploration corporations.  Prior thereto, the Company had been in the business of exploring mineral properties in Canada and abroad. During the year ended September 30, 2004, the sale of the Companys last remaining mineral property interest completed the Companys transformation to an investment company with the goal of investing in primarily mineral exploration corporations.  See Item 4: Information on the Company  A.  History and Development  4. Significant changes or events  b) September 30, 2004  Bahuerachi Sale.  The Companys only recurring source of income has been interest income relating to cash deposits on hand and overhead fee recoveries charged to third parties for whom the Company has incurred and rebilled administrative or mineral property expenditures.  With the Companys new status as an investment company, its source of income will be from the sale of investments.



The following discussion of the results of operations of the Company for the fiscal years ended September 30, 2004, 2003 and 2002 should be read in conjunction with the consolidated financial statements of the Company and related notes included therein.



The Company's consolidated financial statements are prepared in accordance with Canadian GAAP, the application of which, in the case of the Company, conforms in all material respects for the periods presented with US GAAP except for the differences referred to in Note 15 of the consolidated financial statements of the Company included herein. The noon rate of exchange on March 24, 2005, reported by the United States Federal Reserve Bank of New York, for the conversion of Canadian dollars into United States dollars was CDN$1.2157 (US$0.82= CDN$1.2157).







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



A. OPERATING RESULTS



The following is a summary of operating results, outlining the individual corporate components of consolidated net earnings (loss).



|                                                                 | 2004      | 2003        | 2002       
|---------------------------------------------------------------- | --------- | ----------- | -----------
|Revenues                                                         | $24,096   | $    21,136 | $    23,668
|Expenses and other:                                              |           |             |            
|General and administrative                                       | (264,132) | (303,682)   | (403,337)  
|Equity in loss of investees                                      | (888,856) | (216,397)   | (82,121)   
|Gain (loss ) on disposal of investments                          | 370,669   | (15,073)    | 1,279      
|Write-down of investments                                        | (104,000) | (472,780)   | (506,631)  
|Abandonment and write-down of   mineral properties and equipment | (22,029)  | (300,754)   | (1,000)    
|Debenture interest                                               | (59,100)  | (30,601)    | -          
|Gain on dilution of equity investment                            | 459,300   | -           | -          
|Gain on sale of interest in Waddy Lake Resources Inc.            | 1,354,416 | -           | -          
|Gain on sale of Jolu Mill                                        | -         | 554,487     | -          
|Site restoration provision                                       | -         | (46,000)    | -          
|Other                                                            | -         | 4,997       | (5,071)    
|Current income taxes                                             | -         | -           | (17,350)   
|Net Earnings (loss)                                              | $870,364  | $ (804,667) | $ (990,563)



Year ended September 30, 2004 compared to the year ended September 30, 2003

Revenue

There has not been a significant change in revenue from 2003 to 2004.



Other Income and Expenses

The Company has net earnings of $870,000 in the year ended September 30, 2004 versus a loss of $805,000 in the comparative period. The more significant contributing income items were the gain on sale of interest in Waddy Lake Resources Inc., (Waddy), gain on sale of investments and gain on dilution of investments recognized in fiscal 2004, (total income amount of $2,184,000). In the comparative period a gain on sale of the Jolu Mill contributed $554,000 to total earnings. The gain on sale of investments in the current period related primarily to the sale of 2,917,000 Golden Band shares for a gain of $344,000. Approximately $21,000 of the gain pertained to the sale of 1,100,000 shares of Aloak. The current period dilution gain pertained to the Companys investment in Tyler Resources Inc. The Companys interest in Tyler was diluted by 5% when Tyler completed a significant private placement at a share price of $.25 per share when the Companys average carrying value of the investment was $0.06 per share. There was a $1.3 million gain on sale of 49% of the Companys 100% interest in Waddy due to the fact that the Company had consolidated a significant deficit position in Waddy prior thereto.



The prior period gain on sale of the Jolu Mill related to the Companys final divestment of Saskatchwan mineral property assets. The mill had been written-down to $1 during an extended period of declining mineral prices and was sold during a more buoyant market.



Equity in loss of investees increased $673,000 due primarily to the Companys $695,000 share of Northern Abitibi Mining Corp.s loss for the period. Northern Abitibi had written-off its mineral properties during the current year resulting in a significant loss.







57

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In the current year there was a write-down of investments in the amount of $104,000. The Companys investment in Northern Abitibi was written-down to market value at March 31, 2004 due to a prolonged low share price that was considered to be other than temporary. The prior years investment write-down pertained to Aloak shares.



During the current year mineral property and equipment was written-down by $22,000. The write-down pertained primarily to the Bahuerachi property that was written-down to its approximate fair value of $800,000 before it was sold to Tyler Resources. In the comparative period, the Company recorded reclamation expense of $46,000 regarding outstanding road reclamation that was not assumed by the purchaser of the Saskatchwan mineral properties.



Expenses

Debenture interest in the current period increased approximately $28,000 over the prior period. Debentures aggregating $287,500 were issued December 16, 2002 and debentures aggregating $262,500 were issued July 8, 2003. Hence the comparative period interest relates only to the part of 2003 that the debentures were outstanding. The current period interest relates to the full $550,000 of debentures for a full year.



General and administrative expenses declined approximately $40,000 from the comparative period. The more significant variances in the individual categories that comprise the total are as follows:



|                                    | 2004     | 2003     | Expense Increase (Decrease) |  
|----------------------------------- | -------- | -------- | --------------------------- | -
|Procon legal costs                  | $67,851  | $25,035  | $42,816                     | 1
|Jolu Mill lease and insurance costs | -        | 52,815   | (52,815)                    | 2
|Gerle Gold legal costs              | 107      | 13,310   | (13,203)                    | 3
|Other expenses in aggregate         | 196,174  | 212,522  | (16,348)                    |  
|Total General And Administrative    | $264,132 | $303,682 | $(39,550)                   |  



1.  A renewed legal effort was made during the current period to settle the Procon Lawsuit, culminating in a

settlement described in note 8 to the financial statements of the Company. There should be no further

related legal costs.  See Item 4(A)(4)(c) and Item 8.

2.

Prior to the sale of the Jolu Mill the Company was responsible for lease and insurance costs associated with the Jolu Mill. Effective with the sale in February, 2003, these costs ceased, hence there are no costs in fiscal 2004.

3.

A lawsuit with Gerle Gold regarding the ownership of a mineral property was completed in fiscal 2003, having been settled in favour of Gerle Gold. There was a small disbursements billing in fiscal 2004, however there will be no further legal costs regarding this issue.



The following is a discussion of significant changes in assets and liabilities that are not explained in the notes to the financial statements.



Cash

The change in cash balances is discussed under Operating Cash Flow which follows under B.



Due from Related Parties

The amounts due from related parties pertains to administrative costs charged to companies related by virtue of certain common officers and directors. At September 30, 2003 there was a receivable of approximately $25,000 from Tyler Resources Inc. when it was experiencing liquidity problems. Tyler has since received significant financing and is current with all of its liabilities to the Company. See Item 7(B).





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Prepaids and Deposits

The increase in prepaids and deposits is due to the reclassification of the $44,500 reclamation deposit to the current category, as the Company expects the deposit to be released in the current year due to substantial completion of the required reclamation.



Marketable Securities

The Company had a $75,000 investment in RSX Energy Inc. at September 30, 2004 that was classified as a current asset due to the Companys plan to sell the investment within a year. The investment was sold subsequent to year-end for gross proceeds of $122,000.



Reclamation Liability

The reclamation liability was reclassified as a current liability at September 30, 2004 as the purchaser of the property to which it pertained substantially completed the reclamation on the Companys behalf and the amount is payable to the purchaser.



Of the $59,000 amount due to related parties at September 30, 2003, $56,000 was due to Tyler Resources Inc. for the Companys share of Bahuerachi, Mexico mineral property expenditures.  The Company sold its remaining interest in Bahuerachi during the year ended September 30, 2004, therefore there was no such payable at September 30, 2004.



Waddy Lake Liability

As disclosed in Note 8 to the financial statements, Waddy Lake ceased to be consolidated at April 30, 2004.  The legal action has been settled and the claims waived.



Fiscal Year ended September 30, 2003 compared to 2002



Revenue



There has not been a significant change in revenue from 2002 to 2003



Expenses



General and administrative expenses



The more significant contributors to the approximately $100,000 decrease in general and administrative expenses are as follows:



1)

In fiscal 2002 the Company had a recovery of $69,000 relating to the write-off of an old over-accrual relating to prior years mineral exploration expenses  increase $69,000.

2)

Legal costs, relating to the Procon lawsuit and a lawsuit regarding an ownership dispute over a mineral property, declined $39,000.  The latter lawsuit, which was settled in 2004, resulted in ownership of the mineral property, that had previously been written-off, being assigned to the other party.

3)

Reporting to shareholders costs declined $16,000 due to a decrease in the number of shareholders requiring mailings and savings on printing that resulted from reduced numbers and the combination of the Management Proxy Circular and Annual Report into one document.

4)

Salaries and benefits declined $10,000 as a result of more being billed to other companies who share the services of salaried employees.

5)

Costs relating to the Komis Mine and the Jolu Mill declined $110,000 due to the sale of the property and mill during the year.  The Komis mine was decommissioned in 2001, but required annual environmental monitoring.  The Komis Mine was part of the Saskatchewan properties sold to Golden Band in November, 2002.





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Other income and expenses:



The equity in losses of investees is comprised of the Companys share of Mansons and Northern Abitibis net losses for the years ended September 30, 2003 and 2002. The large increase in the loss is primarily due to significant mineral property write-downs in the investees fiscal 2003 financial statements. The Companys share of the investees mineral property write-downs in fiscal 2003 was $130,000, (2002-$3,000).



Investments were written-down $472,780 in fiscal 2003 (2002-$506,631), due to the downward trend of the share prices that appeared to be other than temporary.



The 2003 write-down was comprised of the write-down of Northern Abitibi to $0.10 per share, write-down of Aloak to $0.005 per share and write-down of Jolu Development Corp., to reflect the September 30, 2003 value of the Golden Band shares that could be exchanged for the JDC shares. Subsequent to year-end the Company exercised its right to demand that Golden Band buy 100% of its JDC shares in exchange for Golden Band shares. The write-down in fiscal 2002 related to writing down Tyler shares to $0.05 per share and Aloak shares to $0.02 per share.



The 2003 write-down to mineral properties pertains to the Bahuerachi property. Subsequent to year-end the Company entered into a letter of intent with Tyler whereby Tyler would purchase the Companys share of the property for 13,336,000 shares with a deemed price of $0.06 per share. The property was written-down to said value, ($800,000).



The gain on sale of the Jolu Mill represented the difference between the value of the Jolu Development Corp. shares received as consideration, $350,000, plus the liabilities assumed and the book value of the assets sold. Since the mill had been written-off in a prior year when gold prices were low, and the mill was sold in a period of rising gold prices, the gain was significant.



Site restoration provision is an additional provision for road and other reclamation regarding Komis that has not been settled with the Saskatchewan Government.



The loss on sale of investments in fiscal 2003 pertained primarily to the loss of $15,000 on cancellation of Manson Creek Resources Ltd. escrow shares for no consideration since the terms of escrow could never be met.



The following is a discussion of the significant changes in assets from 2002 to 2003:



Cash

The change in cash balances is discussed under Operating Cash Flow which follows under B.



Accounts Receivable

The increase in amounts receivable from $10,532 to $25,727 pertains to a receivable from Golden Band for post sale mine lease liabilities (which is essentially an offset to CDGs lease liability).



Due From Related Parties

The amounts due from related parties pertains to administrative costs charged to companies related by virtue of certain common officers and directors.  The increase from the 2002 balance of $16,861 to the 2003 balance of $35,052 was due to a growing receivable from Tyler Resources Inc.  Subsequent to 2003 year-end, all September 30, 2003 related party receivables, including those due from Tyler were received.



Prepaids

The comparative 2002 period balance of $80,291 was significantly higher than the 2003 balance of $13,401 due to the presence of prepaid leases re. Jolu and Komis. (Note that there was a payable for the full years lease and the prepaid portion of this liability was recorded.)  Given the sale of Jolu and Komis there were no such prepaids at September 30, 2003.







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Demand Notes Receivable

The notes receivable at September 30, 2003, are due from Tyler Resources Inc.; the terms are described in note 3 to the financial statements.  The full amount was repaid subsequent to year-end.



Investments

Investments are described in detail in note 4 to the financial statements.  During the 2003 fiscal year Aloak and Jolu Development Corp., as well as Northern Abitibi shares were written-down to fair value. (Discussed under operations above.)



Reclamation Deposit

The reclamation deposit on the books at September 30, 2003  of $46,000 pertains to the Komis road and outstanding Komis issues.  The remainder of the $330,000 deposit that was outstanding at September 30, 2002, was transferred to Jolu Development Corp. with the sale of the Jolu Mill.



Exploration Properties

The Golden Band Acquisition agreement closed November 7, 2002.  The sale was reflected at the September 30, 2002 year-end resulting in the disclosure of the disposition of the Saskatchewan properties and the recording of the Golden Band shares as at that date.  The only mineral property remaining on the books at September 30, 2003 is the Mexican property of Bahuerachi.  Bahuerachi was written-down to $800,000 in fiscal 2003 to reflect the agreed-upon value per the letter of intent regarding the sale of the property to Tyler entered into subsequent to year-end.



Inflation and Foreign Currency



The impact of inflation and foreign currency fluctuations on the Company is not material. The Company does not currently have assets or liabilities denominated in foreign currencies.



The Company does not engage in currency borrowing or hedging.



B.

LIQUIDITY AND CAPITAL RESOURCES



|                             | September 30,
|---------------------------- | -------------
|                             | 2004         
|Cash and cash equivalents    | $181,241     
|Working capital (deficiency) | $158,699     



Operating Cash Flow



In 2004, 2003 and 2002, operating activities reduced cash resources as corporate expenses exceeded revenues.



Liquidity Provided from Financing Activities



During fiscal 2003, the Company received $550,000 cash pursuant to convertible debenture financing and expended $17,000 on interest paid to the debenture holders.  There were no significant costs associated with the financing. During fiscal 2004, $33,000 was expended on debenture interest.



No cash was generated by financing activities during the 2004 and 2002 fiscal years.



Liquidity Provided by (Used in) Investing Activities



There were net exploration property and equipment cash expenditures during the current period of approximately $70,000 including the payment of the prior years $56,000 payable to Tyler Resources Inc. for its share of expenditures on the Bahuerachi property, Mexico. There should be no further mineral property costs now that all properties have been sold.







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Expenditures on exploration properties aggregated $77,000 in 2003 and $39,000 in 2002.  All of the exploration property additions in 2004 and 2003 were incurred on the Companys Mexican properties; primarily Bahuerachi.  The cash expenditures relating to exploration properties in fiscal 2002 pertained to the Companys one-half share of costs to terminate a property acquisition agreement for the Don David property in Mexico.



The Company advanced $25,000 to Tyler Resources Inc., by way of notes receivable during fiscal 2003.  The full amount owing, including accrued interest, was repaid in fiscal 2004.  See Item 7:  Major Shareholders and Related Party Transactions  B. Related Party Transactions."



In fiscal 2003 the Company sold mineral properties, previously written-off in the books, for $7,500 and shares in Aloak for $1,200.



The excess of proceeds on the sale of investments over the purchase cost of investments in the year ended September 30, 2004, contributed $293,000 to cash and working capital during the year. This included $200,000 received pursuant to the legal settlement described in note 8 to the financial statements.  See Item 4(A)(4)(c) and Item 8. Legal costs of $68,000 associated with achieving this settlement were paid during the current year. These legal costs, which are included in cash operating expenses during the year ended September 30, 2004, explain the increase in cash operating expenses compared to the 2003 fiscal year.



The Company sold Tyler shares in the open market during the 2002 fiscal year for $39,000 and reacquired Tyler shares through a private placement for $31,000.



Working Capital



Subsequent to year-end the Company sold 779,500 shares of Golden Band Resources for proceeds of $209,000 and exercised warrants to acquire a further 592,202 shares of Golden Band at a cost of $118,000, for a net contribution to treasury of $91,000. Further, the Company sold its entire investment in RSX Energy Inc. for proceeds of $122,000.



Working capital is sufficient for the Companys present requirements.



The Company has an investment portfolio that at September 30, 2004 had a fair value of $7,600,000. Fair values are based on market quotes and may not represent actual proceeds should these investments be sold. However, management believes the Company has ample opportunities to generate more cash and working capital through the sale of investments in an amount sufficient to fund future operations.



Management believes, the receipt of the remaining $600,000, provided for in the legal settlement discussed in Item 4(A)(4)(c), Item 8 and note 7 to the financial statements, over the following three years, would improve the Companys financial position even more. However, at this point the Company cannot conclude about the future collectibility of those amounts.  There are no assurances that such amounts will be received.



There were no borrowings at the end of 2002.  At September 30, 2004 and September 30, 2003, the Company owed $550,000 to convertible debenture holders (see Note 7 to financial statements and Item 4.  Information on the Company  A. History and Development  4.  Significant changes or events - d) Year ended September 30, 2003  Convertible Debenture Financings).  The due date of the convertible debentures was December 17, 2005.  The convertible debentures bore interest at 6% per annum, payable semi-annually on March 31 and September 30 and were secured by a floating charge over substantially all of the assets of the Company.  In addition, the debentures were convertible into units comprised of one common share and one share purchase warrant at $0.10 per unit until December 17, 2004 and $0.11 per unit from December 18, 2004 to December 17, 2005.



Without the written consent of the debenture holders, the Company was not allowed to advance monies by way of a loan to any company or conduct exploration activities of any nature, except for its commitment to fund exploration costs relating to the 2003 program on the Bahuerachi property in Mexico.



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Subsequent to year-end the full $550,000 of debentures were converted into 5,499,091 common shares and 5,499,091 warrants.   Subsequent to year-end 500,000 warrants were exercised at $0.11 per share for $55,000.  The remaining 4,999,091 warrants expire as follows:



|Number of Shares | Expiry Date       | Exercise Price
|---------------- | ----------------- | --------------
|4,990,000        | December 16, 2006 | $0.11-$0.13   
|9,091            | December 21, 2006 | $0.12-$0.14   



The Company maintains its cash in Canadian currency and invests excess cash in brokerage accounts as required.



The Company does not utilize any financial instruments for hedging purposes.



There are no material commitments for capital expenditures as of September 30, 2004 nor as of December 31, 2004.



C.       RESEARCH AND DEVELOPMENT, PATENTS AND LICENSES



The company expended the following on mineral exploration activities during the last three fiscal years:



2004

$11,582

2003

$132,691

2002

$1,000



D.  TREND INFORMATION



During the year-ended September 30, 2004 the Company sold its remaining exploration property. Thereafter the Company became exclusively an investment Company. Further the Company ceased to consolidate Waddy Lake Resources Inc. pursuant to the investment sale described in item 4(A)(4)(c). Certain amounts in the statement of operations that were associated with these two transactions are considered non-recurring. The gain on sale of interest in Waddy Lake and the write-off of exploration property costs will not occur in future years.



Future recurring operating items will relate to the ongoing general and administrative expenses, debenture interest, and investment-related income/loss items  equity in earnings (loss) of investees, gain (loss) on sale of investments and write-down of investments, as applicable.



E.  OFF BALANCE SHEET ARRANGEMENTS



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

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F.  TABULAR DISCLOSURE OF CONTRACTUAL OBLIGATIONS.



|                                                                                                                         | Payments Due by Period(1)
|------------------------------------------------------------------------------------------------------------------------ | -------------------------
|                                                                                                                         | Total                    
|Long-Term Debt Obligations(2)                                                                                            | $550,000                 
|Capital (Finance) Lease Obligations                                                                                      | Nil                      
|Operating Lease Obligations                                                                                              | $27,350                  
|Purchase Obligations                                                                                                     |                          
|[Other Long-Term Liabilities Reflected on the Company's Balance Sheet under the GAAP of
the primary financial statements | Nil                      
|Contractual Obligations(1)                                                                                               | Nil                      
|Total                                                                                                                    | $577,350                 



(1)

As of September 30, 2004.



(2)

Subsequent to September 30, 2004, $550,000 in principal amount of the convertible debentures were converted into common shares.  See Item 4(A)(4)(a), as a result there is no committed debenture payable after the conversion.



G.  SAFE HARBOR



Except for historical facts, all information required by Item 5 E and 5 F of this Item 5 is deemed to be a forward-looking statement as that term is defined in Section 27A of the Securities Act and Section 21E of the Exchange Act and the accuracy of these statements cannot be guaranteed as they are subject to a variety of risks.



Item 6:  DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES



A.

DIRECTORS AND SENIOR MANAGEMENT (see table below)

B.

COMPENSATION (see table below)

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|Name, Age and Present
Position with the
Corporation                      | Professional Degrees and
Present Principal
Occupation and Previous
Business Experience                                                                                                                                                                                                                                                                                                                                                        | Period as Senior Management or Director | Shares
Owned (2)(6)                                    | Annual
Compensation
|------------------------------------------------------------------------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ------------------------------------------------------ | -------------------
|James  Devonshire
Director, Chief Executive Officer and President
Age 57 | C.A.  Institute of Chartered Accountants (Alberta)  1974; M.A. Political Science  University of Waterloo  1971 and B.A. Political Science and Economics  University of Calgary  1970.

Self-employed Chartered Accountant and Management Consultant.  Director and President of Manson Creek Resources Ltd. and Northern Abitibi Mining Corp.; Chairman, CEO and Director of Tyler Resources Inc.                                       | Since March 30, 1990                    | 1,910,800 or
5.4% of total issued and outstanding      | $24,185 (3)        
|Gregory H. Smith
Director and Chief Financial Officer
Age 57             | C.A.  Institute of Chartered Accountants (Alberta)  1975 and B.Com.  University of Calgary  1970.
Chartered Accountant and partner with Smith Cageorge Perry, Chartered Accountants, Calgary.  President of Alberta-Pacific Management Ltd., Director of Armistice Resources Ltd. and Tyler Resources Inc., Director and Chief Financial Officer of Aloak Corp., Secretary/Treasurer of Yorkland Group  management of private companies. | Since March 27, 1997                    | 2,546,216 or
7.2% of total issued and outstanding      | $2,680             
|Robert G. Ingram (1)(5)
Director
Age 61                                  | C.A.  Institute of Chartered Accountants (Alberta)  1967
And B.Com.  University of Alberta  1965.

Self-employed Chartered
Accountant.  Director and President of Southesk Energy Ltd., Director and President of Uncas Production Corporation and Director and President of First Yellowhead Equities Inc., Director of Golden Band Resources Inc., Santoy Resources Ltd. and Equitech Corporation                                       | Since September 24, 1981                | 7,494,182 or
19.4% of the total issued and outstanding | $1,300             



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|Name, Age and Present
Position with the
Corporation | Professional Degrees and
Present Principal
Occupation and Previous
Business Experience                                                                                                                                                                                                                                                                                                                                                                                             | Period as Senior Management or Director | Shares
Owned (2)(6)                                   | Name, Age and Present
Position with the
Corporation
|--------------------------------------------------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------------- | ----------------------------------------------------- | ---------------------------------------------------
|Calvin Fairburn (1)
Director
Age 70                 | BSAM-Advanced Management 1972; P.Eng.-APPEGA 1960 and
B.Sc. Eng. University of Saskatchewan  1957.

Self-employed Professional
Engineer. Over 45 years experience in the Petroleum and Natural Gas and Agriculture/ Farming Industries.  Director of Buffalo Oil Company Limited from 1993-1998.                                                                                                                                                                                  | Since
March 6, 2003                     | 401,200 or
1.1% of the total issued and outstanding   | $1,600                                             
|Kerry Brown(5)
Director
Age 49                      | C.A.  Institute of Chartered Accountants (Alberta)  1982 and B.Com.  Unversity of Alberta  1979.

Chairman and Chief Executive Officer of Foundation Equity Corporation, an angel capital company, since it's inception in 1992. Chairman of McCoy Bros. Inc, a TSE listed company since 1995. Chairman of Equitech Corporation and HomeBank Technologies Inc., both listed on the TSX. Director of Innovotech Inc. and First Yellowhead Equities Inc. both listed on the TSX. | Since
February 28, 2005                 | 1,100,000 or
3.1% of the total issued and outstanding | Nil                                                
|Edward Fry
Director
Age 57                          | Self-employed businessman who
specializes in private real estate
development, finance and
syndication. Chairman and
Director of Safe Harbour Inc.
and has served as a director
on a number of public Boards.                                                                                                                                                                                                                                                                       | Since
February 28, 2005                 | 100,000 or
.2% of the total issued and outstanding    | Nil                                                
|Barbara ONeill
Secretary
Age 38                    | Secretary of the Company, and Tyler Resources Inc., Manson Creek Resources Ltd. and  Northern Abitibi Mining Corp.                                                                                                                                                                                                                                                                                                                                                                 | Since June 28, 1993                     | 75,000 or .2%                                         | $49,350                                            





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Notes:



(1)

Messrs. Fry, Ingram and Fairburn constitute the Audit Committee of the Company.  The Company does not have an Executive Committee.

(2)

The approximate number of shares of the Company carrying the right to vote in all circumstances beneficially owned, directly or indirectly, or over which control or direction is exercised by each proposed nominee as of March  24, 2005.

(3)

This amount was paid to a corporation in which the officer is a shareholder, for consulting services provided at customary professional rates.  See Related Party Transactions below.

(4)

Options held by Directors and Officers outstanding as at March 24, 2005:



|Option Holder    | Number of Common Shares | Exercise Price | Expiry Date      
|---------------- | ----------------------- | -------------- | -----------------
|James Devonshire | 450,000                 | $0.11          | June 4, 2007     
|Gregory H. Smith | 375,000                 | $0.11          | June 4, 2007     
|Robert G. Ingram | 300,000                 | $0.11          | June 4, 2007     
|Edward Fry       | 100,000                 | $0.33          | February 27, 2008
|Kerry Brown      | 100,000                 | $0.33          | February 27, 2008
|Barbara ONeill  | 75,000                  | $0.11          | June 4, 2007     



No Options were granted in 2004.   Options for 200,000 shares at $0.33 per share were granted on February 28, 2005.



(5)

Mr. Ingram has control or direction over corporations that hold warrants for 9,091 shares exercisable between $0.12-$0.14 and warrants for 2,990,000 shares exercisable between $0.11-$0.13.  Mr. Ingram personally holds warrants for 500,000 shares exercisable between $0.11-$0.13.  Mr. Brown holds warrants for 500,000 shares exercisable between $0.11-$0.13.  See Item 4:  Information on the Company  A. History and Development  4.  Significant changes or events - e) Year ended September 30, 2003  Convertible Debenture Financings and (a) Subsequent to September 30, 2004  Conversion of Debentures.



(6)

Where persons listed on this table have the right to obtain additional shares of common stock within 60 days from March 24, 2005, through the exercise of outstanding options or warrants, these additional shares are deemed to be outstanding for the purpose of computing the percentage of common stock owned by such persons, but are not deemed to be outstanding for the purpose of computing the percentage owned by any other person.  Based on 34,753,172 shares of common stock outstanding as of March 24, 2005.



No officers or directors, or persons or entities affiliated or controlled by officers or directors of the Company held warrants as at September 30, 2004.  As a result of the debenture conversion described in Item 4 A. 4 a). Kerry Brown holds 500,000 warrants allowing him to acquire 500,000 common shares at $0.12 per share to December 17, 2005 and $0.13 per share to December 16, 2006.  Mr. Ingram and companies over which he exercises control or influence holds warrants to acquire 3,490,000 common shares at $0.12 per share to December 17, 2005 and $0.13 per share to December 16, 2006 as well as warrants to acquire 9,091 common shares at $0.12 per share to December 17, 2005; $0.13 per share from December 18, 2005 to December 17, 2006 and $0.14 per share from December 18, 2006 to December 21, 2006.



As of February 28, 2005, the Company does not have any plans that require the Company to contribute to, or to provide pension, retirement or similar benefits to directors and officers.



All of the Companys shareholders, including officers and directors if they own shares, have the same voting rights.



See also Item 7(B).



C.

BOARD PRACTICES



All directors hold office until the next annual meeting of the shareholders of the Company and until their successors have been elected and qualified. Officers of the Company serve at the discretion of the Board of Directors. See the table under Item 6 B for term of office and audit committee information.



The Companys Audit Committee must be comprised of at least three directors, all of whom must be outside directors who are not employees or members of management of the Company or any of its associates or affiliates.   The board of directors of the Company, after each annual shareholders meeting must appoint or re-appoint an audit committee.  As of the date of this annual report, the members of the audit committee were Messrs. Ingram, Sanders and Fairburn.



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





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The Company does not have a remuneration committee.



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



There are no family arrangements between any director or officer of the Company and any other director or officer of the Company.



There are no directors service contracts with the Company or any of its subsidiaries providing for benefits upon termination of employment.



D.

EMPLOYEES



The Company currently employs three persons on a full time basis, and throughout fiscal 2004, 2003 and 2002 employed two persons on a full-time basis. None of the Company's employees are represented by a labor union.  Corporations in which certain of the Company's officers or directors are shareholders have provided geological and exploration services and direct administrative services at usual professional rates.



The Company utilized the services of four contractors during fiscal 2004.



E.         SHARE OWNERSHIP



Directors and Officers Options



See table under Item 6B.



Employee/Officers Stock Options



The Company has adopted a 1998 Stock Option plan, pursuant to which up to 10% of the issued and outstanding common shares are reserved for issuance.  Under the plan, the options that have been granted expire at the earlier of five years from the grant date, the date at which the Directors determine, or 60 days from the date from which the optionee ceases to be a director, officer, employee or consultant.  Options are granted at the fair value of the shares around the grant date or greater amount determined by the directors.



Pursuant to the 1998 Stock Option plan of the Company, employees/consultants, and officers have been granted options. The following are outstanding as at March 24, 2005, (exclusive of directors and officers options summarized above):



|Number of Common Shares | Exercise
Price CDN $ | Expiry
Date 
|----------------------- | -------------------- | ------------
|75,000                  | $0.11                | June 4, 2007



Item 7:

MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS



A.

MAJOR SHAREHOLDERS



1.

To the knowledge of the directors and senior officers of the Company, as of March 24, 2005, no persons or corporations beneficially owned, directly or indirectly, or exercised control or direction over 5% or more of the votes attached to all outstanding shares of the Corporation which have the right to vote in all circumstances, except as follows:





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|As at March 24, 2005 (1)
|------------------------
|Shareholder             
|Gregory H. Smith        
|James Devonshire        
|Robert Ingram           





(1)

Includes all options and warrants held by each individual.



(2)

Where persons listed on this table have the right to obtain additional shares of common stock within 60 days from March 24, 2005, through the exercise of outstanding options or warrants, these additional shares are deemed to be outstanding for the purpose of computing the percentage of common stock owned by such persons, but are not deemed to be outstanding for the purpose of computing the percentage owned by any other person.  Based on 34,753,172 shares of common stock outstanding as of March 24, 2005.



All of the Companys major shareholders have equal voting rights.



2.

As of March 24, 2005, according to records of the Companys transfer agent, the Company had 1,137 registered holders of its common shares, 268 of whom were residents of the United States. The total shareholdings of such United States resident shareholders as at March 24, 2005 were 6,599,718 common shares, representing 18.9% of the total issued and outstanding capital of the Company. These do not include an indeterminable number of persons who hold their shares in 'street name through broker-dealers or other beneficial holders.  The Company does not know how many beneficial shareholders it has in the United States, but management believes there are approximately 800 such shareholders.



3.

To the best of the Companys knowledge, the Company is not directly or indirectly owned or controlled by another corporation(s), by any foreign government or by any other natural or legal person(s), severally or jointly. The Company believes that the day to day business operations and affairs of the Company are controlled by the Board of Directors of the Company.



4.

The Company has no knowledge of any arrangements, the operation of which may, at a date subsequent to the date of this Annual Report, result in a change of control of the Company.



5.

The following significant changes occurred in the percentage share ownership of the major shareholders during the past three years:



Mr. Devonshire:  In 2002 Mr. Devonshire beneficially owned 2.8% of the Companys common shares.  Mr. Devonshires interest increased to 6.5% in 2003 due to the inclusion of 500,000 shares that could potentially be issued pursuant to the conversion of debentures into common shares and warrants to purchase common shares, which are further assumed to be converted into 500,000 common shares.



Mr. Ingram:  In 2002 Mr. Ingram beneficially owned 2.1% of the Companys common shares.  Mr. Ingrams interest increased to 21.4% in 2003 due to the inclusion of 3,500,000 shares that could potentially be issued pursuant to the conversion of debentures into common shares and warrants to purchase common shares, which are further assumed to be converted into 3,500,000 common shares.



Mr. Sanders:  In 2002 Mr. Sanders, a former director, beneficially owned 0% of the Companys common shares.  Mr. Sanders interest increased to 4.6% in 2003 due to the inclusion of 500,000 shares that could potentially be issued pursuant to the conversion of debentures into common shares and warrants to purchase common shares, which are further assumed to be converted into 500,000 common shares.



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6.

None of the Companys shareholders have different voting rights.

B.

RELATED PARTY TRANSACTIONS



Other than as disclosed below, for the years ended September 30, 2004 and the period from October 1, 2004 to February 28, 2005, the Company has not entered into any transactions or loans between the Company and any (a) enterprises that directly or indirectly through one or more intermediaries, control or are controlled by, or are under common control with, the Company; (b) associates; (c) individuals owning, directly or indirectly, an interest in the voting power of the Company that gives them significant influence over the Company, and close members of any such individuals' family; (d) key management personnel and close members of such individuals' families; or (e) enterprises in which a substantial interest in the voting power is owned, directly or indirectly, by any person described in (c) or (d) or over which such a person is able to exercise significant influence.



For purposes of this section, an associate is an unconsolidated enterprise in which the Company has a significant influence or which has significant influence over the Company.  Significant influence over an enterprise is the power to participate in the financial and operating policy decisions of the enterprise but is less than control over those policies.  Shareholders (including the Company) beneficially owning a 10% interest in the voting power of a company are presumed to have a significant influence on the company.  This section also includes transactions between the Company and any enterprises that has a member of key management in common with the Company.



All related party transactions and loans, in accordance with the preceding discussion, during the last fiscal year and the period from October 1, 2004 to February 28, 2005 are as follows:



1.

The sale of the Companys Bahuerachi mineral property interests to Tyler Resources Inc., a company related by virtue of certain common officers and directors is described in detail in Item 4.  Information on the Company  A. Significant Changes or Events  b) September 30, 2004  Bahuerachi Sale.  Mr. Devonshire, Mr. Smith and Ms. ONeill, who are shareholders, officers and/or directors of the Company are also officers, directors and/or shareholders of Tyler.



2.

The Company subleases office space from Manson, a company related by virtue of certain common officers and directors.  Mr. Devonshire and Ms. ONeill, who are shareholders, officers and/or directors of the Company are also shareholders, officers and/or directors of Manson.  During the year ended September 31, 2004, Manson charged the Company $22,000 for the Companys share of office base rent and operating costs.  The annual base lease charges are $12,150 until December 31, 2006 and $3,050 in 2007, the final year of the lease.  The Company is responsible for its share of lease operating costs which vary from year-to-year but aggregated approximately $10,000 in fiscal 2004.  Rent and operating expenses paid or accrued for the period October 1, 2004 through February 28, 2005 aggregated $9,200.  See Item 4: Information on the Company  D. Property, Plants and Equipment.



3.

Effective February 18, 2003, the Jolu Mill and equipment were sold to Jolu Development Corp. (JDC), a new corporation whose sole shareholder immediately prior to the transaction was Golden Band Resources Inc. (Golden Band), a publicly listed Company.  See Item 4: Information on the Company  A. Significant Changes or Events  f) Year ended September 30, 2003  Sale of Jolu Mill.  At the time of the transaction the Company owned 32% of Golden Band and James Devonshire, a shareholder, officer and director of the Company, was also a shareholder and director of Golden Band.  Mr. Devonshire resigned as a director of Golden Band on January 26, 2004 and Robert Ingram, a shareholder and director of the Company, replaced him on the board.  Mr. Ingram is also a shareholder of Golden Band.



In consideration for the sale of the mill and equipment, JDC agreed to assume the liabilities associated with the mill, past, present and future, issue shares in its capital stock valued at $350,000 and assign a royalty to the company based on $10 per tonne of ore processed through the mill, not to exceed $400,000 in total.  The mill had previously been written-off in the Companys books and the equipment had a net book value of $8,400.  The value of the current liabilities net of any offsetting current assets that was assumed by JDC is $211,000.  In addition JDC assumed $330,000 of the total site restoration liability that was estimated on the Companys books, and $329,000 of the reclamation deposit was transferred to JDC.





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During the year ended September 30, 2004, pursuant to a shareholders agreement with Golden Band, the Company gave notice to Golden Band that it must acquire all of the Companys shares in JDC in exchange for 1,166,667 common shares of Golden Band, with a deemed value of $0.30 per share and the Golden Band shares were received September 30, 2004.  Robert Ingram, a shareholder and director of the Company is also a shareholder and director of Golden Band.  The Company also held 12,361,266 shares of Golden Band.



4.

Pursuant to an agreement dated January 1, 2002, between the Company and Kingslea Financial Corp. (Kingslea), the Company Kingslea for the Presidents consulting services during the years noted at an hourly rate of $105.  Mr. Devonshire is the sole shareholder, officer and director  of Kingslea.  Total amounts paid to Kingslea in the past fiscal year and the period from October 1, 2004 through February 28, 2005, (rounded to the nearest $1,000), were:  Oct. 1, 2004 through Dec. 31, 2004-$10,000, 2004- $24,000.



5.

The Company paid the company of the former Vice-President Exploration, Jean Pierre Jutras, who resigned on March 5, 2003, for his consulting services during the period noted at a daily rate of $400.  Total amounts paid in the past fiscal year, (rounded to the nearest $1,000), was $1,300.  No payments were made in the period from October 1, 2004  February 28, 2005.



6.

The Company employs two individuals whose services are also used by companies related by virtue of certain common officers and directors.  Further the Company pays certain administrative costs applicable to all of these companies.  The Company then bills the related companies for their share of the salaries and administrative costs, including a 10% mark-up to compensate for the administrative costs associated with rebilling. The amounts charged to these companies in the past fiscal year and from October 1, 2004 to December 31, 2004, rounded to nearest $1,000, are as follows (as the Company bills quaterly, no billing has been prepared for January and February 2005):



|                        | Tyler Resources | Manson Creek | Northern Abitibi | Total  
|----------------------- | --------------- | ------------ | ---------------- | -------
|October 1/04-Dec. 31/04 | $15,000         | $8,000       | $1,000           | $24,000
|Fiscal 2004             | $39,000         | $24,000      | $17,000          | $80,000



7.

During the preceding fiscal years the Company was charged for its share of joint venture mineral property expenditures on the Bahuerachi Prospect by the operator of the joint venture, Tyler Resources Inc., a company related by virtue of certain common officers and directors (James Devonshire, Gregory Smith and Barbara ONeill).  Mr. Devonshire is a shareholder, officer and director of Tyler; Mr. Smith is a shareholder and director of Tyler; and Ms. ONeill is a shareholder and officer of Tyler.  See Item 4(B).  A 10% overhead fee is added to certain of the amounts billed, a practice that is common in the industry, the rate of which is the same as most non-related joint ventures in which the Company has participated.  The amounts charged in the 2004 fiscal year, including the related overhead fees, (rounded to the nearest $1,000), was $11,000.



As the Bahuerachi prospects interest was sold in fiscal 2004 there are no costs to report for the period from October 1, 2004-February 28, 2005.



8.

Effective April 30, 2004, the Company settled the lawsuit filed by Procon Mining and Tunnelling Ltd. against the Company, its 100% owned subsidiary, Waddy Lake, and certain current and past directors and officers of the two companies seeking to recover $1,154,133 for mine contracting services as well as damages, court costs and interest on all sums unpaid.  See Item 8 and Item 4(a)(4)(c).



There were no loans made by the Company or any of its subsidiaries to, or for the benefit of, any of the persons noted above, with the exception of the advance to Tyler Resources Inc., described in 8 above.



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Conflicts of Interest



See Item 3:  Key Information - Risk Factors - Conflict of Interest.



The following table identifies, as of March 24, 2005, the name of each director  of the Company and any public reporting company, for which such director currently serves as an officer or director:



|Name of Director | Name of Company                                                                                                                       | Position                                                                                  | Term of Service                                                                                                                                                               
|---------------- | ------------------------------------------------------------------------------------------------------------------------------------- | ----------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|James Devonshire | CDG Investments Inc.

Manson Creek Resouce Inc.
Tyler Resources Inc.

Northern Abitibi Mining Corp.                                   | President
Director
President
Director
CEO/Chairman
Director
President
Director            | Sept 2000  Present
March 1990  Present
August 2000  Present
March 1997  Present
December 2001- Present
December 2000  Present
Sept. 2000  Present
January 2000  Present
|Gregory H. Smith | CDG Investments Inc.

Armistice Resources Ltd.
Aloak Corp.

Tyler Resources Inc.                                                      | Director
CFO
Director
Director
CFO
Director                                               | March 1997  Present
February 2001  Present
November 1987  Present
March 2003  Present
February 2001  Present
December 2000 - Present                                     
|Robert G. Ingram | CDG Investments Inc.
Southesk Engergy Ltd.
First Yellowhead Equities
Santoy Resources Ltd.
Golden Band Resources
Equitech Corporation | Director
Director/President
Director/Treasurer
Director
Director
Director                 | Sept. 1981  Present
July 1994  Present
June 1998  Present
March 1990  Present
Jan. 26 2004  Present
July 2004 -Present                                                   
|Calvin Fairburn  | CDG Investments Inc.                                                                                                                  | Director                                                                                  | March 2003- Present                                                                                                                                                           
|Roger Fry        | None                                                                                                                                  | N/A                                                                                       | N/A                                                                                                                                                                           
|Kerry Brown      | McCoy Bros Inc.
Equitech Corporation
HomeBank Technologies Inc.
Innovotech Inc.
First Yellowhead Equities Inc.                        | Chairman/Director
Chairman/Director
Chairman
Director
Director                            | Oct 1997-Present
March 2001-Present
February 2001-Present
January 2001-Present
April 2002-Present                                                                             
|Barbara ONeill  | CDG Investments Inc.

Manson Creek Resouce Inc.
Tyler Resources Inc.

Northern Abitibi Mining Corp.
Aloak Corp.                       | Secretary
Assistant Secretary
Secretary
Secretary
Assistant Secretary
Secretary
Secretary | June 1993 to present
March 1990 to June 1993
May 1993 to present
August 1998 to present
Nov. 1993 to Aug 1998
May 1993 to present
June 1993 to present                        



C.

INTERESTS OF EXPERTS AND COUNSEL



Not applicable.



Item 8:

FINANCIAL INFORMATION



The financial statements are attached to and form part of this Annual Report. See Part IV, Item 17.  Except as disclosed below, no significant change has occurred since the date of the annual financial statements included herein.



Refer to Item 4 (A) 4(a) Conversion of Debentures.



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Legal Proceedings



Procon Mining and Tunnelling Ltd. filed a Statement of Claim against the Company, its 100% owned subsidiary, Waddy Lake, and certain current and past directors and officers of the two companies seeking to recover $1,154,133 for mine contracting services as well as damages, court costs and interest on all sums unpaid. The Statement of Claim was filed on December 14, 2000 in the Supreme Court of British Columbia.  The named defendants included Waddy Lake, CDG Investments Inc., Glen Harper, Larry Lahusen, Robert Lemmon, James Devonshire, Barbara ONeill, Robert Ingram, Donald Busby and Peter Cole.  The suit was subsequently dropped against Messrs. Harper, Busby and Cole. The Company reached a settlement that is described in detail under item 4(A)(4)(c).



Dividend Policy



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



Item 9:

OFFER AND LISTING



Offer and Listing Details



1 to 3 not applicable



4.

The following is the price history of the Companys stock on (1) the OTC Bulletin Board (the OTCBB) under the symbol GLDUF until April 29, 2002 and then CDGEF from April 30, 2002 to date; (2) the Toronto Stock Exchange for 1997 to 2000; and the CNQ-Canadian Trading and Quotation System Inc. from May 2004 to date under the symbol CDGI:



a)

for the five most recent full financial years the annual high and low market prices:



|OTC Bulletin Board
Year ended September 30, | 2004
US $ | 2003
US$ | 2002
US$ | 2001
US$
|------------------------------------------- | --------- | -------- | -------- | --------
|High                                        |           | $0.17    | $0.12    | $0.10   
|Low                                         |           | $0.035   | $0.009   | $0.005  



|Toronto Stock Exchange
Year ended September 30, | 2004
Cdn$ | 2003
Cdn$ | 2002
Cdn$ | 2001
Cdn$ | 2000
Cdn$
|----------------------------------------------- | --------- | --------- | --------- | --------- | ---------
|High                                            |           | -  (1)    | -  (1)    | - (1)     | - (1)    
|Low                                             |           | -  (1)    | -  (1)    | -  (1)    | -  (1)   

(1)

The Company did not trade on the Toronto Stock Exchange during fiscal 2002 or subsequent to February 21, 2001.





|CNQ
Year ended September 30, | 2004(1)
Cdn$
|---------------------------- | ------------
|High                         |             
|Low                          |             

(1) The Company began trading on the CNQ in May 2004.



b)

for the two most recent full years, the high and low market prices for each full financial quarter.

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|OTC Bulletin Board | Sale Price            
|------------------ | ----------------------
|                   | CDGEF (formerly GLDUF)
|Quarter Ended      |                       
|Fiscal 2005        | Low US$               
|December 31, 2004  | $0.05                 
|Fiscal 2004        | Low US$               
|December 31, 2003  | $0.035                
|March 31, 2004     | $0.10                 
|June 30, 2004      | $0.06                 
|September 30, 2004 | $0.055                
|Fiscal 2003        | Low US$               
|December 31, 2002  | $0.009                
|March 31, 2003     | $0.025                
|June 30, 2003      | $0.03                 
|September 30, 2003 | $0.02                 



|CNQ                | Sale Price
|------------------ | ----------
|                   | CDGI      
|Quarter Ended      |           
|Fiscal 2005        | Low Cdn$  
|December 31, 2004  | $0.03     
|Fiscal 2004        | Low Cdn$  
|June 30, 2004      | $0.05     
|September 30, 2004 | $0.04     



c)

for the most recent six months the high and low market prices for each month during the previous six months:



|OTC Bulletin Board |         |         
|------------------ | ------- | --------
|Month Ended        | Low US$ | High US$
|September, 2004    | $0.06   | $0.07   
|October, 2004      | $0.05   | $0.08   
|November, 2004     | $0.07   | $0.22   
|December, 2004     | $0.12   | $0.25   
|January, 2005      | $0.21   | $0.35   
|February, 2005     | $0.26   | $0.36   



|CNQ             |          |          
|--------------- | -------- | ---------
|Month Ended     | Low Cdn$ | High Cdn$
|September, 2004 | $0.04    | $0.10    
|October, 2004   | $0.03    | $0.08    
|November, 2004  | $0.05    | $0.20    
|December, 2004  | $0.12    | $0.32    
|January, 2005   | $0.22    | $0.43    
|February, 2005  | $0.30    | $0.43    



These above quotations reflect inter-dealer prices without retail mark-up, markdown, or commissions and may not necessarily represent actual transactions.





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The OTCBB is smaller and less liquid than the major securities markets in the United States. The trading volume of the Companys shares on the OTCBB has been volatile. Consequently, shareholders in the United States may not be able to sell their shares at the time and at the price they desire.



The CNQ is smaller and less liquid than the major securities markets in Canada and the trading volume of the Companys shares has been volatile.  Consequently, shareholders may not be able to sell their shares at the time and at the price they desire.

The trading of the Companys shares on the Toronto Stock Exchange was suspended February 21, 2001 and the Company was delisted effective February 21, 2002. The Company made an unsuccessful application for listing on the Canadian Venture Exchange in February 2001.



B.

PLAN OF DISTRIBUTION



Not applicable



C.

MARKETS



The Companys common shares were traded on the Toronto Stock Exchange in Canada but were delisted from the TSE on February 21, 2002.   The Company then applied for a listing on the Canadian Venture Exchange. The Company received notice on March 7, 2001 that the Canadian Venture Exchange had denied its listing application for failure to meet all of the minimum listing requirements.



The Company commenced listing on the CNQ-Canadian Trading and Quotation System Inc. exchange in Canada effective May 18, 2004.  If the Company fails to remain current in its filings with the Securities and Exchange Commission, or if the Company decides to terminate its registration with the Securities and Exchange Commission, the Company would not qualify to be listed on the OTCBB and its shareholders may not be able to sell their shares in the United States.



The Company currently trades on the OTCBB under the symbol CDGEF and the CNQ under the symbol CDGI.



D.

SELLING SHAREHOLDERS
Not applicable.

E.

DILUTION
Not applicable.

F.

EXPENSES OF THE ISSUE

Not applicable.



Item 10:  ADDITIONAL INFORMATION



A.

SHARE CAPITAL



Not applicable.





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B.

MEMORANDUM AND ARTICLES OF ASSOCIATION



1.

Companys Objects and Purposes



The Company was incorporated under the Business Corporation Act (Alberta) on October 12, 1979 and was assigned corporate access number 20205811.  The Company prepares and makes its own corporate registry filings withAlberta Registrar of Companies.



At the Annual & Special Meeting on March 21, 2002, the shareholders approved a change in our business from that of a Natural Resources Company to that of an Investment Company and a change in name from Golden Rule Resources Ltd. to CDG Investments Inc.



2.

Directors



a)

Directors power to vote on a proposal, arrangement or contract in which the director is materially interested:



According to the Companys By-Law No. 1, except as required by the Alberta Business Corporations Act (the Act), no director is obliged to make any declaration or disclosure of interest or refrain from voting.



b)

Directors power, in the absence of an independent quorum, to vote compensation to themselves or any members of their body: in accordance with By-Law No. 1 and the Articles of Association, the directors will be paid such remuneration for their services to the Company as the board from time to time determines.  There is no specification regarding an independent quorum although a quorum is required for any meeting.

c)

Borrowing Powers

Without limiting the powers of the Company as set forth in the Act, the board may from time to time cause the Company to:

1)

borrow money on credit of the Company,

2)

to the extent permitted by the Act, give guarantees on behalf of the Company to secure the performance of any present or future indebtedness or other obligation of another person,

3)

issue, reissue, sell or pledge bonds, debentures, notes or other evidences of indebtedness or guarantee of the Company, whether secured or unsecured, and

4)

charge, mortgage, hypothecate, pledge or otherwise create a security interest in any or all property of the Company, currently owned or subsequently acquired, to secure any present or future indebtedness or other obligation of the Company.

To the extent permitted by the Act, the board may from time to time delegate to a committee, or to one or more of the directors and officers of the Company, all or any of the powers conferred on the board to such extent and in such manner as the board from time to time determines.

d)

Retirement

There is no specification in the Companys Articles of Association or Charter or By-laws that indicate an age limit regarding retirement or non-retirement.

e)

Number of Shares

A director is not required to be a shareholder of the Company in accordance with the Articles of Association.



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3.

Rights, Preferences, Restrictions of Shares

The Company is authorized to issue an unlimited number of common shares without nominal or par value in accordance with Articles of Amendment dated April 30, 1987.  All of the following pertains to common shares:

a)

Dividend Rights

Subject to the rights of persons, if any, entitled to shares with special rights as to dividends, all dividends declared shall be paid to the shareholders in proportion to the number of shares held by them.  All dividends unclaimed for three years after having been declared may be forfeited by the Directors for the benefit of the Company.

b)

Voting Rights

On a show of hands every member personally present and every duly appointed proxy or representative of a member attending the meeting shall have one vote, and on a poll every member, proxy or representative attending the meeting and entitled to vote shall have one vote for each share of which he is the holder, proxy or representative.

At the first annual general meeting and at every succeeding annual general meeting all of the Directors however appointed or elected shall retire from office.  A retiring Director shall retain office until the dissolution of the meeting at which his successor is elected.  A retiring Director shall be eligible for re-election.  The Companys directors do not stand for re-election at staggered intervals.

c)

Rights to share in the Companys profits

There are no rights assigned pursuant to the Companys Articles or By-Laws that are in addition to those assigned by the Business Corporations Act.

d)

Rights to share in surplus

There are no rights assigned pursuant to the Companys Articles or By-Laws that are in addition to those assigned by the Business Corporations Act.

e)

Redemption Provisions

There are no redemption provisions in the Articles or By-Laws.

f)

Sinking Fund Provisions

There are no sinking fund provisions in the Articles or By-Laws.

g)

There are no provisions for liability to further capital calls in the By-Laws or Articles.

h)

There are no provisions discriminating against any existing or prospective holder of such securities as a result of such shareholder owning a substantial number of shares.

4.

In order to change the rights of the holders of capital stock the Company would have to create another class of shares and have the holders exchange their shares for those of the other class.  The Company, is, however, only authorized to issue common shares at this time.  Conditions to change are not more significant than is required by law.  If the Company wishes to amend the Articles it must receive Shareholder approval and then file the amended Articles with Alberta Corporate Registry.



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5.

In accordance with the Business Corporations Act of Alberta:

The directors of a corporation shall call an annual meeting of shareholders to be held not later than fifteen months after holding the last annual meeting and may, at any time, call a special meeting of shareholders.  Notice of the time and place of the meeting shall be communicated to shareholders of record entitled to vote, directors and auditors not less than 21 days and not more than 50 days before the meeting.

The Company does not limit who may attend its annual meetings to shareholders, directors and auditors.



A notice of record date advising of the Companys annual general meeting and the date for which the determination of shareholders is to be fixed must be issued seven days in advance of the record date.  The notice of meeting, information circular, financial statements and proxy are to be mailed to the shareholders not less than 25 days prior to the meeting date.  A quorum for the transaction of business at a general meeting is two shareholders present in person or represented by proxy representing a minimum of 5% of the issued voting shares in the Company.



Only members who are registered holders of the Companys shares at the close of business on the record date (a date which is not more than 50 days, nor less than 35 days prior to the date of the meeting) who either attend the meeting or who have completed and delivered a form of proxy in the manner and subject to the provisions described above shall be entitled to vote or to have their shares voted at the meeting.



On a show of hands, every person who is present and entitled to vote shall have one vote.  Whenever a vote by show of hands shall have been taken upon a question, unless a ballot thereon is so required or demanded, a declaration by the Chairman of the meeting that the vote upon the question has been carried or carried by a particular majority or not carried, an entry to that effect in the minutes of the meeting shall be conclusive evidence of the fact without proof of the number or proportion of the votes recorded in favor of or against any resolution or other proceeding in respect of the said question, and the result of the vote so taken shall be the decision of the members upon the said question.



No business shall be transacted at a general meeting unless the quorum requisite shall be present at the commencement of the meeting.



6.

There are no known limitations on the rights to own securities, including the rights of non-resident or foreign shareholders to hold or exercise voting rights except that, in accordance with the Business Corporations Act of Alberta, the Company is prohibited from holding shares in itself and subsidiaries are also prohibited from acquiring shares of the Company and except as provided in the Investment Canada Act, (the Act).



Management of the Company considers that the following general summary fairly describes those material provisions of the Act pertinent to an investment by an American investor in the Company.



The Act requires a non-Canadian making an investment which would result in the acquisition of control of a Canadian business, the gross value of the assets of which exceeds certain threshold levels or the business activity of which is related to Canadas cultural heritage or national identity, to either notify, or file an application for review with the Investment Review Division of Industry Canada, the federal agency created by the Investment Canada Act.



The notification procedure involves a brief statement of information about the investment of a prescribed form, which is required to be filed with Industry Canada by the investor at any time up to 30 days following implementation of the investment. It is intended that investments requiring only notification will proceed without government intervention unless the investment is in a specific type of business activity related to Canadas cultural heritage and national identity. If an investment is reviewable under the Act, an application for review in the form prescribed is normally required to be filed with Industry Canada prior to the investment taking place and the investment may not be implemented until the review has been completed and the Minister responsible for Investment Canada is satisfied that the investment is likely to be of net benefit to Canada. If the Minister is not satisfied that the investment is likely to be of net benefit to Canada, the non-Canadian must not implement the investment or, if the investment has been implemented, may be required to divest himself of control of the business that is the subject of the investment.





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The following investments by non-Canadians are subject to notification under the Act:



(1)

an investment to establish a new Canadian business; and

(2)

an investment to acquire control of a Canadian business that is not reviewable pursuant to the Act.



The following investments by a non-Canadian are subject to review under the Act:



(1)

direct acquisitions of control of Canadian businesses with assets of $5 million or more unless the acquisition is being made by an American investor;

(2)

direct acquisitions of control of Canadian businesses with assets of $250,000,000 or more by an American investor;

(3)

indirect acquisitions of control of Canadian businesses with assets of $5 million or more if such assets represent more than 50% of the total value of the assets of the entities, the control of which is being acquired, unless the acquisition is being made by an American investor;

(4)

indirect acquisitions of control of Canadian businesses with assets of $250,000,000 or more by an American investor if such assets represent more than 50% of the total value of the assets of the entities, the control of which is being acquired;

(5)  indirect acquisitions of control of Canadian businesses with assets of $50 million or more even if such assets represent less than 50% of the total value of the assets of the entities,  the control of which is being acquired, unless the acquisition is being made by an American investor in which case there is no review; and

(6)

an investment subject to notification that would not otherwise be reviewable if the Canadian business engages in the activity of publication, distribution or sale of books, magazines, periodicals, newspapers audio or video music recordings, or music in print or machine-readable form.



Generally speaking, an acquisition is direct if it involves the acquisition of control of the Canadian business or of its Canadian parent or grandparent and an acquisition is indirect if it involves the acquisition of control of a non- Canadian parent or grandparent of an entity carrying on the Canadian business. Control may be acquired through the acquisition of actual or de jure voting control of a Canadian corporation or through the acquisition of substantially all of the assets of the Canadian business. No change of voting control will be deemed to have occurred if less than one-third of the voting control of a Canadian corporation is acquired by an investor.



An American, as defined in the Act includes an individual who is an American national or a lawful, permanent resident of the United States, a government or government agency of the United States, an American-controlled corporation, limited partnership, trust or joint venture and a corporation, limited partnership, trust or joint venture that is neither American-controlled or Canadian-controlled of which two-thirds of its board of directors, general partners or trustees, as the case may be, are any combination of Canadians and Americans.



The higher thresholds for Americans do not apply if the Canadian business engages in activities in certain sectors such as oil, natural gas, uranium, financial services (except insurance), transportation services or media activities.



The Act specifically exempts certain transactions from either notification or review. Included among the category of transactions is the acquisition of voting shares or other voting interests by any person in the ordinary course of that persons business as a trader or dealer in securities. Given the nature of the Companys business and the size of its operations, management does not believe the Investment Canada Act would apply to an investment in the Companys shares by a U.S. investor.



7.

There are no provisions in the Companys Articles of Association, Charter or By-Laws that would have the effect of delaying, deferring, or preventing a change in control of the Company and that would operate only with respect to a merger, acquisition or corporate restructuring involving the Company or any of its subsidiaries/investees.



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8.

There are no By-Law provisions governing the ownership threshold above which shareholder ownership must be disclosed; however, any person who beneficially owns or controls, directly or indirectly, more than 10% of the Companys voting shares is considered an insider, and must file an insider report with the Securities Commission at www.sedi.ca within ten days of becoming an insider disclosing any direct or indirect beneficial ownership of, or control over direction over securities of the Company.  In addition, if the Company itself holds any securities, the Company must disclose such ownership.



9.

Except for the Companys quorum requirements, certain requirements related to related party transactions, the approval of amendments to the Companys articles, forfeiture of dividends, voting by a show of hands, and disclosures by certain shareholders of their ownership, which are discussed above, there are no significant differences in the law applicable to the Company, in the areas outlined above, in Alberta, Canada versus the United States.  In most states in the United States, a quorum must consist of a majority of the shares entitled to vote.  Some states allow for a reduction of the quorum requirements to less than a majority of the shares entitled to vote.  Having a lower quorum threshold may allow a minority of the shareholders to make decisions about the Company, its management and activities.  Additionally, in the United States, a director may not be able to vote on the approval of any transaction in which the director has a interest.  Generally, most states in the United States require amendments to a companys articles of incorporation to be approved by at least a majority of the votes cast by the holders of the issued and outstanding shares.  Some states, or some older corporations, may require approval of amendments by 2/3 of the votes cast by the holders of the issued and outstanding shares.  Under the laws applicable to the Company, an amendment to the articles could be approved by less than a majority of the outstanding shares, which would allow a minority of the Companys shareholder to change the Companys articles. In addition, in the United States voting by separate voting groups may be required on the approval of any such amendments.  Generally, in the United States, unclaimed dividends are required to be turned over to the appropriate state authorities for holding on behalf of the recipient of the dividend, rather than being forfeited for the benefit of the Company.  Also, in the United States, shareholder votes are usually conducted by ballot rather than a show of hands.  Voting by a show of hands may cause inaccurate results.  The Companys common shares are registered with the Securities and Exchange Commission under Section 12(g) of the Securities Exchange Act of 1934, as amended (the Exchange Act).  As a result, under Section 13 of the Exchange Act, shareholders beneficially owning more than five percent (5%) of the Companys common shares may be required to make filings with the Securities and Exchange Commission relating to their ownership of the Companys common shares.



10.

The conditions imposed by the Memorandum and Articles of Association governing changes in capital are not more stringent than is required by law.



C.

MATERIAL CONTRACTS



There have been no material contracts entered into in the two immediately preceding years other than in the ordinary course of business with the exception of:



1)

Sale of Saskatchewan Property Portfolio to Golden Band, see Item 4(A)(4)(f)

2)

Sale of Jolu Mill to Jolu Development Corp., see Item 4(A)(4)(d)

3)

Sale of Bahuerachi property, see Item 4(A)(4)(a).

4)

Shareholders agreement with Golden Band, dated February 18, 2003, see  Item 7(B)(5) and Item 4(A)(4)(d).

5)

Sublease agreement with Manson dated October 26, 2001, see Item 7(B)(2) and Item 4(D).

6)

Convertible Debentures, see Item 7(B)(3) and Item 4(A)(4)(c).

7)

Consulting Contract with Mr. Devonshires company, Kingslea Financial Corp., dated January 1, 2002. The agreement specifies that Kingslea shall be remunerated at $105 per hour for services that have been provided by Mr. Devonshire as Chief Executive officer of the Company.



D.

EXCHANGE CONTROLS



There is no law or governmental decree or regulation in Canada that restricts the export or import of capital including the availability of cash and cash equivalents for use by the Companys group, or affects the remittance of dividends, interest or other payments to a non-resident holder of common shares of the Company, other than withholding tax
requirements (see E, Taxation, below).





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E.

TAXATION



Material Canadian Federal Income Tax Consequences



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



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



Dividends



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



Capital Gains



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



(a)

the non-resident holder;

(b)

persons with whom the non-resident holder did not deal at arms length; or

(c)

the non-resident holder and persons with whom the non-resident holder did not deal with at arms length,



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



Material United States Federal Income Tax Considerations



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





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



U.S. Holders



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



Distributions on Shares of Common Stock



U.S. Holders receiving dividend distributions (including constructive dividends) with respect to the Companys common stock are required to include in gross income for United States federal income tax purposes the gross amount of such distributions to the extent that the Company has current or accumulated earnings and profits, without reduction for any Canadian income tax withheld from such distributions. Such Canadian tax withheld may be credited, subject to certain limitations, against the U.S. Holders United States federal income tax liability or, alternatively, may be deducted in computing the U.S. Holders United States federal taxable income by those who itemize deductions. (See more detailed discussion at Foreign Tax Credit below.) To the extent that distributions exceed current or accumulated earnings and profits of the Company, they will be treated first as a return of capital up to the U.S. Holders adjusted basis in the common stock and thereafter as gain from the sale or exchange of such shares. Preferential tax rates for long-term capital gains are applicable to a U.S. Holder which is an individual, estate or trust. There are currently no preferential tax rates for long-term capital gains for a U.S. Holder which is a corporation. Dividends paid on the Companys common stock will not generally be eligible for the dividends received deduction provided to corporations receiving dividends from certain United States corporations.



Foreign Tax Credit



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





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Disposition of Shares of Common Stock



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



Other Considerations



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



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



If 75% or more of the Companys annual gross income has ever consisted of, or ever consists of, passive income or if 50% or more of the average value of the Companys assets in any year has ever consisted of, or ever consists of, assets that produce, or are held for the production of, such passive income, then the Company would be or would become a PFIC. The Company has not provided assurances that it has not been and does not expect to become a PFIC.



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



Information Reporting and Backup Withholding



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

83

---



failed to report payments of interest or dividends properly or (3) fails, under certain circumstances, to certify that it has been notified by the IRS that it is subject to backup withholding for failure to report interest and dividend payments.



F.

DIVIDENDS AND PAYING AGENTS

Not applicable.



G.

STATEMENT BY EXPERTS



Not applicable



H.

DOCUMENTS ON DISPLAY



Any documents referred to herein may be examined at the Companys offices at 500, 926-5th Avenue S.W., Calgary, Alberta, Canada.



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



I.

SUBSIDIARY INFORMATION



Not required  see financial statements



Item 11:  QUANTITIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK



The Company is not subject to material foreign currency rate risk, as all investments are in Canadian companies, in Canadian dollars and the Company does not have significant expenses denominated in foreign currencies, nor do its revenue sources originate in a currency other than the Canadian dollar.  Interest rate risk does not play a large role either, as interest income has been decreasing over the years and is not a significant part of operations.  The Companys debentures have a fixed interest rate.



The Company is subject to the risks that affect the market price of its investments and these are discussed under Risk Factors within this document.



Item 12:  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES



Not required.



Item 13:  DIVIDEND ARREARAGES AND DELINQUENCIES



The Company is in arrears on certain leases payable to the Saskatchewan Government, pertaining to the Komis mine, in the amount of approximately $143,000 including accrued interest.  This amount is reflected in the current liabilities in the Consolidated Financial Statements of the Company. The purchaser of the Komis property is in the process of negotiating a foregiveness or deferral of those amounts, but there are no assurances that a favourable outcome will result.



Item 14:  MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS



There have been no modifications to the constituent instruments defining the rights of the holders of the Common shares.  The rights evidenced by the Common Shares have not been materially modified or qualified by the issuance or modification of any other class of securities or debt.





84

---



Item 15:  CONTROLS AND PROCEDURES



An evaluation was performed under the supervision and with the participation of the Companys management, including Mr. Devonshire, who is the Companys chief executive officer, and Mr. Smith, the Companys chief financial officer, of the effectiveness of the design and operation of the Companys disclosure controls and procedures pursuant to Rules 13a-15(e) and 15d-15(e) of the Securities Exchange Act of 1934 (the Exchange Act) as of September 30, 2004.  Based upon that evaluation, Mr. Devonshire and Mr. Smith, concluded that the Companys disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Exchange Act is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commissions rules and forms.



Disclosure controls and procedures are controls and other procedures that are designed to ensure that information required to be disclosed in the Companys reports filed or submitted under the Securities Exchange Act is recorded, processed, summarized and reported, within the time periods specified in the Securities and Exchange Commissions rules and forms.  Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in the Companys reports filed or submitted under the Exchange Act is accumulated and communicated to management, including the Companys principal executive officer and the Companys principal financial officer, as appropriate, to allow timely decisions regarding required disclosure.



Changes in Internal Control Over Financial Reporting. There were no changes in the Companys internal control over financial reporting during the fiscal year ended September 30, 2004, that have materially affected, or are reasonably likely to materially affect, the Companys internal control over financial reporting.



Item 16:  RESERVED

Item 16A:  AUDIT COMMITTEE FINANCIAL EXPERT



The Board of Directors has determined that Mr. Robert Ingram, CA, chairman of the audit committee is the Companys audit committee financial expert.  This determination is based on his experience and active employment as a Chartered Accountant and his educational background in accountancy.  Mr. Ingram is not considered to be an independent director as that term is defined in Rule 4200(a)(15) of the National Association of Securities Dealers.    The other members of the audit committee are Messrs. Fry and Fairburn both of whom are considered to be an independent director as that term is defined in Rule 4200(a)(15) of the National Association of Securities Dealers.



Item 16B:

CODE OF ETHICS



The Company has not yet adopted a code of ethics that applies to its principal executive officer, principal financial officer, principal accounting officer or controller, or persons performing similar functions.  The board of directors has evaluated the business operations of the Company and the number of employees and their engagement in Company operations.  Based on these factors and the scrutiny offered by the CNQ and corporate law, the general rules of fiduciary duty and various other laws, the Company believes there are adequate ethical standards applicable to the officers, employees and consultants of the Company.   This is an ongoing evaluation, and the board of directors may adopt a formal code in the future.



Item 16C:

PRINCIPAL ACCOUNTING FEES AND SERVICES

Audit Fees

In each of fiscal years 2004 and 2003, for the aggregate professional services rendered by the principal accounting firm for the audit of the Companys annual financial statements and review of financial statements and other statutory and regulatory filings, the Company paid the sum of $15,200 and $17,750, respectively.

85

---





Audit Related Fees

In each of the fiscal years 2004 and 2003, the Company paid no amounts in respect of assurance and related services by the principal accounting firm that were reasonably related to the performance of the audit or review of the Companys financial statements outside of those fees disclosed above under Audit Fees above.

Tax Fees

In each of the fiscal years 2004 and 2003, the Company paid $1,700 and $250, respectively, for tax compliance (review of corporate tax returns) rendered by the Companys principal accounting firm.

All Other Fees

The Company did not pay any amounts in respect of other products or services provided by the Companys principal accounting firm in the 2003 and 2004 fiscal years other than those set forth above.

Board Approval

The services rendered by the Companys principal accounting firm were approved by the audit committee prior to the engagement.  Approval was based on an evaluation of past services and the need for these services in the current period, comparative analysis of rates and availability of service staff and managements recommendation.  Each service was specifically evaluated and approved before an engagement was undertaken.

Principal Accounting Firm Hours

To the best of the Companys knowledge, the percentage of hours expended on the Companys principal accounting firms engagement to audit the Companys financial statements for the 2004 fiscal year that were attributed to work performed by persons other than the principal accounting firms full-time, permanent employees was less than or equal to 50%.

Item 16D:

EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES



Not Applicable.



Item 16E:

PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS



During the fiscal year ended September 30, 2004 and the period from October 1, 2004 through February 28, 2005, there have been no purchasers of the Companys shares or other units of any class of the Companys equity securities registered by the Company under Section 12 of the Exchange Act made by or on behalf of the Company or any affiliated purchaser.



For purposes of this Item 16E, the term affiliated purchaser means:



1.

A person acting, directly or indirectly, in concert with the Company for the purpose of acquiring the Companys securities; or



2.

An affiliate who, directly or indirectly, controls the Companys purchases of such securities, whose purchases are controlled by the Company, or whose purchases are under common control with those of the Company; Provided, however, that "affiliated purchaser" shall not include a broker, dealer, or other person solely by reason of such broker, dealer, or other person effecting purchases under Rule 10b-18 under the Securities Exchange Act of 1934 on behalf of the Company or for its account, and shall not include an officer or director of the Company solely by reason of that officer or director's participation in the decision to authorize Rule 10b-18 purchases by or on behalf of the Company.





86

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PART III



Item 17: FINANCIAL STATEMENTS



See the Consolidated Financial Statements listed in Item 19 hereof and filed as part of this Annual Report.



These financial statements were prepared in accordance with generally accepted accounting principles in Canada and are expressed in Canadian dollars.  Such financial statements contain a discussion of the material variations in the accounting principles, practices and methods used in preparing the financial statements from the principles, practices and methods generally accepted in the United States.  For a history of exchange rates in effect for Canadian dollars as against U.S. dollars, see Item 3: Key Information  A. Selected Financial Data - Exchange Rates.



Item 18

:  FINANCIAL STATEMENTS



(Inapplicable - see Item 17 "Financial Statements" above)



Item 19

: FINANCIAL STATEMENTS AND EXHIBITS



(a) Financial Statements



Consolidated Balance Sheets of the Company for the years ended September 30, 2004 and 2003, and Consolidated Statements of Operations, Shareholders' Equity and Cash Flow for each of the years in the three year period ended September 30, 2004.





FORM 20-F



REGISTRATION
STATEMENT - CDG INVESTMENTS INC.



EXHIBIT
INDEX







1.1

Consolidated
Financial Statements for the year ended September 30, 2004 including the
following:



i)

Auditors'
Report





ii)

Consolidated
Balance Sheets





iii)

Consolidated
Statements of Operations





iv)

Consolidated
Statements of Shareholders' Equity





v)

Consolidated
Statements of Cash Flow



vi)

Notes
to the Consolidated Financial Statements



---



















































































CDG
INVESTMENTS INC.

Consolidated
Financial Statements

September
30, 2004

---





Contents



Page



Auditors'
Report

1



Consolidated
Balance Sheets

2



Consolidated
Statements of Operations

3



Consolidated
Statements of Shareholders' Equity

4



Consolidated
Statements of Cash Flow

5



Notes
to the Consolidated Financial Statements

6-17







---

Grant Thornton LLP

Chartered
Accountants

Management
Consultants

Canadian
Member Firm of

Grant
Thornton International













Report
of Independent Auditor





To
the Shareholders of

CDG
Investments Inc.



We
have audited the consolidated balance sheets of CDG Investments Inc. as at
September 30, 2004 and 2003 and the consolidated statements of operations,
shareholders' equity and cash flows for each of the years in the three year
period ended September 30, 2004.  These financial statements are the
responsibility of the Company's management.  Our responsibility is to
express an opinion on these financial statements based on our audits.



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



In
our opinion, these consolidated financial statements present fairly, in all
material respects, the consolidated financial position of the Company as at
September 30, 2004 and 2003 and the consolidated results of its operations and
cash flows for each of the years in the three year period ended September 30,
2004 in accordance with generally accepted accounting principles in Canada.





(Signed) "Grant Thornton LLP"





Calgary,
Alberta, Canada

Grant
Thornton LLP

December
2, 2004

Chartered Accountants









Suite
2800

500
- 4 Avenue S.W.

Calgary,
Alberta

T2P
2V6

Tel:
 (403) 260-2500

Fax:
(403) 260-2571

1

---

CDG
Investments Inc.

Consolidated
Balance Sheets

(Expressed
in Canadian $)





|September
      30                                                             | 2004                 | 2003                 | 
|------------------------------------------------------------------------------ | -------------------- | -------------------- | 
|ASSETS                                                                         | (note
      1)       |                      | 
|CURRENT                                                                        |                      |                      | 
|Cash
      and cash equivalents                                                | $
           181,241 | $
           238,467 | 
|Accounts
      receivable                                                      | 25,905               | 25,727               | 
|Due
      from related parties Note 12                                         | 18,896               | 35,052               | 
|Prepaids
      and deposits                                                    | 53,038               | 13,401               | 
|Marketable
      securities (fair value - $106,000)                            | 74,700               | -                    | 
|Demand
      notes receivable from related party Note 3                        | -                    | 24,991               | 
|                                                                               |                      |                      | 
|                                                                               | 353,780              | 337,638              | 
|                                                                               |                      |                      | 
|INVESTMENTS
      Note 4                                                       | 2,865,048            | 2,396,457            | 
|RECLAMATION
      DEPOSIT Note 5                                               | -                    | 45,500               | 
|EXPLORATION
      PROPERTIES Note 6                                            | -                    | 800,000              | 
|CAPITAL
      ASSETS                                                           | -                    | 7,698                | 
|                                                                               |                      |                      | 
|                                                                               | $
       3,218,828   | $
       3,587,293   | 
|                                                                               |                      |                      | 
|LIABILITIES                                                                    |                      |                      | 
|CURRENT                                                                        |                      |                      | 
|Accounts
      payable and accrued liabilities                                 | $
          195,081  | $
          200,618  | 
|Due
      to related parties Note 12                                           | -                    | 59,259               | 
|                                                                               | 195,081              | 259,877              | 
|WADDY
      LAKE LIABILITY Note 8                                              | -                    | 1,154,133            | 
|RECLAMATION
      LIABILITY                                                    | -                    | 46,000               | 
|CONVERTIBLE
      DEBENTURES Note 7                                            | 517,375              | 491,275              | 
|                                                                               |                      |                      | 
|                                                                               | 712,456              | 1,951,285            | 
|                                                                               |                      |                      | 
|SHAREHOLDERS'
      EQUITY                                                     |                      |                      | 
|CAPITAL
      STOCK Note 9                                                     |                      |                      | 
|Authorized
      Unlimited
      number of shares without nominal or par value |                      |                      | 
|Issued
      28,154,081
      common shares (2003-28,154,081)                  | 42,644,074           | 42,644,074           | 
|EQUITY
      COMPONENT CONVERTIBLE DEBENTURES Note 7                           | 72,000               | 72,000               | 
|CONTRIBUTED
      SURPLUS                                                      | 172,594              | 172,594              | 
|DEFICIT                                                                        | (40,382,296)         | (41,252,660)         | 
|                                                                               |                      |                      | 
|                                                                               | 2,506,372            | 1,636,008            | 
|                                                                               |                      |                      | 
|                                                                               | $
      3,218,828    | $
      3,587,293    | 







"James
Devonshire"

"Gregory
Smith"



James
Devonshire



Gregory
Smith

President/Director/CEO
                                                                     Chief
Financial Officer/Director





See
accompanying notes to the financial statements.





2

---

CDG
Investments Inc.

Consolidated
Statements of Operations

(Expressed
in Canadian $)





|Years
      Ended September 30                                                        | 2004                     | 2003                     | 2002                     | 
|------------------------------------------------------------------------------------- | ------------------------ | ------------------------ | ------------------------ | 
|                                                                                      | (note
      1)           |                          |                          | 
|REVENUE                                                                               |                          |                          |                          | 
|Interest                                                                              | $
            7,612      | $
            7,690      | $
            6,896      | 
|Recovery
      of indirect costs and other                                            | 16,484                   | 13,446                   | 16,772                   | 
|                                                                                      |                          |                          |                          | 
|                                                                                      | 24,096                   | 21,136                   | 23,668                   | 
|                                                                                      |                          |                          |                          | 
|EXPENSES
      AND OTHER                                                              |                          |                          |                          | 
|General
      and administrative                                                      | 264,132                  | 303,682                  | 403,337                  | 
|Debenture
      interest                                                              | 59,100                   | 30,601                   | -                        | 
|Amortization
      and depreciation                                                   | -                        | 2,503                    | 5,071                    | 
|Equity
      in loss of investees                                                     | 888,856                  | 216,397                  | 82,121                   | 
|Write-down
      of investments                                                       | 104,000                  | 472,780                  | 506,631                  | 
|Loss
      (gain) on disposal of investments                                          | (370,669)                | 15,073                   | (1,279)                  | 
|Gain
      on dilution of equity investment                                           | (459,300)                | -                        | -                        | 
|                                                                                      |                          |                          |                          | 
|                                                                                      | 486,119                  | 1,041,036                | 995,881                  | 
|                                                                                      |                          |                          |                          | 
|LOSS
      BEFORE THE FOLLOWING                                                       | (462,023)                | (1,019,900)              | (972,213)                | 
|Gain
      on sale of interest in Waddy Lake Resources Inc.
      Note
      8        | 1,354,416                | -                        | -                        | 
|Gain
      on sale of Jolu Mill   Note 10                                             | -                        | 554,487                  | -                        | 
|Site
      restoration provision                                                      | -                        | (46,000)                 | -                        | 
|Abandonments
      and write-down of exploration
      properties
      and equipment | (22,029)                 | (300,754)                | (1,000)                  | 
|Gain
      on disposal of exploration properties                                      | -                        | 7,500                    | -                        | 
|                                                                                      |                          |                          |                          | 
|EARNINGS
      (LOSS) BEFORE INCOME TAXES                                             | 870,364                  | (804,667)                | (973,213)                | 
|Current
      income taxes Note 13                                                    | -                        | -                        | (17,350)                 | 
|                                                                                      |                          |                          |                          | 
|NET
      EARNINGS (LOSS)                                                             | $
            870,364    | $
          (804,667)    | $
          (990,563)    | 
|                                                                                      |                          |                          |                          | 
|                                                                                      |                          |                          |                          | 
|EARNINGS
      (LOSS) PER SHARE,
      basic
      and diluted   note 11              | $
                  0.03 | $
                (0.03) | $
                (0.04) | 
|                                                                                      |                          |                          |                          | 
|Weighted
      average number of shares outstanding                                   |                          |                          |                          | 
|-
      basic                                                                         | 28,154,081               | 28,154,081               | 28,154,081               | 
|-
      diluted                                                                       | 34,154,081               | 28,154,081               | 28,154,081               | 







See accompanying notes
to the financial statements.





3

---

CDG
Investments Inc.

Consolidated
Statements of Shareholders' Equity

(Expressed
in Canadian $)





|Years
      Ended September 30 |                     |             |        
|------------------------------ | ------------------- | ----------- | -------
|                               | Common
      Shares | Contributed |        
|                               | Number              | Amount      | Surplus



|Balance,
      September 30, 2001 | 28,154,081 | 42,644,074  | 172,594  | (39,457,430) 
|--------------------------------- | ---------- | ----------- | -------- | -------------
|                                  |            |             |          |              
|Net
      Loss                    | -          | -           | -        | (990,563)    
|                                  |            |             |          |              
|Balance,
      September 30, 2002 | 28,154,081 | 42,644,074  | 172,594  | (40,447,993) 
|                                  |            |             |          |              
|Net
      Loss                    | -          | -           | -        | (804,667)    
|                                  |            |             |          |              
|Balance,
      September 30, 2003 | 28,154,081 | 42,644,074  | 172,594  | (41,252,660) 
|                                  |            |             |          |              
|Net
      Earnings                | -          | -           | -        | 870,364      
|                                  |            |             |          |              
|Balance,
      September 30, 2004 | 28,154,081 | $42,644,074 | $172,594 | $(40,382,296)





See accompanying
notes to the financial statements.





4

---

CDG
Investments Inc.

Consolidated
Statements of Cash Flow

(Expressed
in Canadian $)





|Years
      Ended September 30                                      | 2004                  | 2003               | 2002                | 
|------------------------------------------------------------------- | --------------------- | ------------------ | ------------------- | 
|                                                                    | (note
      1)        |                    |                     | 
|INCREASE
      (DECREASE) IN CASH AND
      CASH
      EQUIVALENTS: |                       |                    |                     | 
|                                                                    |                       |                    |                     | 
|OPERATING
      ACTIVITIES                                          |                       |                    |                     | 
|Cash
      operating expenses                                       | $
       (296,941)    | $
       (246,558) | $
       (292,620)  | 
|Interest
      and other income received                            | 24,096                | 21,136             | 23,668              | 
|                                                                    |                       |                    |                     | 
|                                                                    | (272,845)             | (225,422)          | (268,952)           | 
|                                                                    |                       |                    |                     | 
|INVESTING
      ACTIVITIES                                          |                       |                    |                     | 
|Exploration
      property and equipment additions                  | (70,192)              | (76,830)           | (39,000)            | 
|Notes
      receivable                                              | 24,991                | (24,991)           | -                   | 
|Purchase
      of investments                                       | (617,551)             | -                  | (30,000)            | 
|Other
      assets                                                  | -                     | -                  | (1,540)             | 
|Proceeds
      on disposal of assets                                | 911,371               | 8,702              | 39,367              | 
|                                                                    |                       |                    |                     | 
|                                                                    | 248,619               | (93,119)           | (31,173)            | 
|                                                                    |                       |                    |                     | 
|FINANCING
      ACTIVITIES                                          |                       |                    |                     | 
|Debenture
      proceeds                                            | -                     | 550,000            | -                   | 
|Debenture
      interest paid                                       | (33,000)              | (17,326)           | -                   | 
|                                                                    | (33,000)              | 532,674            | -                   | 
|                                                                    |                       |                    |                     | 
|INCREASE
      (DECREASE) IN CASH
      AND
      CASH EQUIVALENTS  | (57,226)              | 214,133            | (300,125)           | 
|                                                                    |                       |                    |                     | 
|CASH
      AND CASH EQUIVALENTS:                                    |                       |                    |                     | 
|                                                                    |                       |                    |                     | 
|Beginning
      of year                                             | 238,467               | 24,334             | 324,459             | 
|                                                                    |                       |                    |                     | 
|End
      of year                                                   | $
            181,241 | $
         238,467 | $
           24,334 | 



Supplemental Information:



Interest
and Income Taxes

1.

The
Company expended $18,700 in cash on income taxes during the year ended September
30, 2004, (2003 - $Nil, 2002 - $Nil).

2.

Cash
interest payments are noted above.

Non-cash
transactions

1.

The
Company sold its last remaining mineral property interest during the year ended
September 30, 2004 in exchange for common shares in the capital stock of the
purchaser valued at $800,000 - see note 6.

2.

During
the year ended September 30, 2004, the Company exchanged its 350,000 shares of
Jolu

Development
Corp. ("JDC"), for 1,166,667 common shares of Golden Band Resources Inc. The

transaction
was recorded at the carrying value of the JDC shares which approximated the fair
value of

the
Golden Band shares on the exchange date.

3.

The
company sold the Jolu Mill and equipment during the year ended September 30,
2003 for non-

cash
consideration as described in note 10 to these financial statements.

4.

The
Company sold mineral properties during the year ended September 30, 2002 in
exchange for

common
shares in Golden Band Resources Inc. at $1,048,292 based on the average trading
price of

the
Golden Band shares during a reasonable period before and after the transaction
date.







See
accompanying notes to the financial statements





5

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)





1.

NATURE
 OF OPERATIONS



The
Company's business consists of holding investments in primarily mineral
exploration companies. Four of the companies in which it invests represent
significant investments, (greater that 20% interest), and the Company is able to
exercise significant influence over three of these companies. In addition the
Company has less significant holdings in various companies which it may buy and
sell from time to time as market conditions dictate. The sale of the Bahuerachi,
Mexico property interest in the year, (note 6), marked the end of the Company's
former business of mineral exploration.



Effective
April 30, 2004, the Company surrendered effective control of its wholly-owned
subsidiary, Waddy Lake Resources Inc. ("Waddy"), when it sold 49% of its
investment and turned over all operating decisions to the acquirer. As a result,
effective April 30, 2004, the Company ceased to consolidate Waddy. Waddy was
inactive during the current and previous fiscal year. Waddy's earnings and
cash flows in both the period ended April 30, 2004 and the year ended September
30, 2003 were insignificant. The only significant Waddy balance sheet item that
was included in the consolidated balance sheet at September 30, 2003 was the
liability discussed in Note 8.





2.

SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES



Principles
of Consolidation

During
the year ended September 30, 2003 these consolidated financial statements
included the accounts of the Company, and the 100% owned subsidiaries, GR
Capital Corporation and Waddy Lake Resources Inc. GR Capital Corporation was
wound-up into the Company effective September 30, 2003. Effective April 30,
2004, the Company surrendered control of Waddy Lake Resources Inc. and ceased to
include its accounts in the financial statements.



Use
of Estimates

The
preparation of financial statements in conformity with generally accepted
accounting principles requires management to make estimates 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

Cash
and cash equivalents may include bank and brokerage deposits, term deposits and
treasury bills with maturities equal to or less than 90 days.



Exploration
Properties

All
costs relating to the exploration of mineral properties were capitalized on an
area of interest basis. When an area of interest was abandoned, or management
determine that there was a permanent and significant decline in value, the
related accumulated costs were charged to operations.  The Company reviewed
the carrying values of mineral property interests on a quarterly basis by
reference to the project economics, including the timing of the exploration
and/or development work, the work programs and exploration results experienced
by the Company and others, and the extent to which optionees had committed, or
were expected to commit to, exploration on the property.  When it became
apparent that the carrying value of the property exceeded its estimated net
recoverable amount based on the foregoing criteria, an impairment provision was
made for the other than temporary decline in value.

Where
the Company's exploration commitments for an area of interest were performed
under option agreements with a third party, the proceeds of any option payments
under such agreements were applied to the area of interest to the extent of
costs incurred.  The excess, if any, was credited to operations.
 Option payments made by the Company were recorded as mineral property
costs.



Capital
Assets

Capital
Assets are recorded at cost. Depreciation is provided on a declining balance
basis at annual rates of 20% - 30%.



Flow-Through
Common Shares

Resource
expenditure deductions for income tax purposes related to exploration and
development activities funded by flow-through share arrangements, were renounced
to investors in accordance with income tax legislation.  Future income tax
liability was increased and capital stock was reduced by the estimated tax
benefits transferred to shareholders.







6



---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)







3.

SUMMARY
OF SIGNIFICANT ACCOUNTING POLICIES (Continued)



Joint
Interests

Certain
of the Company's exploration and development activities were conducted jointly
with others. These financial statements reflect only the Company's
proportionate interest in such activities.  Although the Company held its
pre-sale interest in the Bahuerachi, Mexico mineral property pursuant to a joint
venture agreement, none of its operations were carried on through a joint
venture entity.



Investments

Investments
in corporations in which the Company is able to exercise significant influence
are accounted for by the equity method. Portfolio investments are carried at
cost, less provision for declines in value that are considered to be other than
temporary.



Foreign
Currency

Foreign
currency denominated monetary assets and liabilities are translated into
Canadian dollars at the exchange rate in effect at the balance sheet date.
Foreign currency denominated non-monetary assets and liabilities are translated
to Canadian dollars at the exchange rate in effect on the transaction date.
 Revenue and expense items are translated at average exchange rates for the
period.



Financial
Instruments

The
fair market value of cash and term deposits, accounts receivable and accounts
payable and accrued liabilities approximate their carrying value as a result of
the short-term nature of the instruments or the variable interest rate
associated with the instrument.  Unless otherwise noted, it is management's
opinion that the Company is not exposed to significant interest, currency, or
credit risks arising from these financial instruments.



Reclamation
costs

The
Company's activities, had in past years primarily been focused on exploration
directed toward the discovery of mineral resources.  When it was determined
that future reclamation costs, including site restoration costs, were likely,
and the amounts could be reasonably estimated, the costs thereof were accrued.



Earnings
(Loss) per share

Basic
earnings (loss) per share is computed by dividing the net earnings (loss) by the
weighted average number of common shares outstanding for the year.  Diluted
per share amounts reflect the potential dilution that could occur if securities
or other contracts to issue common shares were exercised or converted to common
shares. The treasury stock method is used to determine the dilutive effect of
stock options and other dilutive instruments. Under the treasury stock method
only "in-the-money" dilutive instruments impact the dilution
calculations.



Income
Taxes

Income
taxes are recorded using the liability method of tax allocation. Future income
taxes are calculated based on temporary timing differences arising from the
difference between the tax basis of an asset or liability and its carrying value
using tax rates anticipated to apply in the periods when the timing differences
are expected to reverse. The effect on future tax assets and liabilities of a
change in tax rates is recognized in income in the period that substantive
enactment or enactment occurs. To the extent that the Company does not consider
it more likely than not that a future tax asset will be recovered, it provides a
valuation allowance against the excess.



Stock-based
Compensation

Effective
October 1, 2002, in accordance with the recommendations of the Canadian
Institute of Chartered Accountants, (CICA), the Company prospectively adopted,
with no restatement or disclosure pertaining to awards granted prior to October
1, 2002, new rules for the accounting for, and disclosure of, stock-based
compensation.



The
new recommendations of the CICA establish financial accounting and reporting
standards for stock-based compensation plans as well as transactions in which an
entity issues its equity instruments to acquire goods or services from
non-employees.  The Company has elected to follow the "fair value"
method of accounting for stock-based compensation arrangements, whereby the fair
value of the stock options at the date of grant is recorded as compensation
cost.  The fair value is determined using an option-pricing model that
takes into account the exercise price and expected life of the option, the
current price of the underlying stock, its expected volatility, the expected
dividends on the stock, and the current risk-free interest rate for the expected
life of the option.  Stock options to purchase 600,000 common shares at
$0.11 per share to June 4, 2007 were granted during the year ended September 30,
2003.  The Black-Scholes Option Pricing Model was used to determine that
there was no material value associated with the options granted during the
period, using a risk-free interest rate of 3.2%, volatility of 319%, nil
dividend yield and four year expected life.







7

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)









3.

Demand
Notes Receivable

2004

2003



Due
from Tyler Resources Inc., bearing interest at 10% per annum

-$    13,580

Due
from Tyler Resources Inc., bearing interest at 12% per annum

-

11,411

$
               -

$    24,991



Tyler
Resources Inc. is related by virtue of certain common officers and directors and
the Company holds a significant, (21%),

investment
in the corporation. During the year ended September 30, 2004, the notes,
together with accrued interest thereon, were repaid.





4.

Investments



|                                                    |   |           | September 30, 2004 |   |           |   | September 30, 2003 |          
|--------------------------------------------------- | - | --------- | ------------------ | - | --------- | - | ------------------ | ---------
|                                                    |   |           | Fair Value         |   |           |   | Carrying           |          
|                                                    |   |           |                    |   |           |   | Amount             |          
|Portfolio investments:                              |   |           |                    |   |           |   |                    |          
|Golden Band Resources Inc.                          |   |           |                    |   |           |   |                    |          
|(12,361,266 common shares, 2003
      - 11,569,202) |   | $         | 2,472,000          |   |           | $ | 1,400,921          |          
|Aloak Corp.                                         |   |           |                    |   |           |   |                    |          
|(4,200,000 common shares, 2003
      - 5,300,000)   |   |           | 42,000             |   |           |   | 21,000             |          
|Tyler Resources Inc                                 |   |           |                    |   |           |   |                    |          
|(880,952 common shares)                             |   |           | -                  |   |           |   | -                  |          
|Jolu Development Corp.                              |   |           |                    |   |           |   |                    |          
|(350,000 common shares)                             |   |           | -                  |   |           |   | -                  |          
|                                                    |   |           | 2,514,000          |   |           |   | 1,421,921          |          
|Equity-accounted investments:                       |   |           |                    |   |           |   |                    |          
|Tyler Resources Inc.                                |   |           |                    |   |           |   |                    |          
|(14,216,952 common shares)                          |   |           | 4,123,000          |   |           |   | 1,149,353          |          
|Manson Creek Resources Ltd.                         |   |           |                    |   |           |   |                    |          
|(5,899,048 common shares, 2003
      - 4,899,048)   |   |           | 708,000            |   |           |   | 293,773            |          
|Northern Abitibi Mining Corp.                       |   |           |                    |   |           |   |                    |          
|(7,995,426 common shares, 2003
      - 7,995,426)   |   |           | 280,000            |   |           |   | 1                  |          
|                                                    | $ | 7,625,000 |                    | $ | 2,865,048 |   | $                  | 3,891,000





Fair
values above are based on market quotes and may not represent actual proceeds
should these investments be sold.  The investments in Manson Creek,
Northern Abitibi and Tyler represent 36%, 29% and 21% of the total issued and
outstanding shares of the respective companies.



Effective
September 30, 2004, all of the 350,000 common shares in Jolu Development Corp.,
(JDC), were exchanged for 1,166,667 common shares of Golden Band Resources Inc.
(Golden Band), pursuant to the JDC Shareholders' Agreement.



Subsequent
to year-end the Company sold 779,500 common shares of Golden Band for net
proceeds of $208,514 and exercised 592,202 warrants at $0.20 per share for a
total cost of $118,440.





5.

Reclamation
Deposit



The
reclamation deposit at September 30, 2003 pertained to outstanding Komis mine
issues primarily relating to the road leading to the mine that was sold in a
prior year.



The
reclamation was substantially completed in the year ended September 30, 2004 and
the Company is negotiating for partial or full release of the deposit.



8

---





CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)





|6. | Exploration Properties                                 |   | 2004      |  |   | 2003      | 
|-- | ------------------------------------------------------ | - | --------- |  | - | --------- | 
|   | Mineral Claims                                         |   |           |  |   |           | 
|   | Balance, beginning of year                             | $ | 172,299   |  | $ | 139,426   | 
|   | Dispositions                                           |   | (169,066) |  |   | -         | 
|   | Write-down of mineral properties                       |   | (3,233)   |  |   | -         | 
|   | Costs incurred                                         |   | -         |  |   | 32,873    | 
|   | Balance, end of year                                   | $ | -         |  | $ | 172,299   | 
|   | Exploration and Development
      Expenditures         |   |           |  |   |           | 
|   | Balance, beginning of year                             | $ | 627,701   |  | $ | 828,637   | 
|   | Dispositions                                           |   | (630,934) |  |   | -         | 
|   | Costs incurred                                         |   | 11,581    |  |   | 99,818    | 
|   | Abandonment and write-down of
      mineral properties |   | (8,348)   |  |   | (300,754) | 
|   | Balance end of year                                    | $ | -         |  | $ | 627,701   | 
|   | Total                                                  | $ | -         |  | $ | 800,000   | 



The
mineral property carried on the books at September 30, 2003 was the Company's
approximate 40% interest in the Bahuerachi, Mexico property that was sold during
the year ended September 30, 2004 to Tyler Resources Inc., (Tyler), a company
related by virtue of certain common officers and directors.  Tyler issued
13,336,000 shares at an agreed price of $0.06 per share in payment of the
purchase price. The share price was negotiated and agreed to by independent
committees of the board of directors of both companies. The Bahuerachi property
was written-down to $800,000 at September 30, 2003 to reflect the value assigned
to the property pursuant to the terms of the above-noted sale, a value that was
within the range assigned to the property by an independent valuator. The
transaction between these related parties was reflected at the exchange amount,
being the amount established and agreed to by the related parties.



7.

Convertible
Debentures



During
the year ended September 30, 2003 the Company closed two debenture financings
aggregating $550,000.  Directors, or companies over which they have control
or direction, subscribed to $450,000 of the debentures.  The debentures
bear interest at 6% per annum, payable semi-annually on March 31 and September
30, are due December 17, 2005 and are secured by a floating charge over
substantially all of the assets of the Company.  The debentures are
convertible into units comprised of one common share and one share purchase
warrant, at $0.10 per unit until December 18, 2004 and $0.11 per unit during the
year ended December 17, 2005.  The warrants expire two years after
conversion of the debenture and may be exercised to purchase one common share at
prices ranging from $0.10 per share to $0.14 per share depending on the year of
exercise.  The debentures are redeemable by the Company after December 17,
2003 provided that stock volumes and price meet specified levels and the stock
continues to be listed on a recognized exchange.



Without
the written consent of the debenture holders, the Company may not advance monies
by way of a loan to any company or conduct exploration activities of any nature,
except for its commitment to fund exploration costs relating to the 2003 program
on the Bahuerachi property in Mexico.





|                            | 2004     |  | 2003                
|--------------------------- | -------- |  | --------------------
|Principal
      amount      | $550,000 |  | $
           550,000
|Less
      equity component | (72,000) |  | (72,000)            
|                            | 478,000  |  | 478,000             
|Add
      accreted interest | 39,375   |  | 13,275              
|Liability
      component   | $517,375 |  | $
           491,275





The
debentures have been segregated into the respective fair values of their debt
and equity components on the date of issuance.  Over the term of the
debentures, the debt components are accreted to the face value of the debentures
by recording additional interest expense.





9

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)









8.

Waddy
Lake Liability Settlement



A
statement of Claim that had been filed against the Company, its 100% - owned
subsidiary, Waddy Lake Resources Ltd., ("Waddy Lake"), and certain current
and past directors and officers of the two companies, seeking to recover
$1,154,133 for mine contracting services as well as damages, court costs and
interest on all sums unpaid, was settled effective April 30, 2004 by mutual
release. No amount will be payable by any of the parties named in the suit.
Pursuant to the Settlement Agreement the Company sold 49% of its 100% share
position in Waddy Lake for nominal consideration, and granted an option to
acquire an additional 1% of the issued and outstanding Waddy Lake shares for
nominal consideration.



Pursuant
to the agreement the Company is to receive $800,000 over four years: $200,000
upon execution of the agreement, (received), and $200,000 in each of June 2005,
2006, and 2007. This will be the Company's only claim to the assets of Waddy
Lake. The Company will not have the right to any income earned through Waddy
Lake. The acquiring company will make all operating decisions regarding future
business conducted through Waddy Lake and will appoint a majority of the board
members. As a result, effective April 30, 2004, the Company ceased to
consolidate the operations of Waddy Lake, recorded the gain on the partial sale
of their investment and recorded the remaining investment at cost in a nominal
amount. The Company will record its future $200,000 installment proceeds on an
"as received" basis as a result of uncertainty regarding collection.





9.

Capital
Stock



Options
and Warrants



i)

Stock
Options



Number
of Shares

Expiry
Date

2004

2003

Price



November
9, 2004

475,000

475,000

$

0.25

June
4, 2007

1,975,000

1,975,000

$
      0.11

2,450,000

2,450,000





The
Company has an option plan, in which up to 10% of the issued and outstanding
common shares are reserved for issuance.  Under the plan, the options that
have been granted expire at the earlier of five years from the grant date, the
date at which the Directors determine, or 60 days from the date from which the
optionee ceases to be a director, officer, employee or consultant.  Options
are granted at the fair value of the shares around the grant date or greater
amount determined by the directors. All of the above options vested on the grant
date.



ii)

Stock
Option Transactions

Number

Weighted-Average



of
Options

Exercise
Price



As
at September 30, 2002

2,585,800

$
 0.21

Expired

(735,800)

$
 0.35

Granted

600,000

$0.11

As
at September 30, 2003 and

September
30, 2004.

2,450,000

$
 0.14





iii)

Warrants



At
September 30, 2004 and September 30, 2003, 3,000,000 share purchase warrants
were outstanding exercisable at a price of $0.65 per share to March 14, 2006.







10

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)



10.

Sale
of Jolu Mill



Effective
February 18, 2003 the Jolu Mill and equipment were sold to Jolu Development
Corp. ("JDC"), a new corporation whose sole shareholder immediately prior to
the transaction was Golden Band Resources Inc. ("Golden Band").  In
consideration for the sale of

the
mill and equipment, JDC assumed the liabilities associated with the mill, past,
present and future, issued shares in its capital stock valued at $350,000 and
assigned a royalty to the Company based on $10 per tonne of ore processed
through the mill, not to exceed $400,000 in total.  The mill had previously
been written-off in the Company's books and the equipment had a net book value
of $8,400.  The value of the current liabilities net of any offsetting
current assets that was assumed by JDC was $211,000.  In addition JDC
assumed $330,000 of the total site restoration liability that was estimated on
the Company's books, and $329,000 of the reclamation deposit was transferred
to JDC.



During
the year ended September 30, 2004, pursuant to a shareholders agreement with
Golden Band, the Company gave notice to Golden Band that it must acquire all of
the Company's shares in JDC in exchange for 1,166,667 common shares of Golden
Band and the exchange was completed.



11.

Earnings
per share



The
following adjustments were made in arriving at diluted earnings per share for
the year ended September 30, 2004.



2004

Net
earnings available to common shareholders

$870,364

Interest
expense on convertible debentures assumed



converted,
(net of tax)

21,780

Net
earnings adjusted for diluted computation

$892,144



Weighted
average number of common shares

28,154,081

Assumed
convertible debenture conversion

5,500,000

Warrants

500,000

Average
number of diluted common shares

34,154,081



As
there was a net loss during the years ended September 30, 2003 and September 30,
2002, the calculation was anti-dilutive during the comparative periods.



The
dilutive effect of stock options and warrants was calculated using the treasury
stock method. This method calculates the number of incremental shares by
assuming the outstanding stock options and warrants are exercised, and then
reduced by the number of shares assumed to be repurchased from the issuance
proceeds, using the average market price of the Company's common shares for
the period. Excluded from the calculation of diluted earnings per share were the
warrants exercisable at $0.65 per share and the options exercisable at $0.11 and
$0.25 per share as the exercise prices were equal to or greater than the average
trading price of the Company's common shares for the year ended September 30,
2004.



12.

Related
Party Transactions and Commitment



During
the year a company, related by virtue of certain common officers and directors,
charged $22,000, (2003 - $21,000, 2002- $30,000), for the Company's share of
office base rent and operating costs.  Pursuant to a sublease agreement
with the related company, the Company is committed to pay its share of lease
operating costs and base lease expenses.  The committed base lease costs
for the following years are $12,150 in each of 2005 and 2006 and $3,050 in 2007,
the final year of the lease.  The Company will also be required to pay its
share of lease operating costs in each of these years, which in 2004 aggregated
$10,000.



During
the year companies, in which an officer or director is a controlling
shareholder, charged the Company $25,000, (2003 - $34,000, 2002 - $33,000), for
administrative and geological services.  The services were recorded at the
exchange amount being that established and agreed to by the two parties.



The
amounts due from related parties at year-end pertained to administrative
billings to companies related by virtue of certain common officers and
directors. The administrative billings to related parties for the year
aggregated $80,000, (2003 - $62,000, 2002 - $88,000).



The
amount due to a related party at September 30, 2003 pertained to exploration
costs billed by a company related by virtue of certain common officers and
directors.  The related company was the operator of the Bahuerachi joint
venture and charged the Company for its share of third party exploration
billings, (2004 - $10,500, 2003 - $121,000), in addition to an overhead fee of
10% thereon, (2004 - $1,050, 2003 - $12,000).  The 10% administrative fee
is a standard rate in non-related joint venture arrangements.  See also
notes 3, 6 and 7.



11

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)







13.

Income
Taxes



a)

Following
is a reconciliation of income taxes calculated at statutory rates to the actual
income taxes recorded in the accounts:



|                                                                                                                                                        | 2004                    | 2003                      | 2002                
|------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------------- | ------------------------- | --------------------
|Computed
      expected income taxes (recovery) at a combined
      Provincial
      and Federal rate of 34% (2003 - 38%, 2002 - 39.8%)                 | $296,000                | $(306,000)                | $(387,000)          
|Effect
      on income taxes resulting from:
      Non-recognition
      of losses and future tax
      benefits
      for financial statement purposes | -                       | 306,000                   | 387,000             
|Application
      of previously unrecognized losses
      and
      future tax benefits                                                                 | (296,000)               | -                         | -                   
|Future
      income tax expense (recovery)                                                                                                              | -                       | -                         | -                   
|Current
      income tax expense relating to a prior
      year's
      reassessment                                                                    | -                       | -                         | 17,350              
|Total
      income tax expense                                                                                                                          | $
                    - | $
                      - | $
            17,350



As
at September 30, the significant components of the Company's future income tax
asset were as follows:



|                                                                                                               | 2004
      (at
      34%) | 2003
      (at
      38%)  
|-------------------------------------------------------------------------------------------------------------- | ------------------------- | ---------------------------
|Losses
      carried forward                                                                                   | $
      569,000           | $
       1,214,000         
|Tax
      values in excess of book values:
      Mineral
      properties and capital assets
      Investments | 581,000
      1,510,000   | 7,680,000
      896,000    
|Future
      income tax asset before valuation allowance                                                       | 2,660,000                 | 9,790,000                  
|Valuation
      allowance                                                                                      | (2,660,000)               | (9,790,000)                
|Future
      income tax asset                                                                                  | $
                     -  | $
                        -



b)

The
Company has accumulated non-capital losses for income tax purposes of
approximately $1,673,000. Unless sufficient

taxable
income is earned in future years these losses will expire as follows:



|     |           
|---- | ----------
|2006 | $134,000  
|2007 | 764,000   
|2008 | 43,000    
|2011 | 732,000   
|     | $1,673,000





c)

The
Company has available the following amounts which may be deducted, at the annual
rates indicated below, in determining taxable income of future years.



|                                                  | 2004       | Rate  
|------------------------------------------------- | ---------- | ------
|Canadian
      exploration expense                | $579,000   | 100%  
|Foreign
      exploration and development expense | 1,032,000  | 10%   
|Undepreciated
      capital cost                  | 96,000     | 20-30%
|                                                  | $1,707,000 |       



12

---

CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)







14.

Segmented
Information



a)

Identifiable
assets by significant geographic segment are as follows:



|       | 2004       |  | 2003      
|------ | ---------- |  | ----------
|Canada | $3,218,828 |  | $2,787,293
|Mexico | -          |  | 800,000   
|       | $3,218,828 |  | $3,587,293





b)

Segmented
loss before income taxes by significant geographic segment is as follows:



2004
- With the exception of Mexican mineral property write-downs of $11,580, the
loss before income taxes for the year

ended
September 30, 2004 was wholly attributable to Canadian operations.



2003
- With the exception of Mexican mineral property write-downs of $300,754, the
loss before income taxes for the year ended September 30, 2003 was attributable
to Canadian operations.



2002
- The loss before income taxes for the year ended September 30, 2002 was wholly
attributable to Canadian operations.





15.

Generally
Accepted Accounting Principles in Canada and United States



The
Company follows Canadian generally accepted accounting principles ("GAAP")
which are different in some respects from those applicable in the United States
and from practices prescribed by the United States Securities and Exchange
Commissions, as described below:



a)
       Sale of Saskatchewan Mineral
Properties



Under
Canadian GAAP financial statements should be adjusted when events occurring
between the date of the financial statements and the date of their completion
provide additional evidence relating to conditions that existed at the date of
the financial statements.  Consequently the sale of the Saskatchewan
mineral properties, which closed subsequent to September 30, 2002, was recorded
at September 30, 2002 for Canadian GAAP purposes.  Further, for Canadian
GAAP purposes, the sale was valued at the fair value of the shares received as
proceeds for the sale at the time the agreement was negotiated.  US GAAP
would dictate that the transaction would be recorded in fiscal 2003, on the
closing date, and the shares in Golden Band Resources Inc. ("Golden Band"),
that were received as proceeds of the sale would be valued at the stock market
price of the shares on the closing date.  For US GAAP, the effect on the
fiscal 2003 financial statements would be to record an investment in Golden Band
in the amount of $2,777,000 and a gain on sale of $2,777,000, effective November
7, 2002, as these properties were previously written-off for US GAAP purposes.
In 2004 the carrying value of the remaining investment and the gain (loss) on
sale of investments would be adjusted accordingly.



b)

Marketable
Securities



Under
Canadian GAAP these portfolio investments are carried at the lesser of cost and
market value. For US GAAP purposes, the investments would be characterized as
"trading securities". Unrealized gains and losses would be reported in
income and the carrying value of the investment would be adjusted to fair value.





c)

Long-term
Investments



Portfolio
investments in shares of public companies have been recorded at cost, less
provisions for decreases in value considered to be other than temporary. Under
US GAAP, the Company is required to record these "available-for-sale"
investments at fair value and record the unrealized gains or losses as a
component of other comprehensive income under Shareholder's Equity.



13

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)







d)

Exploration
Properties



Under
Canadian GAAP the costs relating to the acquisition and exploration of mineral
properties are capitalized on an area of interest basis and charged against
income through unit-of-production depletion, when properties are developed to
the stage of commercial production.  Costs related to abandoned properties,
and costs related to properties which the Company has assessed, based on the
price of metals/minerals and general economic and market conditions, as not
viable, have been charged to other expenses in the year in which such
determination is made.



Under
US GAAP the costs relating to the exploration of mineral properties as defined
above, which have not led to the identification of a commercially feasible
property, are expensed in the year incurred and are charged to income (loss)
from operations. When the Company has sold a mineral property, the proceeds
equal the gain on sale of the property for US GAAP purposes as the property
would have previously been written-off.



e)

Convertible
Debentures



Under
US GAAP, the proceeds from Convertible Debentures received in fiscal 2003 of
$550,000 would be recorded as a liability.  For Canadian GAAP purposes,
$72,000 of the debt was attributed to equity and additional interest expense is
being recorded over the term of the debentures with an equal accretion to the
liability component of the debenture.  For US GAAP purposes, the fair value
of the Convertible Debentures at September 30, 2004 was $516,000, (2003 -
$498,000), determined by discounting the expected future cash flows of the
debentures at current rates for debt instruments with similar terms.





f)

Equity
Investments



Certain
of the Company's equity investments are in companies that capitalize mineral
exploration costs. For US GAAP purposes these costs would be written-off as
incurred, (see (d) above). In reconciling to US GAAP, the Company's share of
the write-off increases the Company's loss.



Further,
for Canadian GAAP purposes, when the Company's equity-accounted investment in
a company is diluted, due to the issue by the investee of shares to outside
parties, a gain or loss on dilution is recorded based on the difference between
the issue price per share and the Company's carrying value per share on the
issue date. For US purposes a gain or loss would be recorded only when the
Company disposes of an interest in the equity-accounted investment.



14

---



CDG
Investments Inc.

Notes
to the Consolidated Financial Statements

September
30, 2004 and 2003

(Expressed
in Canadian $)







15.

Generally
Accepted Accounting Principles in Canada and United States(continued)



The
effect of the above differences on the Company's financial statements is set
out below:



| | Consolidated
      Balance Sheets:                     |  | 2004      |              | 2003         |              |             
| | ------------------------------------------------------ |  | --------- | ------------ | ------------ | ------------ | ------------
| | Marketable
        Securities:                         |  |           |              |              |              |             
| | As
        reported - Canadian GAAP                    |  |           | $            | 74,700       |              | -           
| | Unrealized
        gain on trading securities          |  |           |              | 31,300       |              | -           
| | US
        GAAP                                        |  |           | $            | 106,000      |              | -           
| | Investments:                                           |  |           |              |              |              |             
| | As
        reported - Canadian GAAP                    |  | $         | 2,865,048    | $            | 2,396,457    |             
| | Golden
        Band investment reported at             |  |           |              |              |              |             
| | different
        value for US purposes (note 15a)     |  | 1,365,202 |              | 1,728,708    |              |             
| | Equity
        investments adjusted to US              |  |           |              |              |              |             
| | GAAP
        carrying value (note 15f)                 |  |           | (797,937)    |              | (1,032,683)  |             
| | Unrealized
        valuation loss "available-for-sale" |  |           |              |              |             
| | investments
        (note 15c)                         |  |           | (273,123)    |              | (294,482)    |             
| | US
        GAAP                                        |  |           | $            | 3,159,190    | $            | 2,798,000   
| |                                                        |  |           |              |              |              |             
| | Exploration
        properties:                        |  |           |              |              |              |             
| | As
        reported - Canadian GAAP                    |  | $         | -            | $            | 800,000      |             
| | To
        be written-off as incurred for US           |  |           |              |              |              |             
| | GAAP
        purposes (note 15d)                       |  |           | -            |              | (800,000)    |             
| | US
        GAAP                                        |  |           |              | $            | -            | $           
| |                                                        |  |           |              |              |              |             
| | Convertible
        debentures:                        |  |           |              |              |              |             
| | As
        reported - Canadian GAAP                    |  | $         | 517,375      | $            | 491,275      |             
| | Convertible
        debentures presented as a          |  |           |              |              |              |             
| | liability
        (note 15e)                           |  |           |              | 32,625       |              | 58,725      
| | US
        GAAP                                        |  |           |              | $            | 550,000      | $           
| |                                                        |  |           |              |              |              |             
| | Equity
        portion of convertible debentures:      |  |           |              |              |             
| | As
        reported - Canadian GAAP                    |  | $         | 72,000       | $            | 72,000       |             
| | Convertible
        debentures presented as a          |  |           |              |              |              |             
| | liability
        (note 15e)                           |  |           |              | (72,000)     |              | (72,000)    
| | US
        GAAP                                        |  |           |              | $            | -            | $           
| |                                                        |  |           |              |              |              |             
| | Deficit:                                               |  |           |              |              |              |             
| | As
        reported - Canadian GAAP                    |  | $         | (40,382,296) | $            | (41,252,660) |             
| | Previous
        years' adjustments                    |  |           | (90,700)     |              | (3,568,972)  |             
| | Current
        income adjustments (see below)         |  | 728,640   |              | 3,478,272    |              |             
| | Deficit,
        US GAAP                               |  |           |              | (39,744,356) |              | (41,343,360)
| | Accumulated
        other comprehensive                |  |           |              |              |              |             
| | income
        (loss)                                  |  |           |              | (273,123)    |              | (294,482)   
| | Deficit
        and accumulated other comprehensive    |  |           |              |              |             
| | income
        (loss) - US GAAP                        |  | $         | (40,017,479) | $            | (41,637,842) |             



15

---



CDG
  Investments Inc.

Notes
  to the Consolidated Financial Statements

September
  30, 2004 and 2003

(Expressed
  in Canadian $)







15.

Generally
  Accepted Accounting Principles in Canada and United States(continued)



|Consolidated
        Statements of Operations:                |   | 2004      |  |   | 2003      |  |   | 2002     
|------------------------------------------------------------- | - | --------- |  | - | --------- |  | - | ---------
|Net Earnings
        (Loss):                                  |   |           |  |   |           |  |   |          
|As reported -
        Canadian GAAP                           | $ | 870,364   |  | $ | (804,667) |  | $ | (990,563)
|Gain on sale of
        mineral property (note 15a, 15d)      |   | 800,000   |  |   | 2,777,000 |  |   | -        
|Exploration
        property expenditures - expensed          |   |           |  |   |           |  |   |          
|in year incurred
        (note 15d)                           |   | (22,029)  |  |   | (132,691) |  |   | (1,000)  
|Accreted interest
        debenture (note 15e)                |   | 26,100    |  |   | 13,275    |  |   | -        
|Abandonments re
        property costs previously             |   |           |  |   |           |  |   |          
|written-off for US
        GAAP purposes                      |   | 22,029    |  |   | 300,754   |  |   | 1,000    
|Gain on sale of
        "trading securities" (note 15b)       |   | 31,300    |  |   | -         |  |   | -        
|Change in equity
        in loss of investees (note 15f)      |   | 694,046   |  |   | 216,397   |  |   | 82,121   
|Eliminate gain on
        dilution of equity investment (note |   |           |  |   |           |  |   |          
|15f)                                                          |   | (459,300) |  |   | -         |  |   | -        
|Adjust write-offs
        and loss on sale of investments     |   |           |  |   |           |  |   |          
|due to different
        cost basis for US GAAP purposes      |   | (363,506) |  |   | 303,537   |  |   | -        
|                                                              |  
|Net Earnings
        (Loss) - US GAAP                         | $ | 1,599,004 |  | $ | 2,673,605 |  | $ | (908,442)
|                                                              |   |           |  |   |           |  |   |          
|Consolidated
        Statements of Comprehensive              |   |           |  |   |           |  |   |          
|Earnings
        (Loss):                                      |   | 2004      |  |   | 2003      |  |   | 2002     
|Net Earnings
        (Loss) - US GAAP                         | $ | 1,599,004 |  | $ | 2,673,605 |  | $ | (908,442)
|Unrealized
        valuation loss "available-for-sale"        |   |           |  |   |           |  |   |          
|investments (note
        15c)                                |   | (273,123) |  |   | (294,482) |  |   | -        
|Comprehensive
        Earnings (Loss) US GAAP                 | $ | 1,325,881 |  | $ | 2,379,123 |  | $ | (908,442)
|                                                              |   |           |  |   |           |  |   |          
|Canadian GAAP
        basic and diluted earnings (loss)       |   |           |  |   |           |  |   |          
|per share                                                     | $ | 0.03      |  | $ | (0.03)    |  | $ | (0.04)   
|                                                              |   |           |  |   |           |  |   |          
|                                                              |   |           |  |   |           |  |   |          
|US GAAP basic
        earnings (loss) per share               | $ | 0.06      |  | $ | 0.09      |  | $ | (0.03)   
|US GAAP diluted
        earnings (loss) per                   |   |           |  |   |           |  |   |          
|share                                                         | $ | 0.05      |  | $ | 0.08      |  | $ | (0.03)   





16

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(b) Exhibits



1.1

Articles and Memorandum, as amended(1)

2.1

6% Convertible Debentures(1)

4.1

Sale Agreement Saskatchewan Properties(1)

4.2

Sale Agreement Jolu Mill(1)

4.3

Shareholders Agreement JDC Development Corp. (1)

4.4

Settlement Agreement Procon

4.5

Stock Option Plan(1)

4.6

Mr. Devonshire Consulting Agreement(1)

8.1

List of Subsidiaries

12.1

Certification of James Devonshire pursuant to Rule 13a-14(a).

12.2

Certification of Gregory Smith pursuant to Rule 13a-14(a).

13.1

Certification of James Devonshire pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.

13.2

Certification of Gregory Smith pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.



(1) Previously filed as an exhibit to the Company's Form 20-F annual report for the fiscal year ended September 30, 2003, filed with the Securities and Exchange Commission on April 16, 2004.  File Number 000-23650.

87

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SIGNATURES



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



DATED at Calgary, Alberta, this 24th day of March, 2005.



CDG INVESTMENTS INC.



/s/ James Devonshire





By:

James Devonshire

President/Director/Chief Executive Officer





88