---

UNITED STATESSECURITIES AND EXCHANGE COMMISSIONWASHINGTON, D.C.
20549

FORM 20-F/A

[      ] REGISTRATION STATEMENT PURSUANT
  TO SECTION 12(b) or 12(g) OF THESECURITIES 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 May 31, 2006(with other
information to November 28, 2006 except where noted)

OR

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

For the transition period from _______________ to
_______________

OR

[      ] SHELL COMPANY REPORT PURSUANT
TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report
_______________

Commission file number 000-30588

ROCKWELL VENTURES
INC.(Exact name of Registrant specified in its charter)

NOT APPLICABLE(Translation of Registrants
name into English)

BRITISH COLUMBIA, CANADA(Jurisdiction of
incorporation or organization)

Suite 1020, 800 West Pender StreetVancouver,
British Columbia, Canada, V6C 2V6(Address of principal executive
offices)

COMMON SHARES WITHOUT PAR VALUE(Title of
Class)

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

|Title of Each Class | Name of each exchange
      on which registered
|------------------- | -----------------------------------------------
|None                | Not applicable                                 

---

- ii -

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

Common Shares without Par Value(Title of Class)

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

Number of outstanding shares of Rockwell's only class of capital
  stock as at May 31, 2006.
  23,694,776 Common Shares without Par Value

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

Yes [      ]  No[   X  
  ]

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

Yes [      ] No [   X  
  ]

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

Yes [   X   ] No [     
  ]

Indicate by check mark whether the Registrant is a large accelerated
  filer, an accelerated filer or non-accelerated filer. See definition of accelerated
  filer and large accelerated filer in Rule 12b 2 of the Exchange
  Act.

[      ]  Large Accelerated
  Filer                
  [      ] Accelerated Filer                       
  [   X   ] Non Accelerated Filer

Indicate by check mark which financial statement item Registrant
  has elected to follow:

Item 17 [   X   ]   Item 18
[      ]

If this is an annual report, indicate by check mark whether the
Registrant is a shell company (as defined in Rule 12b 2 of the Exchange
Act):

Yes [      ]  No
[   X   ]

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

Indicate by check mark whether Registrant has filed all documents
  and reports required to be filed by Sections 12, 13 or 15(d) of the Securities
  Exchange Act of 1934subsequent to the distribution of securities under
  a plan confirmed by a court.

NOT APPLICABLE

---

- ii -

Currency and Exchange Rates

All monetary amounts contained in this Annual Report are,
unless otherwise indicated, expressed in Canadian dollars. On May 31, 2006 the
Bank of Canada noon rate for Canadian Dollars was US$1.00:Cdn$ 1.1015 (see Item
3A for further historical Exchange Rate Information).

NOTE REGARDING FORWARD LOOKING STATEMENTS

Except for statements of historical fact, certain information
contained herein constitutes forward-looking statements including, without
limitation, statements containing the words believes, anticipates,
intends, expects and words of similar import, as well as all projections of
future results. Such forward-looking statements involved known and unknown
risks, uncertainties and other factors which may cause the actual results,
performance or achievements of Rockwell to be materially different from any
future results, performance or achievements of Rockwell expressed or implied by
such forward-looking statements. Such risks are discussed in Item 3D Risk
Factors. The statements contained in Item 4B Business Overview, Item 5
Operating and Financial Review and Prospects and Item 11 Quantitative and
Qualitative Disclosures About Market Risk are inherently subject to a variety
of risks and uncertainties that could cause actual results, performance or
achievements to differ significantly.

---



|T A B L E
      O F C O N T E N T S
|-----------------------------------

|         |                                                                                    | PAGE
|-------- | ---------------------------------------------------------------------------------- | ----
|         |                                                                                    |     
|PART 1   |                                                                                    |     
|         |                                                                                    |     
|ITEM 1.  | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS                              | 1   
|         |                                                                                    |     
|ITEM 2.  | OFFER STATISTICS AND EXPECTED TIMETABLE                                            | 2   
|         |                                                                                    |     
|ITEM 3.  | KEY INFORMATION                                                                    | 3   
|         |                                                                                    |     
|ITEM 4.  | INFORMATION ON THE COMPANY                                                         | 12  
|         |                                                                                    |     
|ITEM 5.  | OPERATING AND FINANCIAL REVIEW AND PROSPECTS                                       | 42  
|         |                                                                                    |     
|ITEM 6.  | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES                                         | 51  
|         |                                                                                    |     
|ITEM 7.  | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS                                  | 60  
|         |                                                                                    |     
|ITEM 8.  | FINANCIAL INFORMATION                                                              | 63  
|         |                                                                                    |     
|ITEM 9.  | THE OFFER AND LISTING                                                              | 64  
|         |                                                                                    |     
|ITEM 10. | ADDITIONAL INFORMATION                                                             | 66  
|         |                                                                                    |     
|ITEM 11. | QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK                         | 80  
|         |                                                                                    |     
|ITEM 12. | DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES                             | 81  
|         |                                                                                    |     
|PART II  |                                                                                    |     
|         |                                                                                    |     
|ITEM 13. | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES                                    | 83  
|         |                                                                                    |     
|ITEM 14. | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS
      AND USE OF PROCEEDS | 84  
|         |                                                                                    |     
|ITEM 15. | CONTROLS AND PROCEDURES                                                            | 85  
|         |                                                                                    |     
|ITEM 16. | AUDIT COMMITTEE, CODE OF ETHICS, ACCOUNTANT FEES AND EXEMPTIONS                    | 86  
|         |                                                                                    |     
|PART III |                                                                                    |     
|         |                                                                                    |     
|ITEM 17. | FINANCIAL STATEMENTS                                                               | 89  
|         |                                                                                    |     
|ITEM 18. | FINANCIAL STATEMENTS                                                               | 90  
|         |                                                                                    |     
|ITEM 19. | EXHIBITS                                                                           | 91  

---

 page 2 

PART I

|ITEM 1. | IDENTITY OF DIRECTORS,
      SENIOR MANAGEMENT AND ADVISERS
|------- | -----------------------------------------------------------

Not applicable.

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

Not applicable.

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 page 3 

|ITEM3. | KEY INFORMATION        
|------ | -----------------------
|       |                        
|A.     | Selected Financial Data

The following table summarizes selected consolidated financial
data for Rockwell Ventures Inc. (the Company or Rockwell or the
"Registrant") for the last five fiscal years ended May 31, 2006, in Canadian
dollars, presented in accordance with Canadian generally accepted accounting
principles (Cdn GAAP). Additional information is presented to show the
differences which would result from the application of United States generally
accepted accounting principles (US GAAP) to the Companys financial
information. Refer to note 11 to the consolidated financial statements included
herein for a discussion of the material differences between Cdn GAAP and US GAAP
and their effect on the Companys financial position and results of operations.
The information in the table was extracted from the detailed consolidated
financial statements and related notes included in this annual report, and
should be read in conjunction with such financial statements and with the
information appearing under the heading, Item 5. Operating and Financial Review
and Prospects.

|(In Canadian Dollars, except per share amounts) |   | As
      at May 31, |  
|----------------------------------------------- | - | ------------------- | -
|Balance
      Sheet Data                        |   | 2006                |  
|                                                |   |                     |  
|Total assets (Cdn GAAP)                         | $ | 288,647             |  
|Total assets (US GAAP)                          |   | 288,646             |  
|Total liabilities (Cdn GAAP)                    |   | 1,146,070           |  
|Total liabilities (US GAAP)                     |   | 1,146,070           |  
|Share capital (Cdn GAAP)                        |   | 11,857,649          |  
|Share capital (US GAAP)                         |   | 11,857,649          |  
|(Deficit) (Cdn GAAP)                            |   | (13,238,492         | )
|(Deficit) (US GAAP)                             |   | (13,696,885         | )
|Net assets (deficiency) (Cdn
      GAAP)        |   | (857,423            | )
|Net assets (deficiency) (US GAAP)               |   | (857,424            | )

|                                    |   | Year
      ended May 31, | 
|----------------------------------- | - | ------------------------ | 
|Statement
      of Operations Data  |   | 2006                     | 
|Revenues (US and Cdn GAAP)          | $ | Nil                      | 
|Loss for the year(1)(Cdn GAAP)      |   | 1,600,673                | 
|Loss for the year(1)(US
      GAAP) |   | 1,553,817                | 
|Loss per share (Cdn GAAP)           | $ | 0.07                     | 
|Loss per share (US GAAP)            | $ | 0.07                     | 

Notes:

(1)Loss from continuing operations and loss for the
year are the same for all periods presented.

No cash or other dividends have been declared.

---

 page 4 

Except as otherwise indicated, all dollar amounts are stated
  in Canadian dollars, Rockwells functional and reporting currency, unless
  otherwise stated. The following table sets out the exchange rates, based on
  the noon rates as reported by the Bank of Canada, for the conversion of United
  States dollars into one Canadian dollar in effect at the end of the specified
  periods, the average exchange rates during such periods (based on daily noon
  rates as reported by the Bank of Canada) and the range of high and low exchange
  rates for such periods:

|Exchange Rates     |                    |        |  |  |        |  |  |        |  |  |        |  |  |        | 
|------------------ | ------------------ | ------ |  |  | ------ |  |  | ------ |  |  | ------ |  |  | ------ | 
|                   | Years Ended May 31
|                   |                    | 2006   |  |  | 2005   |  |  | 2004   |  |  | 2003   |  |  | 2002   | 
|End of Period      |                    | 0.9079 |  |  | 0.7994 |  |  | 0.7335 |  |  | 0.7302 |  |  | 0.6547 | 
|Average for Period |                    | 0.8521 |  |  | 0.7937 |  |  | 0.7447 |  |  | 0.6560 |  |  | 0.6378 | 
|High for Period    |                    | 0.9099 |  |  | 0.8493 |  |  | 0.7879 |  |  | 0.7437 |  |  | 0.6623 | 
|Low for Period     |                    | 0.7951 |  |  | 0.7261 |  |  | 0.7084 |  |  | 0.6273 |  |  | 0.6199 | 

The following table sets out the high and low exchange rates,
based on the noon rate as reported by the Bank of Canada, for the conversion of
Canadian dollars into one United States dollar, for the following periods:

Exchange RatesHigh
    LowMarch 2006
    0.8832
    0.8530April 2006
    0.8982
    0.8533May 2006
    0.9099
    0.8902June 2006
    0.9099
    0.8893July 2006
    0.9041
    0.8760August 2006
    0.9037
    0.8838September 2006
    0.9047
    0.8871October 2006
    0.8966
    0.8783November 2006
    0.8868
    0.8715






|B.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Capitalization and Indebtedness                
|------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | -----------------------------------------------
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                
|Not applicable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                
|C.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Reasons for the Offer and Use of
      Proceeds
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                
|Not applicable.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                
|D.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | Risk Factors                                   
|                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   |                                                
|This annual report contains
        forward-looking statements which relate to future events or Rockwells
        future performance, including its future financial performance. In some
        cases, you can identify forward-looking statements by terminology such
        as may, should, expects, plans,
        anticipates, believes, estimates,
        predicts, or potential or the negative of these
        terms or other comparable terminology. These statements are only predictions
        and involve known and unknown risks, uncertainties and other factors,
        including the risks in enumerated in this section entitled Risk
        Factors, that may cause

---

 page 5 

Rockwells or the mining industrys actual results, levels of
activity, performance or achievements to be materially different from any future
results, levels of activity, performance or achievements expressed or implied by
these forward-looking statements.

While these forward-looking statements, and any assumptions
upon which they are based, are made in good faith and reflect Rockwells current
judgment regarding the direction of its business, actual results will almost
always vary, sometimes materially, from any estimates, predictions, projections,
assumptions or other future performance suggested in this annual report. Except
as required by applicable law, including the securities laws of the United
States, Rockwell does not intend to update any of the forward-looking statements
to conform these statements to actual results.

An investment in Rockwells common stock involves a number of
very significant risks. You should carefully consider the following risks and
uncertainties in addition to other information in this annual report in
evaluating Rockwell and its business before purchasing shares of Rockwells
common stock. Rockwells business, operating results and financial condition
could be seriously harmed due to any of the following risks. The risks described
below are not the only ones facing Rockwell. Additional risks not presently
known to Rockwell may also impair its business operations. You could lose all or
part of your investment due to any of these risks.

Risks Associated With Mining

There is no assurance that Rockwell can formally
establish the existence of any mineral reserve on any of its properties. Until
Rockwell is able to establish a mineral reserve, there can be no assurance that
production from these properties will continue for any period of time and if
production fails, Rockwell's business may ultimately fail.

Although Rockwell now owns and operates properties with a
history of sporadic to regular diamond production, these properties have never
been subject to a formal reserve estimation through scientific exploration
techniques. Accordingly, there is no assurance that Rockwell can formally
establish the existence of any mineral reserve on any of its properties. A
mineral reserve is defined by the Securities and Exchange Commission in its
Industry Guide 7 (which can be viewed over the Internet at http://www.sec.gov/divisions/corpfin/forms/industry.htm#secguide7)
as that part of a mineral deposit which could be economically and legally
extracted or produced at the time of the reserve determination. The probability
of an individual prospect ever having a reserve that meets the requirements of
the Securities and Exchange Commission's Industry Guide 7 is remote. If none of
our current or future mineral resource properties contains any reserve, any
funds that Rockwell spends on exploration will be lost.

Even if Rockwell discovers a mineral reserve, there can
be no assurance that the related property will be developed.

Even if Rockwell eventually discovers a mineral reserve on one
or more of its properties, there can be no assurance that it will be able to
develop the properties into producing mines. Both mineral exploration and
development involve a high degree of risk and few properties which are explored
are ultimately developed into producing mines.

The commercial viability of an established mineral deposit will
  depend on a number of factors including, by way of example, the size, grade
  and other attributes of the mineral deposit, the proximity of the resource to
  infrastructure such as a smelter, roads and a point for shipping, government
  regulation and market prices. Most of these factors will be beyond Rockwells
  control, and any of them could increase costs and make extraction of any identified
  mineral resource unprofitable.

---

 page 6 

Mineral operations are subject to applicable law and government
  regulation. Even if Rockwell discovers a mineral resource in a commercially
  exploitable quantity, these laws and regulations could restrict or prohibit
  the exploitation of that mineral resource. If Rockwell cannot exploit any mineral
  resource that it might discover on our properties, its business may fail.

Both mineral exploration and extraction require permits from
various foreign, federal, state, provincial and local governmental authorities
and are governed by laws and regulations, including those with respect to
prospecting, mine development, mineral production, transport, export, taxation,
labor standards, occupational health, waste disposal, toxic substances, land
use, environmental protection, mine safety and other matters. There can be no
assurance that Rockwell will be able to obtain or maintain any of the permits
required for the continued exploration of its mineral properties or for the
construction and operation of a mine on its properties at economically viable
costs. If Rockwell cannot accomplish these objectives, our business could
fail.

Rockwell believes that it is in compliance with all material
laws and regulations that currently apply to its activities but there can be no
assurance that it can continue to do so. Current laws and regulations could be
amended and the Company might not be able to comply with them, as amended.
Further, there can be no assurance that Rockwell will be able to obtain or
maintain all permits necessary for our future operations, or that it will be
able to obtain them on reasonable terms. To the extent such approvals are
required and are not obtained, Rockwell may be delayed or prohibited from
proceeding with planned exploration or development of its mineral
properties.

In addition, environmental hazards unknown to Rockwell which
have been caused by previous or existing owners or operators of the properties
may exist on the properties in which Rockwell holds an interest. Even if
Rockwell relinquishes its licenses, it will still remain responsible for any
required reclamation and rehabilitation of the properties.

Mineral exploration and development are subject to
extraordinary operating risks. Rockwell does not currently insure against these
risks. In the event of a cave-in or similar occurrence, Rockwells liability may
exceed its resources, which would have an adverse impact on
Rockwell.

Mineral exploration, development and production involve many
risks which even a combination of experience, knowledge and careful evaluation
may not be able to overcome. Hazards such as unusual or unexpected formations
and other conditions are involved.

Rockwells operations will be subject to all the hazards
  and risks inherent in the exploration, development and production of resources,
  including liability for pollution, cave-ins or similar hazards against which
  it cannot insure against or which it may elect not to insure. Any such event
  could result in work stoppages and damage to property, including damage to the
  environment. Rockwell does not currently maintain any insurance coverage against
  these operating hazards. The payment of any liabilities that arise from any
  such occurrence would have a material, adverse impact on Rockwell.

The
  prediction of grade can be more challenging for the type of deposit which the
  Company is exploiting.

In the case
  of alluvial diamond deposits, the prediction of grade can be challenging due
  to the inherent geological nature of such deposits. Since alluvial diamonds
  are laid down by rivers flowing over uneven terrain and that the diamonds themselves
  vary in terms of size and quality, the resultant deposits in many cases display
  a "nugget" effect. In order to determine grade under such circumstances
  it is necessary to process large volumes of material (bulk testing) in order
  to be sure that grade calculations are representative and accurate. Moreover,
  in the case of such deposits, drilling is only of use in the determination of
  gravel distribution and not diamond content, since the volume of material recovered
  is insufficiently representative of grade. Notwithstanding the above caution,
  bulk testing is a straightforward technique that is currently being applied
  across all of Rockwell’s South African operations. Furthermore, size frequency
  distribution curves can be used to accurately predict the relative abundance
  of diamonds in terms of stone size, thus mitigating risk.

---

 page 7 

Mineral prices are subject to dramatic and unpredictable
  fluctuations.

Rockwell expects to derive revenues from the extraction and sale
  of diamonds and, possibly, from the extraction and sale of base metals such
  as copper. The prices of those commodities have fluctuated widely in recent
  years, and are affected by numerous factors beyond Rockwells control including
  international, economic and political trends, expectations of inflation, currency
  exchange fluctuations, interest rates, global or regional consumptive patterns,
  speculative activities and increased production due to new extraction developments
  and improved extraction and production methods. The effect of these factors
  on the price of diamonds and base metals, and, therefore, the economic viability
  of any of Rockwells projects, cannot accurately be predicted.

The mining industry is highly competitive and there is no
assurance that Rockwell will continue to be successful in acquiring mineral
claims. If Rockwell cannot continue to acquire properties to explore for mineral
resources, it may be required to reduce or cease operations.

The mineral exploration, development, and production industry
is largely unintegrated. Rockwell competes with other exploration companies
looking for mineral resource properties and the resources that can be produced
from them. However, the mining business operates in a worldwide market, and
prices for minerals are derived from relatively pure market forces. Accordingly,
competition to sell any metals or concentrates produced should not be an issue
if metals prices warrant production

Rockwell competes with many companies possessing greater
financial resources and technical facilities. This competition could adversely
affect Rockwells ability to acquire suitable prospects for exploration in the
future. Accordingly, there can be no assurance that Rockwell will acquire any
interest in additional mineral resource properties that might yield reserves or
result in commercial mining operations.

Risks Related to Rockwell

Rockwell has been an exploration stage mining company
with a history of operating losses and no assurance of revenues

Rockwell has been an exploration stage company whose operating
history has been restricted to the acquisition and exploration of properties for
mineral deposits. This does not provide a meaningful basis for an evaluation of
Rockwells prospects if it ever determines that it has a mineral reserve and
commences the construction and operation of a mine. Rockwell has, to date, no
revenue from operations and a history of net losses resulting in an accumulated
deficit of over $13.2 million at May 31, 2006.

Rockwell expects to continue to incur significant losses into
the foreseeable future. There can be no assurance that Rockwell will be
successful in finding an economic ore body, and therefore there can be no
assurance that Rockwell will ever be able to earn revenues.

---

 page 8 

Rockwell requires additional financing in order to continue
  in business as a going concern, the availability of which is uncertain.

Rockwell requires additional financing to fund its operations.
At May 31, 2006 working capital deficit was approximately $0.9 million.
Rockwells cash resources are currently not sufficient to continue operations at
current levels. There can be no assurance that additional financing will be
available to Rockwell when needed or, if available, that it can be obtained on
commercially reasonable terms.

Any additional equity financing that Rockwell undertakes could
be dilutive to existing shareholders, and any debt financing that Rockwell
undertakes could involve restrictive covenants with respect to future capital
raising activities and other financial and operational matters.

If Rockwell fails to raise sufficient financing to meet its ongoing
  cash needs, it will be forced to scale down or perhaps even cease the operation
  of its business, which may result in the loss of some or all of your investment
  in Rockwells common stock.

There is no guarantee of title to Rockwells
properties.

Although Rockwell has obtained the usual industry standard
title reports with respect to its properties, this should not be construed as a
guarantee of title. Properties may be subject to prior unregistered agreements
or transfers, or native land claims, and title may be affected by undetected
defects. Certain of the claims may be under dispute and resolutions of a dispute
may result in the loss of all of such property or a reduction in Rockwells
interest therein.

Surveys have not been performed on all the
properties.

Not all of Rockwells properties have been surveyed and,
accordingly, the precise location of the boundaries of the properties and
ownership of mineral rights on specific tracts of land comprising the properties
may be in doubt. It is therefore possible that if Rockwell discovers a mineral
deposit near the boundary of one of its properties, such mineral deposit may end
up being outside the boundary of its property and therefore not owned by
Rockwell.

Some of Rockwells directors and officers serve on the
boards of other exploration companies, which could potentially give rise to
conflicts of interest.

Some of Rockwells directors and officers are engaged, and
  will continue to be engaged, in the search for additional business opportunities
  on their own behalf and on behalf of other companies. Situations may arise where
  these directors and officers will be in direct competition with Rockwell. Conflicts,
  if any, will be dealt with in accordance with the relevant provisions of the
  Business Corporations Act (British Columbia) and applicable common law.

---

 page 9 

The loss of any of Rockwells key management employees
  could have a material adverse effect on Rockwells business.

The nature of Rockwells business and Rockwells ability
  to continue its exploration activities and to exploit any mineral reserves that
  it may find in the future depends, in large part, on Rockwells ability
  to attract and maintain qualified key management personnel. Competition for
  such personnel is intense, and there can be no assurance that Rockwell will
  be able to attract and retain such personnel. Rockwells development now
  and in the future will depend on the efforts of key management figures, such
  as Ronald W. Thiessen, Rockwells Chief Executive Officer, and Jeffrey
  R. Mason, Chief Financial Officer. The loss of any of these key people could
  have a material adverse effect on Rockwells business. Rockwell does not
  currently maintain key-man life insurance on any of its key employees.

Rockwells properties are located in Chile, South Africa
and the Democratic Republic of Congo, and its operations there may be affected
by varying degrees of political and economic uncertainties.

Rockwells properties are located in Chile,South
Africa and the Democratic Republic of Congo, and mineral exploration and mining
activities there may be affected in varying degrees by political stability and
economic uncertainties. Operations also may be affected in varying degrees by
government regulations with respect to restrictions on production, repatriation
of profits, price controls, export controls, income taxes, expropriations or
property, environmental legislation and mine safety.

There can be no assurance that the current economic and
political stability in Chile will continue throughout the period in which
Rockwell is looking to explore an operate its properties or that government
regulations will not be changed in a way that will adversely affect Rockwells
operations in the country. Any shifts in political or economic conditions, and
any changes to government regulations relating to the mining industry and
foreign investors in Chile are beyond the control of Rockwell and may adversely
affect its business.

South Africa has recently undergone major constitutional
changes to effect majority rule, and also to effect mineral title. Accordingly,
many laws may be considered relatively new, resulting in risks such as possible
misinterpretation of new laws, modification of mining or exploration rights,
operating restrictions, increased taxes, environmental regulation, mine safety
and other risks arising out of a new sovereignty over mining, any or all of
which could have an adverse impact upon Rockwell. Rockwell's operations may also
be affected in varying degrees by political and economic instability, terrorism,
crime, extreme fluctuations in currency exchange rates and inflation.

Congo has been the subject to significant political and civil
unrest. In 1992, Congo completed a transition to multi-party democracy after a
long history of one-party Marxist rule. However, the 1990s were subject to
periods of violent civil unrest, including a low-level guerrilla war waged
against the government by a group known as the Ninjas in the Pool region of
the country. Congo has remained stable and calm since the signing of a peace
accord with the Ninjas in March 2003.

In March 2006, the World Bank and International Monetary Fund
(IMF) approved Heavily Indebted Poor Countries decision point treatment for
Congo. However, the IMF and World Bank noted that Congo needed to address
serious concerns about governance and financial transparency in order to qualify
for completion point and irrevocable debt relief. Any resources that are freed
by interim debt relief granted to Congo must be used for poverty reduction under
a reform program closely monitored by the international financial institutions.

There is no assurance that Rockwells operations in the Congo
will not be affected in the future by political and economic instability,
terrorism, crime, extreme fluctuations in currency exchange rates and inflation.

---

 page 10 

South African government empowerment initiatives may adversely
  affect Rockwells ability to obtain or maintain permits and licenses for
  mining rights in South Africa.

In order to address inequalities to Historically Disadvantaged
Persons (HDP) engendered by South Africas former apartheid system, the South
African Government has initiated certain government empowerment initiatives.

In October 2002, the South African Government enacted the Mineral
  Development Act that deals with the state's policy towards the future of ownership
  of minerals rights and the procedures for conducting mining transactions in
  South Africa. The Mineral Development Act is a statute with wide-ranging objectives,
  including sustainable development and the promotion of equitable access to South
  Africas mineral wealth by the inclusion of HDP into the industry. The
  Mineral Development Act came into effect in May 2004. The South African Government
  has stated that, under the Mineral Development Act, it will be issuing permits
  and licenses for prospecting and mining rights to applicants using a "scorecard"
  approach. Applicants will need to demonstrate their eligibility for consideration
  based upon the number of credits accumulated in terms of quantifiable ownership
  transformation criteria, such as employment equity and human resource development.

Future amendments to, and interpretations of, the economic
empowerment initiatives by the South African Government and the South African
courts could adversely affect the business of Rockwell and its results of
operations and its financial condition.

Absence of dividends

Rockwell has paid no dividends on its shares since
incorporation, and does not anticipate doing so in the foreseeable future.

Rockwell expects to be a passive foreign investment
company, which could have consequences for U.S. investors.

Potential investors who are U.S. taxpayers should be aware that
Rockwell expects to be a passive foreign investment company (PFIC) for the
current fiscal year, that it may also have been a PFIC in prior years, and that
it may also be a PFIC in subsequent years. If Rockwell is a PFIC for any year
during a U.S. taxpayers holding period, then such U.S. taxpayer generally will
be required to treat any so-called excess distribution received on its common
shares, or any gain realized upon a disposition of common shares, as ordinary
income and to pay an interest charge on a portion of such distribution or gain,
unless the taxpayer makes a qualified electing fund (QEF) election or a
mark-to-market election with respect to the shares of Rockwell. In certain
circumstances, the sum of the tax and the interest charge may exceed the amount
of the excess distribution received, or the amount of proceeds of disposition
realized, by the taxpayer. A U.S. taxpayer who makes a QEF election generally
must report on a current basis its share of Rockwells net capital gain and
ordinary earnings for any year in which Rockwell is a PFIC, whether or not
Rockwell distributes any amounts to its shareholders.

---

 page 11 

Rockwells stock is a penny stock. Trading of Rockwells
  stock may be restricted by the SEC's penny stock regulations which may limit
  a stockholder's ability to buy and sell Rockwells stock.

Because the market price for Rockwells shares is less than
US$5.00, its securities are classified as penny stock. For transactions
involving a penny stock, brokers or dealers are required to approve a previous
account for penny stock transactions, which involves obtaining financial
information concerning the investor and satisfying themselves that the investor
has sufficient knowledge and experience to evaluate the risks associated with
penny stock. The broker or dealer must also deliver certain information to
investors on penny stock, including disclosure concerning the risks associated
with penny stock, and must receive a written agreement from investors prior to
the transactions. As a result of the penny stock restrictions, brokers or
potential investors may be reluctant to trade in Rockwells securities, which
may result in less liquidity for Rockwells stock.

NASD sales practice requirements may also limit a
stockholder's ability to buy and sell Rockwells stock.

In addition to the "penny stock" rules promulgated by the Securities
  and Exchange Commission (see above for discussions of penny stock rules), the
  National Association of Securities Dealers has adopted rules that require that
  in recommending an investment to a customer, a broker-dealer must have reasonable
  grounds for believing that the investment is suitable for that customer. Prior
  to recommending speculative low priced securities to their non-institutional
  customers, broker-dealers must make reasonable efforts to obtain information
  about the customer's financial status, tax status, investment objectives and
  other information. Under interpretations of these rules, the NASD believes that
  there is a high probability that speculative low priced securities will not
  be suitable for at least some customers. The NASD requirements make it more
  difficult for broker-dealers to recommend that their customers buy Rockwell
  common stock, which may limit your ability to buy and sell Rockwell stock and
  have an adverse effect on the market for Rockwell shares.

Rockwell has a significant number of outstanding options
and warrants, the exercise of which could result in significant equity
dilution.

At November 28, 2006, Rockwell had a significant number of share
  purchase options (462,917) and warrants (42,000,000), which will likely act
  as an upside damper on the trading price range of Rockwells shares. The
  underlying shares issuable upon exercise of these securities represent approximately
  63% of Rockwells currently issued shares.

---

 page 12 

|ITEM 4. | ********INFORMATION ON THE
      COMPANY********
|------- | ------------------------------------------------
|        |                                                 
|SUMMARY
|       
|A.      | History and Development of
      Rockwell       

|1. | The legal name of the Registrant is Rockwell Ventures
      Inc.                                                                                                                                                                                                                                                                                                                  
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|2. | Rockwell was incorporated under the Company Act(British Columbia) (the predecessor legislation to the Business
      Corporations Act(British Columbia)) on November 10, 1988 under the
      name Annabel Gold Mines Inc.                                                                                                                                                        
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|3. | The company changed its name to Carissa Mining
      Corporation on January 24, 1994. On October 26, 1995, the company changed
      its name to Rockwell Ventures Inc., consolidated its share capital on
      the basis of five shares to one and subsequently increased its authorized
      share capital to 200,000,000 Common Shares without par value.                  
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|4. | On December 29, 2004, Rockwell increased its authorized
      share capital to consist of an unlimited number of Common Shares without
      par value.                                                                                                                                                                                                                             
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|5. | At the Companys Annual and Extraordinary General Meeting
      held on November 28, 2005, the Companys shareholders approved the
      creation of a class of preferred shares and the consolidation of the
      Companys common shares on a four old shares for one new basis. Regulatory
      approval of this capital reorganization was received on January 27,
      2006.
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|6. | The principal events in the development of Rockwells
      business since June 1, 2005, being the beginning of the most recently
      completed fiscal year, to November 28, 2006 are:                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   | (i)                                                                                                                                                                                                                                                                                                                                                                                 
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     
|   |                                                                                                                                                                                                                                                                                                                                                                                     

---

 page 13 

As provided in the Definitive
Agreement, Rockwell will also execute a definitive agreement in relation to the
acquisition of control of the mineral rights relating to the Galputs Mineral
Project.

| | (ii) | In November 2006, Rockwell completed a $21 million
      private placement of 42 million units at $0.50 per unit, with each unit
      consisting of one common share and one share purchase warrant exercisable
      over three years at $0.60 in the first year, $0.80 in the second year and
      $1.00 in the third year. The third year term of the warrants is subject to
      the Company achieving Tier 1 status on the TSX Venture Exchange within the
      first two years. All securities are subject to a four month holding period
      in Canada expiring on March 23, 2007 and a portion will be subject to
      additional US resale restrictions in the United
States.
| | ---- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|7. | Rockwells principal capital expenditures and material
      divestitures in the past three fiscal years ended May 31, 2006 are as
      follows:
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------

| |      |  |                 |  |  |                  |  |   | Exploration    |  |  |                  | 
| | ---- |  | --------------- |  |  | ---------------- |  | - | -------------- |  |  | ---------------- | 
| |      |  |                 |  |  |                  |  |   | Expenditures   |  |  |                  | 
| |      |  | Exploration     |  |  |                  |  |   | Expensed       |  |  |                  | 
| |      |  | Expenditures    |  |  |                  |  |   | (excluding     |  |  |                  | 
| |      |  | Deferred        |  |  | Mineral Property |  |   | related stock- |  |  | Mineral Property | 
| |      |  | (capitalized or |  |  | Acquisitions     |  |   | based          |  |  | Acquisitions     | 
| | Year |  | invested)       |  |  | Capitalized      |  |   | compensation)  |  |  | Expensed         | 
| | 2006 |  | nil             |  |  | nil              |  | $ | 307,390        |  |  | nil              | 
| | 2005 |  | nil             |  |  | nil              |  | $ | 920,902        |  |  | nil              | 
| | 2004 |  | nil             |  |  | nil              |  | $ | 525,619        |  |  | nil              | 

---

 page 14 

|8. | The principal expenditures by property currently
      anticipated for the ensuing year, subject to the ability to finance from
      existing cash reserves and other sources of equity financing, are as
      follows:
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|                                          | Exploration Expenditures
|----------------------------------------- | ------------------------
|Ricardo Property                          | $ 300,000               
|Holpan/Klipdam/ Wouterspan
      Property | $3,125,000              
|Wouterspan Property                       | $5,000,000              
|Galputs Property                          | $1,700,000              
|Kwango River Project                      | $7,900,000              

|B. | Business Overview   
|-- | --------------------
|   |                     
|1) | **Ricardo Property**

Rockwells Ricardo Property is located along the West Fissure
  fault in Chile. Although exploration on the Ricardo Property to date has not
  identified a deposit containing economic mineralization, Rockwells management
  remains optimistic that given its location, the Ricardo Property represents
  a property that warrants further exploration or the possibility of a farm-out
  to another party prepared to fund its exploration.

|**2)** | Alluvial Diamond
Properties
|------ | ---------------------------

In June 2006, Rockwell entered into the Agreement in Principle
to acquire interests and/or rights in the Holpan/Klipdam Property, the
Wouterspan Property and Galputs Minerale Project in South Africa, and the Kwango
River Project in the DRC. In November 2006, Rockwell and the Vendors of Durnpike
executed the Definitive Agreement, setting out the binding terms and
conditions of the Acquisition in line with the Agreement in Principle. The
Company has received the necessary regulatory approvals in Canada and South
Africa and all conditions of such approval have been fulfilled. The Acquisition
was completed in November 2006. Pursuant to the Definitive Agreement, Rockwell
will acquire all of the shares and shareholder loans in Durnpike from the
Vendors for the consideration set forth below, payable in Common Shares at a
deemed issue price per share equal to the closing price of the Common Shares on
the TSX Venture Exchange on June 29, 2006, being the trading day immediately
preceding the issue of a press release by Rockwell announcing the acquisition.
The consideration is payable on the dates described below.

Durnpike holds or is in the process of acquiring an interest
and/or rights in four alluvial diamond properties, the Holpan/Klipdam Operation,
the Wouterspan Operation, the Galputs Project and the Kwango River Project, all
situated in Southern Africa.

Rockwell intends to seek a secondary listing of its share capital
  on the Johannesburg Stock Exchange in South Africa (the JSE Inward Listing)
  (An inward listing is a South African term for a company that is already listed
  on a stock exchange outside of the country and will be seeking an additional
  listing in South Africa).

As provided in the Definitive Agreement, Rockwell will execute
a definitive agreement in relation to the acquisition of control of the mineral
rights relating to the Galputs Minerale Project.

---

 page 15 

Pursuant to the Acquisition, Rockwell will:

| | (a) | acquire from the Vendors all of their shares and loans in
      Durnpike for South African Rand (ZAR) 34 million (US$4.6 million),
      payable in Common Shares on the earlier of (i) the date of The JSE Inward
      Listing; and (ii) within 9 months from signature of the Definitive
      Agreement, and thereby acquire Durnpikes interests in the Holpan/Klipdam
      Operation, the Wouterspan Operation, the Galputs Project and the Kwango
      River Project; and                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
| | --- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (b) | spend US$7 million on a feasibility study on the Kwango
        River Project by August 31, 2007. This deadline may be extended to February
        29, 2008 at no cost and be further extended to December 31, 2008 by payment
        of US$1 million in Common Shares. If Rockwell wishes to retain the Kwango
        River Project following completion of the feasibility study, Rockwell
        must (i) pay to the Vendors an amount equal to 60% of the net present
        value of the Kwango River Project Valuation (as determined in terms of
        the feasibility study and subject to a minimum acquisition cost of US$13
        million and a maximum acquisition cost of US$26 million), which payment
        shall be effected in Common Shares and (ii) commit to incur an additional
        amount of up to US$6 million in expenditures for development of the Kwango
        River Project within 16 months from the date of completion of the feasibility
        study; and
| |     |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
| | (c) | acquire Galputs Minerale (through a purchase of Virgilia
        Investments Inc.) for ZAR9 million (US$1.2 million), payable to the Vendors
        in Common Shares on the earlier of (i) the date of the JSE Inward Listing
        and (ii) within 9 months from signature of the Definitive Agreement. In
        the event that Rockwell has not obtained title to Virgilia within 5 days
        of the Listing Date, it will pay the Vendors ZAR5.8 million (US$0.8 million)
        on the Closing Date in Common Shares and a further ZAR3.2 million (US$0.43
        million) in Common Shares at the time of the transfer of title to Virgilia
        shares to Rockwell in due course.                                                                                                                                                                                                                                                                                                       

All Common Shares issued to the Vendors pursuant to the
Acquisition will be held in escrow for at least 12 months from the date of
issuance, provided that a limited portion of those escrowed Common Shares may be
released to enable the Vendors to meet specified government regulatory
obligations.

The operational
  status, and ownership of each of the properties was as follows:

|Property                 | Operational status at May 31, 2006 | Ownership immediately before the transaction                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|------------------------ | ---------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Holpan and Klipdam       | In production.                     | The Holpan/Klipdam property and the Wouterspan property, were indirectly
      owned by the H.C. Van Wyk Diamante Trust ("Van Wyk Trust"), a
      business trust registered in RSA. Van Wyk Trust holds 99% of HC Van Wyk
      Diamonds (Pty) Ltd ("HCVW"), a private RSA company (the remaining
      1% owned by the Van Wyk Trust nominees), and 99% of Klipdam Mining Company
      Limited ("Klipdam"), an unlisted RSA public company (the remaining
      1% owned by the Van Wyk Trust nominees). HCVW and Klipdam, are collectively
      referred to as The Van Wyk Diamond Group of companies ("VWDG").
      VWDG is an independent diamond producer that conducts diamond exploration
      and mining on the Holpan/Klipdam property, which VWDG owns, and also conducts
      contract mining on the Wouterspan Property, over which HCVW holds options
      to acquire title.
|Galputs Minerale Project | In production.                     | The Galputs Minerale project was owned 100% by Virgilia Investments BVI
      Limited, a private British Virgin Islands corporation, which in turn was
      owned by certain of the Vendors.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|Kwango River Project     | In production on a small scale.    | The Kwango River Project was owned by Midamines SPRL, a private company
      incorporated under the laws of the DRC. Durnpike had entered into an agreement
      in January 2006 to conduct exploration and mining operations (as an independent
      contractor) on behalf of Midamines at the Kwango River Project.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        

Durnpike completed the acquisition of an initial 49% of the issued
  and outstanding shares of HCVW and 51% of the issued and outstanding shares
  of Klipdam (the Acquisition Interest) prior to July 7, 2006. To
  acquire the Acquisition Interest, Durnpike will pay the Van Wyk Trust ZAR50
  million (US$6.8 million) on closing and ZAR30 million (US$ 4.1 million) on the
  one-year anniversary of the closing. Durnpike has an option to increase its
  shareholding in HCVW to a 51% control interest, upon obtaining necessary South
  African regulatory and corporate approvals, by subscribing for additional shares
  in HCVW in an amount of ZAR1 million (US$0.14 million) and obtaining the requisite
  corporate approvals for the introduction of a ZAR24 million (US$3.3 million)
  working capital loan into VWDG.

Rockwell also entered into an Exchange agreement with the Van
Wyk Trust in terms by which it was granted a call option, and granted a
corresponding put option to the Van Wyk Trust, to acquire an additional 23% of
VWDG for ZAR60 million (US$8.2 million), payable in Common Shares. The Exchange
shall become effective upon Rockwell having completed the JSE Inward Listing. It
is expected that a Black Economic Empowerment company will acquire a 26%
interest in VWDG. Talks with specific parties are well advanced.

---

 page 16 

For illustrative
  purposes, and to aid in understanding the effects of the transaction, we provide
  below a table showing projected estimated ownership of Rockwell after each major
  step of the transactions. The figures stated in the table below are based on
  certain assumptions. There is a significant risk that the actual results will
  very, perhaps materially, from the results projected below.

|Assuming Kwongo River costs the maximum      |                  |  | Running total of number of common shares,
|-------------------------------------------- | ---------------- |  | -----------------------------------------
|agreed, namelyUS$ 26 million                 |                  |  | and
      %of total                      
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|                                             |                  |  | Held bynon-                              
|                                             | Value of common  |  | vendor owners                            
|                                             | shares issued    |  | of Rockwell                              
|                                             |                  |  |                                          
|Common shares outstanding at March 15, 2007  |                  |  | 68,300,000                               
|Acquire 100% of Durnpike (which owns 51% HP) | 34,000,000   ZAR |  | -                                        
|                                             |                  |  | 68,300,000                               
|Finders' fees                                | 8,500,000   ZAR  |  | 2,249,000                                
|                                             |                  |  | 70,549,000                               
|Warrants exercised                           |                  |  | 41,000,000                               
|                                             |                  |  | 111,549,000                              
|Acquire Galputs                              | 9,000,000   ZAR  |  | -                                        
|                                             |                  |  | 111,549,000                              
|Purchase Kwongo (assume maximum amount)      | 26,000,000   USD |  | -                                        
|                                             |                  |  | 111,549,000                              
|Durnpike purchases a further 23% of HP       | 60,000,000   ZAR |  | -                                        
|                                             |                  |  | 111,549,000                              
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|Assuming Kwongo River costs the minimum      |                  |  | Running total of number of common shares,
|agreed, namelyUS$ 13 million                 |                  |  | and
      %of total                      
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|                                             |                  |  |                                          
|                                             |                  |  | Held bynon-                              
|                                             | Value of common  |  | vendor owners                            
|                                             | shares issued    |  | of Rockwell                              
|                                             |                  |  |                                          
|Common shares outstanding at March 15, 2007  |                  |  | 68,300,000                               
|Acquire 100% of Durnpike (which owns 51% HP) | 34,000,000   ZAR |  | -                                        
|                                             |                  |  | 68,300,000                               
|Finders' fees                                | 8,500,000   ZAR  |  | 2,249,000                                
|                                             |                  |  | 70,549,000                               
|Warrants exercised                           |                  |  | 41,000,000                               
|                                             |                  |  | 111,549,000                              
|Acquire Galputs                              | 9,000,000   ZAR  |  | -                                        
|                                             |                  |  | 111,549,000                              
|Purchase Kwongo (assume minimum amount)      | 13,000,000   USD |  | -                                        
|                                             |                  |  | 111,549,000                              
|Durnpike purchases a further 23% of HP       | 60,000,000   ZAR |  | -                                        
|                                             |                  |  | 111,549,000                              

---

 page 17 

The above
  analysis assumes that 41 million in-the-money warrants will be exercised. In
  the event that they are not, the Company will likely have to undertake an equity
  offering and would consider not immediately purchasing a further 23% of Holpan/Klipdamfrom
  the Vendors. Consequently the Company does not expect any change-of-control
  issues with respect to this transaction.

Upon acquisition
  of Durnpike, the Company will commence consolidating the results of Durnpike
  into its consolidated financial statements.

The Company
  did appoint two of the Vendors to its Board of Directors. The individuals appointed
  were Messrs John Bristow and Jeffrey Brenner. Mr. Bristow was appointed President
  and Chief Operating Officer of Rockwell. The Company does not anticipate that
  any more of the Vendors will become involved with the Company at the Board of
  Directors, or senior management, levels.

Hunter Dickinson Inc.

Rockwell does not have full-time management or employees.
Hunter Dickinson Inc. ("HDI") provides management services to Rockwell, pursuant
to a geological and administrative services agreement dated January 1, 2001. HDI
is one of the larger independent mining exploration groups in North America and
employs or retains approximately 90 staff or service providers substantially on
a full-time basis. These individuals include professional technical staff (which
include accredited professional engineers and geoscientists), professionally
accredited accountants (the majority of whom have professional accreditations);
and administrative, office and field support staff.

HDI has supervised mineral exploration projects throughout
Canada and internationally in Brazil, Chile, China, the United States (Nevada
and Alaska), Mexico and South Africa. HDI allocates the costs of staff input
into projects based on time records of involved personnel. Costs of such
personnel and third party contractors are billed to the participating public
companies on a full cost recovery basis (inclusive of HDI staff costs and
overhead) for amounts that are considered by Rockwell's management to be
competitive with arms-length suppliers. The shares of HDI are owned equally by
each of the participating corporations (including Rockwell) as long as HDI
services are being provided. However, should the Company terminate the service
agreement, the Company will be required to surrender its single share at the
time of termination pursuant to the terms of the service agreement. HDI is
managed by certain directors of Rockwell and who are generally also directors of
the other corporate participants in similar arrangements with of HDI.

C. Organizational Structure

Rockwell is based in British Columbia, Canada. As at May 31,
2006, Rockwell had the following subsidiaries:

| | a) | Minera Ricardo Resources Inc. S.A., an exploration-stage
      company organized pursuant to the laws of Chile, of which the Company owns
      a direct 99.9% partnership interest; Rockwell holds its interest in the
      Ricardo Property in Chile through Minera Ricardo Resources Inc.
  S.A.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                     
| | b) | 549949 BC Ltd., a wholly owned subsidiary incorporated
      under the laws of British Columbia which holds a 0.1% partnership interest
      in Ricardo                                                                                                                                            
| |    |                                                                                                                                                                                                                                                                                                     
| | c) | N9C, a wholly owned subsidiary incorporated under the
      laws of the Cayman Islands of which Rockwell owns a direct 100%
      partnership interest                                                                                                                                              
| |    |                                                                                                                                                                                                                                                                                                     
| | d) | N10C, a wholly owned subsidiary incorporated under the
      laws of the Cayman Islands of which N9C owns a direct 100% partnership
      interest                                                                                                                                                  
| |    |                                                                                                                                                                                                                                                                                                     
| | e) | Rockwell Resources RSA (Pty) Ltd, a wholly owned
      subsidiary incorporated under the laws of the South Africa of which N10C
      owns a direct 100% partnership interest                                                                                                                       

---

 page 18 



Immediately upon the completion of the Acquisition described in
  Item B. Business Overview – Alluvial Diamond Properties, the organization
  structure of Rockwell changed to:





---

 page 19 

|D. | Property, Plants and
Equipment
|-- | ------------------------------

Rockwell has no plant or equipment located on any of its
properties as at May 31, 2006.

Glossary:In this Annual Report on Form 20-F, the
following terms have the meanings set forth herein:

|A. | Geological Terms                                                |                                                                                                                                                                                                                                                                                                                                                              
|-- | --------------------------------------------------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Induced Polarization 
      (IP) Anomaly                        | A geophysical feature, which
        is considered to be different in appearance from the typical survey results
        (background) when tested for levels of electro-conductivity. An IP anomaly
        may be indicative of mineralization.                                                                                                             
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Very Low Frequency
      Electromagnetic (VLF-
      EM) Survey | Method involves measurement
        of time varying low frequency electromagnetic fields in and over the earth,
        when these impinge on conducting formations or mineralized bodies at depth
        they produce currents that are measured at surface.                                                                                               
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Magnetotelluric Survey                                          | An electromagnetic survey
        in which natural electric (two horizontal component) and magnetic (three
        component) fields are measured.                                                                                                                                                                                                           
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Metallogenic Belt                                               | Mineral deposits that occur
        in a particular geographic area or in a trend and are related in space
        or time to the regional geological features.                                                                                                                                                                                              
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Porphyry                                                        | An igneous rock containing
        conspicuous crystals or phenocrysts in a fine-grained groundmass; also
        a type of mineral deposit in which ore minerals are widely disseminated,
        generally of low grade but large tonnage                                                                                                                  
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Resistivity                                                     | An exploration method in which
        an electrical current is introduced into the ground by two contact electrodes
        and the potential differences are measured between any two other electrodes.
        Resistivity anomalies display the difference between fresh rock and rock
        in which metallic minerals or other changes have occurred.
|   |                                                                 |                                                                                                                                                                                                                                                                                                                                                              
|   | Sulphide                                                        | A compound of sulphur with
        another element, typically a metallic element or compound.                                                                                                                                                                                                                                                                

|B.                                                                        | Measurement
|------------------------------------------------------------------------- | -----------
|                                                                          |            
|Conversion of metric units into imperial
      equivalents is as follows:

Metric Units
    Multiply by
    Imperial Unitshectares
    2.471
    = acresmeters
    3.281
    = feetkilometers
    0.621
    = miles (5,280 feet)grams
    0.032
    = ounces (troy)tonnes
    1.102
    = tons (short) (2,000 lbs)grams/tonne
    0.029
    = ounces (troy)/ton


---

 page 20 

Mining in the Republic of South Africa

South Africa has recently undergone major constitutional
changes to effect majority rule, and also to effect mineral title. Accordingly,
many laws may be considered relatively new, resulting in risks such as possible
misinterpretation of new laws, modification of mining or exploration rights,
operating restrictions, increased taxes, environmental regulation, mine safety
and other risks arising out of a new sovereignty over mining, any or all of
which could have an adverse impact upon Rockwell. Rockwell's operations may also
be affected in varying degrees by political and economic instability, terrorism,
crime, extreme fluctuations in currency exchange rates and inflation.

Changes, if any, in mining or investment policies or shifts in
political attitude in South Africa may adversely affect Rockwell's operations or
likelihood of future profitability. Operations may be affected in varying
degrees by government regulations with respect to, but not limited to,
restrictions on production, price controls, export controls, currency
remittance, income taxes, expropriation of property, foreign investment,
maintenance of claims, environmental legislation, land use, land claims of local
people, water use and mine safety.

The political situation in South Africa introduces a certain
degree of risk with respect to Rockwell's activities. The Government of South
Africa exercises control over such matters as exploration and mining licensing,
permitting, exporting and taxation, which may adversely impact on Rockwell's
ability to carry out exploration, development and mining activities. Failure to
comply strictly with applicable laws, regulations and local practices relating
to mineral right applications and tenure could result in loss, reduction or
expropriation of entitlements or in the imposition of additional local or
foreign parties as joint venture partners with existing or other interests.

Government Regulation

The exploration and mining activities of Rockwell are subject
to various South African national, provincial and local laws governing
prospecting, development, production, taxes, labour standards and occupational
health, mine safety, toxic substance and other matters. Exploration activities
and mining are also subject to various national, provincial and local laws and
regulations relating to the protection of the environment. These laws mandate,
among other things, the maintenance of certain air and water quality standards,
and land reclamation. These laws also set forth limitations on the generation,
transportation, storage and disposal of solid and hazardous waste. Although
Rockwell's activities are currently carried out in accordance with all
applicable rules and regulations, to the best of its knowledge and belief no
assurance can be given that new rules and regulations will not be enacted or
that existing rules and regulations will not be applied in a manner which could
limit or curtail production or development. Amendments to current laws and
regulations governing operations and activities of exploration, mining and
milling or more stringent implementation thereof could have a material adverse
effect on Rockwell's business, results of operation and financial condition.

In October 2006, the Government of South Africa released the
Mineral and Petroleum Resources Royalty Bill 2006(the Royalty Bill)
and the Diamond Export Levy Bill 2006(the Export Levy Bill). The
Royalty Bill proposes, among other things, that companies extracting diamonds
pay a royalty of 5% from the sales of those metals, payable on gross revenue.
The Export Levy Bill contemplates an additional 5% levy on any rough diamonds
that are cleared for export under the South African Diamonds Act, based
on the value of such diamonds established or assessed under that Act. If
enacted, the Royalty Bill and the Export Levy Bill may reduce the viability of
diamond projects undertaken by the Company in South Africa. The Bills are
presently under discussion and comment.

---

 page 21 

The mining industry in South Africa, where the Company's
projects are located, is subject to extensive regulation. The regulatory
environment is developing, lacks clarity in a number of areas and is subject to
interpretation, review and amendment as the mining industry is further developed
and liberalized. In addition, the regulatory process entails a public comment
process, which makes the outcome of legislation and regulatory controls
uncertain and may cause delays in the regulatory process. A number of
significant matters have not been finalized, including the Royalty Bill
as well as legislation dealing with beneficiation. Rockwell cannot predict the
outcome or timing of any amendments or modifications to applicable regulations
or the interpretation thereof, the release of new regulations or their impact on
its business.

South African Government Empowerment
Initiatives

In order to address inequalities to Historically Disadvantaged
Persons (HDP) engendered by South Africas former apartheid system, the South
African Government has initiated certain government empowerment initiatives.

In October 2002, the South African Government enacted the
Mineral Development Act that deals with the state's policy towards the future of
ownership of minerals rights and the procedures for conducting mining
transactions in South Africa. The Mineral Development Act is a statute with
wide-ranging objectives, including sustainable development and the promotion of
equitable access to South Africas mineral wealth by the inclusion of HDP into
the industry. The Mineral Development Act came into effect in May 2004. The
South African Government has stated that, under the Mineral Development Act, it
will be issuing permits and licenses for prospecting and mining rights to
applicants using a "scorecard" approach. Applicants will need to demonstrate
their eligibility for consideration based upon the number of credits accumulated
in terms of quantifiable ownership transformation criteria, such as employment
equity and human resource development.

Future amendments to, and interpretations of, the economic
empowerment initiatives by the South African Government and the South African
courts could adversely affect the business of Rockwell and its results of
operations and its financial condition.

Mining in the Democratic Republic of Congo

The renewed interest by the international mining industry in
the Congo has been as a result of the 2003 implementation of the new Congo
Mining Code, which was drafted in consultation with the World Bank.

The Mining Code provides the prospecting permit holder with
broad access to explore its properties under a transparent and efficient permit
process. In the case of diamond exploration, the new Mining Code gives the
prospecting permit holder exclusive rights for a period of four years, renewable
for two additional two-year periods. Upon development of an economically viable
deposit, the holder can apply for a mining permit.

The Congo Mining Code states that an Exploitation License is a
real property, exclusive, conveyable and transferable right which can be leased,
in accordance with the provisions of the present Code, the surface rights
therefore form an integral part of the mining rights. The Code identifies that
any applicant for an Exploitation Licence must submit an environmental impact
study (EIS) together with an environmental management plan for the project
(EMPP), and obtain the approval of his EIS and EMPP, as well as implement the
EMPP.

The Exploitation Licence entitles its holder to the exclusive
right to carry out, within the perimeter over which it has been granted, and
during its term of validity, exploration, development, construction and

---

 page 22 

exploitation works in connection with the mineral(s) for which
the licence has been granted. In addition, it entitles the licence holder,
without restriction, to

- enter the Exploitation Licence area to conduct mining operations;
- build the installations and infrastructures required for mining
  exploitation;
- use the water and wood within the Exploitation Licence perimeter for the
  requirements of the mining, complying with the requirements set forth in the
  EIS and the EMPP;
- use, transport and freely sell his products originating from within the
  exploitation perimeter;
- proceed with concentration, metallurgical or technical treatment
  operations, as well as the transformation of the mineral substances extracted
  from the deposit within the exploitation perimeter; and
- proceed to carry out works to extend the mine.

As long as a Perimeter is covered by an Exploitation Licence,
no other application for a mining or quarry right for all or part of the same
Perimeter can be processed. However, an applicant to whom the holder of the
Exploitation Licence has refused to provide his consent to open a quarry within
the Perimeter may submit an application for Quarry Exploitation Licence over
part of the Perimeter which is the subject of the Exploitation Licence but which
is not being used for the mining operations. Failing that, the application is
processed and is the subject of an administrative litigation process in which
the holder and the applicant participate if the latter submits, together with
his application, evidence that the holder has refused to give his consent and is
acting in bad faith. The Mining Regulations set forth the basic and substantive
rules for this administrative litigation process.

Technical Summary

The following disclosure is derived from Rockwell files and
technical reports. Additional details can be found in technical reports by RH De
Decker, Pr.Sci.Nat., filed on www.sedar.com.

**Cautionary Note to Investors Concerning
      Estimates of Inferred Resources**The following discussion includes references to inferred resources.
          Rockwell advises investors that while this term is recognized and required
          by Canadian securities regulations (under National Instrument 43-101
          Standards of Disclosure for Mineral Projects), the U.S.
          Securities and Exchange Commission does not recognize it. Inferred
          resources have a great amount of uncertainty as to their existence,
          and great uncertainty as to their economic and legal feasibility. It
          cannot be assumed that all or any part of an inferred mineral resource
          will ever be upgraded to a higher category. Under Canadian rules, estimates
          of Inferred Mineral Resources may not form the basis of feasibility
          or preliminary feasibility studies, except in rare cases. Investors
          are cautioned not to assume that part or all of an inferred resource
          exists, or is economically or legally mineable.


Properties in South Africa

Figure 1 shows the location of the Holpan/Klipdam, Wouterspan
and Galputs properties located in the Republic of South Africa (RSA or South
Africa).

---

 page 23 

Figure 1 Location of the
Holpan/Klipdam, Wouterspan and Galputs Properties

The Holpan/Klipdam Property

Location and Access

The Holpan/Klipdam property is located 45 km from Kimberley, in
the Northern Cape Province, in central South Africa.

The property has ready access to all required infrastructure.
Given that the operations are located next to an irrigation canal, the
operations have year-round water supply and the necessary pumping stations and
water supply pipelines are in place. The property is situated on a tarred road
and is 45 km from Kimberley, a modern town of 200,000 inhabitants with
comprehensive mining support services, spares and supplies. Kimberley has a
regional airport and air service that links to all major cities in South Africa.
The property is connected to the national electricity grid and the necessary
transformers and supply lines are in place.

Property Description and Ownership

The Holpan/Klipdam property consists of the adjacent Holpan 161
and Klipdam 157 farms, covering an area of 3,836 hectares. Details are provided
in Table 1.

---

 page 24 

Table 1: Summary of Holpan-Klipdam landholdings

Company
      Property Name
      Area (ha)
      Mineral Right
      Permit Number
      Renewal DateHC van Wyk Diamonds Pty Ltd
    Remaining extent of farm Holpan 161,
      Barkly West
    2370.0518
    Mineral Lease K55/2000S
    ML 1/2002
    09 November 2014Klipdam Diamond Mining (Pty) Ltd
    Remaining extent of the farm Klipdam
      157, Barkly West
    1466.0095
    Mineral Lease K54/2000RM
    MP 86/2002
    06 June 2004*


Exploration History

Holpan and Klipdam have been the focus of intermittent mining
since the early 1900s and have consistently been known for yielding large
diamonds. There are regular references to this in historic records such as the
work of George Beet (1931), who discusses the Broderick diamond  a perfect
Cape white, weighing 412.5 carats. HC Van Wyk Diamonds (HCVWD) has produced in
excess of 90,000 carats of diamonds from Holpan and Klipdam since 1994. The
Klipdam Mining Company has produced 18,333 carats between July 1996 and February
1999 from the Klipdam Farm.

The work conducted from 1994 to date at Holpan-Klipdam
comprises extensive mining of Rooikoppie and Primary gravels, drilling and bulk
testing. Since August 2005, the majority of processing has been undertaken using
a state of the art, high efficiency 200 tonnes per hour (tph) Dense Media
Separation plant with X-ray Flowsort recovery and grease table final recovery
apparatus. A large new earth moving fleet, comprising 41 units of Volvo and
Komatsu equipment, currently moves 159,000 cubic meters (m3) of
gravel and overburden on a monthly basis.

Geology

A key factor in the origin of the extensive and rich alluvial
diamond deposits found in South Africa and Namibia is the existence of over 1000
diamond bearing kimberlites across southern Africa on the Kaapvaal Craton.
Kimberlite emplacement was followed by liberation and entrainment of diamonds
and deposition in terraces on the ancient Vaal and Orange Rivers between
approximately 4.8 million years ago (Ma) and 4 Ma.

The Holpan-Klipdam deposit comprises an extensive flat-lying
alluvial sequence located on the right bank of the modern Vaal River and 6 km
inland from a bend in the river known as the Horseshoe. The sequence extends
across an area of approximately 5 km by 2.5 km. Economic concentrations of
diamonds within the sequence are found both in the deflational Rookoppie
deposit and in well developed, clearly-defined palaeo-channels that were
preserved by a highly resistant calcrete cap. The palaeo-channels extend over
several km and are up to 500 m wide in places. At Holpan and Klipdam, the
bedrock consists of Archaean Ventersdorp lavas, and shales and diamictites of
the 300 to 250 Ma Dwyka Group of the Karoo Supergroup.

The Rooikoppie unit varies in thickness from a few cm up to
about 2 m and has an estimated average thickness in the order of 1 m. Solution
cavities up to 3 m deep in the calcretised bedrock form sharp, discontinuous
depressions and are filled with the overlying Rooikoppie gravel. Since such
cavities, when considered in a hydrodynamic context, have very high diamond
trapping potential and so these features are of key economic importance. Given
the high incidence of pronounced solution features in the palaeo-

---

 page 25 

land surface underlying the Rooikoppie (as observed in current
mine workings at Holpan-Klipdam), this area is considered to be of high interest
with regard to its exploration potential.

The Primary gravels found in the palaeo-channels typically
comprise the lower third of the sedimentary sequence and rest directly on the
bedrock. The thickness of the gravel bed varies from about 1 to 6 m and average
approximately 3 m thick. The Primary gravels comprise a poorly sorted assemblage
of large boulders (up to 45 cm in diameter at the base of the unit), cobbles and
pebbles set in a sandy matrix that is considered to have been deposited by a
large, middle-stage, meandering river system.

High-resolution digital aerial photographs of the
Holpan-Klipdam properties clearly show the distribution of mine workings in the
area, including the adjacent Leicester kimberlite pipe. Tonal darkening, seen
immediately to the west of the Klipdam plant area, corresponds closely to a
buried palaeo-channel as defined by exploration drilling, and is interpreted to
be its surface expression.

Exploration and Operation

Due to the significant burial depth of the Primary gravels at
Holpan-Klipdam, the thickness and distribution of the alluvial gravel deposits
have been investigated through systematic percussion drilling. A total of 3,243
boreholes with a combined depth of 14,486 m were drilled on the Holpan-Klipdam
property between 1994 and 2005. Drill holes extended to bedrock in the majority
of cases. Boreholes were spaced at 50 m intervals along traverses 100 m apart.
Chip samples were collected at 1-m intervals and logged on site by a geologist.
Procedures were audited in conjunction with the original field logs under the
supervision of Rockwells consultant in November 2005.

As of January 2006 the drilling program, supported by trial
mining test work and field observation, has outlined gravel volumes of
approximately 7,500,000 m3for the Rooikoppie unit and 4,300,000
m3for the Primary unit on the Holpan-Klipdam properties.

The production and survey data obtained from HCVWD have been
accepted following on-site observation of mining and treatment processes,
extended discussions with company personnel and detailed presentations by
Managing Director as well as other individuals responsible for the compilation
of the state diamond logs.

At least 3,267,400
  m3 of gravel has been bulk sampled or mined within the Holpan-Klipdam
  properties by HCVWD between June 2003 and December 31 2005. Systematic and professional
  surveying information are available for this period.

Geological continuity for both the Primary gravels and the
Rooikoppie gravels has been established and demonstrate the continuity of
diamond mineralization along these alluvial diamond runs and within the
defined resource area. A simple aggregated global average diamond grade of 1.16
carats per 100 m3 is implied. When evaluated on a the basis of a
6-month rolling weighted average for the same period, grade ranges from 0.89
carats per 100 m3 to 1.93 carats per 100 m3. Therefore,
the estimated grade of 1.16 carats per 100 m3 is considered to be
conservative.

Diamond values presented in this report represent information
collated from actual diamond sales concluded by HCVWD. They are determined by an
official tender process whereby goods are cleaned, sorted and parcelled into
different sizes and categories (either individually, which is typical for larger
stones, or collectively for smaller stones) before being shown to registered
buyers who make sealed offers

---

 page 26 

on the different diamond parcels. Typically, diamonds are sold
to registered local and international buyers who offer the best price on a
parcel. This process is underpinned by professional valuation of the stones to
arrive at a reserve or market price prior to tender and the entire process is
conducted through officially registered diamond marketing facilities or
bourses. Strict adherence to the Kimberley Process is maintained throughout
the mining, recovery, marketing and sales process.

For the period June 2003 to December 2005 (for which survey
information is available and the data on which the grade has been estimated) the
average weighted diamond value is US$848 per carat.

Using stone-by-stone weight records compiled by HCVWD
production staff for the period January April 2006, a diamond size-frequency
distribution analysis was carried out in order to gain a better understanding of
the diamond population present at Holpan-Klipdam. This approach was used to
predict the frequency with which large stones would be expected to be present at
Holpan-Klipdam. This is of key importance as a small number of large, high value
stones can significantly increase the value of production. When compared to
nearby properties such as Zoutpan, Riverview and Pniel, there appears to be a
significant population of large stones, possibly representing a distinct
kimberlitic source or a higher degree of fluvial sorting.

Estimates of Mineralization

The continuity
  of the geology and mineralisation, together with the degree of confidence in
  grade and stone value are considered sufficient to classify the diamondiferous
  gravels, as an inferred resource. The production information used to support
  this contention covers a mined volume of 3,267,400 m3 and a total of 37,809
  carats. Note that this inferred resource has been defined on the basis of detailed
  bulk testwork undertaken by HCVWD between June 2003 and December 31 2005, for
  which period detailed, accurate and verifiable production, surveying and sales
  records are available. The drilling information is deemed sufficiently dense,
  accurate and clearly defined to support this classification. Although reconciliation
  of carats produced to volumes mined is only possible in a global sense, RH De
  Decker, Pr. Sci. Nat., the independent Qualified Person responsible for the
  resource estimate, is of the opinion that it constitutes an inferred resource.

It is also estimated that 4,800,000 m2 of gravel,
that is similar, visually, to the Rooikoppie gravels, surrounds the area of the
inferred resource. While this gravel feature is readily identifiable from the
prevalent red chert clasts (Pebbles) in the regolith and abandoned artisanal
workings, as well as vegetation features discernable from aerial photography,
its diamond content should be independently evaluated to determine whether a
classifiable resource exists. It is Mr. De Deckers opinion that the classified
resource base could be expanded significantly by a limited but systematic
program of pitting and sterile bulk testing trenching.

The property hosts an extensive alluvial diamond deposit. An
estimated inferred resource of 12,000,000 m3 of diamondiferous gravel
with a grade of 1.16 carats per 100 m3 and a mean value of US$848 per
carat (as assessed from production records) has been identified on the property.
RH De Decker, Pr. Sci Nat., is the independent Qualified Person responsible for
the resource estimate.

Planned Program

A CDN$3.125 million program is proposed, as summarized
below:

Description
    Amount (CDN$)Bulk sampling activities
    $1,500,000Trial mining activities
    $1,225,000General environmental work
    $125,000Geology, engineering and supervision
    $275,000


---

 page 27 

The Wouterspan Property

Location and Access

The Wouterspan Property is located on the northern bank of the
Orange River, about 100 km west of Douglas in the Northern Cape Province, South
Africa.

The area has ready access to good infrastructure. Water is
available from the Orange River. The property is directly linked to an
all-weather gravel road. It is 200 km from the town of Kimberley, where
comprehensive back up services for mining, spares and other supplies are
available. The property is connected to the national electricity grid. Staff
quarters have been built on site and transport provisions have been made for
personnel to work on a two week on, four day off basis.

Wouterspan is situated on the edge of the Karoo, an arid semi
desert that forms part of the high plateau (or highveld) of South Africa.
Rainfall is about 200 mm per annum primarily during the summer. Winter
temperatures range from 0°C at night time to approximately 14°C during the day;
summer daytime temperatures may reach 45°C.

The project area comprises a relatively flat raised terrace
adjacent to the modern day Orange River. The main relief features include a
gentle rise towards the western limit of the permit area, together with a sharp
topographic descent of approximately 12 m in the south-east, adjacent to the
Orange River, defining the limit of the terrace. Subtle hollows, some of which
host minor ephemeral drainages are also seen in the project area.

Property Description and Ownership

The property comprises portions of the Lanyon Vale 376 farm
that total 969.4 hectares.

The surface rights of Wouterspan are held by Mr. J.F. Gouws. No
servitudes exist with regard to these landholdings. H.C. Van Wyk Diamante
(HCVWD) has concluded prospecting and option agreements to purchase the two
companies Farhom Mining and Construction Limited and Okapi Diamonds (Pty)
Limited together with their surface and mineral rights holdings at Wouterspan.
These are described below:

Table 2 Permits for Wouterspan Property

Company
    Property Name
    Area (ha)
    Permit Number
    Expiry DateFarhom Mining and Construction
      Limited
    Portion 16 (a portion of Portion 9) of
      Lanyon Vale 376
    188.7926 hectare
    Mining Permit No. 144/2004
    29 April 2006*Okapi Diamonds (Pty)
      Limited
      Remainder of 
        Portion 9 (Wouter) of
      Lanyon Vale 376
      780.61 
        hectare
      Prospecting 
        Permit No. PP 86/2004
      29 April 2006*


History

The first diamond discovered in South Africa was about 75 km
upstream of Wouterspan on the Middle Orange River (MOR). This discovery led to
the rapid proliferation of small-scale artisanal mining activities.

---

 page 28 

Early mining concentrated on the surface deflation deposits,
known as Rooikoppie gravels. Rooikoppie gravels were mined extensively between
Douglas and Prieska from 1926 to 1936 and again during 1943 to 1945.
Subsequently, the MOR has not seen much prospecting and mining activity until
relatively recently. The reasons for this are twofold: a) Large areas are
covered by a very hard layer of calcrete, 0.5 m  3 m thick, which limits access
to the underlying gravel horizons; and b) the gravels contain a high percentage
of banded ironstone clasts, which makes the treatment and concentration of the
gravels technically difficult when using the traditional pan plant
processes.

More recently, the mining problem of the MOR was solved by the
use of blasting and heavy earthmoving equipment to rip and remove the hard
calcrete-silcrete layer. This new technology has resulted in the area being
effectively explored and mined for the first time. A number of companies have
been active in the area. The MOR alluvial deposits have regularly yielded
exceptional large diamonds such as a 211 carat stone recovered from a terrace on
a high level terrace upstream from Wouterspan and was reportedly sold for R28
million; a 181 carat stone recovered from Terrace B on Saxendrift; a 205 carat
stone recovered by Trans Hex from Saxendrift and a 175 carat stone from Trans
Hexs MOR mine.

In 2005, drilling
  work indicated that the size of the gravel facies often associated with diamond
  accumulation at Wouterspan is in the order of 30 million tons. The grade of
  gravels processed during bulk testing from April 2005 onwards was in the order
  of 0.4 - 0.5 carats per hundred tons. Note that aforementioned observations
  are the product of as yet unmodelled bulk testwork and as such should not be
  construed as a Canadian National Instrument 43-101–compliant mineral resource.
  In compliance with US SEC Industry Guide 7 Section (b)(4)(i), this property
  does not have a declarable mineral resource.

Geology

Large areas of the terrace are covered by diamond bearing
surface deposits known as Rooikoppie gravels, often separated from the
underlying Primary gravel by a hard layer of calcrete The basal gravels, termed
Primary Gravels, are well exposed in the workings and shales and tillites of
the Dwyka Group, together with lava are common substrates of the gravels. The
bedrock displays gully and pothole features creating high diamond trapping
potential. At Wouterspan, the gravels occur 20 - 30 m above the Orange River and
appear to have been deposited in a braided river system. Suspended gravel
deposits found between the Rooikoppie and Primary gravels have also been shown
to contain diamonds.

The majority of the alluvial diamonds found in gravel deposits
along the MOR are found in two distinct gravel horizons: an upper deflation
deposit called the Rooikoppie gravel and the basal Primary gravels.

The Rooikoppie unit varies in thickness from a few centimetres
up to about 2 m and has an average thickness of about 1 m. The deposit typically
rests on sand, gravel or in places a hard, semi-continuous layer of calcrete and
silcrete. Solution cavities up to 2 m deep in the calcretised material form
sharp, discontinuous depressions that are filled with the overlying Rooikoppie
gravel.

The Primary gravel deposits comprise the lower half to one
third of the sedimentary sequence and rest directly on the bedrock. These
Primary gravels comprise a poorly sorted assemblage of large boulders (up to 45
cm in diameter at the base of the unit), cobbles and pebbles set in a sandy
matrix that is considered to have been deposited by a large, high-energy braided
system that would be readily capable of transporting diamonds. The total
sequence varies from about 8 m to 18 m in thickness.

The Wouterspan alluvial deposits represent typical remnant
river terraces comprising gravel sequences formed, in large part, through
reworking of glacial outwash deposits and appear to have a common or similar
origin as seasonal flood deposits. The secondary or younger gravels represent
re-working of earlier deposits by late stage erosion and re-deposition as
sheetwash flood gravels in low level terraces often associated with river
damming situations and splays.

The surface deflation Rooikoppie deposits comprise a
diamond-bearing lag deposit created by erosion, winnowing and removal of light
components, and enrichment of heavy components including diamonds.

---

 page 29 

Exploration and Trial Mining

Given that the terrace extends beyond the boundary of the
Wouterspan properties, the entire property is considered prospective. The
thickness and distribution of the alluvial gravel deposits have been
investigated through systematic percussion drilling. Geological logging and
surveying of all boreholes has been undertaken and has been used in the
construction of a geological model, which has itself been used as a guide to
trial mining operations.

Quantitative reconciliation and modeling of grade is not
possible through the analysis of drill data. The only way to establish diamond
presence and grade is through trial mining operations.

The purpose of the trial mining was to: (i) expose the gravels
in section over a wide lateral area in order to gain a better understanding of
the sedimentology and (ii) to process sufficient gravel to be able to determine
the diamond grade of the gravels and lateral consistency thereof. Between March
2005 and January 2006, a total of 513,892 m3 of Primary gravel and
24,013 m3 of Rooikoppie from 11 localities at Wouterspan property
were tested by HCVWD during trial mining operations. Trial mining locations were
selected by HCVWD according to the most well-developed gravel assemblages (both
laterally and vertically) as identified by the drilling program and a series
box-cuts were excavated. Currently operations are taking place on two portions
of the property called Farhom and Okapi farms.

Drilling and trial mining indicate that the property hosts an
extensive alluvial deposit with a large average stone size within the Rooikoppie
and Primary gravel units. The work to date on the Wouterspan Project has
established the presence of diamondiferous gravels, but without having
determined a mineral resource.

A drilling
  program, conducted in 2005 by VWDG at Wouterspan, identified 4,481,000 m3 of
  Rooikoppie facies Gravel and 43,259,000 m3 of Primary facies Gravel. In trial
  mining operations, 2,868 carats of diamonds have been recovered from 514,000
  m3 of Primary and 24,000 m3 of Rooikoppie gravel. Diamonds of exceptional value
  have been recovered from this property, including the recent discovery of a
  157 carat stone that sold for approximately US$5.7 million at official tender.
  Note that the results of the aforementioned testwork are preliminary in nature
  and do not constitute a Canadian National Instrument 43-101 – compliant
  mineral resource. No such resource is currently definable on the property though
  testwork is ongoing, rigorous and extensive.

Planned Program

A budget of CDN$5 million has been proposed, to be used for
bulk sampling and purchase or replacement of equipment for the Wouterspan
operations, as summarized below:

Description
    Amount (CDN$)Further drilling, geologic interpretation and compilation
    $600,000Additional bulk sample activities including test process
      plant additions
    $1,300,000Trial mining operation (including equipment addition) based
      on operational planning with regard to exercising the Farhom and Okapi
      options
    $2,300,000General environmental
    $400,000Geological and engineering, operational planning including
      supervision
    $400,000


The Galputs Minerale Project

Location and Access

The Galputs property is located on the Koa River in
Namaqualand, in the Northern Cape Province, South Africa.

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 page 30 

Galputs Pan, located on an extensive plain with little
topographic relief, is one of a series of deflation pans located along the
palaeo-Koa River that actively flowed for about 5 Ma. The first diamonds from
the Koa Valley were discovered at Galputs in 1936.

The Galputs Pan comprises three interleading pan-shaped
features: the Northern Pan and Neck Area, the Main or Central Pan and the
Southern Pan. Access to the project site is possible via a number of
well-maintained gravel roads. The roads are adequate for large vehicle use and
link to both Springbok and Upington which have regular daily air-links to major
centres in South Africa. The nearest large town is Springbok, about 110 km west
of Galputs. Aggenys, 45 km north of Galputs, is connected to the town of
Springbok in the west by an excellent tarred road and with Upington to the
north-east by an equally good paved road. A wellmaintained paved landing strip
suitable for small to mid-sized aircraft is located at Aggenys.

The Namaqualand region is extremely arid with annual rainfall
averaging only 125 mm, occurring mainly in the summer months from November to
February.

Property Description

The property is comprised of the mining rights to the Galputs
104 farm on which diamondiferous gravels have been identified.

A mining licence (ML 1/2003) was issued to Galputs Minerale
(Pty) Limited on January 8 2003 and is valid until January 7 2018. This mining
licence was granted in respect of a property comprising 791,183 hectares. The
mining licence constitutes an Old Order Mining Right and must be converted to a
New Order Right by 2009. A valid Environmental Management Programme (EMPR) is in
place for the prospecting and mining operations. A surface use agreement is also
in place with the landowner of the property.

The Galputs Project is indirectly owned by Virgilia Investments
Inc (Virgilia), a British Virgin Islands corporation. Virgilias wholly-owned
subsidiary, Galputs Minerale (Pty) Limited, a private SA company, holds mining
rights to the The Galputs Project. Durnpike conducts contract mining operations
at The Galputs Project. Rockwell will acquire, for nominal consideration, all of
the outstanding shares of Virgilia from Marla Trust and make a payment as set
out in (c) above under acquisition.

History

The Koa River and the region around Galputs was probably
occupied by the Orange River during Miocene times (5 Ma). It is now generally
accepted that the diamonds found in both the coastal marine deposits and fluvial
gravels of Namaqualand have been derived from the kimberlite pipes occurring in
the hinterland of southern Africa. The hinterland is underlain by rocks of the
ancient Kaapvaal Craton and from which as much as 500  1,500 m of erosion has
taken place since the intrusion of kimberlites in the late Cretaceous (120  85
Ma). The considerable quantity of diamonds released would have been transported
through the Koa Valley with possible deposition of some stones in favourable
hydrological traps eroded into the bedrock.

Exploration and prospecting work has been conducted
intermittently at Galputs since 1936, with systematic prospecting only
commencing in 1960. Between 1936 and 1986, a total of 4,110 carats were
recovered. No previous data are available to reliably determine the in situ
grade of the gravels at the Galputs Project. Mining at Bosluis Pan, a nearby
site in the Koa Valley, on gravel deposits similar to that of Galputs, has
indicated an average grade of about 3 carats per hundred tons, with reports of
exceptionally rich areas reaching grades of 70 carats per hundred tons.

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 page 31 

Production
  by Galputs Minerale commenced in March 2002 and processing increased in August
  2002, resulting in an estimated mining rate of about 14 000 tonnes of gravel
  and 42 000 tonnes of waste overburden per month. Mining was hampered by a hard
  layer of silcrete overlying the gravel and excessive groundwater found in certain
  areas. The largest stone recovered during prospecting in 2002 was 17.5 carats,
  the average stone size for the period June to August 2002 was 0.98 carats and
  the average selling price since March 2002 has been US$388. An estimation of
  the potential gravel resource contained within the Galputs licence area was
  completed in 2002. Note that the above observations are based on historic data
  alone and do not constitute a mineral resource under the terms of Canadian National
  Instrument 43-101. As such work to date is exploratory in nature and should
  be construed as such. In compliance with US SEC Industry Guide 7 Section (b)(4)(i),
  this property does not have a declarable mineral resource.

Geology

The geology of the region comprises granite gneiss rocks of the
Gladkop Metamorphic Suite. These are Proterozoic basement sequences of the
Bushmanland Metamorphic Complex which yield ages of about 1,300 million years.
Locally, as in the Koa River Valley, ancient drainages are found with sequences
of diamondiferous gravel deposits. Diamonds found in the Koa Valley were
deposited during the transport of vast amounts of material eroded from
kimberlite pipes and fissures situated in the hinterland, to the Atlantic coast
during the Tertiary (65 to 2 Ma). Regionally the cover deposits are extensive
wind blown sequences of Quarternary age.

Diamonds are found in the alluvial gravel successions that have
been exposed in a series of large pans, which are represented by large flat
depressions typically about 1 to 2 km in length, and 200 to 500 m in width
located along the palaeo-Koa River drainage. The gravel deposits are located on
the granite gneiss basement and comprise a thin horizon varying in thickness
from a few centimetres to about 1 metre in places. The gravel layer is overlain
by coarse silty sandstones, which in places is lithified to a hard silcrete and
sand.

The rock assemblages comprising the gravels are mainly quartz
and quartzite pebbles with minor amounts of banded ironstone, epidote and
jasper. Abundant garnet and ilmenite are present in heavy mineral concentrate.
Cobbles and boulders are dominantly granitic in composition and are frequently
highly weathered.

The Galputs Pan comprises three interleading pan-shaped
features: the Northern Pan and Neck Area, the Main or Central Pan and the
Southern Pan.

Diamond mineralization in the Galputs deposit is primarily
confined to the extensive basal gravel sequence that occurs immediately above
the granite-gneiss basement that underlies the Galputs Pan. Silcretes which
overlie the well developed gravel horizon at Galputs also contain clasts and
gravel fragments in places and it is possible that they could be diamond
bearing.

Exploration and Trial Mining

Exploration by Galputs Minerale comprised a drilling programme
along lines 500 m apart over selected areas and construction of simple 3D models
for these areas. Galputs Minerale also undertook prospecting by means of
excavation and processing of gravels to recover diamonds so that estimates could
be made of in-situ grades. Prospecting work was undertaken in the Central or
Main Pan, the Northern Pan and the Neck area, Gravels remaining in areas
previously mined were also delineated, excavated and mined, and tailings
material which still contained a high proportion of clasts was also retreated.
Final diamond recovery was by concentration in a Plietz jig at different size
fractions (typically 1.5 mm, 4-8 mm, 8-16 mm, and +16 mm), after which the
different concentrates were hand sorted.

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 page 32 

Results of the trial mining work indicate a consistent
distribution of diamonds across the pan and show that the gravel sequences
produce consistently high value gem diamonds. Results produced by Galputs
Minerale are compatible with previous prospecting results obtained at Galputs by
other operators.

A total of 139 percussion boreholes have been drilled along
lines 500 m apart and with hole spacing 20 m apart over a localized portion of
the deposit; 67 holes of these holes intersected gravel in the Northern Pan and
Neck Area, and the Main Pan, and Southern Pan. The work was done by Mine Track
Solutions and indicated that the gravel deposit was relatively intact and
prospective in the Northern Pan and the neck Area between the Northern and Main
Pans. Computer modelling of the drill results was carried out to make an initial
estimate of resources volumes and tonnages.

Based on a
  drilling programme and computer modelling by Van Breda (2004), a number of observations
  with respect to the diamondiferous gravels at the Galputs Project may been made.
  The reader is advised that the following observations are based on historic
  data alone and do not constitute a mineral resource under the terms of Canadian
  National Instrument 43-101. As such work to date is exploratory in nature and
  should be construed as such:

Northern
  Pan and Neck Area - Van Breda (2004) proposed a gravel body of approximately
  510,000 tonnes this portion of the deposit.

Main and
  South Pans – Van Breda (2004) gave an estimate of 82,800 tonnes for
  the Main Pan, with further gravels covered by silcretes which he notes could
  yield diamonds as well. No drilling was undertaken on the South Pan, though
  excavations from previous prospecting operations indicate the presence of gravel
  horizons in this area.

Tailings
  Heaps - Van Breda (2004) contended that the large tailings heaps located
  on Galputs which are known to contain diamonds.

Based on estimates
  of Cooke (2002a) and selective drilling and resource delineation undertaken
  by Mine Track Solutions on behalf of Durnpike, it is reasonable to assume there
  is a gravel volume of between 700,000 and 2.1 million tonnes. Note that this
  does not constitute a mineral resource under the terms of Canadian National
  Instrument 43-101.

Planned Program

A budget has been constructed which will allow the Galputs
deposit to be tested systematically by trial mining at an initial scale of about
25,000 tonnes per month with the ability to rapidly expand this to about 50,000
tonnes per month.

In terms of diamond mining operations the South African
government receives a 5% state royalty from diamond revenues, while South
African company tax is 29%. A 5% royalty is paid to the farmer after deduction
of the State royalty.

A budget of CDN$ 1.7 million is proposed for further
exploration and trial mining operations.

Description
    Amount (CDN$)Reverse Circulation drilling programme, 3D modelling,
      Resource delineation
    60,000Purchase of excavator
    430,000Purchase of front end loader
    200,000Purchase of 2 articulated dump trucks
    430,000Construction and purchase of rotary pan metallurgical
      treatment plant
    100,000Construction and purchase of mobile X-ray Flow-sort final
      diamond recovery
    480,000


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 page 33 

Properties in the Democratic Republic of
Congo

The Kwango River Project

Location and Access

The property is located on the Kwango River in the Bandundu
Province of southeastern Democratic Republic of Congo (DRC) (Figure 2).

Figure 2 Location of
Kwango River Property

Roads in the DRC are passable for the purposes of moving heavy
equipment associated with project startup. The countrys aging railway
infrastructure provides important connections domestically as well as

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 page 34 

with the Angolan port of Luanda and with southern Africa. Daily
flights are available between Kinshasa and Tembo.

Cell phone signals can be picked up from Mawangu, the village 5
km from the Midamines campsite on top of the plateau. At present, satellite
technology represents the only viable option for the communication of voice and
data outside the project area.

The project area is also accessible via Angola, through the
town of Malange, about 250 km south-southwest from Tembo. Luanda lies a further
400 km to the west and could be used as port of disembarkation for the
equipment.

The countrys regional climate is tropical to sub-tropical.
While annual average rainfall is in the order of 1,300 mm in the south, it is
nevertheless possible to work in the river for most of the year, which Midamines
have reportedly done in the nineties. The Kwango River is navigable by light
vessel for the full length of the Kwango Project area. During the dry season the
river level drops considerably and water flow ceases altogether, leading to the
exposure of sandbars.

Property Description

The Kwango River Project encompasses over 75 km of river
frontage and also extends across elevated, palaeo-river terraces. Alluvial
diamond deposits occur as gravel assemblages within the modern Kwango River,
underlying its banks and in the adjacent terraces.

The Kwango
  River Project in the Democratic Republic of the Congo comprising approximately
  109 square km within Exploitation Permit Number 331 ("PPE331") held
  by Midamines SPRL ("Midamines"), a company incorporated, and operating,
  in the Democratic Republic of the Congo. Durnpike has an agreement with Midamines
  to manage and carry out exploration and mining on a portion of PPE331, as contractor
  for and on behalf of Midamines, and is entitled to an 80% share of the net revenue
  from the sale of any diamonds produced from the contract area. PPE 331, issued
  in December 2003, is valid until January 2017 (and is renewable for a second
  term) and allows the holder to conduct exploration, develop and exploit the
  deposit as well as market the diamonds produced from the deposit according to
  local government requirements and the Kimberley process.

History

Subsequent to the discovery of the rich West Kasai diamond
fields in the DRC in 1907, other diamond bearing deposits were noted in
south-west DRC along the Kwango (also spelled Cuango) River and extensive
exploration work was undertaken in the region during the 1950s. Reports state
that the results of washing gravels about 25km south of the Tembo Falls brought
immediate results of 81 diamonds weighing 9.42 carats. Following good results
in Angola, prospecting by the company Forminiere took place of the recent
fluvial deposits between the Franz-Jozef and Tembo Falls. The conclusion from
that work was that the primary origin of the Kwango diamonds lies upstream of
the Cuango-Quissema confluence. In 1961, another investigation of the region
between Tembo and Franz-Jozef Falls confirmed the earlier work of 1959: the
presence of potholes and gullies with locally important concentrations of
diamonds. The difference between the Angolan and DRC diamonds are in their size:
in DRC the average is between 10 and 20 stones per carat and in Angola between 1
and 10 stones per carat.

Due to the vast numbers of diamonds and easy mining conditions
encountered in the West Kasai deposits, emphasis on exploitation of diamonds in
the DRC has remained focussed on this area, with areas such as those noted along
the Kwango River that have been subjected only to artisanal mining.

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 page 35 

Since the implementation of political changes in the DRC, the
new Minerals Act of 2003, and the implementation of the Kimberley Process to
which the DRC is a signatory, diamond production has grown steadily.

Midamines has been active in the Kwango River since the mid
nineties. This appears to have been the first mining operations to have been
undertaken in the Kwango Valley from the DRC. The results of their earlier work
are not known. No activity is recorded from the Angolan side of the river in
this part of the Kwango River, despite the good results achieved further
upstream at Luzamba and Luremo.

The river deposits are currently being mined using small
dredges, and the river bank and terraces are being mined by small scale
excavations. The Government Valuator in Kinshasa has valued parcels of diamonds
from recent small scale mining on the property in the range of US$85 to US$110
per carat. The recoveries from both sources are 0.15 to 0.2 carats per 30 kg
samples.

Midamines has not maintained precise production records of and
no other reports are available to give an indication of the size of the diamond
resource along the Kwango River. However since the commencement of the project
the author is aware that Midamines produced a parcel of diamonds in the order of
2,700 carats in September 2005 which attracted average sales prices of US$115 to
$125 when marketed in Antwerp.

Aproximately 84% of the diamonds produced by Midamines are gem
diamonds and only about 6% classify as industrials and rejects. Of the gem
population, a significant 34% classify as sawables, and 60% classify as
makables. Typically, diamonds recovered from the Kwango River comprise a well
sorted population of stones, with an average size of approximately 0.25 carats
per stone.

Geology

The project area lies in the broad valley cut by the Kwango
River into the Cretaceous Kwango Formation conglomerates, sandstones and
siltstones. These rocks are the equivalent of the diamondiferous Calonda
Formation in Angola. The Calonda Formation is considered to be a prime source of
the secondary diamond deposits that are mined in recent drainage systems as for
example diamonds being mined at Luzamba and elsewhere along the Cuango and Lui
Rivers in Angola, which both lead into the Kwango River to the north.

The Kwango Formation is generally covered by younger Quaternary
age sediments of the barren Kalahari Formation. The sequence forms low rolling
hills that terminate in a plateau that lies about 150 m above the river.

The bedrock is granitic gneiss, displaying potholes and gullies
exhibiting extremely high diamond trapping potential. Extensive indurated,
closely-packed diamondiferous gravel was observed in these potholes and gullies.
The gravel lies below 5 to 10 m of overburden that consists of well-sorted buff
to reddish-brown sand, interfingered with silty to clayey sand.

Extensive raised terrace deposits are found adjacent to the
modern river system,, formed in an earlier geological period when the base level
of the river valley was at a higher elevation. The significance of the terrace
deposits are that they may be indurated Kwango Formation and therefore present a
different metallurgical challenge for their exploitation.

It is apparent that the basal gravel units should be targeted
as a potential source of alluvial diamonds. Funnelling of the stream flow
prevents the deposition of fine sediments. Under suitable conditions and
resistant lithologies, the higher flow rates generated would create potholes,
gullies and other irregularities

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 page 36 

in the bedrock that would act as trapsites for diamonds.
Because of their high specific gravity and small size, the diamonds would
quickly settle to the bottom and be covered (and consequently protected) by
cobbles, pebbles and boulders. This process would continually add diamonds to
the same trapsites, thereby enriching the grade of the basal deposits.

Planned Program

A preliminary budget scenario has been compiled for the Kwango
project based on the observations of manufacturing companies including Marine
and Mineral Projects (Pty) Limited and ADP Projects (Pty) Limited, of Cape
Town, South Africa, both with extensive experience of operating conditions in
Angola and the DRC. The scenario is very preliminary in nature and is intended
as a guide for initial financial planning. No members of personnel from either
of the above companies have visited the project area or examined the project
data and no exclusive planning or feasibility study has been undertaken.

A CDN$ 7.9 million provisional budget for the initial
exploration work and bulk sampling program is:

Description
    Amount (CDN$)Desk top geological studies, resource delineation, 3D
      modeling, field vehicles, site surveys
    200,000Establishment of operational infrastructure
    100,000Purchase of rotary pan plant and X-ray flowsort final
      recovery unit
    1,300,000Purchase of Earth moving equipment
    2,700,000Logistics, road construction and site infrastructure
    2,200,000Fuel
    1,400,000


Ricardo Property, Chile

On March 2, 1998, Rockwell received final approval from the TSX
Venture Exchange to acquire 100% of the issued and outstanding shares of Minera
Ricardo Resources Inc. S.A. (Ricardo), in exchange for 22,400,000 shares of
Rockwell. Rockwell subsequently transferred a 0.1% interest in Ricardo to 549949
BC Ltd., Rockwells wholly-owned British Columbia subsidiary. Ricardo is the
owner of 66 exploration and exploitation mining concessions covering an area of
approximately 162.5 square km immediately south of the City of Calama, Chile
(the Ricardo Property).

The Ricardo Property was purchased from Mesquite Resources LLC.
Ricardo is the legal owner of the exploration and exploitation concessions
comprising the Ricardo Property. Pursuant to Chilean mining law the grant of
mining concessions provides the holder with the rights to the mineral substances
within a concession but not the surface rights. Concession holders are initially
granted exploration concessions having a two-year term and are required to pay
annual taxes to keep the concession in good standing. Subject to being able to
apply to have one-half of an exploration concession renewed for a further two
years an exploration concession holder must, prior to the end of the initial two
year term, apply to convert the exploration concession to an exploitation
concession and as part of such process cause the concession to be surveyed.
Exploration concessions and exploitation concessions are subject to forfeiture
in the event the holder fails to pay annual taxes. Rockwell has received a legal
opinion from Chilean legal counsel confirming that Ricardo has good title to the
Ricardo Property.

Chile  Economic and Political Climate

The following discussion represents managements understanding
based on discussions with its personnel and consultants in Chile. In 1989 Chile
completed the transition from a military government to democracy with Christian
Democrat Party leader Patricio Alwyn taking office as President in March 1990
after winning

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 page 37 

a majority in nationwide elections held in December 1989. A
second democratic election held in December 1993 resulted in the government led
by President Eduardo Frei. In March 2000, Ricardo Lagos was elected as President
of Chile.

Mining has historically been a significant factor in the
Chilean economy. Given the history of mining in the country, management believes
that Chile has the infrastructure and trained personnel required for modern
mining operations.

Management believes that the labor situation in Chile is
currently relatively stable, with a low incidence of strike action, particularly
in the private sector.

There are currently no significant restrictions on the
repatriation from Chile of earnings to foreign entities. Foreign entities have
the right to repatriate from Chile their earnings after payment of all Chilean
tax, including a tax on the amount of earnings distributed to foreign persons by
way of a dividend. Chile does not currently have a tax treaty with the United
States.

Location and Access

The Ricardo mineral property is located immediately south of
the City of Calama, Chile at elevations of 2,400 to 2,600 meters. The area is
accessed by Highway 25 from the port city of Antofagasta, located 205 kilometers
to the southwest (Figure 3).

Figure 3. Ricardo
Property, General Location Map

The Corporación Nacional del Cobre de Chile (Codelco), the
Chilean national copper company, is currently erecting housing and other
infrastructure, as part of a relocation of its workers for its Chuquicamata
project, in certain areas of the Ricardo Property. Rockwell believes this
construction usurps Ricardo's constitutional mining rights. Accordingly, in
order to preserve access to its mineral

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 page 38 

concessions, in November 2002 Ricardo applied for several
easements on its Ricardo Property to prevent Codelco from further developing its
construction project over Ricardo's mining rights. On June 28, 2006, the
application for the easements was denied by the Supreme Court of Chile.

Figure 4 below illustrates the exploration and exploitation
concessions controlled by Ricardo, covering an area of approximately 16,250
hectares:

Figure 4. Ricardo mining
claims

The following is summarized from company files and reports.

Exploration Programs to Date

In 1988, Dr. Richard Baker and Jay Fuller acquired control of
the Ricardo Property. A series of geological and geophysical programs, including
limited drilling, were subsequently carried out on the property.

In July-December, 1991, Codelco drilled 10 vertical rotary
holes and one vertical diamond drill hole in the western portion of the Ricardo
concession area. Total depths of the 11 drill holes ranged from 167 to 606
meters. Five of the holes of the program failed to penetrate bedrock. Spot core
and rotary hole samples of alluvial material contained erratic anomalous copper
and zinc values. In February 1992, Codelco terminated its agreement with
Ricardo.

Freeport McMoRan Copper Company (Freeport) executed an Option
to Purchase Agreement with Ricardo in 1992 and commenced a drilling program in
early 1993. During the period January 1993 through May 1994, a total of 5,095
meters were drilled in one diamond core and 13 rotary holes with spot coring.
Six of the 11 Freeport holes that may have been drilled to bedrock encountered
steep fault zones at their bottoms. Two of the other five holes were logged as
having drilled into barren bedrock. A number of Freeport drill

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 page 39 

hole samples contained anomalous copper and zinc values.
Detailed descriptions of Freeport drill hole RF-6 refers to bedrock as
consisting of leached capping composed of sheared, oxidized and leached,
intensely altered, coarse-grained porphyry as evidenced by rotary hole cuttings
commencing at 138 meters and continuing to about 428 meters. This is an
impressive thickness of alteration, although the fragments may be extraneous
material within a thick section of fault gouge penetrated by the drill hole. If
the cuttings are truly representative of bedrock, the area warrants additional
drilling. It is also significant that the relatively shallow bedrock surface in
RF-6 (138 meters) may indicate a buried topographic high related to a leached,
and possibly mineralized, porphyry body.

Freeport contracted two geophysical studies in 1993 including
compilation of a composite gravity map. The gravity study report describes a
major structure striking northwest-southeast immediately north of the Ricardo
mineral holdings. Gravity, magnetic and very low frequency-electromagnetic
(VLF-EM) geophysical surveys, conducted on the property in July 1993, were
designed to delineate structural trends and to identify areas of shallow bedrock
occurrences on the Ricardo property.

In 1995, owners of the property negotiated an exploration
agreement with International Nickel Company Limited (INCO) who drilled a total
of 12 holes in two stages during its evaluation. The first six holes drilled by
INCO consisted of four, reverse-circulation rotary drill holes targeting gravity
highs to the southwest, and two holes in the area drilled by Freeport in the
eastern portion of the property. The holes ranged in depth from 268 to 448
meters. None of the holes penetrated bedrock.

The second phase of the INCO drilling program also consisted of
six holes, five angled and one vertical combination, of rotary plus coring. All
six were drilled approximately two to three kilometers east of Calama to test
irregular areas of high resistivity. Four of the holes penetrated faulted
andesitic volcanics, one hole intersected a short section of monzonite, and the
sixth hole encountered clay-altered granite cut by quartz veins. A sample of the
upper portion of the granite section contained a high molybdenum/copper
ratio.

INCO contracted induced polarization (IP) and continuous
magnetotelluric surveys to be conducted on the Ricardo property during the term
of its exploration agreement. The caliche cover also complicated a continuous
magnetotelluric survey, however, the contractor concluded that the survey
successfully determined the thickness of the gravels and detected extensions of
the West Fissure. INCO did not follow up any of the encouraging geophysical
results with drilling as it terminated the agreement with Ricardo in 1996.

In February 2000, Rockwell entered into a letter of intent (the
Letter of Intent) for an option to purchase agreement on its Ricardo Property
with Empresa Minera de Mantos Blancos S.A. (Mantos Blancos), a subsidiary of
Anglo-American PLC, and Ricardo, by then a wholly owned subsidiary of Rockwell.
In July 2000, Mantos Blancos terminated its Option to Purchase Agreement on the
Ricardo Property after having completed a 16-drill hole program on a small
section of the Property to depths of up to 250 meters.

In January 2004, Ricardo signed a Letter of Understanding with
Rio Tinto Mining and Exploration Ltd. (Rio Tinto), which contemplated the
acquisition by Rio Tinto of a 100% interest in a majority of the claims which
make up the Ricardo Property. From April to June 2004, Rio Tinto carried out an
exploration program at Ricardo comprising 8 vertical drill holes, totaling 2,296
meters, drilled by reverse circulation or part reverse circulation and part core
rigs. The seventh hole was drilled within the West Fault Zone to test the
possible southwestward extension of an altered intrusion hosting pyritic
mineralization that had been intersected in a previous hole by INCO. It tested a
horst block between the east and west faults within the West Fault system, and
intersected unaltered Paleozoic rocks. Although Rio Tinto concluded that the
alteration system was closed off by the hole, there may be further potential in
this area.

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 page 40 

Geophysicists from Zonge, a geophysical contractor, conducted a
review of existing IP and analogue magnetotelluric (AMT) geophysical images and
processed data, and where available, raw data for Rio Tinto to detect
mineralized or altered zones beneath the thick gravel cover. Rio Tinto concluded
that none of the areas warranted further drilling, although targets associated
with the West Fissure Zone remained. In January 2005, Rio Tinto terminated its
Letter of Understanding with Rockwell.

Geology

The Ricardo Property is situated within the Precordillera of
Northern Chile, over a major north-south striking complex zone, locally known as
the West Fault system or West Fissure. The oldest units in the area are
Paleozoic metamorphosed sedimentary and intrusive rocks; intrusions are
associated with copper occurrences. Triassic sedimentary rocks, and rhyolitic to
andesitic volcanic rocks overlie the Paleozoic sedimentary and intrusive rocks.
From drill hole information, it has been determined that volcanic rocks of
dacite composition are the dominant rock type to the east of the West Fault
system in the Ricardo area. These units are overlain by Jurassic and Lower
Cretaceous sedimentary rocks, then Upper Cretaceous sediments with intercalated
volcanic units. In the Ricardo area, the main unit is Lower Cretaceous
porphyritic andesite, with intercalated dacites and andesitic breccias.
Chuquicamata Porphyry Complex, Toki Cluster and Opache Porphyry and other
intrusions in this area are of Eocene and Oligocene age. The sequence was also
uplifted and eroded, forming alluvial fan and fluvial sedimentary deposits known
in the area as the Calama Formation. These units are covered by Miocene clays,
limestones and gravels in the Ricardo area. There is no outcrop on the
property.

Sampling Method and Approach

Seven drilling campaigns have been completed. For details of
the sampling procedures see Rockwells Form on 20F for 2005.

Plan of Operation

Drilling programs have tested a number of areas on the Ricardo
Property. However, Rockwell believes that a significant potential remains in
along the West Fault system in the central part of the property.

A drilling program, consisting of a minimum of four to six
angled holes, totaling 2,000 meters, along two east-west lines across the West
Fault are proposed to fully test this area. The program would cost approximately
US$270,000. Rockwell has deferred further work at Ricardo, while it focuses on
its alluvial diamond properties.

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 page 41 

British Columbia Properties

In November 2004, Rockwell entered into a Farmout Agreement
with Amarc Resources Ltd. (Amarc), a company related by virtue of certain
directors in common. Pursuant to the agreement with Amarc, Rockwell had to incur
$600,000 in exploration expenditures to earn up to 50% interests in the Crystal
and Hook projects located in the Cariboo region of British Columbia, and in the
M3, M4, M5, Tsil and Kalder projects located in the Prince George region of
British Columbia. The companies could then either form a joint venture to
jointly fund further exploration on the projects, or Amarc could purchase all or
any of Rockwell's earned interests in the projects for the fair value of those
interests in cash or shares, as valued at the time of acquisition. In December
2004, Rockwell earned its 50% interests in these properties, but these interests
were allowed to lapse during the 2006 fiscal year.

Crystal is located 30 kilometers from 100 Mile House and Hook
is near the town of Likely. Preliminary ground surveys, consisting of geological
mapping, geochemical sampling and geophysical surveys, were carried out by Amarc
prior to the Amarc/Rockwell agreement. Reconnaissance drilling performed under
the Amarc/Rockwell agreement on the Crystal property yielded negative results
and the property was allowed to lapse. Reconnaissance drilling on the Hook
property also yielded negative results, and the Hook property was subsequently
vended to Wildrose Resources Ltd., a company holding adjoining claims to the
property, in consideration for Wildrose paying for the filing of assessment work
and submitting a report to Amarc and Rockwell on the exploration potential of
the consolidated claim group. Amarc and Rockwell had an exclusive right for 45
days after receipt of the report to acquire an option to purchase an interest in
the consolidated claim group, but this right was allowed to lapse during the
2006 fiscal year.

The M3 to M5 properties, located north of Prince George, were
staked by Amarc in 2004. Preliminary geophysics was carried out on M3 and M4 by
Amarc. The Tsil and Kalder properties are located north of Fort St James. Amarc
carried out preliminary geophysical surveys prior to the Amarc/Rockwell
agreement. A number of anomalies were identified and tested by a total of eight
drill holes in early 2005. An evaluation of these results was completed and the
results did not warrant further exploration by Rockwell. Rockwell held these
properties on assessment credits for the purpose of reviewing their potential
for joint venture status, but they were allowed to lapse during the 2006 fiscal
year.

---

 page 42 

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

The following discussion and analysis of Rockwells financial
condition and results of operations for the three years ended May 31, 2006
should be read in conjunction with the Companys consolidated financial
statements and related notes included in this annual report. The consolidated
financial statements included in this annual report were prepared in accordance
with Cdn GAAP. For a reconciliation of the consolidated financial statements to
US GAAP, see note 11 to the consolidated financial statements.

Overview

Rockwell is an exploration stage company whose operating
history has been restricted to the acquisition and exploration of properties for
mineral deposits. It has not earned any revenues to date. In management's
opinion, given that the nature of the Company's business, meaningful financial
information consists primarily of the Company's liquidity and solvency.

Going Concern

Rockwells consolidated financial statements are prepared on
the basis that it will continue operations as a going concern. However, the
Company has no revenues and has incurred operating losses since inception. The
ability for the Company to continue as a going concern depends on its ability to
develop profitable operations and to continue to raise adequate financing to
fund exploration activities on its properties. There can be no assurance that
the Company will be able to secure the necessary financial resources, nor
achieve profitability or positive cash flows. If the Company is unable to obtain
adequate additional financing, it will be required to curtail its operations and
exploration activities. Furthermore, failure to continue as a going concern may
result in the Company not being able to realize the carrying value of its
projects and could result in potential losses to the Companys shareholders.
Failure to continue as a going concern would require that the Company's assets
and liabilities be restated on a liquidation basis, which would differ
significantly from the going concern basis.

Critical Accounting Policies

Rockwells consolidated financial statements are prepared in
accordance with Cdn GAAP and reconciled to US GAAP. Amounts are presented in
Canadian dollars unless otherwise indicated. Canadian GAAP requires management
to make estimates and assumptions that affect the reported amounts of revenues
and expenses during the reporting period. Significant areas requiring the use of
management estimates relate to the impairment of mineral property interests,
determination of asset retirement obligations and the assumptions used in
determining stock-based compensation expense. The Company bases its estimates on
historical experience and other assumptions that it believes are reasonable in
the circumstances. Actual results may differ from these estimates. During the
fiscal period ended May 31, 2006, the Company did not adopt any new accounting
policy that would have a material impact on the consolidated financial
statements, nor did it make changes to existing accounting policies.

The following critical accounting policies affect the Companys
more significant estimates and assumptions used in preparing its consolidated
financial statements:

---

 page 43 

|(a) | Mineral property
interests
|--- | --------------------------

Under Canadian GAAP, the acquisition costs of mineral
properties are deferred until the property is placed into production, sold, or
abandoned, or when management has determined that there has been an impairment
in value. Acquisition costs which have been deferred will be amortized on a
unit-of-production basis, over the estimated useful life of the related property
following the commencement of production, or written off if the property is
sold, allowed to lapse or abandoned, or written down to fair value when an
impairment has been determined to have occurred.

Mineral property acquisition costs include the cash
consideration and the fair market value of common shares, based on the trading
price of the shares, on the date of issue or as otherwise provided under the
agreed terms for the mineral property interest.

Exploration costs are expensed in the period incurred.
Recoveries are recorded in the period received.

Administrative expenditures are expensed in the period
incurred.

The Company reviews its long-lived assets for impairment
whenever events or changes in circumstances indicate that the carrying value of
an asset may not be recoverable.

In March 2004, the Emerging Issues Task Forces (EITF) reached
a consensus that mineral interests covered by leases should be considered
tangible assets. On April 30, 2004, the FASB issued a FASB Staff Position
(FSP) amending SFAS 141 and SFAS 142, Goodwill and Other Intangible Assets,
to provide that certain mineral use rights are considered tangible assets and
that mineral use rights should be accounted based on their substance. The FSP is
effective for the first reporting period beginning after April 29, 2005, with
early adoption permitted.

In March 2004, in its report on Mining Assets: Impairment and
Business Combinations the EITF reached a consensus that an entity should
include the cash flows associated with value beyond proven and probable reserves
in estimates of future cash flows (both undiscounted and discounted) used for
determining whether a mining asset is impaired under Statement No. 144,
Accounting for the Impairment or Disposal of Long-Lived Assets.

Under U.S. GAAP, the recoverability of capitalized mineral
properties exploration expenditures are generally considered insupportable until
a commercially mineable deposit is determined; therefore, all mineral properties
exploration expenditures are expensed as incurred. As the Company does not have
reports on proven and probable reserves on any of its mineral properties, all
exploration expenditures incurred, other than its acquisition costs, and its
other mineral properties have been expensed as incurred.

|(b) | Asset retirement
  obligations
|--- | ------------------------------

The Company records the fair value of an asset retirement
obligation as a liability in the period in which it incurs a legal obligation
associated with the retirement of tangible long-lived assets that result from
the acquisition, construction, development, and/or normal use of the long-lived
assets. The Company also records a corresponding asset which is amortized over
the life of the asset. Subsequent to the initial measurement of the asset
retirement obligation, the obligation is adjusted at the end of each period to
reflect the passage of time (accretion expense) and changes in the estimated
future cash flows underlying the obligation (asset retirement cost).

---

 page 44 

Under United States GAAP, Statement of Financial Accounting
Standards No. 143, "Accounting for Asset Retirement Obligations" ("SFAS 143")
requires companies to record the fair value of the liability for closure and
removal costs associated with the legal obligation upon retirement or removal of
any tangible longlived asset, effective for years beginning on or after January
1, 2003. Under this standard, the initial recognition of the liability is
capitalized as part of the asset cost and depreciated over its estimated useful
life. The Company has determined that there were no asset retirement obligations
as at May 31, 2006.

For Canadian GAAP purposes, effective June 1, 2004, the Company
adopted the provisions of CICA Handbook Section 3110 (HB3110). HB3110 requires
essentially the same accounting treatment of asset retirement obligations as
SFAS 143. Consequently, the Company believes there is no difference in asset
retirement obligations under United States GAAP and Canadian GAAP for the
Company upon the adoption of this standard, and there is no effect on amounts
previously reported.

The Company has determined that there are no material
differences in the measurement and presentation of asset retirement obligations
between Cdn GAAP and US GAAP as at May 31, 2006 and 2005.

|(c) | Marketable
securities
|--- | ---------------------

Under Canadian GAAP, short-term marketable securities are
carried at the lower of aggregate cost or current market value, with any
unrealized loss included in the statements of operations. Long-term investments
are carried on the cost or equity basis and are only written down when there is
evidence of a decline in value that is other than temporary.

Under US GAAP, Statement of Financial Accounting Standard No.
115, Accounting for Certain Investments in Debt and Equity Securities (SFAS
115) requires that certain equity investments must be classified into
available-for-sale or trading securities and carried at fair market value. Any
unrealized holding gains or losses are reported as a separate component of
shareholders equity until realized for available-for-sale securities, and
included in earnings for trading securities. Under SFAS 115, for the years ended
May 31, 2006, 2005 and 2004 the Companys investments in marketable securities
would be classified as trading securities and there is no difference between
Canadian GAAP and US GAAP.

|A. | Results of Operations
|-- | ---------------------

Rockwells annual and quarterly operating results are primarily
affected by the level of exploration activity associated with its mineral
property interests. Economic factors such as foreign exchange fluctuations,
mineral prices and regulatory development may also affect the Companys
operating results and the volatility of the trading price of its common stock.
To managements knowledge, there are no governmental, economic, fiscal, monetary
or political policies or factors that have materially affected, or could
materially affect, directly or indirectly, the Companys operations or
investments by the Companys U.S. shareholders. Inflationary factors have not
had a material impact on the Companys operating results for fiscal 2006, 2005
or 2004. The Companys results of operations are summarized below:

---

 page 45 

|                                                                                                                                                                                                                                                                                                                 | Year ended May 31
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -----------------
|                                                                                                                                                                                                                                                                                                                 | 2006             
|EXPENSES Exploration Foreign exchange loss
      (gain) Legal, accounting and audit Office and administration
      Property Investigation Shareholder communications Stock-based
      compensation  administration Stock-based compensation  exploration
      Travel and conferences Transfer agent filings | $                
|TOTAL EXPENSES                                                                                                                                                                                                                                                                                                   |                  
|Interest
      income Gain on sale of marketable securities Write-down of mineral
      property interests Write-down of marketable securities                                                                                                                                                                   |                  
|LOSS FOR THE PERIOD                                                                                                                                                                                                                                                                                              | $                

Year ended May 31, 2006 (fiscal 2006) versus year ended
May 31, 2005 (fiscal 2005)

The Company had a net loss of $1,600,673 for the 2006 fiscal
year compared to a net loss of $1,485,694 for the previous year. The increase in
net loss is primarily due to increased expenses in property investigation,
travel and conference expenses and stock based compensation. This increase was
offset by decreases in exploration expenses (2006  $307,390; 2005 
$920,902).

Exploration expenses (excluding stock-based compensation)
decreased to $307,390 in fiscal 2006 compared to $920,902 in fiscal 2005. This
decrease is due to the termination of exploration activities at the Royce
Diamond property and various British Columbia properties due to insufficient
results to warrant further exploration.

Foreign exchange gains increased to $46,881 in fiscal 2006
compared to a foreign exchange loss of $3,105 in fiscal 2005. Administrative
costs for fiscal 2006 increased to $489,014 in comparison to $285,618 incurred
in fiscal 2005, primarily due to increased consulting and salary expenses
related to the evaluation of properties for acquisition and exploration.

Property investigation expenses (2006  $399,006; 2005  $nil)
and travel and conference expenses (2006  $132,647; 2005  $30,293) increased
for the fiscal year 2006 compared to fiscal 2005 as the Company continued to
evaluate properties for acquisition and exploration.

Legal, accounting and audit expenses for fiscal 2006 increased
to $175,782 in comparison to the $80,078 incurred in fiscal 2005, the increase
is primarily related to the evaluation of properties for acquisition.

---

 page 46 

Write-down of marketable securities decreased to $19,128 in
fiscal 2006 from $135,486 in fiscal 2005 due to the decline in the value of
Taseko Mines Limited common shares in early fiscal 2006 and the Comwest warrants
held by the Company as marketable securities. The Taseko Mines Limited shares
were sold during the year for a gain of $55,340.

The Company recorded a write-down of mineral property interests
of $46,856 in fiscal 2006 due to the Companys application for easements on the
Companys Minera Ricardo property being denied by the Chilean law courts.

Stock-based compensation increased to $83,516 in fiscal 2006
from $11,513 in fiscal 2005 due to an increase in the number of options granted
during fiscal 2006 (486,250) compared to fiscal 2005 (30,000). Interest income
decreased to $2,172 for the fiscal 2006, compared to $17,854 for the fiscal 2005
due to lower cash balances on hand.

Related Party Transactions  Fiscal 2006

Hunter Dickinson Inc. (HDI) is a private company with certain
directors in common with the Company that carries out investor relations,
geological, corporate development, administrative and other management services
for, and incurs third party costs on behalf of the Company, on a full
cost-recovery basis.

Costs for services rendered by HDI to the Company increased to
$578,134 in fiscal 2006, compared to $163,317 in fiscal 2005 due to an increase
in administrative activities.

During fiscal 2006, the Company paid nil compared to $1,060 in
fiscal 2005 to Gordon J. Fretwell Law Corporation, a private company controlled
by a former director of the Company, for legal services.

During the year ended May 31, 2006, the Company paid $18,630
(2005  $16,164) to Euro-American Capital Corporation, a private company
controlled by a director of the Company.

Year ended May 31, 2005 (fiscal 2005) versus year ended
May 31, 2004 (fiscal 2004)

The loss for fiscal 2005 increased to $1,485,694 from
$1,396,018 in the previous year due to an increase in exploration expenses and a
write down of marketable securities. This loss was partially offset by a
decrease in stock-based compensation in fiscal 2005.

Exploration expenses (excluding exploration-related stock-based
compensation) were $920,902 in fiscal 2005 compared to $525,619 in fiscal 2004.
The exploration expenses incurred in fiscal 2005 consisted mainly of $600,000 on
the British Columbia properties pursuant to the Companys farmout agreement with
Amarc Resources Ltd., and $279,300 on the Ricardo Property. Exploration expenses
incurred in fiscal 2004 were $752,897 for the Royce Claims, which was
subsequently terminated, $272,470 on the Ricardo Property, and $200,000 in
drilling expenses pursuant to the Companys farmout agreement with Taseko Mines
Limited. Exploration expenses in fiscal 2004 were offset by a recovery of
$480,500 and proceeds of $220,000 on the disposal of the interest earned
pursuant to the farmout agreement with Taseko Mines Limited.

Write-down of marketable securities increased to $135,486 in
fiscal 2005 from $25,000 in fiscal 2004 due to the decline in the value of
Taseko Mines Limited common shares held by the Company as marketable securities.
Stock-based compensation decreased to $11,513 in fiscal 2005 from $445,020 in
fiscal 2004

---

 page 47 

due to a decrease in the number of options granted during
fiscal 2005 (120,000) compared to fiscal 2004 (5,065,500).

|B. | Liquidity and Capital
Resources
|-- | -------------------------------

Overview

Historically, the Company's sole source of funding has been the
issuance of equity securities for cash, primarily through private placements to
sophisticated investors and institutions. The Company has issued common share
capital in each of the past few years, pursuant to private placement financings
and the exercise of warrants and options. The Company's access to exploration
financing, when the financing is not transaction specific, is always uncertain.
There can be no assurance of continued access to significant equity funding.

Working Capital

At May 31, 2006, Rockwell had working capital deficit of
$889,614 as compared to working capital of $550,554 at May 31, 2005, and a
working capital of approximately $1.86 million at May 31, 2004. The decrease in
working capital between fiscal 2006 and fiscal 2005 was due to exploration
activities conducted.

As described in Item 4.B. (Financing Activity), subsequent to
the end of the fiscal year, the Company completed a $6.0 million credit facility
and $21.0 million private placement to fund the acquisition of the alluvial
diamond properties and to repay the convertible promissory note of $9.5
million.

The proceeds of the credit facility and private placement will
be used to facilitate the acquisition of Durnpike Investments (Proprietary)
Limited ("Durnpike") and the funding of Durnpikes obligations in connection
with the acquisition of 51% of the outstanding shares of Klipdam Diamond Mining
Company Limited and HC Van Wyk Diamonds (Proprietary) Limited.

The Company has no long term debt, capital lease obligations,
operating leases or any other long term obligations.

The Company has no "Purchase Obligations" defined as any
agreement to purchase goods or services that is enforceable and legally binding
on the Company that specifies all significant terms, including: fixed or minimum
quantities to be purchased; fixed, minimum or variable price provisions; and the
approximate timing of the transaction.

Financing Activity

$6.0 million credit facility

On August 21, 2006 Rockwell reached an agreement with Quest
Capital Corp. (Quest) for a $6.0 million credit facility (the Facility). The
Facility is payable out of the proceeds of any future debt or equity financing
or disposition of any of the assets of Rockwell, other than in the ordinary
course of business, and bears interest from March 1, 2007 at the rate of 18% per
annum, calculated daily and compounded monthly, payable on the last business day
of each month. The Facility, if not earlier converted, must be repaid on or
before May 31, 2007. The Facility is secured by a first charge over all of the
assets of Rockwell. In consideration for the Facility, Quest received 385,714
common shares of Rockwell. In addition, should the Facility remain outstanding
on November 30, 2006, Quest will receive

---

 page 48 

an additional number of common shares equal to 4.5% of the
principal amount then outstanding divided by the average closing price of the
common shares of Rockwell on the TSX Venture Exchange for the 10 trading days
immediately preceding November 30, 2006. The facility may be repaid at any time,
without penalty. Quest has the right to convert the facility to common shares if
Rockwell completes an equity financing for $5.0 million or greater, at the
greater of the price at which the financing is conducted less a 3% discount,
subject to a minimum conversion price of $0.65 per share.

On September 1, 2006, Rockwell borrowed $6.0 million under the
Facility to facilitate the funding of Durnpikes obligations in connection with
the acquisition of 51% of the outstanding shares of Klipdam Diamond Mining
Company Limited and HC Van Wyk Diamonds (Proprietary) Limited.

$9.5 million private placement of convertible promissory
notes

In July 2006, Rockwell entered into agreements to complete a
$9.5 million private placement of subordinated secured convertible promissory
notes (the Notes). The Notes must be repaid on or before March 31, 2007 and
have similar terms and conditions to the $6.0 million credit facility, including
conversion rights. The Notes are subordinated to the Facility, and are secured
by a charge over all of the assets of Rockwell. As consideration for the Notes,
the noteholders received 678,571 common shares of Rockwell on closing and
1,055,555 common shares on September 30, 2006, or equal to five percent of the
outstanding balance owed on the Notes divided by the average closing price of
Rockwell's common shares on the Exchange for the five trading days immediately
preceding such issue, less a 10% discount. In addition, should the Notes remain
outstanding on March 31, 2007, noteholders will receive an additional number of
common shares on the same terms.

In November 2006, the Notes were repaid in full.

$21 million private placement financing

On November 23, 2006, Rockwell completed a $21 million private
placement of 42 million units at $0.50 per unit. Each unit consists of one
common share (Shares) in the capital of Rockwell and one Share purchase
warrant. Each warrant entitles the holder to buy one Share in the capital of
Rockwell at the exercise price of $0.60 during the first year from completion of
the financing, or at an exercise price of $0.80 during the second year or at an
exercise price of $1.00 during the third year. The third year term of the
warrants is conditional upon Rockwell achieving Tier 1 status on the TSX Venture
Exchange within the first two years.

Rockwell will use the net proceeds from the offering to
complete the Acquisition described in Item B. Business Overview  Alluvial
Diamond Properties, repay the Notes, carry out exploration and development,
and for general working capital and corporate development purposes.

Financial Instruments

Rockwell financed its activities from fiscal 2000 through
fiscal 2006 primarily through the issuance of equity shares by way of private
placement. Rockwell keeps its financial instruments denominated in Canadian
dollars and does not engage in any hedging operations with respect to currency
or in-situ minerals.

|C. | Research and Development, Patents and License,
      etc.
|-- | ---------------------------------------------------------

Not applicable.

---

 page 49 

|D. | Trend Information
|-- | -----------------

The Companys Ricardo property has the potential to host copper
deposits. Copper prices have been increasing since late 2003. Copper prices
averaged US$1.30/lb in 2004 and US$1.59/lb in 2005. Copper prices have continued
to increase in 2006, averaging US$3.03/lb to the early December.

The rough
  diamond market was strong in 2005. Prices for polished stones increased, including
  large stones (>2 carats with better colour and quality) and smaller diamond
  segments.

In 2006, diamond
  prices increased 4-5% in the first three quarters, but softened in the latter
  part of the year as a consequence of increased debt levels in manufacturing
  centers and high energy prices, depressing discretionary spending in key markets
  such as the United States of America. Prices of larger solid diamonds continued
  to show solid gains on a year-over-year basis.

According
  to a recent report, round polished diamonds, 4 carats and 5 carats in size,
  and representing about 1% of the market by value, continue to post solid price
  gains, year-over-year. The continued price appreciation of large stones is significant
  in respect to the production mix from the projects being acquired in Kimberley
  area of South Africa, which comprises a significant component of large (greater
  than 2 carats, including 10 carat) stones.

The Company will continue to make expenditures in fiscal 2007
to keep its Ricardo property in good standing, and has plans to invest in
exploration and development of its recent alluvial diamond acquisitions, as
discussed in Items 4.B and 4.D of this Annual Report. These expenditures will
result in a decrease in the Company's cash and working capital position unless
further equity financings are completed during 2007, and there is no assurance
that the Company will be successful in acquiring such financing.

|E. | Off-Balance Sheet
Arrangements
|-- | ------------------------------

Rockwell does not have any off-balance sheet arrangements that
have or are reasonably likely to have a current or future effect on its
financial condition, changes in financial condition, revenues or expenses,
results of operations, liquidity, capital expenditures or capital resources that
is material to investors.

|F. | Tabular Disclosure of Contractual
    Obligations
|-- | -------------------------------------------------

As at May 31, 2006, Rockwell did not have any of the following
types of contractual obligations: long-term debt obligations, capital lease
obligations, operating lease obligations, purchase obligations, or any other
long term liabilities required to be reflected on its balance sheet under Cdn
GAAP.

Payment due by periodType of Contractual Obligation
    Total
    Less than1 Year
    1 - 3 Years
    3 - 5 Years
    More than 5
      YearsLong-Term Debt
      Obligations
    
    
    
    
    Capital (Finance)
      Lease Obligations
    
    
    
    
    Operating Lease Obligations (Office Lease)
    
    
    
    
    


---

 page 50 

Payment due by periodType of Contractual Obligation
    Total
    Less than 1 Year
    1 - 3 Years
    3 - 5 Years
    More than 5
      YearsPurchase Obligations
    
    
    
    
    Other Long-Term Liabilities Reflected on the Company's
      Balance Sheet under the GAAP of the primary financial statements
    
    
    
    
    Total
    
    
    
    
    




|G. | Safe Harbor
|-- | -----------

The safe harbor provided in Section 27A of the Securities Act
and Section 21E of the Exchange Act applies to forward-looking information
provided pursuant to Item 5.E and F above.

---

 page 51 

|ITEM6. | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
|------ | ------------------------------------------

|A. | Directors and Senior Management
|-- | -------------------------------

|                                            |                            | Period a Director of the
|------------------------------------------- | -------------------------- | ------------------------
|Name, Position
      and Place of Residence | Position                   | Issuer                  
|                                            |                            |                         
|John Bristow                                | President, Chief Operating | since August 2006       
|Pretoria, South Africa                      | Officer and Director       |                         
|                                            |                            |                         
|Jeffrey Brenner                             | Director                   | since August 2006       
|Sandton, South Africa                       |                            |                         
|                                            |                            |                         
|Rene G. Carrier                             | Director                   | since April 1993        
|North Vancouver, Canada                     |                            |                         
|                                            |                            |                         
|David Copeland                              | Chief Executive Officer    | since September 2006    
|Vancouver, Canada                           | and Director               |                         
|                                            |                            |                         
|Scott D. Cousens                            | Director                   | since November 2000     
|Vancouver, Canada                           |                            |                         
|                                            |                            |                         
|Jeffrey R. Mason                            | Chief Financial Officer,   | since November 2000     
|Vancouver, Canada                           | Secretary and Director     |                         
|                                            |                            |                         
|Ronald W. Thiessen                          | Director                   | since November 2000     
|West Vancouver, Canada                      |                            |                         
|                                            |                            |                         
|Douglas B. Silver                           | Director                   | since March 1998        
|Englewood, United States of America         |                            |                         

Principal Occupation of Current Management of
Rockwell

DR. JOHN BRISTOW  President, Chief Operating Officer and
Director

Dr. Bristow, Ph.D., has over 30 years
experience in the diamond business, initially with De Beers and most recently as
CEO of Kalahari Diamonds, plc, which successfully merged with Petra Diamonds in
2005. In 1998 Mr. Bristow played a key role in listing alluvial diamond producer
Gem Diamond Mining Corporation (Gem) on the Johannesburg Stock Exchange.
Mvelaphanda Diamonds (Proprietary) Limited subsequently acquired a controlling
interest in Gem, then merged with the Trans Hex Group, South Africas largest
publicly listed diamond producer, in 2000. Mr. Bristow has considerable African
and International experience in the exploration, evaluation and mining of
kimberlite and alluvial diamond deposits.

---

 page 52 

Dr. Bristow currently is, or was within
the past five years, an officer and/or director of the following public
companies:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director, President and Chief Operating
      Officer
    August 2006
    Present


JEFFREY BRENNER  Director

Mr. Brenner is a leading international
diamantaire  a specialist in the valuation, marketing and sales of rough
diamond production from alluvial deposits. His ability to evaluate rough
diamonds will be important to the success of the alluvial operations. From a
corporate perspective, Mr. Brenners role will be to use his extensive knowledge
of South African alluvial diamonds in networking activities in Belgium and other
key trading centres and to market the large and high quality gemstones (the
average value of which are in excess of US$1,000 per carat) produced from the
newly acquired South African properties.

Mr. Brenner currently is, or was within
the past five years, an officer and/or director of the following public
companies:

Company
    Positions Held
    From
    ToRockwell Ventures
      Inc.
    Director
    August
      2006
    Present


RENE CARRIER  Director

Rene Carrier was a past Vice-President
of Pacific International Securities Inc. for ten years where he worked until
1991. Since that time he has been President of Euro-American Capital
Corporation, a private company which specializes in restructuring,
administration, and raising venture capital funds for junior companies.

Mr. Carrier currently is, or was within
the past five years, an officer and/or director of the following public
companies:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    April 1993
    PresentPresident
    April 1993
    November 2000Continental Minerals Corporation
    Director
    February 2001
    PresentQuartz Mountain Resources Ltd.
    Director
    January 2000
    PresentPresident
    June 2005
    PresentAcrex Ventures Ltd.
    Director
    September 2000
    September 2003Chartwell Technology Inc.
    Director
    June 1991
    PresentInternational Royalty Corporation
    Lead Director
    June 2003
    Present


---

 page 53 

DAVID COPELAND, P.ENG.  CHIEF EXECUTIVE OFFICER AND
DIRECTOR

David Copeland is a geological engineer
  who graduated in Economic Geology from the University of British Columbia. With
  over 30 years of experience, Mr. Copeland has undertaken assignments in a variety
  of capacities in mine exploration, discovery and development throughout the
  South Pacific, Africa, South America and North America. He is a director of
  Hunter Dickinson Inc., a private company with certain directors in common with
  the Company, which provides consulting services.

Mr. Copeland is, or was within the past
five years, an officer and/or director of the following public companies:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    September 2006
    PresentChief Executive Officer
    August 2006
    PresentAmarc Resources Ltd.
    Director
    September 1995
    PresentAnooraq Resources Corporation
    Director
    September 1996
    September 2004Casamiro Resource Corp.
    Director
    February 1995
    August 2002Continental Minerals Corporation
    Director
    November 1995
    PresentFarallon Resources Ltd.
    Director
    December 1995
    PresentGreat Basin Gold Ltd.
    Director
    February 1994
    PresentNorthern Dynasty Minerals Ltd.
    Director
    June 1996
    PresentTaseko Mines Limited
    Director
    January 1994
    Present


SCOTT COUSENS  Director

Scott Cousens provides management,
technical and financial services to a number of publicly traded companies. Mr.
Cousens focus since 1991 has been the development of relationships within the
international investment community and has established strong ties with North
American, European and Asian investors. In addition to financing initiatives he
also oversees the corporate communications programs for the public companies to
which Hunter Dickinson Inc. provides services.

Mr. Cousens is, or was within the past
five years, an officer and/or director of the following public companies:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    November 2000
    PresentAmarc Resources Ltd.
    Director
    September 1995
    PresentAnooraq Resources Corporation
    Director
    September 1996
    PresentContinental Minerals Corporation
    Director
    June 1994
    PresentFarallon Resources Ltd.
    Director
    December 1995
    Present


---

 page 54 

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    November 2000
    PresentGreat Basin Gold Ltd.
    Director
    March 1993
    November 2006Northern Dynasty Minerals Ltd.
    Director
    June 1996
    PresentTaseko Mines Limited
    Director
    October 1992
    Present


JEFFREY MASON, B.Comm., CA  Director, Chief Financial
Officer and Secretary

Jeffrey Mason holds a Bachelor of
Commerce degree from the University of British Columbia and obtained his
Chartered Accountant designation while specializing in the mining, forestry and
transportation sectors at the international accounting firm of Deloitte &
Touche. Following comptrollership positions at an international commodity
mercantilist and Homestake Mining Group of companies including responsibility
for North American Metals Corp. and the Eskay Creek Project, Mr. Mason has spent
the last several years as a corporate officer and director for a number of
publicly-traded mineral exploration companies. Mr. Mason is also employed as
Chief Financial Officer of Hunter Dickinson Inc. and his principal occupation is
the financial administration of the public companies to which Hunter Dickinson
Inc. provides services.

Mr. Mason is, or was within the past
five years, an officer and or director of the following public companies:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    November 2000
    PresentChief Financial Officer
    November 2000
    PresentAmarc Resources Ltd.
    Director
    September 1995
    PresentSecretary
    September 1995
    PresentChief Financial Officer
    September 1998
    PresentAnooraq Resources Corporation
    Director
    April 1996
    September 2004Secretary
    September 1996
    PresentChief Financial Officer
    February 1999
    PresentContinental Minerals Corporation
    Director
    June 1995
    PresentSecretary
    November 1995
    PresentChief Financial Officer
    June 1998
    PresentFarallon Resources Ltd.
    Director
    August 1994
    PresentSecretary
    December 1995
    PresentChief Financial Officer
    December 1997
    PresentGreat Basin Gold Ltd.
    Director
    February 1994
    November 2006Secretary
    February 1994
    November 2006Chief Financial Officer
    June 1998
    November 2006Northern Dynasty Minerals Ltd.
    Director
    June 1996
    Present


---

 page 55 

|                                      | Secretary                    | June 1996     | Present
|------------------------------------- | ---------------------------- | ------------- | -------
|Chief Financial Officer               | June 1998                    | Present      
|Quartz Mountain Resources 
      Ltd. | Principal Accounting Officer | January 2005  | Present
|Taseko Mines Limited                  | Director                     | February 1994 | Present
|Secretary                             | February 1994                | Present      
|Chief Financial Officer               | November 1998                | Present      

DOUGLAS SILVER  Director

Douglas Silver, the president and owner
of Balfour Holdings Inc., holds a Bachelor of Geology and Zoology degree from
the University of Vermont and a Masters degree in Economic Geology from the
University of Arizona. Mr. Silver, who is based in Englewood, Colorado, has
twenty years of professional experience in the base and precious metals industry
ranging from exploration geologist to activities in the areas of corporate
business development, capital raising and investor relations.

Mr. Silver is an independent director
of the following public company:

Company
    Positions Held
    From
    ToRockwell Ventures Inc.
    Director
    March 1998
    Present


RONALD THIESSEN, CA  Chairman of the Board and Director

Ronald Thiessen is a Chartered
Accountant with professional experience in finance, taxation, mergers,
acquisitions and re-organizations. Since 1986, Mr. Thiessen has been involved in
the acquisition and financing of mining and mineral exploration companies. Mr.
Thiessen is employed by Hunter Dickinson Inc., a company providing management
and administrative services to several publicly-traded companies and focuses on
directing corporate development and financing activities. He is also a director
of Hunter Dickinson Inc.

Mr. Thiessen is, or was within the past
five years, an officer and/or director of the following public companies:

Company
      Positions Held
      From
      ToRockwell Ventures Inc.
      Director
      November 2000
      PresentChairman
      September 2006
      PresentPresident and Chief Executive Officer
      November 2000
      September 2006Amarc Resources Ltd.
      Director
      September 1995
      PresentPresident and Chief Executive Officer
      September 2000
      PresentAnooraq Resources Corporation
      Director
      April 1996
      PresentPresident and Chief Executive Officer
      September 2000
      Present


---

 page 56 

Company
      Positions Held
      From
      ToCasamiro Resource Corp.
      Director and President
      February 1990
      August 2002Continental Minerals 
        Corporation
      Director
      November 1995
      PresentPresident and Chief 
        Executive Officer
      September 2000
      January 2006Co-Chairman
      January 2006
      PresentFarallon Resources Ltd.
      Director
      August 1994
      PresentPresident and Chief 
        Executive Officer
      December 1999
      September 2004Co-Chairman
      September 2004
      December 2005Chairman
      December 2005
      PresentGreat Basin Gold Ltd.
      Director
      October 1993
      PresentPresident and Chief 
        Executive Officer
      September 2000
      December 2005Co-Chairman
      December 2005
      PresentNorthern Dynasty Minerals Ltd.
      Director
      November 1995
      PresentPresident and Chief Executive Officer
      November 2001
      PresentTaseko Mines Limited
      Director
      October 1993
      PresentPresident and Chief 
        Executive Officer
      September 2000
      July 2005Co-Chairman
      July 2005
      May 2006Chairman
      May 2006
      PresentTri-Gold Resources Corp.
      Director
      July 1992
      Present


|B. | Compensation
|-- | ------------

During Rockwells financial year ended May 31, 2006 the
aggregate direct remuneration paid or payable to the Companys directors and
senior officers by the Company and its subsidiaries, all of whose financial
statements are consolidated with those of Rockwell, was $94,245. This figure
includes any portion of remuneration received by the named person as an officer
or employee of Hunter Dickinson Inc. that is attributable to Rockwells affairs.

David Copeland, Chief Executive Officer, John Bristow,
President and Ronald W. Thiessen, former President and Chief Executive Officer,
and Jeffrey R. Mason, Chief Financial Officer, are each a Named Executive
Officer of the Company for the purposes of the following disclosure. Mr.
Copeland and Dr. Bristow were appointed in August 2006 and as such, have not
been included in the executive compensation disclosure provided below. The
compensation paid to the Named Executive Officers during the Companys three
most recently completed financial years is as set out below:

---

 page 57 

Summary Compensation Table

NAMED EXECUTIVE
      OFFICERS Name and Principal Position
    Year
    Annual
      Compensation
    Long Term Compensation
    All Other
      Compens ation ($)Awards
    PayoutsSalary ($)
    Bonus ($)
    Other Annual
      Compen- sation ($)
    Securities Under
      Options Granted (#)
    Shares or Units Subject
      to Resale Restrictions ($)
    LTIP Payouts
      ($)Ronald W. Thiessen Director and former
      President and Chief Executive Officer
    2006 2005 2004
    29,016 10,834 20,693
    Nil Nil Nil
    Nil Nil Nil
    Nil Nil 500,000
    Nil Nil Nil
    Nil Nil Nil
    Nil Nil NilJeffrey R. Mason Chief Financial Officer and
      Director
    2006 2005 2004
    18,769 8,418 15,612
    Nil Nil Nil
    Nil Nil Nil
    Nil Nil 500,000
    Nil Nil Nil
    Nil Nil Nil
    Nil Nil Nil


No share options were granted to the Named Executive Officers
during the year ended May 31, 2006.

No share options were exercised by the Named Executive Officers
during the year ended May 31, 2006.

Termination of Employment, Change in Responsibilities and
Employment Contracts

There are no compensatory plans or arrangements with respect to
the Named Executive Officer resulting from the resignation, retirement or any
other termination of employment of the officers employment or from a change of
the Named Executive Officers responsibilities following a change in
control.

Compensation of Directors

During the fiscal year 2006, each independent director of the
Company was paid an annual directors fee of $10,200.

No share options were granted to directors during the year
ended May 31, 2006.

Securities Held By Insiders

As at November 28, 2006 the directors and officers of Rockwell
and their affiliates held as a group, directly and indirectly, own or control an
aggregate of 6,954,594 common shares (10.3%) . To the knowledge of the directors
and officers of the Company, as at such date, there were no persons holding more
than 10% of the issued common shares.

|C. | Board Practices
|-- | ---------------

All directors were elected at the annual general meeting held
in November 2006, and have a term of office expiring at the next annual general
meeting of Rockwell expected to be held in November 2007. The period during
which each director has served as a director is disclosed in Item 6(A) herein.
All officers have a term of office lasting until their removal or replacement by
the Board of Directors.

There are no contracts or arrangements under which directors
are compensated or provided benefits upon termination of employment.

Messrs. Rene G. Carrier and Scott D. Cousens are members of
Rockwells audit committee. The audit committee is selected annually by the
directors of Rockwell at the first meeting of the board held after

---

 page 58 

Rockwells annual general meeting. Its primary function is to
review the financial statements of the company before they are submitted to the
board for approval and the audit committee is also available to assist the board
if required with matters relating to the appointment of Rockwells auditor and
the overall scope and results of the audit, internal financial controls, and
financial information for publication for various purposes.

|D. | Employees
|-- | ---------

At November 28, 2006, Rockwell has no direct employees. The
Companys administrative and exploration functions are primarily administered
through Hunter Dickinson Inc. and contractors (see Item 7B).

|E. | Share Ownership
|-- | ---------------

Security holdings of the Companys directors and senior
management (as at November 28, 2006), as disclosed on www.sedi.ca.

Name of Insider(1)
    Shares Beneficially Owned or
      Controlled(2)
    As a percentage of outstanding
      sharesJeffrey Brenner
    Nil
    NilJohn W. Bristow
    Nil
    NilRene G. Carrier
    1,233,439 shares (3)
    1.8 %David Copeland
    1,032,373 shares
    1.5%Scott D. Cousens
    2,930,436 shares
    4.3%Jeffrey R. Mason
    1,357,296 shares
    2.0%Douglas B. Silver
    Nil
    NilRonald W. Thiessen
    401,050 shares
    0.6%


|(1) | The information as to principal occupation, business or
      employment and Shares beneficially owned or controlled is not within the
      knowledge of the management of the Company and has been furnished by the
      respective nominees. Each nominee has held the same or a similar principal
      occupation with the organization indicated or a predecessor thereof for
      the last five years.
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The number of Shares beneficially owned by the above
      nominees for directors, directly or indirectly, is based on information
      furnished by the Company and by the nominees themselves.                                                                                                                                                                                                              
|(3) | Certain of these shares are held by Euro American Capital
      Corporation, a private company that is wholly owned by Mr.
  Carrier.                                                                                                                                                                                                                                                                          

At the Companys Annual and Extraordinary General Meeting held
in November 2006, shareholders of the Company approved a Share Incentive Plan
(2006 Plan) in accordance with the policies of the TSX Venture Exchange. Under
the 2006 Plan, a maximum of 10% of the issued and outstanding shares of the
Company at the time an option is granted, less the number of shares reserved for
issuance in the 2006 Plan, are reserved for issuance as options to be granted at
the discretion of the Companys board of directors to eligible optionees under
the 2006 Plan. The exercise price of each option normally equals or

---

 page 59 

exceeds the market price of the Company's shares as calculated
on the date of grant. Options granted are for a term of no greater than five
years.

Incentive stock options may be issued to directors, officers,
employees or consultants of the Company at the discretion of the board of
directors, subject to an aggregate maximum of 10% of the issued capital of the
Company.

At November 28, 2006, an aggregate of 462,917 common shares
have been reserved for issuance pursuant to the 2006 Plan:

Exercise
    No.
      of SharesExpiry date
    price
    ReservedSeptember 28, 2007
    $ 0.40
    102,917February 29, 2008
    $ 0.42
    210,000March 28, 2008
    $ 0.50
    150,000462,917


---

 page 60 

|ITEM7. | MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
|------ | -------------------------------------------------

|A. | **Major Shareholders**
|-- | ----------------------

Rockwells securities are recorded on the books of its transfer
agent in registered form. However, the majority of such shares are registered in
the name of intermediaries such as brokerage houses and clearing houses on
behalf of their respective brokerage clients, and the Company does not have
knowledge or access to information about of the beneficial owners thereof. To
the best of its knowledge, the Company is not directly or indirectly owned or
controlled by a corporation or foreign government. As of November 28, 2006,
Rockwell had authorized an unlimited number of common shares without par value
of which 67,815,450 were issued and outstanding.

At the Companys Annual and Extraordinary General Meeting held
on November 28, 2005, the Companys shareholders approved the creation of a
class of preferred shares and the consolidation of the Companys common shares
on a four old shares for one new basis. Regulatory approval of this capital
reorganization was received on January 27, 2006.

Beneficial ownership means the sole or shared power to vote
or direct the voting or to dispose or direct the disposition of any security. A
person is deemed to have beneficial ownership of any securities that such person
has a right to acquire within 60 days of November 28, 2006 through the exercise
of any option or warrant. Any security that any person has the right to acquire
within 60 days is deemed outstanding for the purpose of calculating the
ownership of such person, but is not deemed to be outstanding for the purpose of
calculating the ownership percentage of any other person.

As of November 28, 2006, other than the security holdings of
directors and senior management disclosed in Item 6.E., the only registered
holders of 5% or more of the common shares of the Company are as follows:

Shareholder Nameand Address
    Number ofShares Held
    Percentage ofIssuedCommonSharesThe Canadian Depository for Securities Limited ("CDS")
      (3)25 The Esplanade PO Box 1038 Stn A Toronto, ON
      M5W 1G5
    22,024,713
    32.5%Haywood Securities Inc, In Trust For Springleaf
      Enterprises Inc 400 Burrard St, Suite 200 Vancouver, BC
    10,000,000
    14.8%Haywood Securities Inc, In Trust For Abdulaziz Hamad
      Aljomaih 400 Burrard St, Suite 200 Vancouver, BC
    6,000,000
    8.9%


---

 page 61 

Shareholder Name and Address
    Number of Shares
      Held
    Percentage of Issued
      Common SharesUnion Securities, In Trust For Rahim Ladhani 700
      West Georgia St, Suite 900 Vancouver, BC
    3,400,000
    5.0%


As of November 28, 2006, directors and officers of Rockwell in
total (8 persons) owned or controlled an aggregate of 5,504,594 shares (8.1%) of
Rockwell, or 6,954,594 shares (6.3%) on a fully diluted basis. These directors
or officers do not have any different voting rights with respect to the common
shares held by them. Under the British Columbia Securities Act, insiders
(generally officers, directors, holders of 10% or more of the Companys shares)
are required to file insider reports of changes in their ownership in the first
10 days following a trade in Rockwells securities. Under British Columbia
securities laws, insider trading information is available at
www.sedi.ca

As at November 28, 2006, to the best of the Company's
knowledge, the following is the geographic distribution of shareholders. Shares
registered in intermediaries were assumed to be held by residents of the same
country in which the clearing house was located.

PercentageNumber of registered
      Number of common
      of totalLocation
      shareholders
      shares held
      sharesCanada
      65
      59,204,497
      87.3%United States
      17
      3,110,238
      4.6%Other countries
      139
      5,500,715
      8.1%Total
      221
      67,815,450
      100%


To management’s
  knowledge, there are no arrangements the operation of which may at a subsequent
  date result in a change of control of Rockwell. The purchase of Durnpike and
  its related southern African operating properties is expected to cause significant
  dilution, but a change of control resulting from this purchase is not anticipated.

|B. | Related Party Transactions
|-- | --------------------------

No director or senior officer, and no associate or affiliate of
the foregoing persons, and no insider has or has had any material interest,
direct or indirect, in any other transactions, or in any other proposed
transaction, which in either such case has materially affected or will
materially affect Rockwell or its predecessors during the fiscal year ended May
31, 2006 except as follows:

|(a) | Farmout agreement - Gibraltar exploration properties,
      British Columbia, Canada
|--- | ------------------------------------------------------------------------------------

In December 2003, the Company entered
into a farmout agreement (the "2003 farmout agreement") with Taseko Mines
Limited ("Taseko"), a public company with certain directors in common with the
Company. Under the terms of the 2003 farmout agreement, Taseko granted to the
Company rights to earn joint venture working interests, subject to a maximum of
$200,000, on certain exploration properties located in the vicinity of the
Gibraltar mine property. For a period of 150 days after the Company had earned
its working interest, Taseko had the right to purchase, at its option, the
Company's earned interests for cash or common share consideration aggregating
110% of the Company's earn-in amount. If Taseko elected to issue common
shares,

---

 page 62 

the number of common shares to be
issued upon exercise would be valued at the ten-day weighted average trading
price as traded on the TSX-V.

In December 2003, the Company earned an
interest in these properties to the extent of $200,000.

During the Companys fiscal year ended
May 31, 2004, Taseko exercised its right to purchase the Company's interest, and
on June 15, 2004, Taseko issued 78,853 of its common shares for total
consideration of $220,000.

|(b)     | Farmout agreement - British Columbia exploration
        properties, Canada                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | In November 2004, the Company entered into a farmout
        agreement (the "2004 farmout agreement") with Amarc Resources Ltd. ("Amarc"),
        a public company with certain directors in common with the Company. Under
        the terms of the 2004 farmout agreement, Amarc granted to the Company
        rights to earn joint venture working interests of 50%, subject to a maximum
        of $600,000 in exploration costs to be spent on certain mineral properties
        located in British Columbia.                                                                                                      
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | For a period of 180 days after the Company had earned
        its working interest, Amarc had the exclusive right to purchase, at its
        option, the Company's earned interest for a number of Amarc common shares
        (or cash equivalent) not to be less than 110% of the qualified expenditures
        incurred by, or for the account of, the Company to earn its interest.
        If Amarc elected to issue common shares, the common shares to be issued
        upon exercise would be valued at the five-day weighted average trading
        price as quoted on the TSX-V prior to the date of the call.
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | In December 2004, the Company had earned its 50% interest
        in these properties. Amarc did not exercise its option to reacquire the
        Companys interest (the right of Call) on any of the
        properties within the permitted 180 days. Consequently, Amarcs right
        of call expired.                                                                                                                                                                                                                                                                                                             
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(c)     | Arrangements with Hunter Dickinson Inc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | The Company is party to the geological and administrative
        services agreement with HDI dated for reference January 1, 2001, as described
        under Item 4.B of this Annual Report.                                                                                                                                                                                                                                                                                                                                                                                                                               
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | During the fiscal year ended May 31, 2006, the Company
        paid $578,134 (May 31, 2005  $163,317) for such services and cost
        reimbursements.                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(d)     | Gordon J. Fretwell Law Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | Gordon J. Fretwell Law Corporation is a private company
        controlled by a director, Gordon Fretwell, that provides legal services
        to the Company. During the year ended May 31, 2006, the Company paid $nil
        (May 31, 2005  $1,060) for such services.                                                                                                                                                                                                                                                                                                                                                
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|(e)     | Euro-American Capital Corporation                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | Euro-American Capital Corporation is a private company
        controlled by a director, Rene Carrier, that provides management services
        to the Company. During the year ended May 31, 2006, the Company paid $18,630
        (May 31, 2005 - $16,164) for such services.                                                                                                                                                                                                                                                                                                                                           
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|**(f)** | Private placement participation by directors                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|        |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
|        | Pursuant to the private placement offering of $21
        million in*Item 5.B. Liquidity and Capital Resources*, Mr. Copeland,
        Mr. Cousens and Mr. Mason participated in purchasing 300,000, 400,000
        and 400,000 units, respectively.                                                                                                                                                                                                                                                                                                                                                                       

---

 page 63 

|ITEM **8.** | FINANCIAL INFORMATION
|----------- | ---------------------

|A. | Consolidated Statements and Other Financial Information
|-- | -------------------------------------------------------

See Item 17 Financial Statements.

Legal Proceedings

|(a) | Ricardo is currently awaiting the outcome of proceedings
      against Gasoducto Nor-Andino S.A. before the Chilean Supreme Court for
      compensation for a right of way for a gas pipeline situated on the Ricardo
      property.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|(b) | The Company holds a 100% interest in certain mineral
      exploration and exploitation concessions totaling approximately 16,400
      hectares in the Calama Mining District in Chile. The Corporación Nacional
      Del Cobre de Chile (Codelco), the Chilean national copper company, is
      currently erecting housing and other infrastructure, as part of a
      relocation of its workers for its Chuquicamata project, in certain areas
      of the Ricardo Property. The Company believes this construction usurps the
      Company's constitutional mining rights. Accordingly, in order to preserve
      access to its mineral concessions, the Company applied for several
      easements on its Ricardo Property to prevent Codelco from further
      developing its construction project over the Company's mining rights in
      November 2002. In June 2006, the Supreme Court of Chile denied the
      Companys application for the easements.

Dividend Policy

Rockwell has not paid any dividends on its outstanding common
shares since its incorporation and does not anticipate that it will do so in the
foreseeable future. All funds of the Company are being retained for exploration
of its projects.

|B. | Significant Changes
|-- | -------------------

There have been no significant changes to the accompanying consolidated
  financial statements since May 31, 2006.

On January
  31, 2007, the Company acquired 100% of Durnpike which had acquired 51% of Durnpike
  (see Item 4), and consequently commenced consolidating the balance sheets and
  income statements of Durnpike at that date.

---

 page 64 

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

|A. | Offer and Listing Details
|-- | -------------------------

Trading Markets

|                                           | TSX Venture Exchange | OTC Bulletin Board
|------------------------------------------ | -------------------- | ------------------
|                                           | Symbol=RCW           | Symbol=RCKVF      
|                                           | Canadian Dollars     | U.S. Dollars      
|                                           | High                 | Low               
|Five most recent financial years           |                      |                   
|Fiscal 2002                                | $1.88                | $0.48             
|Fiscal 2003                                | $0.88                | $0.08             
|Fiscal 2004                                | $1.28                | $0.16             
|Fiscal 2005                                | $0.68                | $0.28             
|Fiscal 2006                                | $0.70                | $0.28             
|                                           |                      |                   
|                                           |                      |                   
|Two most recent financial years by quarter |                      |                   
|Fiscal 2005                                |                      |                   
|Quarter ended August 31, 2004              | $0.40                | $0.28             
|Quarter ended November 30, 2004            | $0.68                | $0.28             
|Quarter ended February 28, 2005            | $0.48                | $0.32             
|Quarter ended May 31, 2005                 | $0.52                | $0.28             
|Fiscal 2006                                |                      |                   
|Quarter ended August 31, 2005              | $0.44                | $0.28             
|Quarter ended November 30, 2005            | $0.52                | $0.28             
|Quarter ended February 28, 2006            | $0.55                | $0.28             
|Quarter ended May 31, 2006                 | $0.70                | $0.55             
|                                           |                      |                   
|Latest six months                          |                      |                   
|June 2006                                  | $0.85                | $0.60             
|July 2006                                  | $0.79                | $0.50             
|August 2006                                | $0.72                | $0.52             
|September 2006                             | $0.61                | $0.38             
|October 2006                               | $0.62                | $0.48             
|November 2006                              | $0.71                | $0.55             

The transfer of the Companys common shares is managed by its
transfer agent, Computershare Trust Company of Canada of Vancouver.

---

 page 65 

|B.                                                                                                                                                                                                        | Plan of Distribution 
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ---------------------
|                                                                                                                                                                                                          |                      
|Not applicable.                                                                                                                                                                                          
|                                                                                                                                                                                                         
|C.                                                                                                                                                                                                        | Markets              
|                                                                                                                                                                                                          |                      
|The shares of Rockwell trade
        in Canada on the TSX Venture Exchange (TSX Venture) and are
        quoted on the National Association of Securities Dealers OTC Bulletin
        Board (OTCBB).
|                                                                                                                                                                                                         
|D.                                                                                                                                                                                                        | Selling Shareholders 
|                                                                                                                                                                                                          |                      
|Not applicable.                                                                                                                                                                                          
|                                                                                                                                                                                                         
|E.                                                                                                                                                                                                        | Dilution             
|                                                                                                                                                                                                          |                      
|Not applicable.                                                                                                                                                                                          
|                                                                                                                                                                                                         
|F.                                                                                                                                                                                                        | Expenses of the Issue
|                                                                                                                                                                                                          |                      
|Not applicable.                                                                                                                                                                                          

---

 page 66 

|ITEM 10. | **ADDITIONAL INFORMATION**
|-------- | --------------------------

|A. | Share Capital
|-- | -------------

Not applicable.

|B. | Notice of Articles and Articles
|-- | -------------------------------

Copies of Rockwells memorandum and articles of incorporation,
as registered with the British Columbia Registrar of Companies under Corporation
No. 354545, were filed with the Companys initial registration statement on Form
20-F filed in 2000. The Business Corporations Act(British Columbia) (the
BCA") came into force on March 29, 2004. As a result, the Company Act(British Columbia) was repealed, and the Company became a pre-existing
company subject to the provisions of the BCA. Every pre-existing company is
required under the BCA to file a Transition Application containing a notice of
articles with the British Columbia Registrar of Companies, as a result of which
the notice of articles supersedes and replaces the companys memorandum. The
Company has caused a Transition Application to be filed with the British
Columbia Registrar of Companies, and its notice of articles and the related
articles are being filed as exhibits to this Annual Report.

A discussion of the notice of articles and articles of Rockwell
follows:

Objects and Purposes

Rockwells Notice of Articles do not specify objects or
purposes. Under British Columbia law, a British Columbia corporation has all the
legal powers of a natural person; however corporations may not undertake certain
limited business activities such as operating as a trust company or railroad
without alterations to its form of articles and specific government consent.

Directors  Powers and Limitations

Rockwells articles do not specify a maximum number of
directors (the minimum under British Columbia law for a public company is
three). The articles specify that the number of directors shall be the number of
directors fixed by shareholders annually or the number that are actually elected
at a general shareholders meeting. The number of directors is determined
annually by shareholders at the annual Shareholders meeting and all directors
are elected at that time, there are no staggered directorships. Under the
articles the directors are entitled between successive annual general meeting to
appoint one or more additional directors but not more than one-third of the
number of directors fixed at a shareholders meeting or actually elected at the
preceding annual general meeting. Directors automatically retire at the
commencement of each annual meeting subject to being re-elected.

Under the articles, a director who is any way directly or
indirectly interested in a proposed contract or transaction with Rockwell or who
holds any office or possesses any property whereby directly or indirectly a duty
might be created which would conflict with his duty or interest as a director
shall declare the nature and extent of such interest in such contract or
transaction. A director shall not vote in respect of any such contract or
transaction if the company in which he is interested and if he should vote his
vote shall not be counted but shall be counted in the quorum present at the
meeting. Similarly, under the BCA directors are obligated to abstain from voting
on matters in which they may be financially interested after fully disclosing
such interest. Directors must abstain in such circumstances both under the
articles and under the BCA.

Directors must be of the age of majority (18), and meet
eligibility criteria including not being mentally infirm, an undischarged
bankrupt, no fraud related convictions in the previous five years and a majority
of

---

 page 67 

directors must be ordinarily resident in Canada. There is no
mandatory retirement age either under Rockwells articles or under the BCA.

The directors may from time to time at their discretion
authorize the Company to borrow any sum of money for the purposes of the Company
and may raise or secure the repayment of that sum in such manner upon such terms
and conditions, in all respects, as they think fit, and in particular, and
without limiting the generality of the foregoing, by the issue of bonds or
debentures, or any mortgage or charge, whether specific or floating, or other
security on the undertaking or the whole or any part of the property of the
Company, both present and future. Directors need not own any shares of the
Company in order to qualify as directors.

Rights and Restrictions attached to Shares

The directors may declare dividends and fix the date of record
therefore and the date for payment thereof. No notice need be given of the
declaration of any dividend.

Subject to the terms of shares with special rights or
restrictions, all dividends shall be declared according to the number of shares
held and no dividend shall bear interest against Rockwell.

The directors may direct payment of any dividend wholly or
partly by the distribution of specific assets or of paid-up shares, bonds,
debentures or other debt obligations of Rockwell, or in any one or more of those
ways, and where any difficult arises in regard to the distribution, the
directors may settle the same as they think expedient, and in particular may fix
the value for distribution of specific assets or of paid-up shares, bonds,
debentures or other debt obligations of Rockwell, or in any one or more of those
ways, and, where any difficulty arises in regard to the distribution, the
directors may settle the same as they think expedient, and in particular may fix
the value for distribution of specific assets, and may determine the cash
payments shall be made to a member upon the basis of the value so fixed in place
of fractional shares, bonds, debentures or other debt obligations in order to
adjust the rights of all parties, and may vest any of those specific assets in
trustees upon such trusts for the persons entitled as may seem expedient to the
directors.

Notwithstanding anything contained in Rockwells articles the
directors may from time to time capitalize any undistributed surplus on hand of
Rockwell and may from time to time issue as fully paid and non-assessable any
unissued shares or any bonds, debentures or other debt obligations of Rockwell
as a dividend representing such undistributed surplus on hand or any part
thereof.

Any dividend, interest or other moneys payable in cash in
respect of shares may be paid by cheque or warrant sent through the post
directed to the registered address of the holder, or, in the case of joint
holders, to the registered address of that one of the joint holders who is first
named on the register or to such person and to such address as the holder or
joint holders may in writing direct. Every such cheque or warrant shall be made
payable to the order of the person to whom it is sent. Any one of two or more
joint holders may give effectual receipts for any dividends, bonuses or other
moneys payable in respect of the shares held by them as joint holders.

A transfer of a share shall not pass the right to any dividend
declared thereon before the registration of the transfer in the register.

Notwithstanding any other provisions of the articles should any
dividend result in any shareholders being entitled to a fractional part of a
share of Rockwell, the directors shall have the right to pay such shareholders
in place of that fractional share, the cash equivalent thereof calculated on the
par value thereof, or in the case of shares without nominal or par value,
calculated on the price or consideration for

---

 page 68 

which such shares were or were deemed to be issued, and shall
have the further right and complete discretion to carry out such distribution
and to adjust the rights of the shareholders with respect thereto on as
practical and equitable a basis as possible including the right to arrange
through a fiscal agent or otherwise for the sale, consolidation or other
disposition of those fractional shares on behalf of those shareholders of
Rockwell.

The directors may, before declaring any dividend, set aside out
of the profits of Rockwell such sums as they think proper as appropriations from
income which shall at the discretion of the directors, be applicable for meeting
contingencies, or for equalizing dividends, or for any other purpose to which
the profits of Rockwell may be properly applied, and pending such application
may, either be employed in the business of Rockwell or be invested in such
investments as the directors in their discretion may from time to time
determine.

Changes to Rights of Common Shareholders

Changes to the articles and memorandum of Rockwell a special
resolution being a resolution passed by not less than 75% of the shares voted
in person or by proxy at a duly convened shareholders meeting. Some corporate
changes including amalgamation with another company, sale of substantially all
of Rockwells assets, re-domiciling out of the jurisdiction of British Columbia,
creation of new classes of shares not only require such 75% approval but
generally also give rise to a dissent right which is the right to be paid the
fair value of the stockholders shares in cash if the required special
resolution is actually passed and Rockwell elects to proceed with the matter
notwithstanding receipt of dissent notices. A notice of a shareholders meeting
at which such an action is intended to be effected must include a prominent
notice of the dissent right. Dissent provisions governed by the BCA and not by
the articles of Rockwell.

Shareholders Meetings

Shareholders meetings are only peripherally governed by the
articles of Rockwell with most shareholder protections contained in the
Securities Act (British Columbia) and the BCA. The articles provide that
Rockwell will hold an annual general meeting, will provide at least 21 days
notice and will provide for certain procedural matters and rules of order with
respect to conduct of the meeting. The Securities Act(British Columbia)
and the BCA superimpose requirements that generally provide that shareholders
meetings require not less than a 60 day period from initial public notice that
Rockwell makes a thorough advanced search of intermediary and brokerage
registered shareholdings to ascertain location of beneficial shareholders so
that materials can be sent, the form and content of information circulars and
proxies and like matters typically governed by such securities legislation. This
legislation specifies the disclosure requirements for various corporate actions,
background information on the nominees for election for director, executive
compensation paid in the previous year and full details of any unusual matters.
Rockwell must hold an annual shareholders meeting within 13 months of the
previous annual shareholders meeting and must present audited statements that
are no more than 180 days old at that meeting.

Redemption

Subject to the special rights and restrictions attached to any
class of shares, Rockwell may, by a resolution of the directors and in
compliance with the BCA, redeem any of its shares that have a right of
redemption attached thereto at the price and upon the terms specified in such
resolution and where Rockwell purposes to redeem some, but not all, of its
shares of a particular class or kind, it shall not be obligated to redeem them
pro rata but may redeem them in any manner the directors in their absolute
discretion may deem fit.

Rockwell has no redeemable securities authorized or issued.

---

 page 69 

Pre-emptive Rights

There are no pre-emptive rights applicable to Rockwell which
provide a right to any person to participate in offerings of Rockwells
securities

Liquidation

All common shares of Rockwell participate ratably in any
available assets in the event of a winding up or other liquidation.

No Limitation on Foreign Ownership

There are no limitations under Rockwells Articles or in the
BCA on the right of persons who are not citizens of Canada to hold or vote
common shares. (See also Exchange Controls  below.)

Dividends

Dividends may be declared by the Board out of available assets
and are paid rateably to holders of common shares. No dividend may be paid if
Rockwell is, or would thereby become, insolvent.

Voting Rights

Each Rockwell share is entitled to one vote on matters to which
common shares ordinarily vote including the election of directors, appointment
of auditors and approval of corporate changes and other matters requiring
shareholder approval.

Change in Control

Rockwell has not implemented any shareholders rights against
possible take-overs. Rockwell does not have any agreements which are triggered
by a take-over or other change of control. There are no provisions in its
articles triggered by or affected by a change in outstanding shares which gives
rise to a change in control.

Share Ownership Reporting

The articles of Rockwell do not require disclosure of share
ownership. Share ownership of director nominees must be reported annually in
proxy materials sent to Rockwells shareholders. There are no requirements under
British Columbia corporate law to report ownership of shares of Rockwell but the
British Columbia Securities Act requires disclosure of trading by insiders
including holders of 10% of voting shares within 10 days of the trade.
Controlling shareholders (generally those in excess of 20% of outstanding
shares) must provide seven days advance notice of share sales.

|C. | Material Contracts
|-- | ------------------

Rockwells material contracts are included in the exhibits list
in item 19.

|D. | Exchange Controls
|-- | -----------------

Rockwell is a Canadian corporation incorporated under the laws
of British Columbia. There is no law or governmental decree or regulation in
Canada that restricts the export or import of capital, or affects the remittance
of dividends, interest or other payments to a non-resident holder of Common
Shares, other than withholding tax requirements. Any such remittances to United
States residents are generally subject to withholding tax. See Taxation
below.

---

 page 70 

There is no limitation imposed by the laws of Canada or by the
charter or other constituent documents of Rockwell on the right of a
non-resident to hold or vote the Common Shares, other than as provided in the
Investment Canada Act (Canada) (the Investment Act). The
following discussion summarizes the material features of the Investment
Act for a non-resident who proposes to acquire a controlling number of
Common Shares. It is general only, it is not a substitute for independent advice
from an investors own advisor, and it does not anticipate statutory or
regulatory amendments. Rockwell does not believe the Investment Act will
have any affect on it or on its non-Canadian shareholders due to a number of
factors including the nature of its operations and Rockwells relatively small
capitalization.

The Investment Act generally prohibits implementation of
a reviewable investment by an individual, government or agency thereof,
corporation, partnership, trust or joint venture (each an entity) that is not
a Canadian as defined in the Investment Act (a non-Canadian), unless
after review the Director of Investments appointed by the minister responsible
for the Investment Act is satisfied that the investment is likely to be
of net benefit to Canada. The size and nature of a proposed transaction may give
rise to an obligation to notify the Director to seek an advance ruling. An
investment in the Common Shares by a non-Canadian other than a WTO Investor
(as that term is defined in the Investment Act and which term includes
entities which are nationals of or are controlled by nationals of member states
of the World Trade Organization) when Rockwell was not controlled by a WTO
Investor, would be reviewable under the Investment Act if it was an
investment to acquire control of Rockwell and the value of the assets of
Rockwell, as determined in accordance with the regulations promulgated under the
Investment Act, was $5 million or more, or if an order for review was made by
the federal cabinet on the grounds that the investment related to Canadas
cultural heritage or national identity, regardless of the value of the assets of
Rockwell. An investment in the Common Shares by a WTO Investor, or by a
non-Canadian when Rockwell was controlled by a WTO Investor, would be reviewable
under the Investment Act if it was an investment to acquire control of
Rockwell and the value of the assets of Rockwell, as determined in accordance
with the regulations promulgated under the Investment Act, was not less than a
specified amount, which for 2005 exceeds $250 million. A non-Canadian would
acquire control of Rockwell for the purposes of the Investment Act if the
non-Canadian acquired a majority of the Common Shares. The acquisition of less
than a majority but one-third or more of the Common Shares would be presumed to
be an acquisition of control of Rockwell unless it could be established that, on
the acquisition, Rockwell was not controlled in fact by the acquiror through the
ownership of the Common Shares.

The foregoing assumes Rockwell will not engage in the
production of uranium or own an interest in a producing uranium property in
Canada, or provide any financial service or transportation service, as the rules
governing these businesses are different.

Certain transactions relating to the Common Shares would be
exempt from the Investment Act, including

(a)      
an acquisition of the Common Shares by a person in the ordinary course of that
persons business as a trader or dealer in securities,

(b)      
an acquisition of control of Rockwell in connection with the realization of
security granted for a loan or other financial assistance and not for a purpose
related to the provisions of the Investment Act, and

(c)      
an acquisition of control of Rockwell by reason of an amalgamation, merger,
consolidation or corporate reorganization following which the ultimate direct or
indirect control in fact of Rockwell, through the ownership of the Common
Shares, remained unchanged.

---

 page 71 

|E. | Taxation
|-- | --------

Certain Canadian Federal Income Tax Consequences

The discussion under this heading summarizes the principal
Canadian federal income tax consequences of acquiring, holding and disposing of
shares of common stock of Rockwell for a shareholder of Rockwell who is not a
resident of Canada but is a resident of the United States and who will acquire
and hold shares of common stock of Rockwell as capital property for the purposes
of the Income Tax Act (Canada) (the Canadian Tax Act). This summary
does not apply to a shareholder who carries on business in Canada through a
permanent establishment situated in Canada or performs independent personal
services in Canada through a fixed base in Canada if the shareholders holding
in Rockwell is effectively connected with such permanent establishment or fixed
base. This summary is based on the provisions of the Canadian Tax Act and the
regulations thereunder and on an understanding of the administrative practices
of Canada Revenue Agency, and takes into account all specific proposals to amend
the Canadian Tax Act or regulations made by the Minister of Finance of Canada as
of the date hereof. It has been assumed that there will be no other relevant
amendment of any governing law although no assurance can be given in this
respect. This discussion is general only and is not, nor is it intended to
provide a detailed analysis of the income tax implications of any particular
shareholders interest. Investors are advised to obtain independent advice from
a shareholders own Canadian and U.S. tax advisors with respect to income tax
implications pertinent to their particular circumstances.

The provisions of the Canadian Tax Act are subject to income
tax treaties to which Canada is a party, including the Canada-United States
Income Tax Convention (1980), as amended (the Convention).

Dividends on Common Shares and Other
Income

Under the Canadian Tax Act, a non-resident of Canada is
generally subject to Canadian withholding tax at the rate of 25 percent on
dividends paid or deemed to have been paid to him or her by a corporation
resident in Canada. Rockwell is responsible for withholding of tax at the
source. The Convention limits the rate to 15 percent if the shareholder is a
resident of the United States and the dividends are beneficially owned by and
paid to such shareholder and to 5 percent if the shareholder is also a
corporation that beneficially owns at least 10 percent of the voting stock of
the payor corporation.

The amount of a stock dividend (for tax purposes) would
generally be equal to the amount by which the paid up or stated capital of
Rockwell had increased by reason of the payment of such dividend. Rockwell will
furnish additional tax information to shareholders in the event of such a
dividend. Interest paid or deemed to be paid on Rockwells debt securities held
by non-Canadian residents may also be subject to Canadian withholding tax,
depending upon the terms and provisions of such securities and any applicable
tax treaty.

The Convention generally exempts from Canadian income tax
dividends paid to a religious, scientific, literary, educational or charitable
organization or to an organization constituted and operated exclusively to
administer a pension, retirement or employee benefit fund or plan, if the
organization is a resident of the United States and is exempt from income tax
under the laws of the United States.

Dispositions of Common Shares

Under the Canadian Tax Act, a taxpayers capital gain or
capital loss from a disposition of a share of common stock of Rockwell is the
amount, if any, by which his or her proceeds of disposition exceed (or are
exceeded by, respectively) the aggregate of his or her adjusted cost base of the
share and reasonable expenses of disposition. The capital gain or loss must be
computed in Canadian currency using a weighted average adjusted cost base for
identical properties. The capital gains net of losses included in income are as
follows. For gains net of losses realized before February 28, 2000, as to 75%.
For gains

---

 page 72 

net of losses realized after February 27, 2000 and before
October 18, 2000, as to 66 2/3%. For gains net of losses realized after October
17, 2000, as to 50%. There are special transitional rules to apply capital
losses against capital gains that arose in different periods. The amount by
which a shareholders capital loss exceeds the capital gain in a year may be
deducted from a capital gain realized by the shareholder in the three previous
years or any subsequent year, subject to certain restrictions in the case of a
corporate shareholder.

Under the Canadian Tax Act, a non-resident of Canada is subject
to Canadian tax on taxable capital gains, and may deduct allowable capital
losses, realized on a disposition of taxable Canadian property. Shares of
common stock of Rockwell will constitute taxable Canadian property of a
shareholder at a particular time if the shareholder used the shares in carrying
on business in Canada, or if at any time in the five years immediately preceding
the disposition 25% or more of the issued shares of any class or series in the
capital stock of Rockwell belonged to one or more persons in a group comprising
the shareholder and persons with whom the shareholder and persons with whom the
shareholder did not deal at arms length and in certain other circumstances.

The Convention relieves United States residents from liability
for Canadian tax on capital gains derived on a disposition of shares unless

(a)        the value of the
shares is derived principally from real property in Canada, including the
right to explore for or exploit natural resources and rights to amounts computed
by reference to production,

(b)      
the shareholder was resident in Canada for 120 months during any period of 20
consecutive years preceding, and at any time during the 10 years immediately
preceding, the disposition and the shares were owned by him when he or she
ceased to be resident in Canada, or

(c)      
the shares formed part of the business property of a permanent establishment
that the holder has or had in Canada within the 12 months preceding the
disposition.

United States Tax Consequences

United States Federal Income Tax Consequences

The following is, in the opinion of Rockwell after consultation
with its professional advisors, a discussion of material United States federal
income tax consequences, under current law, generally applicable to a U.S.
Holder (as hereinafter defined) of common shares of Rockwell. This discussion
does not address all potentially relevant federal income tax matters and it does
not address consequences peculiar to persons subject to special provisions of
federal income tax law, such as those described below as excluded from the
definition of a U.S. Holder. In addition, this discussion does not cover any
state, local or foreign tax consequences, (see Taxation  Canadian Federal
Income Tax Consequences above). Accordingly, holders and prospective holders of
common shares of Rockwell are urged to consult their own tax advisors about the
specific federal, state, local, and foreign tax consequences to them of
purchasing, owning and disposing of common shares of Rockwell, based upon their
individual circumstances.

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 and which are subject to differing
interpretations. This discussion does not consider the potential effects, both
adverse and beneficial, of any proposed legislation which, if enacted, could be
applied, possibly on a retroactive basis, at any time.

---

 page 73 

U.S. Holders

As used herein, a U.S. Holder means a holder of common shares
of Rockwell who is a citizen or individual resident of the United States, a
corporation or partnership created or organized in or under the laws of the
United States or of any political subdivision thereof, an entity created or
organized in or under the laws of the United States or of any political
subdivision thereof which has elected to be treated as a corporation for United
States federal income tax purposes (under Treasury Regulation Section 301.7701
-3), an estate whose income is taxable in the United States irrespective of
source or a trust subject to the primary supervision of a court within the
United States and control of a United States fiduciary as described in Section
7701(a)(30) of the Code. This summary does not address the tax consequences to,
and U.S. Holder does not include, persons subject to specific provisions of
federal income tax law, such as tax-exempt organizations, qualified retirement
plans, individual retirement accounts and other tax-deferred accounts, financial
institutions, insurance companies, real estate investment trusts, regulated
investment companies, broker-dealers, non-resident alien individuals, persons or
entities that have a functional currency other than the U.S. dollar,
shareholders subject to the alternative minimum tax, shareholders who hold
common shares as part of a straddle, hedging or conversion transaction, and
shareholders who acquired their common shares through the exercise of employee
stock options or otherwise as compensation for services. This summary is limited
to U.S. Holders who own common shares as capital assets and who own (directly
and indirectly, pursuant to applicable rules of constructive ownership) no more
than 5% of the value of the total outstanding stock of Rockwell. This summary
does not address the consequences to a person or entity holding an interest in a
shareholder or the consequences to a person of the ownership, exercise or
disposition of any options, warrants or other rights to acquire common shares.
In addition, this summary does not address special rules applicable to United
States persons (as defined in Section 7701(a)(30) of the Code) holding common
shares through a foreign partnership or to foreign persons holding common shares
through a domestic partnership.

Distribution on Common Shares of Rockwell

In general, U.S. Holders receiving dividend distributions
(including constructive dividends) with respect to common shares of Rockwell are
required to include in gross income for United States federal income tax
purposes the gross amount of such distributions, equal to the U.S. dollar value
of such distributions on the date of receipt (based on the exchange rate on such
date), to the extent that Rockwell has current or accumulated earnings and
profits, without reduction for any Canadian income tax withheld from such
distributions. Such Canadian tax withheld may be credited, subject to certain
limitations, against the U.S. Holders federal income tax liability or,
alternatively, may be deducted in computing the U.S. Holders 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 Rockwell, they will be treated first as a
return of capital up to the U.S. Holders adjusted basis in the common shares
and thereafter as gain from the sale or exchange of property. Preferential tax
rates for long-term capital gains are applicable to a U.S. Holder that is an
individual, estate or trust. There are currently no preferential tax rates for
long-term capital gains for a U.S. Holder which is a corporation.

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

---

 page 74 

Dividends paid on the common shares of Rockwell generally will
not be eligible for the dividends received deduction provided to corporations
receiving dividends from certain United States corporations. A U.S. Holder which
is a corporation and which owns shares representing at least 10% of the voting
power and value of Rockwell may, under certain circumstances, be entitled to a
70% (or 80% if the U.S. Holder owns shares representing at least 20% of the
voting power and value of Rockwell) deduction of the United States source
portion of dividends received from Rockwell (unless Rockwell qualifies as a
foreign personal holding company or a passive foreign investment company, as
defined below). Rockwell does not anticipate that it will earn any United States
income, however, and therefore does not anticipate that any U.S. Holder will be
eligible for the dividends received deduction.

Under current Treasury Regulations, dividends paid on
Rockwells common shares, if any, generally will not be subject to information
reporting and generally will not be subject to U.S. backup withholding tax.
However, dividends and the proceeds from a sale of Rockwells common shares paid
in the U.S. through a U.S. or U.S. related paying agent (including a broker)
will be subject to U.S. information reporting requirements and may also be
subject to the 28% U.S. backup withholding tax, unless the paying agent is
furnished with a duly completed and signed Form W-9. Any amounts withheld under
the U.S. backup withholding tax rules will be allowed as a refund or a credit
against the U.S. Holders U.S. federal income tax liability, provided the
required information is furnished to the IRS.

Foreign Tax Credit

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

Disposition of Common Shares of Rockwell

In general, U.S. Holders will recognize gain or loss upon the
sale of common shares of Rockwell equal to the difference, if any, between (i)
the amount of cash plus the fair market value of any property received, and (ii)
the shareholders tax basis in the common shares of Rockwell. Preferential tax
rates apply to long-term capital gains of U.S. Holders that are individuals,
estates or trusts. In general, gain or loss on the sale of common shares of
Rockwell will be long-term capital gain or loss if the common shares are a
capital asset in the hands of the U.S. Holder and are held for more than one
year. Deductions for net capital losses are subject to significant limitations.
For U.S. Holders that are not corporations, 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 that are corporations (other
than corporations subject to Subchapter S of the Code), an unused net capital
loss may be carried back three years and carried forward

---

 page 75 

five years from the loss year to be offset against capital
gains until such net capital loss is thereby exhausted.

Other Considerations

Set forth below are certain material exceptions to the
above-described general rules describing the United States federal income tax
consequences resulting from the holding and disposition of common shares:

Foreign Personal Holding Company

If at any time during a taxable year more than 50% of the total
combined voting power or the total value of Rockwells outstanding shares is
owned, directly or indirectly (pursuant to applicable rules of constructive
ownership), by five or fewer individuals who are citizens or residents of the
United States and 60% or more of Rockwells gross income for such year is
derived from certain passive sources (e.g., from certain interest and
dividends), Rockwell may be treated as a foreign personal holding company. In
that event, U.S. Holders that hold common shares would be required to include in
gross income for such year their allocable portions of such passive income to
the extent Rockwell does not actually distribute such income. Rockwell does not
believe that it currently qualifies as a foreign personal holding company.
However, there can be no assurance that Rockwell will not be considered a
foreign personal holding company for the current or any future taxable year.

Foreign Investment Company

If 50% or more of the combined voting power or total value of
Rockwells outstanding shares is held, directly or indirectly, by citizens or
residents of the United States, United States domestic partnerships or
corporations, or estates or trusts other than foreign estates or trusts (as
defined by Code Section 7701(a)(31)), and Rockwell is found to be engaged
primarily in the business of investing, reinvesting, or trading in securities,
commodities, or any interest therein, it is possible that Rockwell may be
treated as a foreign investment company as defined in Section 1246 of the
Code, causing all or part of any gain realized by a U.S. Holder selling or
exchanging common shares to be treated as ordinary income rather than capital
gain. Rockwell does not believe that it currently qualifies as a foreign
investment company. However, there can be no assurance that Rockwell will not be
considered a foreign investment company for the current or any future taxable
year.

Passive Foreign Investment Company

United States income tax law contains rules governing passive
foreign investment companies (PFIC) which can have significant tax effects on
U.S. Holders of foreign corporations. These rules do not apply to non-U.S.
Holders. Section 1297 of the Code defines a PFIC as a corporation that is not
formed in the United States if, for any taxable year, either (i) 75% or more of
its gross income is passive income, which includes interest, dividends and
certain rents and royalties or (ii) the average percentage, by fair market value
(or, if the corporation is not publicly traded and either is a controlled
foreign corporation or makes an election, by adjusted tax basis), of its assets
that produce or are held for the production of passive income is 50% or more.
Rockwell appears to have been a PFIC for the fiscal year ended May 31, 2005, and
at least certain prior fiscal years. In addition, Rockwell expects to qualify as
a PFIC for the fiscal year ending May 31, 2006 and may also qualify as a PFIC in
future fiscal years. Each U.S. Holder of Rockwell is urged to consult a tax
advisor with respect to how the PFIC rules affect such U.S. Holders tax
situation.

Each U.S. Holder who holds stock in a foreign corporation
during any year in which such corporation qualifies as a PFIC is subject to
United States federal income taxation under one of three alternative tax regimes
at the election of such U.S. Holder. The following is a discussion of such
alternative tax regimes applied to such U.S. Holders of Rockwell. In addition,
special rules apply if a foreign corporation

---

 page 76 

qualifies as both a PFIC and a controlled foreign corporation
(as defined below) and a U.S. Holder owns, actually or constructively, 10% or
more of the total combined voting power of all classes of stock entitled to vote
of such foreign corporation (See more detailed discussion at Controlled Foreign
Corporation below).

A U.S. Holder who elects to treat Rockwell as a qualified
electing fund (QEF) will be subject, under Section 1293 of the Code, to
current federal income tax for any taxable year to which the election applies in
which Rockwell qualifies as a PFIC on his pro rata share of Rockwells (i) net
capital gain (the excess of net long-term capital gain over net short-term
capital loss), which will be taxed as long-term capital gain, and (ii) ordinary
earnings (the excess of earnings and profits over net capital gain), which will
be taxed as ordinary income, in each case, for the shareholders taxable year in
which (or with which) Rockwells taxable year ends, regardless of whether such
amounts are actually distributed. A U.S. Holders tax basis in the common shares
will be increased by any such amount that is included in income but not
distributed.

The procedure a U.S. Holder must comply with in making an
effective QEF election, and the consequences of such election, will depend on
whether the year of the election is the first year in the U.S. Holders holding
period in which Rockwell is a PFIC. If the U.S. Holder makes a QEF election in
such first year, i.e., a timely QEF election, then the U.S. Holder may make
the QEF election by simply filing the appropriate documents at the time the U.S.
Holder files his tax return for such first year. If, however, Rockwell qualified
as a PFIC in a prior year during the U.S. Holders holding period, then, in
order to avoid the Section 1291 rules discussed below, in addition to filing
documents, the U.S. Holder must elect to recognize under the rules of Section
1291 of the Code (discussed herein), (i) any gain that he would otherwise
recognize if the U.S. Holder sold his stock on the qualification date or (ii) if
Rockwell is a controlled foreign corporation, the U.S. Holders pro rata share
of Rockwells post-1986 earnings and profits as of the qualification date. The
qualification date is the first day of Rockwells first tax year in which
Rockwell qualified as a QEF with respect to such U.S. Holder. For purposes of
this discussion, a U.S. Holder who makes (i) a timely QEF election, or (ii) an
untimely QEF election and either of the above-described gain-recognition
elections under Section 1291 is referred to herein as an Electing U.S. Holder.
A U.S. Holder who holds common shares at any time during a year of Rockwell in
which Rockwell is a PFIC and who is not an Electing U.S. Holder (including a
U.S. Holder who makes an untimely QEF election and makes neither of the
above-described gain-recognition elections) is referred to herein as a
Non-Electing U.S. Holder. An Electing U.S. Holder (i) generally treats any
gain realized on the disposition of his Company common shares as capital gain;
and (ii) may either avoid interest charges resulting from PFIC status
altogether, or make an annual election, subject to certain limitations, to defer
payment of current taxes on his share of Rockwells annual realized net capital
gain and ordinary earnings subject, however, to an interest charge. If the U.S.
Holder is not a corporation, any interest charge imposed under the PFIC regime
would be treated as personal interest that is not deductible.

In order for a U.S. Holder to make (or maintain) a valid QEF
election, Rockwell must provide certain information regarding its net capital
gains and ordinary earnings and permit its books and records to be examined to
verify such information. Rockwell intends to make the necessary information
available to U.S. Holders to permit them to make (and maintain) QEF elections
with respect to Rockwell. Rockwell urges each U.S. Holder to consult a tax
advisor regarding the availability of, and procedure for making, the QEF
election.

A QEF election, once made with respect to Rockwell, applies to
the tax year for which it was made and to all subsequent tax years, unless the
election is invalidated or terminated, or the IRS consents to revocation of the
election. If a QEF election is made by a U.S. Holder and Rockwell ceases to
qualify as a PFIC in a subsequent tax year, the QEF election will remain in
effect, although not applicable, during those tax years in which Rockwell does
not qualify as a PFIC. Therefore, if Rockwell again qualifies as a PFIC in

---

 page 77 

a subsequent tax year, the QEF election will be effective and
the U.S. Holder will be subject to the rules described above for Electing U.S.
Holders in such tax year and any subsequent tax years in which Rockwell
qualifies as a PFIC. In addition, the QEF election remains in effect, although
not applicable, with respect to an Electing U.S. Holder even after such U.S.
Holder disposes of all of his or its direct and indirect interest in the shares
of Rockwell. Therefore, if such U.S. Holder reacquires an interest in Rockwell,
that U.S. Holder will be subject to the rules described above for Electing U.S.
Holders for each tax year in which Rockwell qualifies as a PFIC.

In the case of a Non-Electing U.S. Holder, special taxation
rules under Section 1291 of the Code will apply to (i) gains realized on the
disposition (or deemed to be realized by reasons of a pledge) of his Rockwell
common shares and (ii) certain excess distributions, as defined in Section
1291(b), by Rockwell.

A Non-Electing U.S. Holder generally would be required to pro
rate all gains realized on the disposition of his Rockwell common shares and all
excess distributions on his Rockwell common shares over the entire holding
period for the common shares. All gains or excess distributions allocated to
prior years of the U.S. Holder (excluding any portion of the holders period
prior to the first day of the first year of Rockwell (i) which began after
December 31, 1986, and (ii) for which Rockwell was a PFIC) would be taxed at the
highest tax rate for each such prior year applicable to ordinary income. The
Non-Electing U.S. Holder also would be liable for interest on the foregoing tax
liability for each such prior year calculated as if such liability had been due
with respect to each such prior year. A Non-Electing U.S. Holder that is not a
corporation must treat this interest charge as personal interest which, as
discussed above, is wholly non-deductible. The balance, if any, of the gain or
the excess distribution will be treated as ordinary income in the year of the
disposition or distribution, and no interest charge will be incurred with
respect to such balance. In certain circumstances, the sum of the tax and the
PFIC interest charge may exceed the amount of the excess distribution received,
or the amount of proceeds of disposition realized, by the U.S. Holder.

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

Effective for tax years of U.S. Holders beginning after
December 31, 1997, U.S. Holders who hold (actually or constructively) marketable
stock of a foreign corporation that qualifies as a PFIC may elect to mark such
stock to the market annually (a mark-to-market election). If such an election
is made, such U.S. Holder will generally not be subject to the special taxation
rules of Section 1291 discussed above. However, if the mark-to-market election
is made by a Non-Electing U.S. Holder after the beginning of the holding period
for the PFIC stock, then the Section 1291 rules will apply to certain
dispositions of, distributions on and other amounts taxable with respect to
Rockwell common shares. A U.S. Holder who makes the mark-to-market election will
include in income for each taxable year for which the election is in effect an
amount equal to the excess, if any, of the fair market value of the common
shares of Rockwell as of the close of such tax year over such U.S. Holders
adjusted basis in such common shares. In addition, the U.S. Holder is allowed a
deduction for the lesser of (i) the excess, if any, of such U.S. Holders
adjusted tax basis in the common shares over the fair market value of such
shares as of the close of the tax year, or (ii) the excess, if any, of (A) the
mark-to-market gains for the common shares in Rockwell included by such U.S.
Holder for prior tax years, including any amount which would have been treated
as a mark-to-market gain for any prior tax year but for the Section 1291 rules
discussed above with respect to Non-Electing U.S. Holders, over (B) the
mark-to-market losses for shares that were

---

 page 78 

allowed as deductions for prior tax years. A U.S. Holders
adjusted tax basis in the common shares of Rockwell will be adjusted to reflect
the amount included in or deducted from income as a result of a mark-to-market
election. A mark-to-market election applies to the taxable year in which the
election is made and to each subsequent taxable year, unless Rockwell common
shares cease to be marketable, as specifically defined, or the IRS consents to
revocation of the election. Because the IRS has not established procedures for
making a mark-to-market election, U.S. Holders should consult their tax advisors
regarding the manner of making such an election. No view is expressed regarding
whether common shares of Rockwell are marketable for these purposes or whether
the election will be available.

Under Section 1291(f) of the Code, the IRS has issued Proposed
Treasury Regulations that, subject to certain exceptions, would treat as taxable
certain transfers of PFIC stock by Non-Electing U.S. Holders that are generally
not otherwise taxed, such as gifts, exchanges pursuant to corporate
reorganizations, and transfers at death. Generally, in such cases the basis of
Rockwell common shares in the hands of the transferee and the basis of any
property received in the exchange for those common shares would be increased by
the amount of gain recognized. Under the Proposed Treasury Regulations, an
Electing U.S. Holder would not be taxed on certain transfers of PFIC stock, such
as gifts, exchanges pursuant to corporate reorganizations, and transfers at
death. The transferees basis in this case will depend on the manner of the
transfer. In the case of a transfer by an Electing U.S. Holder upon death, for
example, the transferees basis is generally equal to the fair market value of
the Electing U.S. Holders common shares as of the date of death under Section
1014 of the Code. The specific tax effect to the U.S. Holder and the transferee
may vary based on the manner in which the common shares are transferred. Each
U.S. Holder of Rockwell is urged to consult a tax advisor with respect to how
the PFIC rules affect his or its tax situation.

Whether or not a U.S. Holder makes a timely QEF election with
respect to common shares of Rockwell, certain adverse rules may apply in the
event that both Rockwell and any foreign corporation in which Rockwell directly
or indirectly holds shares is a PFIC (a lower-tier PFIC). Pursuant to certain
Proposed Treasury Regulations, a U.S. Holder would be treated as owning his or
its proportionate amount of any lower-tier PFIC shares, and generally would be
subject to the PFIC rules with respect to such indirectly-held PFIC shares
unless such U.S. Holder makes a timely QEF election with respect thereto.
Rockwell intends to make the necessary information available to U.S. Holders to
permit them to make (and maintain) QEF elections with respect to each subsidiary
of Rockwell that is a PFIC.

Under the Proposed Treasury Regulations, a U.S. Holder who does
not make a timely QEF election with respect to a lower-tier PFIC generally would
be subject to tax (and the PFIC interest charge) on (i) any excess distribution
deemed to have been received with respect to his or its lower-tier PFIC shares
and (ii) any gain deemed to arise from a so-called indirect disposition of
such shares. For this purpose, an indirect disposition of lower-tier PFIC shares
would generally include (i) a disposition by Rockwell (or an intermediate
entity) of lower-tier PFIC shares, and (ii) any other transaction resulting in a
diminution of the U.S. Holders proportionate ownership of the lower-tier PFIC,
including an issuance of additional common shares by Rockwell (or an
intermediate entity). Accordingly, each prospective U.S. Holder should be aware
that he or it could be subject to tax even if such U.S. Holder receives no
distributions from Rockwell and does not dispose of its common shares.
Rockwell strongly urges each prospective U.S. Holder to consult a tax advisor
with respect to the adverse rules applicable, under the Proposed Treasury
Regulations, to U.S. Holders of lower-tier PFIC shares.

Certain special, generally adverse, rules will apply with
respect to Rockwell common shares while Rockwell is a PFIC unless the U.S.
Holder makes a timely QEF election. For example under Section 1298(b)(6) of the
Code, a U.S. Holder who uses PFIC stock as security for a loan (including a
margin loan) will, except as may be provided in regulations, be treated as
having made a taxable disposition of such shares.

---

 page 79 

Controlled Foreign Corporation

If more than 50% of the total combined voting power of all
classes of shares entitled to vote or the total value of the shares of Rockwell
is owned, actually or constructively, by citizens or residents of the United
States, United States domestic partnerships or corporation, or estates or trusts
other than foreign estates or trusts (as defined by Code Section 7701(a)(31)),
each of which own, actually or constructively, 10% or more of the total combined
voting power of all classes of shares entitled to vote of Rockwell (United
States Shareholder), Rockwell could be treated as a controlled foreign
corporation (CFC) under Subpart F of the Code. This classification would
effect many complex results, one of which is the inclusion of certain income of
a CFC which is subject to current U.S. tax. The United States generally taxes
United States Shareholders of a CFC currently on their pro rata shares of the
Subpart F income of the CFC. Such United States Shareholders are generally
treated as having received a current distribution out of the CFCs Subpart F
income and are also subject to current U.S. tax on their pro rata shares of
increases in the CFCs earnings invested in U.S. property. The foreign tax
credit described above may reduce the U.S. tax on these amounts. In addition,
under Section 1248 of the Code, gain from the sale or exchange of shares by a
U.S. Holder of common shares of Rockwell which is or was a United States
Shareholder at any time during the five-year period ending on the date of the
sale or exchange is treated as ordinary income to the extent of earnings and
profits of Rockwell attributable to the shares sold or exchanged. If a foreign
corporation is both a PFIC and a CFC, the foreign corporation generally will not
be treated as a PFIC with respect to United States Shareholders of the CFC. This
rule generally will be effective for taxable years of United States Shareholders
beginning after 1997 and for taxable years of foreign corporations ending with
or within such taxable years of United States Shareholders. Special rules apply
to United States Shareholders who are subject to the special taxation rules
under Section 1291 discussed above with respect to a PFIC. Because of the
complexity of Subpart F, a more detailed review of these rules is outside of the
scope of this discussion. Rockwell does not believe that it currently qualifies
as a CFC. However, there can be no assurance that Rockwell will not be
considered a CFC for the current or any future taxable year.

|F.              | Dividends and Paying Agents
|--------------- | ---------------------------
|                |                            
|Not applicable.
|               
|G.              | Statement by Experts       
|                |                            
|Not applicable.
|               
|H.              | Documents on Display       

Exhibits attached to this Form 20-F are also available for
viewing at the offices of Rockwell, Suite 1020 800 West Pender Street,
Vancouver, British Columbia V6C 2V6 or on request of Rockwell at 604-684-6365,
attention: Shirley Main. Copies of Rockwells financial statements and other
continuous disclosure documents required under the British Columbia
Securities Act are available for viewing on the internet at
www.sedar.com.

|I. | Subsidiary Information
|-- | ----------------------

Not applicable.

---

 page 80 

|ITEM11.**** | **QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT
      MARKET RISK**
|----------- | --------------------------------------------------------------------

|(a) | Transaction Risk and Currency Risk Management
|--- | ---------------------------------------------

The Companys operations do not employ financial instruments or
derivatives that are market sensitive and the Company does not have financial
market risks.

|(b) | Exchange Rate Sensitivity
|--- | -------------------------

In the normal course of business for its diamond operations,
the Company enters into transactions for the purchase of supplies and services
denominated in South African rand. As a result, the Company is subject to
foreign exchange risk from fluctuations in foreign exchange rates. The Company
has not entered into any derivative or other financial instruments to mitigate
this foreign exchange risk.

|(c) | Interest Rate Risk and Equity Price
  Risk
|--- | ------------------------------------------

The Company is equity financed and does not have any debt which
would be subject to interest rate change risks.

|(d) | Commodity Price Risk
|--- | --------------------

While the value of the Companys mineral properties can always
be said to relate to the price of the commodity and the outlook for same, the
Company does not have any operating mines nor economic ore and hence does not
have any hedging or other commodity based risks respecting its operations.

|(e) | Exchange Controls
|--- | -----------------

The Company operates in South Africa, and like other foreign
entities operating there, is subject to currency exchange controls administered
by the South African Reserve Bank, the country's central bank. A significant
portion of the Company's funding structure for its South African operations
consists of advancing loans to its subsidiaries incorporated in South Africa.
The Companys ability to repatriate such funds once those subsidiaries are able
to repay the loans, or to repatriate other funds such as operating profits
should any develop, may be adversely affected by such exchange controls.

---

 page 81 

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

|A.              | Debt Securities           
|--------------- | --------------------------
|                |                           
|Not applicable.
|               
|B.              | Warrants and Rights       
|                |                           
|Not applicable.
|               
|C.              | Other Securities          
|                |                           
|Not applicable.
|               
|D.              | American Depositary Shares
|                |                           
|Not applicable.

---

 page 82 

PART II

---

 page 83 

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

Not applicable.

---

 page 84 

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

Not applicable.

---

 page 85 

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

As required by Rule 13a-15 under the Securities Exchange Act of
1934 (the Exchange Act), the Company carried out an evaluation of the
effectiveness of the design and operation of the Companys disclosure controls
and procedures as of May 31, 2006, the latest completed fiscal year. This
evaluation was carried out under the supervision and with the participation of
the Companys Chief Executive Officer, Ronald W. Thiessen, and the Companys
Chief Financial Officer, Jeffrey R. Mason. Based upon that evaluation, the
Companys Chief Executive Officer and Chief Financial Officer concluded that the
Companys disclosure controls and procedures are effective in timely alerting
management to material information relating to the Company required to be
included in the Companys periodic SEC filings. There have been no significant
changes in the Companys internal controls or in other factors that could
significantly affect internal controls subsequent to the date the Company
carried out its evaluation.

Disclosure controls and procedures are controls and other
procedures that are designed to ensure that information required to be disclosed
the Companys reports filed or submitted under the 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
under the Exchange Act is accumulated and communicated to management, including
the Companys Chief Executive Officer and Chief Financial Officer, to allow
timely decisions regarding required disclosure.

During the Companys most recently completed fiscal year ended
May 31, 2006, there were no changes in the Companys internal control over
financial reporting that have materially affected, or are reasonably likely to
affect, its internal control over financial reporting.

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

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

---

 page 86 

|ITEM 16. | AUDIT COMMITTEE, CODE OF
      ETHICS, ACCOUNTANT FEES AND **EXEMPTIONS**
|-------- | -------------------------------------------------------------------------

|A. | Audit Committee Financial
Expert
|-- | --------------------------------

The board of directors has determined that it does not have a
member of its audit committee who qualifies as a financial expert as defined
in Item 401(e) of Regulation S-B.

Rockwell believes that the members of its board of directors
are collectively capable of analyzing and evaluating its financial statements
and understanding internal controls and procedures for financial reporting.
However, Rockwell is currently reviewing candidates for this role.

|B. | Code of Ethics
|-- | --------------

Rockwell has adopted a code of ethics that applies to
Rockwell's chief executive officer, the chief financial officer, and other
members of senior management. As adopted, the Company's Code of Ethics sets
forth standards that are designed to prevent wrongdoing and to promote:

- honest and ethical conduct, including the ethical handling of actual or
  apparent conflicts of interest between personal and professional
  relationships;
- full, fair, accurate, timely and understandable disclosure in reports and
  documents that Rockwell files with, or submits to, the Securities and Exchange
  Commission and in other public communications made by Rockwell;
- compliance with applicable governmental laws, rules and regulations;
- the prompt internal reporting of violations of the Code of Ethics to an
  appropriate person or persons identified in the Code of Ethics; and
- accountability for adherence to the Code of Ethics.

If any person becomes aware of a breach, or suspected breach,
of the Code of Ethics, that person must report it immediately to his or her
manager and Rockwells corporate secretary for action. If this is inappropriate
or uncomfortable for the individual, the breach, or suspected breach, should be
reported to another member of the senior management team and the corporate
secretary for action. The Code of Conduct forms part of the conditions of
employment for every one of Rockwells employees and officers, and also applies
to its directors and contractors. Failure to comply with the Code of Conduct can
result in disciplinary action including, where appropriate, dismissal.

The Code of Ethics was appended as an exhibit to Rockwells
annual report on Form 20-F for the fiscal year ended May 31, 2004, filed with
the Securities and Exchange Commission on November 30, 2004. Rockwell will
provide a copy of the Code of Ethics to any person without charge, upon request.
Requests can be sent to: Rockwell Ventures Inc., Suite 1020, 800 West Pender
Street, Vancouver, British Columbia, Canada, V6C 2V6, Attention: The Corporate
Secretary.

---

 page 87 

|C. | Principal Accountant Fees and
  Services
|-- | ----------------------------------------

The following table discloses the aggregate fees billed for
each of the last two fiscal years for professional services rendered by the
Company's audit firm for various services.

Services:
    
    Year endedMay 31, 2006
    
    
    May 31, 2005Audit Fees
    $
    32,250
    
    $
    20,000Tax Fees
    
    3,500
    
    
    3,150$
    35,750
    
    $
    23,150


Audit related fees comprise of fees billed for assurance and
advisory services related to the annual audit. From time to time, management of
the Company recommends to and requests approval from the audit committee for
non-audit services to be provided by the Company's auditors. The audit committee
routinely considers such requests at committee meetings, and if acceptable to a
majority of the audit committee members, pre-approves such non-audit services by
a resolution authorizing management to engage the Company's auditors for such
non-audit services, with set maximum dollar amounts for each itemized service.
During such deliberations, the audit committee assesses, among other factors,
whether the services requested would be considered prohibited services as
contemplated by the US Securities and Exchange Commission, and whether the
services requested and the fees related to such services could impair the
independence of the auditors.

|D.              | Exemptions from Listing Standards for Audit
      Committees                
|--------------- | ----------------------------------------------------------------------------
|                |                                                                             
|Not applicable.
|               
|E.              | Purchases of Equity Securities by the Issuer
      and Affiliated Purchasers
|                |                                                                             
|None.          

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 page 88 

PART III

---

 page 89 

|ITEM 17. | FINANCIAL
      STATEMENTS
|-------- | --------------------------

The following attached financial statements are incorporated
herein:

|(1) | Report of Independent Registered Public Accounting Firm
      on the consolidated balance sheets as at May 31, 2006 and 2005;
      consolidated statements of operations and deficit, cash flows and
      consolidated schedules of exploration expenses for each of the years ended
      May 31, 2006, 2005 and 2004;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                          
|(2) | Consolidated balance sheets as at May 31, 2006 and
      2005;                                                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                          
|(3) | Consolidated statements of operations and deficit for
      each of the years ended May 31, 2006, 2005 and 2004;                                                                                                                                                                                                         
|    |                                                                                                                                                                                                                                                                                                                          
|(4) | Consolidated statements of cash flows for the periods
      referred to in (3) above;                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                          
|(5) | Consolidated schedules of exploration expenses for the
      periods referred to in (3) above;                                                                                                                                                                                                                           
|    |                                                                                                                                                                                                                                                                                                                          
|(6) | Notes to the consolidated financial
  statements;                                                                                                                                                                                                                                                                        

---

 page 90 

|ITEM 18.                       | FINANCIAL
      STATEMENTS
|------------------------------ | --------------------------
|                               |                           
|Not applicable.   See Item 17.

---

 page 91 

|ITEM 19. | EXHIBITS
|-------- | --------

The following Exhibits have been filed with Rockwells Annual
Report on Form 20-F in previous years:

|Description                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Geological Management and Administration Services Agreement dated for
      reference December 31, 1996.
      Amended Share Incentive Plan dated for reference June 21, 2000 (See
      Item 6 Share Incentive Plan).
      Mineral Properties Transfer Agreement among Hunter Dickinson Group Inc.,
        and Rockwell Ventures Inc. and Amarc Resources Ltd.
      Option Assignment Agreement between Hunter Dickinson Group Inc. and
      Rockwell Ventures Inc.
      Geological, Management and Administration Services Agreement between
        Hunter Dickinson Inc. and Rockwell Ventures Inc., dated January 1, 2001.
      Rio Tinto Agreement dated January 30, 2004
      Farmout Agreement with Amarc Resources Ltd. dated November 25, 2004
      Code of Ethics

The following
  Exhibits are incorporated by reference to the Company's Annual Report on Form
  20-F filed December 15th, 2006:

| | Exhibit | Description                                                                                                                                                                                                                                                                                                                                                                                        
| | ------- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.1     | Acquisition
        Agreement amongst Rockwell Ventures Inc., Hunter Dickinson Inc. and Jeffrey
        Brian Brenner, Robert Pinkas Blau, Larry Lipschitz, Dennis Mark Bristow,
        John Bristow, Leslie Johnston, Gabriel Rousseau Malan, Ira Sasha Epstein,
        and Jester Investment Trust for  the purchase of the common shares
        of Durnpike Investments (Proprietary) Limited
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.2     | Loan Agreement
        between Rockwell Ventures Inc., Rockwell Resources RSA (Proprietary) Limited
        and Durnpike Investments (Proprietary) Limited, Jeffrey Brenner, Robert
        Blau, Larry Lipschitz, Mark Bristow, John Bristow, Les Johnston, Gawie
        Malan, Ira Sasha Epstein                                                                                                
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.3     | Contractor
        Agreement between Galputs Minerale (Proprietary) Limited and Durnpike
        Investments (Proprietary) Limited                                                                                                                                                                                                                                                                 
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.4     | Credit Agreement
        between Quest Capital Corp. and Rockwell Ventures dated July 7, 2006.                                                                                                                                                                                                                                                                                                     
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.5     | Subordinated
        Convertible Note Subscription Agreement                                                                                                                                                                                                                                                                                                                                       
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.6     | Share Incentive
        Plan                                                                                                                                                                                                                                                                                                                                                                       
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 4.7     | $21 million private placement of 42 million units at $0.50
      per unit Subscription Agreement                                                                                                                                                                                                                                                                                                   
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 12.1    | Section 302 Certification of CEO                                                                                                                                                                                                                                                                                                                                                                   
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 12.2    | Section 302 Certification of CFO                                                                                                                                                                                                                                                                                                                                                                   
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 13.1    | Section 906 Certification of CEO                                                                                                                                                                                                                                                                                                                                                                   
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 13.2    | Section 906 Certification of CFO                                                                                                                                                                                                                                                                                                                                                                   
| |         |                                                                                                                                                                                                                                                                                                                                                                                                    
| | 99.1    | Audited financial
        statements as at May 31, 2006 and 2005 and for the years ended May 31,
        2006, 2005, and 2004, and the Report of Independent Registered Public
        Accounting Firm thereon.                                                                                                                                                                                    

---

 page 92 

SIGNATURES

The Registrant 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.

|                           | ROCKWELL VENTURES INC.
|-------------------------- | ----------------------
|                           |                       
|Date:
      March 30, 2007 | By:                   
|                           |                       
|                           |                       

---