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| | **UNITED STATES
        SECURITIES AND EXCHANGE COMMISSION**
        Washington, D.C. 20549
      FORM 20-F | PAGE
      1 OF 63 PAGES. 
      THE EXHIBIT INDEX 
      APPEARS ON PAGE 
      NUMBER 58.
| | ----------------------------------------------------------------------------------------------------------- | -------------------------------------------------------------------------------------------

(Mark One)

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

OR

x  ANNUAL REPORT
  PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934 
  For the fiscal year ended April 30, 2003

OR

** ̈******TRANSITION
  REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
  For the transition period from ______ to ______

COMMISSION FILE NUMBER:01-31380

KIRKLAND LAKE GOLD INC.
  
  (Exact name of Registrant as specified in its charter)

**N/A** 
  (Translation of Registrants name into English)

Canada 
  (Jurisdiction of incorporation or organization)

Macassa Mine Kirkland Lake, Ontario Canada 
  (Address of principal executive offices)

Securities registered or to be registered pursuant to section
  12(b) of the Act:

Title of each Class
      
      Name of each exchange on which registeredNone
      
      N/A


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

Common Shares 
  (Title of Class)

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

N/A 
  (Title of Class)

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

Common Shares: 24,076,166

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

YesxNo
  ** ̈******

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

Item 17 x
  Item 18  ** ̈******

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TABLE OF CONTENTS

|                                          |                                                             |                                                         | Page No | 
|----------------------------------------- | ----------------------------------------------------------- | ------------------------------------------------------- | ------- | 
|                                          |                                                             |                                                         |         | 
|GENERAL                                   | iii                                                         |                                                        
|NOTE REGARDING FORWARD LOOKING STATEMENTS | iii                                                         |                                                        
|GLOSSARY OF TERMS USED HEREIN             | iii                                                         |                                                        
|                                          |                                                             |                                                         |         | 
|PART I                                    |                                                             |                                                         | 1       | 
|                                          |                                                             |                                                         |         | 
|ITEM 1                                    | IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND
      ADVISORS | 1                                                       |        
|                                          | A.                                                          | Directors And Senior Management                         | 1       | 
|                                          | B.                                                          | Advisers                                                | 2       | 
|                                          | C.                                                          | Auditor                                                 | 2       | 
|                                          |                                                             |                                                         |         | 
|ITEM 2                                    | OFFER STATISTICS AND EXPECTED TIMETABLE                     | 2                                                       |        
|                                          |                                                             |                                                         |         | 
|ITEM 3                                    | KEY INFORMATION                                             | 2                                                       |        
|                                          | A.                                                          | Selected Financial Data                                 | 2       | 
|                                          | B.                                                          | Capitalization And Indebtedness                         | 5       | 
|                                          | C.                                                          | Reasons For The Offer And Use Of Proceeds               | 5       | 
|                                          | D.                                                          | Risk Factors                                            | 5       | 
|                                          |                                                             |                                                         |         | 
|ITEM 4                                    | INFORMATION ON THE COMPANY                                  | 11                                                      |        
|                                          | A.                                                          | History And Development Of The Company                  | 11      | 
|                                          | B.                                                          | Business Overview                                       | 14      | 
|                                          | C.                                                          | Organizational Structure                                | 16      | 
|                                          | D.                                                          | Property, Plants And Equipment                          | 16      | 
|                                          |                                                             |                                                         |         | 
|ITEM 5                                    | OPERATING AND FINANCIAL REVIEW AND PROSPECTS                | 28                                                      |        
|                                          | A.                                                          | Operating Results                                       | 28      | 
|                                          | B.                                                          | Liquidity And Capital Resources                         | 30      | 
|                                          | C.                                                          | Research And Development                                | 32      | 
|                                          | D.                                                          | Trend Information                                       | 33      | 
|                                          | E.                                                          | Off-Balance Sheet Arrangements                          | 33      | 
|                                          | F.                                                          | Tabular Disclosure Of Contractual Obligations           | 34      | 
|                                          | G.                                                          | Safe Harbor                                             | 34      | 
|                                          |                                                             |                                                         |         | 
|ITEM 6                                    | DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES                  | 34                                                      |        
|                                          | A.                                                          | Directors And Senior Management                         | 34      | 
|                                          | B.                                                          | Compensation                                            | 37      | 
|                                          | C.                                                          | Board Practices                                         | 39      | 
|                                          | D.                                                          | Employees                                               | 40      | 
|                                          | E.                                                          | Share Ownership                                         | 40      | 
|                                          |                                                             |                                                         |         | 
|ITEM 7                                    | MAJOR SHAREHOLDER AND RELATED PARTY TRANSACTIONS            | 42                                                      |        
|                                          | A.                                                          | Major Shareholders                                      | 42      | 
|                                          | B.                                                          | Related Party Transactions                              | 43      | 
|                                          | C.                                                          | Interests Of Experts And Counsel                        | 44      | 
|                                          |                                                             |                                                         |         | 
|ITEM 8                                    | FINANCIAL INFORMATION                                       | 44                                                      |        
|                                          | A.                                                          | Consolidated Statements And Other Financial Information | 44      | 
|                                          | B.                                                          | Significant Changes                                     | 44      | 

i

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|ITEM 9   | THE OFFER AND LISTING                                                              | 44                                     |   
|-------- | ---------------------------------------------------------------------------------- | -------------------------------------- | --
|         | A.                                                                                 | Offer And Listing Details              | 45
|         | B.                                                                                 | Plan Of Distribution                   | 46
|         | C.                                                                                 | Markets                                | 46
|         | D.                                                                                 | Selling Shareholders                   | 46
|         | E.                                                                                 | Dilution                               | 46
|         | F.                                                                                 | Expenses Of The Issue                  | 46
|         |                                                                                    |                                        |   
|ITEM 10  | ADDITIONAL INFORMATION                                                             | 47                                     |   
|         | A.                                                                                 | Share Capital                          | 47
|         | B.                                                                                 | Memorandum And Articles Of Association | 47
|         | C.                                                                                 | Material Contracts                     | 47
|         | D.                                                                                 | Exchange Controls                      | 49
|         | E.                                                                                 | Taxation                               | 49
|         | F.                                                                                 | Dividends And Paying Agents            | 56
|         | G.                                                                                 | Statements By Experts                  | 56
|         | H.                                                                                 | Documents On Display                   | 56
|         | I.                                                                                 | Subsidiary Information                 | 56
|         |                                                                                    |                                        |   
|ITEM 11  | QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT
      MARKET RISK                    | 56                                     |   
|         |                                                                                    |                                        |   
|ITEM 12  | DESCRIPTION OF SECURITIES OTHER THAN EQUITY
      SECURITIES                       | 56                                     |   
|         |                                                                                    |                                        |   
|PART II  |                                                                                    |                                        | 56
|         |                                                                                    |                                        |   
|ITEM 13  | DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES                                    | 56                                     |   
|         |                                                                                    |                                        |   
|ITEM 14  | MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY
      HOLDERS USE OF PROCEEDS AND | 57                                     |   
|         |                                                                                    |                                        |   
|ITEM 15  | CONTROLS AND PROCEDURES                                                            | 57                                     |   
|         |                                                                                    |                                        |   
|ITEM 16A | AUDIT COMMITTEE FINANCIAL EXPERT                                                   | 58                                     |   
|         |                                                                                    |                                        |   
|ITEM 16B | CODE OF ETHICS                                                                     | 58                                     |   
|         |                                                                                    |                                        |   
|PART III |                                                                                    |                                        | 58
|         |                                                                                    |                                        |   
|ITEM 17  | FINANCIAL STATEMENTS                                                               | 58                                     |   
|         |                                                                                    |                                        |   
|ITEM 18  | FINANCIAL STATEMENTS                                                               | 58                                     |   
|         |                                                                                    |                                        |   
|ITEM 19  | EXHIBITS                                                                           | 58                                     |   

ii

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GENERAL

All references herein to the Corporation mean
  Kirkland Lake Gold Inc..

The Corporation uses the Canadian dollar as its reporting
  currency. All references herein to dollars or $ or Cdn$
  means Canadian dollars, unless otherwise indicated. See Item 3A Key Information
   Selected Financial Data  Currency and Exchange Rates for
  detailed currency conversion information.

Except as noted, the information set forth herein is as of
  November 30, 2003.

NOTE REGARDING FORWARD LOOKING STATEMENTS

This document contains statements that constitute forward-looking
  statements within the meaning of section 27A of the Securities Act
  of 1933and section 21E of the Securities Exchange Act of 1934. Forward
  looking statements include the words believes, anticipates,
  intends, expects, estimates, projects
  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 the Corporation to be materially different from any future results, performance
  or achievements of the Corporation 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. The Corporation expressly disclaims
  any obligation or undertaking to provide an update or revision to any forward
  looking statement contained herein to reflect any change in the Corporations
  expectations or any change in events, conditions or circumstances on any which
  any statement is based. You should carefully review the cautionary statements
  and risk factors contained herein and in other documents that the Corporation
  files from time to time with the Securities and Exchange Commission.

GLOSSARY OF TERMS USED HEREIN

Certain terms used herein are defined as follows:

|advance royalty | A form of royalty where
        the payment is made before the commencement of commercial production and
        which forms a credit against future royalty payments once commercial production
        begins.                                                                                  
|--------------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|alkalic         | Containing one of sodium
        or potassium.                                                                                                                                                                                                                                                    
|alkali-feldspar | Potassic or sodium feldspar.                                                                                                                                                                                                                                                                      
|alluvial        | Relatively recent deposits
        of sedimentary material laid down in river beds, flood plains, lakes,
        or at the base of mountain slopes.                                                                                                                                               
|Archaean        | An era in geologic time
        about 4.6 billion to 2.5 billion years ago during which the Earths
        crust solidified.                                                                                                                                                                     
|augite          | A mineral consisting of
        calcium magnesium iron aluminium silicate.                                                                                                                                                                                                                        
|batholith       | A large mass of igneous
        rock extending to great depth with its upper portion dome-like in shape.
        It has crystallized below surface, but may be exposed as a result of erosion
        of the overlying rock. Smaller masses of igneous rocks are known as bosses
        or plugs.

iii

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|breccia            | Rock consisting of angular
        fragments in a matrix of finer-grained cementing material.                                                                                                                                                                                                                                                                                                                               
|------------------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|Canadian Shield    | A region of Precambrian
        (greater than 600 million years old) rock covering central, eastern and
        northern Canada and extending south into Minnesota and Wisconsin. Large
        areas of the Canadian Shield have been exposed by the erosion of younger
        rocks overlaying the Precambrian rock.                                                                                                     
|cataclasis         | Crushing of rocks.                                                                                                                                                                                                                                                                                                                                                                                                          
|collar             | 1)       The
        timbering or concrete around the mouth of a shaft.
        2)       The top of a drill hole.                                                                                                                                                                                                                                                                                                           
|conglomerate       | A sedimentary rock consisting
        of rounded, water-worn pebbles or boulders cemented into a solid mass.                                                                                                                                                                                                                                                                                                                
|crosscut           | A horizontal opening driven
        from a shaft and at right angles to the strike of a vein or rock formation.                                                                                                                                                                                                                                                                                                             
|cut (and uncut)    | Assays are cut
        or reduced to a lower consistent value in order to avoid such higher grade
        assays skewing the average which would otherwise produce inconsistent
        results. If assays are uncut such higher grade assays are
        included.                                                                                                                                                     
|diabase            | A common basic igneous
        rock usually occurring in dykes or sills.                                                                                                                                                                                                                                                                                                                                                    
|diamond drill(ing) | A rotary type of rock drill
        in which the cutting is done by abrasion rather than percussion. The cutting
        bit is set with diamonds and is attached to the end of long hollow rods
        through which water or other fluid is pumped to the cutting face as a
        lubricant. The drill cuts a core of rock that is recovered in long cylindrical
        sections, two centimetres or more in diameter.
|dore               | The final saleable product
        of a gold mine. Usually a bar consisting of gold and silver.                                                                                                                                                                                                                                                                                                                             
|drift              | A horizontal underground
        opening that follows along the length of a vein or rock formation as opposed
        to a crosscut which crosses the rock formation.                                                                                                                                                                                                                                                       
|dyke               | A long and relatively thin
        body of igneous rock that, while in the molten state, intruded a fissure
        in older rocks.                                                                                                                                                                                                                                                                                         
|fault              | A break in the Earths
        crust caused by tectonic forces which have moved the rock on one side
        with respect to the other; faults may extend many kilometres, or be only
        a few centimetres in length; similarly, the movement or displacement along
        the fault may vary widely.                                                                                                                 
|feldspar           | A group of rock-forming
        minerals.                                                                                                                                                                                                                                                                                                                                                                                   
|felsic             | The term used to describe
        light-coloured rocks containing feldspar, fledpathoids and silica.                                                                                                                                                                                                                                                                                                                        
|fluvial            | Sedimentary material found
        in river beds.                                                                                                                                                                                                                                                                                                                                                                           
|footwall           | The wall or rock on the
        underside of a vein or ore structure.                                                                                                                                                                                                                                                                                                                                                       
|fracture           | A break in the rock, the
        opening of which affords the opportunity for entry of mineral-bearing
        solutions. A cross fracture is a minor break extending at
        more-or-less right angles to the direction of the principal fractures.                                                                                                                                                                   

iv

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|fuchsite            | A mica with a characteristic
        (emerald) green colour arising from the presence of chrome or vanadium.                                                                                                                                                                                                                                                                   
|------------------- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|geotechnical        | Using geology and geological
        engineering.                                                                                                                                                                                                                                                                                                                              
|gneiss              | A coarsely crystalline
        metamorphic rock that looks like granite except that the light and dark
        minerals are segregated into thin layers or lenses.                                                                                                                                                                                                             
|granite             | A course-grained (intrusive)
        ingenious rock consisting of quartz, feldspar and mica.                                                                                                                                                                                                                                                                                   
|granitoid           | Rocks which are in the
        family of granites.                                                                                                                                                                                                                                                                                                                             
|greenstone          | Volcanic rocks forming
        belts within intrusive or sedimentary rocks and which are
        the source of most metal deposits.                                                                                                                                                                                                                                          
|hangingwall         | The wall or rock on the
        upper side of a vein or ore deposit.                                                                                                                                                                                                                                                                                                           
|hectare             | A square of 100 metres
        on each side.                                                                                                                                                                                                                                                                                                                                   
|igneous             | A type of rock which has
        been formed from magna, a molten substance from the earths core.                                                                                                                                                                                                                                                                             
|intrusive           | A body of igneous rock
        formed by the consolidation of magma intruded into other rocks, in contrast
        to lavas, which are extruded upon the surface.                                                                                                                                                                                                              
|komatiitic          | A volcanic rock containing
        a high concentration of magnesium and generally a low concentration of
        silica.                                                                                                                                                                                                                                                      
|lithofacies         | An association of several
        sedimentary rocks laid down during a common geologic time period.                                                                                                                                                                                                                                                                            
|lithological        | The nature and composition
        of rocks.                                                                                                                                                                                                                                                                                                                                   
|mafic               | Igneous rocks composed
        mostly of dark iron and magnesium rich minerals.                                                                                                                                                                                                                                                                                                
|massive             | Solid (without fractures)
        wide (thick) rock unit.                                                                                                                                                                                                                                                                                                                      
|metamorphic         | A type of rock which, through
        heat and pressure, has been changed from igneous or sedimentary rock.                                                                                                                                                                                                                                                                    
|meta-sedimentary    | Metamorphosed sedimentary
        rocks.                                                                                                                                                                                                                                                                                                                                       
|meta-volcanic       | Metamorphosed volcanic
        rocks.                                                                                                                                                                                                                                                                                                                                          
|mill                | 1) A plant in which ore
        is treated for the recovery of valuable metals, or the concentration of
        valuable minerals into 
             a smaller volume for shipment to a smelter or
        refinery.
        2) A piece of milling equipment consisting of a revolving drum, for the
        fine-grinding of ores as a preparation for
             treatment.
|mineralization      | The concentration of metals
        and their chemical compounds within a body of rock.                                                                                                                                                                                                                                                                                        
|modal               | The most frequent value
        of a set of data.                                                                                                                                                                                                                                                                                                                              
|net smelter royalty | A type of royalty based
        on a percentage of the proceeds, net of smelting, refining and transportation
        costs and penalties, from the sale of metals extracted from concentrate
        and doré by the smelter or refinery.                                                                                                                                     
|ore                 | A mixture of minerals and
        gangue from which at least one metal can be extracted at a profit.                                                                                                                                                                                                                                                                           

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|ortho-gneisses  | Gneisses (rocks) which
        have metamorphosed from granites.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|--------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|orthoclase      | Feldspar - potassic.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|para-gneisses   | Schists (rocks) which have
        metamorphosed from sedimentary rocks.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|pillowed        | Volcanic rocks that have
        formed from the bulbous cooling of magma when cooled quickly in water.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|placer          | An alluvial deposit of
        sand and gravel containing valuable metals such as gold, tin, etc.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|plagioclase     | Feldspar which has had
        calcium and aluminium substituted for sodium and silica.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|plugs           | A common name for a small
        offshoot from a larger batholith.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|plunge          | The vertical angle an ore
        body makes between the horizontal plane and the direction along which
        it extends, longitudinally to depth.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                       
|pluton          | Body of rock exposed after
        solidification at great depth.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
|polyphase       | Having multiple phases.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|porphyry        | Any igneous rock in which
        relatively large, conspicuous crystals (called phenocrysts) are set in
        a fine-grained groundmass.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|proto-continent | The earliest crust forming
        event in the Earths geological history and which is a predecessor
        to the current continent.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                    
|quartz          | A mineral whose composition
        is silicon dioxide. A crystalline form of silica.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|raise           | A vertical or inclined
        underground working that has been excavated from the bottom upward.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
|resource        | National Instrument 43-101
        Standards of Disclosure for Mineral Projectsof the Canadian Securities
        Administrators defines a Mineral Resource as a concentration
        or occurrence of natural, solid, inorganic or fossilized organic material
        in or on the Earths crust in such form and quantity and of such
        a grade or quality that it has reasonable prospects for economic extraction.
        The location, quantity, grade, geological characteristics and continuity
        of a mineral resource are known, estimated or interpreted from specific
        geological evidence and knowledge. 
        Mineral Resources are sub-divided, in order of increasing geological confidence,
        into Inferred, Indicated and Measured categories. An Inferred Mineral
        Resource has a lower level of confidence than that applied to an Indicated
        Mineral Resource. An Indicated Mineral Resource has a higher level of
        confidence than an Inferred Mineral Resource but has a lower level of
        confidence than a Measured Mineral Resource. 
        (1) Inferred Mineral Resource.An Inferred Mineral Resource
        is that part of a Mineral Resource for which quantity and grade or quality
        can be estimated on the basis of geological evidence and limited sampling
        and reasonably assumed, but not verified, geological and grade continuity.
        The estimate is based on limited information and sampling gathered through
        appropriate techniques from locations such as outcrops, trenches, pits,
        workings and drill holes.

vi

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|        | (2) Indicated Mineral Resource.An
        Indicated Mineral Resource is that part of a Mineral Resource
        for which quantity, grade or quality, densities, shape and physical characteristics
        can be estimated with a level of confidence sufficient to allow the appropriate
        application of technical and economic parameters, to support mine planning
        and evaluation of the economic viability of the deposit. The estimate
        is based on detailed and reliable exploration and testing information
        gathered through appropriate techniques from locations such as outcrops,
        trenches, pits, workings and drill holes that are spaced closely enough
        for geological and grade continuity to be reasonably assumed. 
        (3) Measured Mineral Resource.A Measured Mineral Resource
        is that part of a Mineral Resource for which quantity, grade or quality,
        densities, shape, physical characteristics are so well established that
        they can be estimated with confidence sufficient to allow the appropriate
        application of technical and economic parameters, to support production
        planning and evaluation of the economic viability of the deposit. The
        estimate is based on detailed and reliable exploration, sampling and testing
        information gathered through appropriate techniques from locations such
        as outcrops, trenches, pits, workings and drill holes that are spaced
        closely enough to confirm both geological and grade continuity. 
        Industry Guide 7 Description of Property by Issuers Engaged or to beEngaged in Significant Mining Operationsof the Securities
        and Exchange Commission does not define or recognize resources. 
        As used herein, resources are as defined in National Instrument
        43-101.
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|reserve | National Instrument 43-101 Standards
        of Disclosure for Mineral Projectsof the Canadian Securities Administrators
        defines a mineral reserve as the economically mineable part
        of a Measured or Indicated Mineral Resource demonstrated by at least a
        comprehensive study of the viability of a mineral project that has advanced
        to a stage where the mining method, in the case of underground mining,
        or the pit configuration, in the case of an open pit, has been established,
        and where an effective method of mineral processing has been determined.
        This study must include a financial analysis based on reasonable assumptions
        of technical, engineering, operating, and economic factors and evaluation
        of other relevant factors which are sufficient for a person qualified
        under such instrument, acting reasonably, to determine if all or part
        of the Mineral Resource may be classified as a Mineral Reserve. This study
        must include adequate information on mining, processing, metallurgical,
        economic and other relevant factors that demonstrate, at the time of reporting,
        that economic extraction can be justified. A Mineral Reserve includes
        diluting materials and allowances for losses that may occur when the material
        is mined.
        Mineral Reserves are sub-divided in order of increasing confidence into
        Probable Mineral Reserves and Proven Mineral Reserves. A Probable                                                                                                                                                                                                                                                                                                                                           

vii

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|            | Mineral Reserve has a lower level of
        confidence than a Proven Mineral Reserve.
        (1) Probable Mineral Reserve.A Probable Mineral Reserve
        is the economically mineable part of an Indicated, and in some circumstances
        a Measured Mineral Resource demonstrated by at least a Preliminary Feasibility
        Study. This Study must include adequate information on mining, processing,
        metallurgical, economic, and other relevant factors that demonstrate,
        at the time of reporting, that economic extraction can be justified.
        (2) Proven Mineral Reserve.A Proven Mineral Reserve
        is the economically mineable part of a Measured Mineral Resource demonstrated
        by at least a Preliminary Feasibility Study. This Study must include adequate
        information on mining, processing, metallurgical, economic, and other
        relevant factors that demonstrate, at the time of reporting, that economic
        extraction is justified. 
        Industry Guide 7 Description of Property by Issuers Engaged or to beEngaged in Significant Mining Operationsof the Securities
        and Exchange Commission defines a reserve as that part of
        a mineral deposit which could be economically and legally extracted or
        produced at the time of the reserve determination. Reserves consist of:
        (1) Proven (Measured) Reserves.Reserves for which: (a) quantity
        is computed from dimensions revealed in outcrops, trenches, workings or
        drill holes; grade and/or quality are computed from the results of detailed
        sampling; and (b) the sites for inspection, sampling and measurement are
        spaced so closely and the geologic character is so well defined that size,
        shape, depth and mineral content of reserves are well-established. 
        (2) Probable (Indicated) Reserves.Reserves for which quantity
        and grade and/or quality are computed from information similar to that
        used for proven (measured) reserves, but the sites for inspection, sampling
        and measurement are farther apart or are otherwise less adequately spaced.
        The degree of assurance, although lower than that for proven (measured)
        reserves, is high enough to assume continuity between points of observation.
        As used herein, reserves are as defined in National Instrument
        43-101.
|----------- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|royalty     | An amount of money paid at regular intervals,
        or based on production, by the lessee or operator of an exploration or
        mining property to the current or former owner of the mineral interests.
        Generally based on a certain amount per ton or a percentage of the total
        production or profits.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|sedimentary | A type of rock which has been created
        by the deposition of solids from a liquid.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      
|shaft       | A vertical or inclined excavation in
        rock for the purpose of providing access to an ore body. Usually equipped
        with a hoist at the top, which lowers and raises a conveyance for handling
        workers and materials.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      

viii

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|shear           | The deformation of rocks
        by lateral movement along innumerable parallel planes, generally resulting
        from pressure and producing such metamorphic structures as cleavage and
        schistosity.                                                                                                 
|--------------- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|shoot           | A concentration of mineral
        values. That part of a vein or zone carrying values of ore grade.                                                                                                                                                                                                             
|sill            | An intrusive sheet of igneous
        rock of roughly uniform thickness, generally extending over considerable
        lateral extent, that has been forced between the bedding planes of existing
        rock.                                                                                                 
|splay           | An offshoot of a fault.
        A split from a major fault.                                                                                                                                                                                                                                                      
|stope           | An excavation in a mine
        from which ore is being or has been extracted.                                                                                                                                                                                                                                   
|strike          | The direction, or bearing,
        from true north of a vein or rock formation measured on a horizontal surface.                                                                                                                                                                                                 
|structural      | Pertaining to geologic
        structure.                                                                                                                                                                                                                                                                        
|subprovince     | A part of a shield (such
        as the Canadian Shield) subdivided by common geologic time and rock types.
        In the Canadian Shield some of the major subprovinces are: Abitibi, Opatica
        and Pontiac.                                                                                             
|syenite         | An intrusive igneous rock
        composed chiefly of orthoclase.                                                                                                                                                                                                                                                
|synclinorium    | A syncline (rocks folded
        in a U shape) related area.                                                                                                                                                                                                                                                   
|tailings        | Material rejected from
        a mill after most of the recoverable valuable minerals have been extracted.                                                                                                                                                                                                       
|tholeiitic      | Volcanic rock with higher
        silica and lower sodium, potassium and magnesium content relative to alkaline
        magma types of volcanic rocks and considered to be related to each other
        by crystal fractionation processes (such as basalt or andesite containing
        augites or pigeonite).
|tonalitic       | Intrusive igneous rock
        with plagioclase feldspar, hornblende (an amphibole mineral), biotite
        (a platy magnesium - iron mica common in igneous rock) and greater than
        10% quartz.                                                                                                         
|trondjhemite    | A sodic, siliceous rock
        containing feldspar and quartz.                                                                                                                                                                                                                                                  
|tuff            | A rock formed of compacted
        volcanic fragments.                                                                                                                                                                                                                                                           
|turbidite       | Submarine landslides along
        a continental slope containing large masses of sediment.                                                                                                                                                                                                                      
|ultramafic      | Igneous rock which are
        very high in mafic minerals, that is, containing virtually no quartz or
        feldspar and composed essentially of iron-magnesium silicates and metallic
        oxides.                                                                                                        
|uncomformably   | Not having the same direction
        of stratification due to the erosion or folding over of younger rocks.                                                                                                                                                                                                     
|unconformity    | A surface of erosion that
        separates younger rocks from older rocks.                                                                                                                                                                                                                                      
|uncut (and cut) | See cut (and uncut)
        .                                                                                                                                                                                                                                                                                  
|vein            | An occurrence of ore with
        an irregular development in length, width and depth usually from an intrusion
        of igneous rock.                                                                                                                                                                         
|volcanics       | Volcanically formed rocks.                                                                                                                                                                                                                                                                                       
|winze           | An internal shaft.                                                                                                                                                                                                                                                                                               

ix

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PARTI

ITEM 1IDENTITY
  OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

A.           DIRECTORS
  AND SENIOR MANAGEMENT

The names, business addresses and functions of the directors and senior management of the Corporation are:

|Name and Business Address                                                                                            | Function                                       
|-------------------------------------------------------------------------------------------------------------------- | -----------------------------------------------
|D. Harry W. DobsonLe Quesne Chambers 9 Burrard Street, St. Helier, Jersey
      JE2 4L5 Channel Isles United Kingdom | Chairman of the Board of Directors             
|Brian A. HinchcliffeMacassa Mine, Hwy. #66 Kirkland Lake, Ontario Canada P2N 3J1                                     | President, Chief Executive Officer and Director
|Robert P. HinchcliffeMacassa Mine, Hwy. #66 Kirkland Lake, Ontario Canada P2N 3J1                                    | Chief Financial Officer                        
|Sandra LeeSuite 300, 570 Granville Street Vancouver, British Columbia
      Canada V6C 3P1                           | Secretary                                      
|Michael W. SuttonMacassa Mine, Hwy. #66 Kirkland Lake, Ontario Canada P2N 3J1                                        | Chief Geologist                                
|Raymond A. BelecqueMacassa Mine, Hwy. #66 Kirkland Lake, Ontario Canada P2N 3J1                                      | General Manager                                
|Brian E. BayleySuite 300, 570 Granville Street Vancouver, British Columbia
      Canada V6C 3P1                      | Director                                       
|W. Warren Holmes371 Hart Street Timmins, Ontario Canada P4N 6W9                                                      | Director                                       

1

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|S. Paul KostuikSuite 601, 2288 Bellevue Avenue West Vancouver, British Columbia
      Canada V7V 1C6 | Director
|---------------------------------------------------------------------------------------------------- | --------
|A. Murray SinclairSuite 300, 570 Granville Street Vancouver, British Columbia
      Canada V6C 3P1   | Director

B.           ADVISERS

Not applicable.

C.           AUDITOR

The names and addresses of the Corporations auditor
  for the preceding year and their membership in the governing professional body
  are:

|Name and Address           | Governing Professional Body                            | Date                  
|-------------------------- | ------------------------------------------------------ | ----------------------
|PricewaterhouseCoopers LLP | Institute of Chartered Accountants of British Columbia | Since December 6, 2001

ITEM 2OFFER
  STATISTICS AND EXPECTED TIMETABLE

Not Applicable.

ITEM 3KEY
  INFORMATION

A.           SELECTED
  FINANCIAL DATA

The following table presents selected consolidated financial
  data of the Corporation for the fiscal years ended April 30, 2003, 2002, 2001,
  2000 and 1999. This information should be read in conjunction with the financial
  statements included elsewhere in this document.

The Corporations 2003 and 2002 annual financial statements
  have been audited by its current independent auditor, PricewaterhouseCoopers
  LLP, Chartered Accountants, and the 2001, 2000 and 1999 annual financial statements
  have been audited by its former independent auditor, Davidson & Company,
  Chartered Accountants. The financial statements have been prepared in accordance
  with Canadian Generally Accepted Accounting Principles (Canadian GAAP).
  Note 19 to the annual financial statements provide descriptions of the principal
  differences between Canadian GAAP and United States Generally Accepted Accounting
  Principles (US GAAP) as they relate to the Corporation and reconciliation
  to US GAAP of the Corporations financial statements.

All information provided herein is in Canadian GAAP (except
  as set out in the two tables below).

2

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SUMMARY OF FINANCIAL INFORMATIONIN THE CORPORATIONS FINANCIAL STATEMENTS

|                                                                  | Years ended April 30(Cdn$)
|----------------------------------------------------------------- | --------------------------
|                                                                  | 2003                      
|OPERATING DATA                                                    |                           
|Revenue                                                           | 11,704,639                
|Operating Costs                                                   | 10,787,637                
|Net Income (Loss)Canadian GAAP  US GAAP                           | (4,934,979) (4,851,311)   
|Basic and DilutedEarnings (Loss)perShare(1)Canadian GAAP  US GAAP | (0.25) (0.24)             

3

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|                                                     | As at April 30(Cdn$)         
|---------------------------------------------------- | -----------------------------
|                                                     | 2003                         
|BALANCE SHEETDATA                                    |                              
|Working Capital(Deficiency)Canadian GAAP US GAAP     | (2,372,658)
      (2,383,536)
|Total AssetsCanadian GAAP US GAAP                    | 21,333,559 21,333,559        
|Total LiabilitiesCanadian GAAP US GAAP               | 9,611,378 9,622,256          
|Shareholders Equity(Deficiency)Canadian GAAP US GAAP | 11,722,181 11,711,303        
|Common SharesNumber
       Amount                    | 24,076,166 17,757,582        
|Dividends Declaredper Share                          | 0                            

(1)           The net loss
  per share amounts are the same on both a basic and a diluted basis. 
  (2)           Adjusted to
  reflect 15 into one share consolidation on October 21, 1999. 
  (3)           Prior to the
  Corporations stated capital adjustment in fiscal 2002.

Currency and Exchange Rates

The following table sets out the exchange rates for one United
  States dollar (US$), expressed in terms of one Canadian dollar,
  in effect at the end of the following periods calculated using the average of
  the exchange rates on the last day of each month in such periods.

|Number of Canadian Dollars equal to US $1.00Year Ended April 30
|---------------------------------------------------------------
|2003                                                           
|1.5335                                                         

4

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The following table sets out the highest and lowest exchange
  rates for one United States dollar, expressed in terms of one Canadian dollar,
  for each month during the previous six months.

|US $1.00 Equals | High(Cdn$) | Low(Cdn$)
|--------------- | ---------- | ---------
|2003            |            |          
|November        | 1.3362     | 1.2973   
|October         | 1.3481     | 1.3043   
|September       | 1.3876     | 1.3469   
|August          | 1.4100     | 1.3836   
|July            | 1.4114     | 1.3368   
|June            | 1.3768     | 1.3348   

The noon rate of exchange on November 28, 2003 for the conversion
  of Canadian dollars into United States dollars was US$ 1.00 = Cdn$ 1.2973.

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

B.CAPITALIZATION
  AND INDEBTEDNESS

Not Applicable.

C.REASONS
  FOR THE OFFER AND USE OF PROCEEDS

Not Applicable

D.RISK
  FACTORS

The securities of the Corporation are highly speculative and
  subject to a number of risks. These risks might affect the Company reaching
  its business objectives, which include successfully developing and carrying
  out its planned exploration activities and completing the rehabilitation and
  recommencement of operation of its mine according to specifications in a timely
  manner and on a profitable basis (collectively business objectives).

A prospective investor or other person reviewing the Corporation
  for a prospective investor should not consider an investment in the Corporation
  unless the investor is capable of sustaining an economic loss of the entire
  investment.

The risks associated with the Corporations business
  include:

The Mining Industry is Speculative and of a High Risk Nature

Mineral exploration and mining activities are speculative
  by their nature and involve a high degree of risk, which even a combination
  of experience, knowledge and careful evaluation may not be able to overcome.

5

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The Corporations drilling activities are an exploratory
  search for additional gold deposits. Such exploration is subject to the risk
  that little or no mineralization is discovered or that any deposits discovered
  are not economic. If this occurs, the Corporations existing gold resources
  and reserves may not be sufficient to sustain operations for a lengthy period.
  This will have an adverse effect on the Corporations revenues over the
  long-term.

The Corporations mining activities are subject to a
  number of factors beyond its control including intense industry competition
  and changes in economic conditions, including some operating costs (such as
  electrical power). Its operations are subject to all the hazards and risks normally
  incidental to exploration, development and production of gold and silver, any
  of which could result in work stoppages, damage to or loss of property and equipment
  and possible environmental damage.

An adverse change in any one of such factors, hazards and
  risks would have a material adverse effect on the Corporation, its business
  and results of operations, including forecast gold production. This might result
  in the Corporation not meeting its business objectives.

The Corporations Activities might suffer from Losses
  or Liabilities for Risks which are not Insurable

Hazards such as unusual or unexpected geological formations
  and other conditions are involved in mineral exploration and development. The
  Corporation may become subject to liability for pollution, cave-ins or hazards
  against which it cannot insure or against which it may elect not to insure.
  The payment of such liabilities would have a material, adverse effect on the
  Corporations financial position and results of operation. Although the
  Corporation maintains liability insurance in an amount which it considers adequate,
  the nature of these risks is such that liabilities might exceed policy limits,
  the liabilities and hazards might not be insurable against, or the Corporation
  might not elect to insure itself against such liabilities due to high premium
  costs or other reasons, in which event the Corporation could incur significant
  costs that could have a materially adverse effect upon its financial condition
  and results of operation.

The Corporation has a Limited History of Operations

The Corporation has a very limited history of, and is in the
  early stages of restarting, production from its mineral properties. In restarting
  such operations, the Corporation may experience higher costs or lower revenues
  than budgeted or delays which were not expected. The Corporation must also locate
  and retain qualified personnel to operate its mining operations. An adverse
  change in any one of such factors or the failure to locate and retain such personnel
  would have a material adverse effect on the Corporation, its business and results
  of operations, including forecast gold production, which might result in the
  Corporation not meeting its business objectives.

The Corporation will Experience Uncertainty in Marketing
  the Gold which it has Mined

The Corporations revenues are expected to be in large
  part derived from the mining and sale of gold. The price of gold fluctuates
  and is affected by numerous factors beyond the Corporation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 mine developments
  and improved mining and production methods. The Corporation sells the gold bullion
  which it produces for US dollars on the North American gold bullion markets.
  A substantial decrease in the price of gold or in the value of the United States
  dollar compared to the Canadian dollar would adversely affect the Corporations
  revenue and net income, if any. The Corporation does not engage in any hedging
  or other transactions to protect itself against such currency fluctuations.

6

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The Corporation is Experiencing Negative Cash Flow

The success of the Corporations business will depend
  upon the Corporations ability to develop its cash flow from operations
  to a point where it becomes profitable. The Corporation currently has limited
  revenue from operations and is experiencing negative cash flow. Accordingly,
  the Corporation is relying on additional funds presently available to it which
  have been raised through the sale of equity and debt capital. The only alternatives
  for the financing of the Corporations business would be the offering by
  the Corporation of an interest in its mineral properties to be earned by another
  party or to obtain project or operating financing from financial institutions,
  neither of which is presently intended. If the Corporation cannot increase its
  cash flow and become profitable there will be a material adverse effect on the
  Corporation, its business and results of operations.

There is a Limited Market for the Corporations Securities
  in the United States of America

The Corporations securities are not listed on any stock
  exchange in the United States of America and there is only a limited over-the-counter
  market in the United States for the Corporations securities. Accordingly,
  investors might need to rely on Canadian equity markets to trade in the Corporations
  securities. Such markets might not have the liquidity found in markets in the
  United States resulting in investors being unable to dispose of the Corporations
  securities.

The Corporations Shares are Penny Stock

The Securities and Exchange Commission has adopted rules (the
  Penny Stock Rules) that regulate broker-dealer practices in connection
  with transactions in penny stocks. Penny stocks are equity securities
  with a price of less than US$ 5.00 (other than securities registered on certain
  national securities exchanges or quoted on the NASDAQ system, provided that
  current prices and volume information with respect to transactions in such securities
  is provided by the exchange or system).

The Penny Stock Rules require a broker-dealer, prior to effecting
  a transaction in a penny stock not otherwise exempt from such rules, to deliver
  a standardized risk disclosure document prepared by the Securities and Exchange
  Commission that provides information about penny stocks and the nature and level
  of risks in the penny stock market. In particular the statement must contain:

|(a) | a description of the nature and level
        of risk in the market for penny stocks in both public offerings and secondary
        trading;                                                                                     
|--- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                  
|(b) | a description of the broker-dealers
        duties to the customer and of the rights and remedies available to the
        customer with respect to a violation to such duties or other requirements
        of securities laws;
|    |                                                                                                                                                                                                                                  
|(c) | a brief, clear, narrative description
        of a dealer market, including bid and ask prices for penny stocks and
        the significance of the spread between the bid and ask price;                                        
|    |                                                                                                                                                                                                                                  
|(d) | a toll-free telephone number for inquiries
        on disciplinary actions;                                                                                                                                                      
|    |                                                                                                                                                                                                                                  
|(e) | the definitions of significant terms
        in the disclosure document or in the conduct of trading in penny stocks;
        and                                                                                                
|    |                                                                                                                                                                                                                                  
|(f) | such other information and be in such
        form, including language, type, size and format, as the Commission shall
        require by rule or regulation.                                                                    

The broker-dealer must obtain from the customer a written
  acknowledgement of receipt of the standardized disclosure document.

7

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The broker-dealer also must provide the customer with:

|(a) | the inside bid and offer quotations
        for the penny stock, or other bid and offer price information for the
        penny stock if inside bid and offer quotations are not available;
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                            
|(b) | the compensation of the broker-dealer
        and its salespersons in the transaction;                                                                                                     
|    |                                                                                                                                                                                            
|(c) | the number of shares to which such bid
        and ask prices apply, or other comparable information relating to the
        depth and liquidity of the market for such stock; and         
|    |                                                                                                                                                                                            
|(d) | a monthly account statements showing
        the market value of each penny stock held in the customers account.                                                                          

In addition, the Penny Stock Rules require that prior to a
  transaction in a penny stock not otherwise exempt from such rules the broker-dealer
  must make a special written determination that the penny stock is a suitable
  investment for the purchaser and receive the purchasers written acknowledgment
  of the receipt of a risk disclosure statement, a written agreement to transactions
  involving penny stocks, and a signed and dated copy of a written suitability
  statement.

At the present market prices the Corporations common
  shares will (and in the foreseeable future are expected to continue to) fall
  within the definition of a penny stock. Accordingly, United States broker-dealers
  trading in the Corporations shares will be subject to the Penny Stock
  Rules. Rather than complying with those rules, some broker-dealers will refuse
  to attempt to sell penny stock. As a result, shareholders and their broker-dealers
  in the United States may find it more difficult to sell their shares of the
  Corporation, if a market for the shares should develop in the United States.

The Corporation is Dependent on Various Key Personnel

The Corporations success is dependent upon the performance
  of key personnel working full-time in management, supervisory and administrative
  capacities or as consultants, namely, Brian A. Hinchcliffe (President and Chief
  Executive Officer), Robert P. Hinchcliffe (Chief Financial Officer), Raymond
  A. Belecque (General Manager) and Michael W. Sutton (Chief Geologist). The Corporation
  does not maintain life insurance for such personnel. The loss of the services
  of senior management or key personnel could have a material and adverse effect
  on the Corporation, its business and results of operations.

There is Uncertainty of the Nature and Amount of the Corporations
  Gold Resources and Reserves

While the Corporation has carried out, and will carry out
  on an annual basis, estimates of its mineral resources and reserves and has
  had some of such estimates independently reviewed, this should not be construed
  as a guarantee that such estimates are accurate. Furthermore, the historical
  gold production from the Corporations mineral properties is no assurance
  that they will contain deposits of gold greater than those currently estimated
  to exist by the Corporation. If such estimates prove to be materially inaccurate,
  that would have a material and adverse effect on the Corporations business
  and results of operations.

The Corporations Activities are subject to Extensive Governmental Regulation and Permitting Requirements

Exploration, development and mining of minerals are subject
  to extensive federal, provincial and local laws and regulations governing acquisition
  of the mining interests, prospecting, development, mining, production, exports,
  taxes, labour standards, occupational health, waste disposal, land use, toxic
  substances and environmental

8

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protection (further described in the next risk factor), mine
  safety and other matters. These laws and regulations are administered by various
  governmental authorities including:

|• | the federal government of Canada  
|- | ----------------------------------
|  | °                                 
|  | °                                 
|  | °                                 
|  |                                   
|• | the government of Ontario         
|  | °                                 
|  | °                                 
|  | °                                 
|  | °                                 
|  | °                                 
|  |                                   
|• | the town of Kirkland Lake, Ontario
|  | °                                 
|  | °                                 
|  | °                                 

The Corporation estimates that the annual costs of complying with such laws and regulations are as follows:

|Description                 | Amount(Cdn$)
|--------------------------- | ------------
|Provincial Land Taxes       | 200         
|Regional Land Taxes         | 1,100       
|Municipal Property Taxes    | 592,000     
|Federal Taxes               | 50,000      
|Environmental Protection    | 40,000      
|Worker Mine and Mill Safety | 24,000      
|Total                       | 707,300     

In addition, the current and future operations of the Corporation,
  from exploration through development activities and production, require permits,
  licences and approvals from some of these governmental authorities. The Corporation
  has obtained all government licenses, permits and approvals necessary for the
  operation of its business to date, however, additional licenses, permits and
  approvals may be required. The failure to obtain any licenses, permits or approvals
  that may be required or the revocation of existing ones would have a material
  and adverse effect on the Corporation, its business and results of operations.

Failure to comply with applicable laws, regulations and permits
  may result in enforcement actions thereunder, including orders issued by regulatory
  or judicial authorities requiring the Corporations operations to cease
  or be curtailed, and may include corrective measures requiring capital expenditures,
  installation of additional equipment or remedial actions. The Corporation may
  be required to compensate those suffering loss or damage by reason of its mineral
  exploration activities and may have civil or criminal fines or penalties imposed
  for violations of such laws, regulations and permits. Any such events could
  have a material and adverse effect on the Corporation and its business and could
  result in the Corporation not meeting its business objectives.

9

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Amendments to current laws, regulations and permits governing
  operations and activities of mining companies, or more stringent implementation
  thereof, could have a material adverse impact on the Corporation and cause increases
  in capital expenditures or production costs or reduced levels of production
  at producing properties or require abandonment or delays in development of its
  mineral properties.

The Corporations Activities are Subject to Extensive
  Environmental Protection Requirements

All phases of the Corporations operations are subject
  to environmental regulation. Environmental legislation is evolving in a manner
  which will require stricter standards and enforcement, increased fines and penalties
  for non-compliance, more stringent environmental assessments of proposed projects
  and a heightened degree of responsibility for companies and their officers,
  directors and employees. Future changes in environmental regulation could adversely
  affect the Corporations operations by increasing costs and reducing profitability.

The Corporation estimates that its costs of complying with
  such environmental legislation are approximately $40,000 per year although its
  mining operations may expose it to liabilities which exceed such amount. Furthermore,
  in accordance with mine closure plans filed with the Ministry of Northern Development
  and Mines of the government of Ontario, the Corporation has posted bonds totalling
  $2,043,435 to secure the costs of rehabilitating its mineral properties. Failure
  to comply with the Corporations mine closure plans would result in the
  loss of some or all of such bonds. In addition, it is possible that such bonds
  are insufficient to secure all of the reclamation costs for which the Corporation
  will be liable.

The Corporation does not Pay Dividends

Investors cannot expect to receive a dividend on their investment
  in the foreseeable future, if at all. Accordingly, it is likely investors will
  not receive any return on their investment in the Corporations securities
  other than possible capital gains.

Investors might experience Difficulty in Enforcing Foreign Judgments Against the Corporation

The Corporation is incorporated under the federal laws of
  Canada and a majority of the Corporations directors and officers are residents
  of Canada. Consequently, it may be difficult for United States investors to
  effect service of process within the United States upon the Corporation or upon
  those directors or officers who are not residents of the United States, or to
  enforce, inside or outside of the United States, any judgements of United States
  courts predicated upon civil liabilities under the United States Securities
  Exchange Act of 1934, as amended. A judgement of a U.S. court predicated
  solely upon such civil liabilities may not be enforceable in Canada by a Canadian
  court if the U.S. court in which the judgement was obtained is determined by
  the Canadian court not to have had jurisdiction in the matter. Furthermore,
  an original action might not be able to be brought successfully in Canada against
  any of such persons or the Corporation predicated solely upon such civil liabilities.

The Corporation might have Labour Difficulties

Factors such as work slowdowns or stoppages caused by the
  attempted unionization of the Corporations operations could materially
  adversely affect its business which would have a negative affect on the Corporations
  business and results of operation which might result in the Corporation not
  meeting its business objectives.

There is Uncertainty of the Title to the Corporations
  Mining Claims and Leases

While the Corporation has carried out reviews of title to
  its mining claims and leases, this should not be construed as a guarantee that
  title to such interests will not be challenged or impugned. The mining claims
  and leases may be subject to prior unregistered agreements or transfers or native
  land claims, and title may be

10

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affected by undetected defects. The existence thereof would
  have a material and adverse effect on the Corporation, its business and results
  of operations.

ITEM 4INFORMATION ON THE COMPANY

A.           HISTORY
  AND DEVELOPMENT OF THE COMPANY

Name, Incorporation and Offices

The Corporation was incorporated under the Company Act
  (British Columbia) on June 29, 1983 under the name Goldpac Investments
  Ltd.. Effective April 22, 1988, the Corporation and Tectono Resources
  Ltd. amalgamated. The amalgamated corporation was called Goldpac Investments
  Ltd.. On July 27, 1988, the Corporation was continued under the Canada
  Business Corporations Act, thereby changing from a provincially to a Canadian
  federally incorporated company, at which time the authorized capital was changed
  to an unlimited number of common shares.

The Corporation changed its name from Goldpac Investments
  Ltd. to Brimstone Gold Corp. on May 19, 1994 and its outstanding
  shares were consolidated on the basis of one new common share for each five
  shares then outstanding.

On October 21, 1999, the Corporation changed its name from
  Brimstone Gold Corp. to Foxpoint Resources Ltd. and
  its outstanding shares were consolidated on the basis of one new common share
  for every 15 shares then outstanding.

The Corporation changed its name from Foxpoint Resources
  Ltd. to Kirkland Lake Gold Inc. on October 25, 2002 to reflect
  the nature and location of the Corporations business.

The Corporations head office is located at its Macassa
  Mine on Highway #66 near Kirkland Lake, Ontario. Its telephone number is (705)
  567-5208. The Corporations registered office is located at Suite 1880,
  1055 West Georgia Street, Vancouver, British Columbia, V6E 3P3.

History

Previous Operations

The Corporation commenced operations in 1983. Over the next
  10 years the Corporation was engaged in mineral exploration on a number of properties
  in British Columbia and Montana. At various times prior to April 30, 1994, the
  Corporation abandoned these properties and wrote off the total acquisition and
  exploration expenditures from its financial statements.

During 1992 and 1993 the Corporation acquired interests in
  a property in each of British Columbia and the Northwest Territories. One of
  the properties was abandoned in 1995 and the other sold in 1997.

In June 1992, the Corporation acquired a placer mine located
  in Idaho and began gold mining operations. In September 1995, the Corporation
  suspended mining on the property because the grade of gold recovered was not
  economic. In January 1996, the Corporation disposed of its interest in the property.

In February, 1996 and March, 1997 the Corporation acquired
  the Mayflower Property in Montana. The Mayflower Property contained the Mayflower
  Mine, which mined gold intermittently from 1896 to 1961. After exploring the
  property for two years, the Corporation decided not to carry out any further
  exploration work and

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wrote-down its interest in 1999. On February 26, 2001 the
  Corporation sold the Mayflower Property for US$ 100,000.

Current Operations

Acquisition of Macassa Mine

On December 14, 2001 the Corporation acquired various mining
  assets located in and around Kirkland Lake, Ontario from Kinross Gold Corporation
  (Kinross). These assets included a recently closed gold mine, the
  Macassa Mine (an underground gold mine, although limited surface mining operations
  are also in place), the mill constructed on the mine property and four contiguous,
  formerly producing, underground gold mining properties known as the Lake Shore,
  Wright-Hargreaves, Teck-Hughes and Kirkland Lake Gold Properties.

The acquisition was made pursuant to an agreement dated October
  29, 2001. Its principal terms are as follows:

|1. | The acquisition price was $5 million
        of which $1 million was paid on each of June 11, 2002 (and the security,
        consisting of a pledge of the title to the assets acquired, held by Kinross
        in respect of such amount, being the only security granted by the Corporation,
        was cancelled), June 14, 2002, December 13, 2002, June 11, 2003 and December
        14, 2003.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                        
|2. | The Corporation granted Kinross a net
        smelter royalty on the production from the properties. The royalty is
        payable on a sliding scale commencing at US$ 300 per ounce of gold as
        follows:                                                                                                                                                                                     

|Average Price Per Ounce
      of Gold Bullion Sold     | Amount 
      of Royalty
|------------------------------------------------------ | ------------------------
|                                                       |                         
|Less than US$ 300                                      | 0%                      
|Equal to or greater than US$ 300 but less than US$ 400 | 2%                      
|Equal to or greater than US$ 400 but less than US$ 500 | 3%                      
|Equal to or greater than US$ 500                       | 4%                      

|   | The royalty shall be paid quarterly beginning on
        the third month anniversary of the commencement of production from any
        of the properties and ending when the Corporation has paid a total of
        Cdn$ 15 million in royalties. The Corporation shall have the right to
        terminate the royalty at any time by paying the balance of the Cdn$ 15
        million.
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                            
|3. | The Corporation assumed all environmental rehabilitation
        costs of the mineral properties, including mine closure bonds, and replaced
        the existing bonds totalling $2,043,435 posted by Kinross.                                                                                                                                                                            

Kinross is a publicly traded corporation based in Toronto,
  Ontario the shares of which trade on the American and Toronto Stock Exchanges.
  None of the insiders of Kinross are insiders of the Corporation.

Development Plans for the Mine

It is the Corporations intention to develop the five
  historic gold mining properties which it acquired from Kinross in a comprehensive
  fashion. Until their acquisition by the Corporation the five properties have
  been developed and operated independently. This analysis will be supplemented
  by additional exploration carried out by the Corporation, including significant
  above and below ground drilling. In that regard the Corporation has been and
  will continue to review, compile and reconcile results from exploration, drilling,
  reserve calculations

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and operations. The Corporation hopes that such efforts will
  result in an increase in the reserves contained in the properties which will
  enable it to return them to production and turn the Corporation into a low cost
  gold producing company.

Past and Proposed Production

On May 14, 2002 gold production re-commenced from the Macassa
  Mill when the mill began processing tailings from the Lake Shore Property at
  a rate of 880 tons per day and an estimated head grade of 0.12 ounces of gold
  per ton. Over 123,700 tons of tailings were processed through the mill and in
  excess of 75% of the contained gold was recovered. An additional 45,555 tons
  of surface rock from the Teck-Hughes and Lake Share Properties were processed.
  A total of 20,500 ounces of gold were recovered.

Initially, the Corporation mined surface deposits, which were
  accessible through open pit operations. In December 2002 and January 2003 the
  Corporation changed its mining operations to underground mining. As of November
  30, 2003, efforts were underway to carry out mining from the 3835-foot, 4250-foot,
  4500-foot, 4750-foot and 5150-foot levels of the Macassa Mine. The near surface
  ore is being drawn from the existing ramp on the Lake Shore and Wright-Hargreaves
  Properties. Underground production is being hauled by the No. 3 Shaft and the
  recently re-commissioned Shaft No. 2 of the Macassa Mine. Mining methods vary
  from mechanized long-hole mining to cut-and-fill and other more labour intensive
  mining methods.

Gold production during fiscal 2003 was 24,589 troy ounces,
  which fell short of the forecasted range of 50,000 to 70,000 ounces, primarily
  for two reasons. Firstly, on March 3, 2003, the Corporation announced a temporary
  halt in ore production from the Macassa Mine after a pillar failed in an existing
  ore pass near to Shaft No. 3. The ore pass, and an additional ore pass also
  close to the shaft were filled, some 200 feet of timber was realigned and underground
  activity re-commenced towards the latter half of April 2003. The second reason
  for the production shortfall was slower than anticipated progress in the Corporation’s
  underground dewatering campaign. Consequently, gold production in the year was
  limited to just ore from the surface. In short, underground mining on a commercial
  scale did not take place during the fiscal year and thus normalized operating
  costs were not established.

The Corporation is currently hiring its own employees to take
  over operational activities formerly conducted by mining contractors. During
  the period from October, 2003 through to April 30, 2004, the Corporation intends
  that monthly production from these three sources will build to a total of 15,000
  tons per month.

Past and Proposed Capital Expenditures and Divestitures

During the three fiscal years ended April 30, 2001, 2002 and
  2003, the Corporation financed its operations by selling equity securities for
  net proceeds of $18,331,286, borrowing $2,500,000 pursuant to convertible loans
  and selling a subsidiary for $149,988 and property, plant and equipment for
  $5,000. In that three year period, the Corporation spent $857,584 on the purchase
  of property, plant and equipment and $7,744,801 on the acquisition, exploration
  and development of its mineral properties, all in the Kirkland Lake, Ontario,
  and $2,043,435 on the acquisition of mine closure bonds.

The Corporation has a variety of capital programs underway
  at the Macassa Mine, ranging from the development of a new level at the 3400-foot
  level to the purchase of mining equipment. Proposed capital expenditures in
  fiscal 2004 are expected to be a minimum of $10 million which will be spent
  on the loading pocket rehabilitation, development activities, the acquisition
  of mining equipment, and the re-commissioning of Shafts No. 2 and 5. These programs
  will be financed through a combination of cash flow from operations and cash
  on hand from financings completed in the summer of 2003 and the exercise of
  warrants and stock options.

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Takeover Offers

Since the commencement of the Corporations last completed
  fiscal year it has neither received any public takeover offers for its shares
  from third parties nor made any such offers.

B.           BUSINESS
  OVERVIEW

Nature

The Corporation is a natural resource corporation engaged
  in the acquisition, exploration and development of and production (mining and
  milling of gold ore) from mineral resource properties in Canada. The Corporation
  also proposes to carry out (although it is not currently carrying out) ore milling
  operations on behalf of other mining companies that do not have their own milling
  facilities. Its business should not be subject to variance due to the time of
  year in which it is carried out.

Principal Markets

The Corporation has received only limited revenue since commencing
  production at its current operations on its Kirkland Lake mining properties.
  Such revenue was from and it anticipates its markets will continue to be the
  North American gold bullion markets.

Seasonality of the Corporations Business

The Corporations business is not expected to be seasonal
  and its mining and milling operations will be carried out year round.

Sources and Availability of Raw Materials

Other than water and power  both of which are readily
  available and do not experience any material price volatility  the Corporation
  does not require any raw materials with which to carry out its business.

Marketing Channels

The Corporation markets the gold bullion produced from the
  Macassa Mine through direct sales to the gold bullion banking industry.

Patents and Licenses; Industrial Commercial and Financial
  Contracts; and New Manufacturing Processes

In conducting its business operations, the Corporation is
  not dependent on any patented or licensed processes, technology, industrial,
  commercial or financial contracts or new manufacturing processes.

Competitive Conditions

The Corporation competes with other mining companies, some
  of which have greater financial resources and technical facilities, for the
  acquisition of mineral interests, as well as for the recruitment and retention
  of qualified employees.

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Government Regulation

Exploration, development and mining of minerals are subject
  to extensive federal, provincial and local laws and regulations governing acquisition
  of the mining interests, prospecting, development, mining, production, exports,
  taxes, labour standards, occupational health, waste disposal, land use, toxic
  substances and environmental protection (further described in the next risk
  factor), mine safety and other matters. These laws and regulations are administered
  by various governmental authorities including:

|• | the federal government of Canada  
|- | ----------------------------------
|  | °                                 
|  | °                                 
|  | °                                 
|  |                                   
|• | the government of Ontario         
|  | °                                 
|  | °                                 
|  | °                                 
|  | °                                 
|  | °                                 
|  |                                   
|• | the town of Kirkland Lake, Ontario
|  | °                                 
|  | °                                 
|  | °                                 

The principal legislation is the Mining Act (Ontario)
  which governs the acquisition and maintenance of mineral rights, development
  of mines, commercial production from mines and procedures for mine closure in
  the province of Ontario. The Act is administered by the Ministry of Northern
  Development and Mines (MNDM) of the government of Ontario. The Corporations
  operations are subject to such legislation and to overview by the MNDM.

Mineral rights are acquired when a licensed prospector stakes
  an unpatented mining claim on the ground. Assessment work, which may include
  sampling, trenching, blasting, geological and geophysical surveying and feasibility
  studies, must be performed and reported annually to the MNDM to maintain an
  unpatented mining claim in good standing and prevent its forfeiture. Patented
  mining claims were based on a surveyed, not staked, area of ground. They are
  no longer granted. Existing patented mining claims do not require any assessment
  work to be carried out but do require annual payments to be made to the MNDM
  in order to be kept in good standing and prevent its forfeiture.

If exploration of an unpatented mining claim warrants it,
  the claim holder may then enter into a 21 year renewable mining lease over the
  ground covered by the claim. Mining claims must be leased before mineral extraction
  for production commences. The mining lease is maintained by paying an annual
  rent per hectare.

The Mining Actprovides a one-window approach
  to permitting and licensing. Before beginning mine development, environmental
  studies must be carried out, the public must be notified, public hearings held,
  and the mine development and closure plans must be approved. The closure plans
  require posting of reclamation bonds to ensure sufficient funds are available
  to carry out the closure plans. As well, the Act encouraged companies to conduct
  progressive rehabilitation during the life of the mine.

In addition all phases of the Corporations operations
  are subject to environmental regulation by various levels of government including
  regional, provincial and federal authorities. Environmental legislation is evolving
  in a

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manner which will require stricter standards and enforcement,
  increased fines and penalties for non-compliance, more stringent environmental
  assessments of proposed projects and a heightened degree of responsibility for
  companies and their officers, directors and employees.

C.           ORGANIZATIONAL
  STRUCTURE

The Corporation does not have any subsidiaries. Its former
  subsidiaries were sold when the Corporation divested its self of its previous
  mining operations as described in Item 4A History and Development of the
  Company History  Previous Operations.

D.           PROPERTY,
  PLANTS AND EQUIPMENT

The Corporations headquarters are located at the Macassa
  Mine, an underground mine situated near Kirkland Lake, Ontario.

The Corporations material tangible fixed assets (property,
  plant and equipment) are also located at the Macassa Mine. All of its mineral
  properties are located around the Mine. These assets and properties are described
  below.

Fixed Assets  Property, Plant and Equipment

The Macassa Mine and Mill facilities consist of a 1,500 ton
  per day carbon-in-pulp mill, a paste plant with a capacity of 2,000 tons per
  day, offices, laboratory, warehouse and mechanical and electrical shops.

The Macassa Mine has two shafts, both of which are operational.
  Production Shaft No. 3 was sunk in 1984 to a depth of 7,050 feet. It is equipped
  with a hoist having a capacity of 1,400 tons per day. Production Shaft No. 2
  reaches a depth of 4,625 feet and is equipped with a hoist having a capacity
  of 800 tons per day. It is located one mile east of Shaft No. 3.

Mining Properties Description and Location

The Corporations Kirkland Lake mining properties consist
  of 224 patented (surveyed) and unpatented (staked and not surveyed) mining claims
  and crown leases, located near Kirkland Lake, Ontario. From west to east, the
  past producing properties include the Macassa (which now includes the Tegren
  Property west of the original Macassa Property), Kirkland Lake Gold, Teck-Hughes,
  Lake Shore and Wright-Hargreaves Properties. The properties are in eastern Teck
  Township and western Lebel Township in the district of Timiskaming, Ontario
  and consist of:

|Interest        | Number ofClaims / Leases | Area(acres)
|--------------- | ------------------------ | -----------
|Patented claims | 174                      | 7,892.3    
|Staked claims   | 45                       | 3,406.0    
|Crown leases    | 5                        | 543.5      

To maintain these mining interests in good standing with the
  authorities from which these interests were granted, the following annual minimum
  levels of exploration must be carried out, taxes paid to the MNDM and the town
  of Kirkland Lake, Ontario and advance royalties paid to various royalty holders:

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|Nature               | Amount(Cdn$) 
|-------------------- | -------------
|Exploration          | $       8,000
|Municipal taxes      | 592,000      
|Miscellaneous taxes  | 8,688        
|Advance royalties(1) | 3,000        
|Total:               | $   611,688  

(1)         An advance royalty of
  $10,000 per year is also payable on the Macassa Property when the Mine is in
  production.

In addition there is a net smelter royalty payable to Kinross
  as described under Item 4A History and Development of the Company 
  History  Current Operations  Acquisition of Macassa Mine.

Some of the mining interests are subject to a royalty payable
  to previous owners. The royalties differ depending on which claim they were
  granted and range from net smelter royalties of 1% to 2%, production royalties
  of $0.10, $0.25, $1.50, $3.00 or $4.00 per ton of ore mined or net profits royalties
  of 2% to 5% while some claims have a royalty of 1% of gross proceeds from production
  or a net profit royalty of 20%.

Reclamation Bonds and Permits

As part of the permitting process for the development and
  commercial operation of the Macassa Mine and Lake Shore Mine, Kinross prepared,
  and had approved by the MNDM, closure plans for both the Macassa Mine and the
  Lake Shore Mine. Financial bonds for the Macassa Mine ($1,481,795) and the Lake
  Shore Mine ($561,640) were posted by Kinross with the MNDM. Upon acquisition
  of the properties from Kinross the Corporation assumed responsibility for these
  bonds and reimbursed Kinross for them. The other three properties, the Kirkland
  Lake Gold, Teck-Hughes and Wright-Hargreaves Properties, will require geotechnical
  investigations and possible closure remediation to meet the MNDMs approval.
  The costs of such investigations and remediation are not yet determinable but
  based on the current requirements the Corporations management does not
  believe them to be significant.

In order to perform diamond drilling underground in the Macassa
  Mine a dewatering program is being carried out. This required a Permit
  to Take Water to be obtained under the Water Resources Act (Ontario).
  This permit allows the Corporation to pump up to 13,104,000 litres per day from
  the Mine.

Accessibility, Climate, Local Resources and Physiography

The town of Kirkland Lake, Ontario (approximate population
  10,000) and its immediate surroundings are located within the Canadian Shield
  and are surrounded by several lakes and swamps. The local vertical relief is
  limited with Kirkland Lake sitting at 310 metres above mean sea level. The immediate
  area is dominated by temperate boreal forest.

The annual precipitation in the area is 300 centimetres of
  snow in the winter and 59 centimetres of rain in the summer. The average temperature
  ranges from minus 22.8 degrees Celsius in the winter to 23.6 degrees Celsius
  in the summer.

Kirkland Lake, and the Corporations five mining properties,
  are accessible by paved highways. The properties are located approximately 125
  kilometres southeast of Timmins, Ontario which has an all-weather, jet capable

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airport with frequent scheduled service. Kirkland Lake is
  serviced by rail and motor coach and has a small airport without scheduled service.
  It is a modern town with most of the amenities usually expected in larger centres.
  There is an available workforce in the area and the entire infrastructure required
  for a full mining operation. Electrical power for the Corporations mining
  operations is readily available from the Ontario provincial power authority.

History

Kinross acquired the Macassa Mine and the Lake Shore and Wright-Hargreaves
  properties from Barrick Gold Corporation (Barrick) in mid-1995 and
  acquired the Kirkland Lake Gold and Teck-Hughes properties in 1998. Barrick
  had acquired the Macassa Mine and these properties as part of its take-over
  of Lac Minerals Ltd. in September, 1994.

All five of the properties acquired by the Corporation and
  the formerly producing mines developed thereon are located along a seven kilometre
  east-west continuous stretch known as the “Main Break” and related
  subsidiary zones. The first of the five to enter production was the Teck-Hughes
  Mine in 1917, followed by the Lake Shore (1918), Kirkland Lake Gold (1919),
  Wright-Hargreaves (1921) and Macassa (1933).

The five former mining properties acquired by the Corporation
  have the following operating profiles:

|Mine               | Period ofOperation | GoldProduced(Ounces)
|------------------ | ------------------ | --------------------
|Macassa            | 1933  1999        | 3,525,389           
|Lake Shore         | 1918  1965        | 8,602,791(1)        
|Teck-Hughes        | 1917  1968        | 3,709,007(1)        
|Kirkland Lake Gold | 1919  1960        | 1,172,955           
|Wright-Hargreaves  | 1921  1965        | 4,821,296(1)        

(1)           Includes
  production during 1984 through 1988 when owned by Lac Minerals Ltd.

Macassa Mine

Overview

The Macassa Mine was in continuous production from 1933 until
  operations were suspended in June 1999. The mine was the last of the five major
  gold mines to cease production. On May 14, 2002 the Corporation restarted mining
  operations at the mine.

History

The original mine was developed on 11 mining claims by Macassa
  Mines Ltd. that organized in 1926 and obtained the assets of United Kirkland
  Gold Mines Ltd. in 1933. In 1962 it combined with Bicroft Uranium Mines Ltd.
  and Renable Mines Ltd. to become Macassa Gold Mines Ltd. An amalgamation in
  November 1970 with Willroy Mines Ltd. and Willecho Mines Ltd. created Little
  Long Lac Gold Mines, located in Toronto. Upper Canada Mine Ltd. optioned the
  mining rights from 1970 to 1976. In December 1982, the amalgamation of several
  corporations, including Little Long Lac Gold Mines, created Lac Minerals Ltd.
  It was during this period

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that the Tegren Property was added to the original Macassa
  Property. In September 1994, Barrick successfully took over Lac Minerals Ltd.,
  and Kinross acquired it from Barrick in May 1995.

The first shaft sunk on the property was the 500 foot Elliot
  shaft developed in the Main Break Zone in the late 1920’s. Mining was
  unsuccessful and operations halted. In 1931, development westward onto Macassa
  ground from the 2475-foot level of the Kirkland Lake Gold Mine discovered ore
  on the Main Break for 700 feet along strike and in subsidiary hangingwall veins.
  These underground workings were connected with the 3100 foot long No. 1 shaft,
  and later by two winzes to greater depths. The No. 1 winze connected the 3000-foot
  to 4625-foot levels and the No. 2 winze the 4625-foot to 6875-foot levels. The
  No. 2 shaft was sunk from surface to a depth of 4625 feet about 1000 feet southwest
  of the No. 1 shaft. In 1986, the No. 3 Shaft was sunk from surface (in what
  had been the Tegren Property) to the 7050-foot level and then to a final level
  of 7225 feet. Until the mid 1990’s this was the deepest single-lift shaft
  in the Western Hemisphere. The No. 3 Shaft was the most recent access shaft,
  and gave access to 21 levels from the 3800-foot to the 7050-foot level until
  1997. As a result of a rock burst on April 12, 1997, only the zones above the
  5150-foot level remained active. Exploration development was underway on the
  3800-foot level when production was halted in 1999. Rehabilitation of levels
  down to the 5700-foot level was in progress prior to closure.

The first mill on the property began operation in October 1933
  at a capacity of 200 tons per day. The milling rate was increased to 425 tons
  per day in 1949 and to 500 to 525 tons per day in 1956. In August 1988 a new
  mill was built which could process 500 to 600 tons of rock and 750 tons of tailings
  per day. By 1996, modifications had increased capacity to 900 tons of rock per
  day and 1,000 tons of tailings per day. When closed in 1999, mill capacity was
  near 1,500 tons of rock per day. Based on a 2,000 ton per day processing rate
  the tailings impoundment area of the mill has a capacity greater than 10 years.
  All of the appropriate permits for processing ore through the mill are in place.

Current Operations

See Current and Proposed Exploration and Development
  following.

Lake Shore Mine

Overview

The Lake Shore Mine is located in the centre of the Kirkland
  Lake camp bounded to the west by the Teck-Hughes mine and to the east by the
  Wright-Hargreaves mine. Lake Shore was by far the largest gold producer of the
  five former producing mines producing 8,499,195 ounces at a grade of 0.51 ounces
  per tonin continuous production from 1918 to 1965. This is almost twice
  the total number of ounces produced from the neighbouring second highest producer,
  Wright-Hargreaves, and represents 36% of the total ounces produced from the
  entire camp. From 1984 to 1988 an additional 103,592 ounces were subsequently
  recovered from pillars by Lac Minerals Ltd. for a total of 8,602,791 ounces
  of gold recovered.

Gold was discovered on the property in 1911. From 1914 to
  1918 the No. 1 Shaft was developed to 400 feet on the South (No. 1) Vein Zone
  and 7,464 feet of underground development on levels at 100, 200, 300, and 400
  feet was carried out. A 65 ton mill was installed and milling began in 1918.
  All work was carried out by Lake Shore Gold Mines Limited.

History

From 1919 to 1965 the mine was eventually serviced by four
  surface shafts and three internal shafts. The original No. 1 Shaft and its extension
  were both inactive during the latter years of operations. The No. 4 Shaft, collared
  at 4325-foot level, took the workings to a depth of 8,150 feet. Underground
  development was carried out on 57

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levels and, during the life of the mine, totalled 279,238
  feet of drifting, 108,317 feet of crosscutting, and 154,547 feet of raising.
  Milling capacity was gradually increased to a maximum of 2,400 tons per day
  and production was continuous until the mine closed in July 1965. Ore from the
  Wright-Hargreaves Mine was treated at the Lake Shore Mill from 1957 until the
  closure of that mill in March 1965.

High-grade ore material on the bottom levels was being mined
  when the mine closed. Diamond drilling below these levels indicated that the
  ore continues and that the Main Break shows no signs of weakening at depth.
  Relatively low tonnage of ore at deeper levels and difficulties in mining at
  these extreme depths proved deepening of the mine workings to be uneconomical
  with the fixed gold prices in the 1960s.

The Main Break and related sub-parallel structures strike
  continuously across the Lake Shore Property but are offset by significant post-ore
  faulting along the Lake Shore fault at the east end of the property. The North,
  or No. 2 vein, is the most productive and extensive structure at Lake Shore.
  This structure is continuous from surface down to the 8075-foot level and has
  been traced by diamond drilling for 800 feet below this level. Between the 1200
  and 4000-foot levels the Main Break branches into several faults.

Mining on the North (No. 2) vein was extensive throughout
  the mine. Of these zones, the area containing mixed syenite porphyry and augite
  syenite west of the shaft area from surface to the 5450-foot level was most
  productive. Occasionally sub-parallel veins were mined separately from this
  vein, but in places the veins are closely spaced and have been stoped together
  across widths up to 70 feet. Stoping was nearly continuous on the North vein
  from surface to the 5400-foot level where veining weakened considerably and
  stopped at the 6325-foot level. Another ore shoot continues below this from
  the 7575-foot level to the 8075-foot level, the bottom level of the mine. This
  ore shoot was traced by diamond drilling down to 8,500-foot level and showed
  no signs of weakening. The North vein on the 8075-foot level was mined over
  an 807 foot strike length at an average stoping width of 7.6 feet and an average
  grade of 0.677 ounces per ton.

Current Operations

The mine has been decommissioned. Accordingly, any ore recovered
  therefrom will have to be accessed from a ramp driven down into the property
  by previous owners or by new surface mining operations of the Corporation.

Kirkland Lake Gold Mine

Overview

The Kirkland Lake Gold Mine is near the western end of the
  five mines bounded to the west by the Macassa Mine and to the east by the Teck-Hughes
  Mine. A total of 1,172,955 ounces of gold at an average grade of 0.37 ounces
  per tonwas mined between 1919 and 1960.

History

The first reported discovery on the property was in 1911.
  In 1912 the Main Break was discovered. In 1913 a two-compartment shaft (Kirkland
  Lake Gold No. 1) was sunk to 80 feet by Kirkland Gold Mines Limited. The No.
  1 shaft was deepened in 1915 to 200 feet and a level was established at 175
  feet by Beaver Consolidated Mines Limited (under option from Kirkland Lake Gold
  Mines Limited).

From 1916 to 1918 Kirkland Lake Gold Mining Company Limited
  (controlled by Beaver Consolidated Mines Limited) deepened the No. 1 shaft to
  700 feet and sank another shaft (the No. 2 main shaft) to 500 feet with levels
  at 300, 400 and 500 feet. A 150 ton per day mill was installed and production
  began in 1918.

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In the early years of the mine, most gold production came
  from workings on the Main Break. In 1937 significant production started from
  the No. 5 vein. The No. 5 vein was a south dipping hangingwall vein structure
  which was mined as a continuous sheet of ore from the 3475-foot level to the
  3875-foot level along a strike length of 1,200 feet. This vein rolls into the
  Main Break along a line gently plunging to the west.

Current Operations

The mine has been decommissioned. Accordingly, any ore recovered
  therefrom will have to be accessed from existing operations in the Macassa Mine
  and on the Lake Shore Property. Alternatively, the Corporation could undertake
  new surface mining operations or drive a ramp down into the Property to access
  the ore.

Teck-Hughes Mine

Overview

The Teck-Hughes Mine is bounded on the west by the Kirkland
  Lake Gold Mine and Lake Shore Mine to the east. The mine began production in
  1917 and had produced 3,688,664 ounces of gold at a recovered grade of 0.38
  ounces per ton when it ceased operating in 1968. In the latter years of operation
  the mine relied heavily on lower grade slough ore which had caved
  from the hangingwalls of open stopes. From 1984 to 1988 Lac Minerals Ltd. mined
  the east boundary pillar area of the Mine which adjoins the Lake Shore Mine,
  as well as some ore available within the Teck-Hughes Mine accessible from the
  Lake Shore Ramp. It recovered a further 20,343 ounces for a total of 3,709,007
  ounces of gold recovered.

History

In 1911 three claims, which were to form the most important
  part of the mine, were staked and three neighbouring claims were staked. In
  1912 gold was discovered on one of the neighbouring claims. Prospecting and
  surface trenching was carried out by Teck-Hughes Gold Mines Limited and a 35
  foot shaft was sunk.

In 1913 the No. 1 Shaft was sunk to 212 feet and 203 feet
  of drifting was carried out on the 200-foot level. The No. 2 Shaft was sunk
  to a depth of 75 feet with 500 feet of lateral development on the 75-foot level
  by Teck-Hughes Gold Mines Limited. From 1914 to 1915 the No. 3 Shaft was sunk
  to 124 feet and an 85 foot winze were developed from the second level. A total
  of 1,360 feet of lateral development in the No. 1 and No. 3 Shafts were carried
  out by Nipissing Mining Company (under option from Teck-Hughes Gold Mines Limited).

From 1915 to 1917 the underground workings were dewatered
  and the No. 3 Shaft was deepened to 400 feet with a winze to 600 feet, and 1,804
  feet of lateral development was carried out. In 1917, a 50 ton mill was installed
  and milling began. This work was completed by Teck-Hughes Gold Mines Limited.

As with other four mines, the most important structure at
  the Teck-Hughes mine is the Main Break. This structure and the veins related
  to it yielded most of the gold in the mine. The mineralized structure was mined
  as the No. 3 vein from surface to the 6105-foot level, the deepest level at
  the mine. Longitudinal sections reveal that stoping on the No. 3 vein was almost
  continuous from surface to near the 3000-foot level. Diamond drilling defined
  the Main Break down to 6650 feet, however there was insufficient ore to warrant
  development below the 6105-foot level. Grade and production both decreased below
  3000 feet. This decrease in ore with depth has been suggested to be directly
  related to a decrease in the proportion of augite syenite to syenite porphyry
  with depth.

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Current Operations

The mine has been decommissioned. Accordingly, any ore recovered
  therefrom will have to be accessed from existing operations in the Macassa Mine
  and on the Lake Shore Property. Alternatively, the Corporation could undertake
  new surface mining operations or drive a ramp down into the Property to access
  the ore.

Wright-Hargreaves Mine

Overview

The Wright-Hargreaves Mine is located to the east of Lake
  Shore in the central portion of the five properties. It ranks second to the
  Lake Shore Mine in terms of gold production and grade, having produced 4,817,680
  ounces of gold at a grade of 0.49 ounces per ton. From 1984 to 1988 Lac Minerals
  Ltd. produced an additional 3,616 ounces of gold from the Mine for a total of
  4,821,296 ounces of gold.

History

This was the first discovery of gold in the Kirkland Lake
  Mining Camp, made in 1911. In 1913 a shaft (Wright-Hargreaves No. 1) was sunk
  to 85 feet with 110 feet of drifting on the 75-foot level. From 1916 to 1921
  the No. 1 shaft was deepened to 400 feet, No. 2 Shaft to 320 feet, No. 3 Shaft
  to 425 feet, and a total of 3,900 feet of lateral development took place. In
  1921 a mill was constructed and milling started at 175 tons per day.

The mine was developed down to the 8200-foot level, the deepest
  development in the Kirkland Lake Mining Camp. Diamond drilling below the 8200-foot
  level revealed several high-grade intersections persisting several hundred feet
  below the level. However, the cost to develop these intersections at such deep
  levels proved to be too high, and mining was not continued.

The Main Break is the most prominent structure crossing the
  Wright-Hargreaves Property. This structure has been traced as a consistently
  strong fault, down to the 8100-foot level, and by diamond drilling below that
  level. A significant amount of ore was mined from this structure, however, most
  of the tonnage came from the North vein. The North vein branches off the Main
  Break to the north just to the west of the property boundary with Lake Shore.
  Stoping on the North vein was extensive to about the 4500-foot level and development
  was to the 6600-foot level. Below this level mining was concentrated along ore-bearing
  fractures of the North vein zone known as the North Heading Vein, North vein,
  and North D Vein. These veins are typically steeply dipping to the south.

Another significant mineralized structure is the South vein-fault
  which branches off the south side of the Kirkland Lake fault in the western
  portion of the mine. As with many of the other mines in the camp there are also
  numerous veins which branch or splay off the main structures and form along
  tension fractures in the wedge of ground between major faults.

Most of the ore mined at Wright-Hargreaves was found within
  syenite porphyry with veins north of the Main Break below the 6600-foot level
  mainly in tuff, greywacke, conglomerate and granite porphyry located in the
  footwall of the main syenite porphyry plug. The Main Break is located within
  syenite porphyry throughout the mine. The north veins below the 6600-foot level
  are much less continuous than veins in the upper levels hosted by syenite porphyry.

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Current Operations

The mine has been decommissioned. Accordingly, any ore recovered
  therefrom will have to be accessed from existing operations in the Macassa Mine
  and on the Lake Shore Property. Alternatively, the Corporation could undertake
  new surface mining operations or drive a ramp down into the Property to access
  the ore.

Geological Setting

The Abitibi Greenstone Belt

The Corporations Kirkland Lake Mining Properties are
  located in the 2.75 to 2.67 billion year old Abitibi greenstone belt, which
  is the worlds largest greenstone belt covering an area of roughly 85,000
  square kilometres in north-eastern Ontario and north-western Québec.
  The Abitibi belt is part of the larger Abitibi Subprovince - a granite-greenstone-gneiss
  terrain that is located within the south-eastern portion of the Archaean Superior
  Province. The Abitibi Subprovince is bound in the north by para- and ortho-gneisses
  of the Opatica Subprovince, to the west by the Kapuskasing Structural Zone,
  to the east by the faulting and cataclasis of the Grenville Front Tectonic Zone,
  to the south-west by unconformably overlying sediments of the Huronian Supergroup
  and Keweenawan volcanics and sediments, and to the south-east by fault contact
  with Archaean metasediments of the Pontiac Subprovince.

Although outcrop in the Abitibi greenstone belt is limited
  by a till and clay cover, locally over 100 feet thick, exposure in the Corporations
  Kirkland Lake Mining Properties is quite good, leading to the first discovery
  of gold in a surface outcrop in 1911. Surface mapping in the Abitibi Subprovince
  has been supplemented by geophysical surveys showing broad regional negative
  magnetic and positive gravity expressions in areas where the surface geology
  consists of greenstone belts and tonalitic plutons, and similar broad regional
  positive magnetic and negative gravity anomalies in areas of granitic plutons.

Volcanic rocks were formed between 2.75 and 2.70 billion years.
  The volcanic rocks are komatiitic, tholeiitic, and calc-alkaline. Between 2.70
  and 2.68 billion years, turbidite dominated assemblages of sedimentary rock
  formed. This was followed locally by formations of alkaline meta-volcanic rocks
  and associated alluvial fluvial metasedimentary rocks between 2.68 and 2.67
  billion years. Three main divisions of granitoid intrusive rocks exist. Tonalite-trondjhemite-granodiorite
  batholiths reached their intrusive peak between 2.74 to 2.69 billion years,
  smaller granodiorite intrusives formed between 2.70 to 2.68 billion years, and
  syenite stocks formed between 2.69 to 2.67 billion years.

The Kirkland Lake Mining Properties

To the north and south of the Corporations Kirkland
  Lake Mining Properties are massive and pillowed mafic volcanic rocks which have
  been subdivided into the Blake River and Kinojevis Groups. To the north the
  volcanic rocks of the Blake River Group are profoundly unconformably overlain
  by the alkalic volcanic and sedimentary rocks known as the Timiskaming Group.

Numerous alkaline sills intrude the Timiskaming sediments.
  They consist of alkali-feldspar syenite, augite syenite as well as quartz-monzonite
  porphyry. In general terms, these units are known as feldspar porphyry (or syenite
  porphyry) as it is difficult to estimate modal percentages of primary plagioclase
  and alkali feldspar in the ground mass.

A series of alkali-feldspar syenite and quartz-monzonite (feldspar
  porphyry) plutons with differing phases of composition intrude the central and
  south limb of the synclinorium. The Otto and Murdock Creek Stocks are examples.
  Another pluton, the Lebel Stock, is entirely syenitic and may be the core intrusive
  of the alkaline volcanic rock assemblage.

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There are a number of key structural features within the Corporations
  Kirkland Lake Mining Properties. The major regional zone of accommodation is
  known as the Larder Lake Break or more regionally the Cadillac-Larder
  Lake Break and has been traced for over 300 kilometres along strike. This
  complex structural feature has been traced to the east through the Larder Lake-Virginiatown
  area (Kerr-Addison Mine) and into Québec through Rouyn-Noranda, Cadillac,
  Val dOr and terminates near Louvicourt at the Grenville Front. The Larder
  Lake Break continues westward under Huronian sediments and appears in the Matachewan
  area some 50 kilometres away. The Larder Lake Break is a broad zone of intense
  shearing and polyphase ductile deformation which represents the zone of structural
  accommodation between the proto-continent to the south and the main mass of
  volcanics to the north. One of the more colourful lithofacies in the Timiskaming
  assemblage of rocks and situated partly in the Larder Lake Break is a zone of
  extremely altered ultramafic volcanic rocks and associated massive and bedded
  carbonate up to several hundred feet thick and locally sufficiently rich in
  gold to constitute ore (such as the Kerr-Addison Mine). Characteristic green
  fuchsite is often associated and is mined locally in the Kirkland Lake area
  as a decorative stone in large panels. The Larder Lake Break generally strikes
  near east-west and dips sub-vertically. Folding is polyphase but is homogeneously
  distributed, creating all scales of interference patterns locally within the
  Timiskaming. In the Kirkland Lake area, known plunges are mostly steep and to
  the west south west at about 60 degrees. The thickest part of the syenite sill,
  with which most of the significant gold mineralization is associated, plunges
  the same way.

Mineralization

All of the properties are contiguous and very similar in nature
  to the Macassa Property.

Mineralization of the Macassa Property is intimately associated
  with the Main Break and the '04 Break which generally strike to the northeast
  and dip steeply to the south. The Main Break and various related branches play
  host to most of the gold mineralization in the camp in quartz-rich zones adjacent
  to the faults and in related hangingwall and footwall quartz veins. At the east
  end of the camp there are an increasing number of branches and splays off the
  strong main branch. These faults act to dissipate and lessen overall fault displacement
  which, based on pre-ore lithological relationships, is of a reverse nature (south
  side up). The overall displacement is rotational and has been calculated to
  be near 1,500 feet at the west end of the camp, and near 350 feet at the east
  end. To the west end of the camp, a fault sub-parallel to the Main Break, known
  as the '04 Break, hosts most of the ore at the Macassa Mine. At least some movement
  on the Main Break post-dates the Matachewan diabase dyke swarm.

A series of later cross-faults have displaced the various
  lithological structures and mineralization in Kirkland Lake. The two most significant
  of these late faults are the Amikougami Creek Fault and the Lake Shore Fault.
  Both faults strike near north-south and are sub-vertical. The vertical displacement
  of these faults is not well known.

The area surrounding the Macassa Mine is underlain by sedimentary
  and volcanic rocks of the Archaean Timiskaming Group. These rocks are several
  kilometres thick and trend to the east. They flank and are nearly parallel to
  the strike of the Larder Lake Break. They unconformably overlie pre-Timiskaming,
  pillowed and massive, volcanic rocks belonging to the Abitibi Supergroup
  which include the Blake River Group volcanics and the predominantly tholeiitic
  Kinojevis Group. Although these pre-Timiskaming volcanics are ubiquitous in
  the surrounding district, they have not been encountered in any of the Macassa
  Mine workings.

Intruded into the Timiskaming sedimentary and volcanic rocks
  is a composite syenitic sill that is broadly centred on the town of Kirkland
  Lake. The long axis of the stock is roughly parallel to the strike of the Timiskaming
  rocks and dips steeply to the south. The three main components of the syenitic
  stock and related dykes are augite syenite, felsic syenite, and syenite porphyry.
  These intrusive rocks are host to an important part of the ore at the Macassa
  Mine.

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The youngest rocks at Macassa, other than mineralization,
  are a few Matachewan diabase dykes.

Mineral Reserve Estimates

The following tables set out the reserve and resource estimates
  for the Macassa Mine property as at April 30, 2003. The estimates were prepared
  in accordance with National Instrument 43-101 Standards of Disclosure for
  Mineral Projects of the Canadian Securities Administrators by the Corporations
  Chief Geologist, Michael Sutton, P.Geo., and Senior Geologist, Stewart Carmichael,
  P.Geo., both of whom are persons qualified to make such estimates for the Corporation
  under the National Instrument. The estimates are contained in their reserve
  report dated August 30, 2003 and entitled Mineral Resources and Mineral Reserves
  of the Macassa Mine Property, Kirkland Lake, Ontario (Kirkland Lake Gold Inc.)
  as at April 30, 2003.

|Reserves | Tons(of ore) | Grade(ounces per ton) | Ounces(of gold)
|-------- | ------------ | --------------------- | ---------------
|         |              |                       |                
|Proven   | 497,700      | 0.42                  | 207,100        
|Probable | 554,100      | 0.51                  | 284,000        
|         |              |                       |                
|Total    | 1,051,800    | 0.47                  | 491,100        

The change in proven and probable reserves from April 31,
  2002 is an increase of 300,400 tons at 0.51 ounces of gold per ton (an increase
  of 153,200 ounces of gold). The change in proven and probable reserves from
  December 18, 2002 is an increase of 251,100 tons at 0.54 ounces of gold per
  ton (an increase of 134,800 ounces of gold).

Cautionary Note to U.S. Investors concerning estimates
  of Measured and Indicated Resources

The following table uses the terms measured resources
  and indicated resources. The Corporation advises U.S. investors
  that while those terms are recognized and required by Canadian regulations (under
  National Instrument 43-101 Standards of Disclosure for Mineral Projects),
  the U.S. Securities and Exchange Commission does not recognize them. U.S.
  investors are cautioned not to assume that any part or all of mineral deposits
  in these categories will ever be converted into reserves.

|Measured & Indicated Resources | Tons(of ore) | Grade(ounces per ton)
|------------------------------ | ------------ | ---------------------
|                               |              |                      
|Measured                       | 986,200      | 0.36                 
|Indicated                      | 2,361,700    | 0.31                 
|                               |              |                      
|Total                          | 3,347,900    | 0.32                 

Cautionary Note to U.S. Investors concerning estimates
  of Inferred Resources

The following table uses the term inferred resources.
  The Corporation advises U.S. investors that while this term is recognized and
  required by Canadian 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 other economic studies. U.S. investors are cautioned not to assume that
  part or all of an

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inferred mineral resource exists, or is economically or legally mineable.

|Inferred Resources | Tons(of ore) | Grade(ounces per ton)
|------------------ | ------------ | ---------------------
|                   |              |                      
|Total              | 558,900      | 0.35                 

The reserves are reported separately from resources. Mineral
  resources (which are not mineral reserves) do not have demonstrated economic
  viability. The reserves and resources are estimated using the polygonal method.
  All intersections are calculated out to a 5.0 foot minimum horizontal mining
  width. Dilution is added to reserves at varying rates depending on mining method,
  and the width of the ore. Dilution in the reserve estimate overall averages
  26% at 0.02 ounces of gold per ton. All higher grade samples are cut to 3.50
  ounces of gold per ton. The cut-off is 0.25 ounces of gold per ton over the
  horizontal mining width. The area of influence of the proven reserve and measured
  resource categories is 30 feet from development chip samples or diamond drill
  holes. The area of influence of the probable reserve and indicated resource
  categories is 50 feet from a known sample point (drill holes). For inferred
  resources there is another 50 feet of influence. A 94% tonnage recovery is used.
  Continuity of the veins appears very good. The assumptions used include US$
  325 U.S. per ounce of gold, and an exchange rate of $0.72 Canadian equals US$
  1.00 ($451 Canadian per ounce). The Corporation is not aware of any environmental,
  permitting, legal, title, taxation, socio-political, marketing or other issue
  that may materially affect its estimate of mineral reserves and resources.

Current and Proposed Exploration and Development

Shaft and Ramp Rehabilitation

The Corporation has re-commissioned Shafts No. 2 and 3 of
  the Macassa Mine and the Lake Shore / Teck-Hughes / Wright-Hargreaves Ramp.
  Such shafts and ramp and now available for use in the Corporations drilling
  programs and for production. Rehabilitation of Shaft No. 3 at the 5025-foot
  level has enabled the Corporation to access four stopes for its production.

Dewatering

The previous owner of the Macassa Mine allowed the mine to
  flood after it ceased production. To dewater the mine, the Corporation has installed
  pumping equipment. As at December 22, 2003 dewatering of the No. 3 Shaft had
  extended to approximately 127 feet below the 5150-foot level. This enabled the
  Corporation to rehabilitate the 5150-foot level and make operational the loading
  pocket located on that level.

The goal of the dewatering program is to reach the mine’s
  lower workings at the 5700-foot level which is expected to be reached by December
  2004. Concurrently an underground exploration and development drilling program
  is being carried out for the purpose of adding to reserves.

Data Analysis

In April 2002, the Corporation commenced an 18 month program
  of data compilation on its gold properties and, in the summer of 2003, engaged
  a team of exploration consultants to work with its geologists to study and make
  recommendations based upon the results. This compilation has resulted in the
  data entry of 18,500 drill holes. Mine openings were digitized for all five
  mines, along the more than 200 miles of levels. The data compilation process
  enabled the team to delineate a host of highly prospective targets that were
  not drilled or well understood in the past.

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The success of newly discovered D Zone, a north-south structure
  new to the previously mined east-west structures in the Camp, has led the Corporation
  to ensure that similar large north-south targets are to be followed up with
  drilling.

Drilling

A total of 133,549 feet of drilling was carried out by the
  Corporation in its last fiscal year (May 1, 2002 to April 30, 2003). Of the
  $1,665,742 spent on the drilling, $819,372 was spent on surface drilling and
  $846,370 was spent on underground drilling. The drilling encompassed $663,060
  worth of definition drilling of known gold mineralization (to establish the
  gold resources and reserves contained in the mineralization) and $1,002,682
  worth of exploration drilling for new gold mineralization. Approximately one-half
  of the surface drilling and 70% of the underground drilling was definition drilling.

Most of the increase in reserves and resources as at April
  30, 2003 from those as at April 30, 2002 is attributable to the exploration
  drilling. This exploration drilling covered various surface targets (mostly
  located close to the Lake Shore Ramp) and underground at the '04 Break above
  the 3800-foot Level and the newly discovered D Zone. The targets of the drilling
  program were primarily definition drilling of various veins to be mined from
  the Lake Shore Ramp (from surface and underground), definition drilling at the
  No. 3 Shaft of the Macassa Mine (at the 3800-foot and 42-foot Levels) of various
  veins, exploration of the D Vein and the area extending 600 feet above the 3800-foot
  Level of the Macassa Mine, and exploration at surface on all properties, with
  emphasis on the Court Vein of the Teck-Hughes Property.

For the fiscal year ending April 30, 2004, the Corporation
  plans to carry out drilling which will cover all of the five properties, with
  the main focus being the search for parallel ore structures to the Main Break
  and '04 Break mineralization complex that has hosted virtually all of the production
  to date.

Following completion of the 18 month data compilation program
  in October 2003 the Corporation began an exploration and drilling program in
  a search for camp-wide mineralized structures. The program is to be carried
  out over a period of three years and will include both surface and underground
  drilling at an estimated cost of approximately $21 million. In addition, the
  Corporation intends to spend approximately $5.2 million for a new hoist for
  the currently decommissioned Shaft No. 5 on the Lake Shore Property and other
  development programs.

This program will be funded, in stages over its three year
  life, from cash flow from operations and private and public financings through
  the sale of equity and debt securities of the Corporation. It is intended the
  surface and Lake Shore-Shaft No. 5 exploration programs will be funded through
  equity private placements and the exploration at Shaft No. 3 will be funded
  through revenue from production.

The results of the Corporation’s surface diamond drilling
  program have increased the probability that there is one geologic structure
  with a potential 20,000 foot strike length and a vertical 7,000 foot dip encompassing
  the northern part of the Corporation’s Kirkland Lake gold properties.

Security of Samples

To ensure the validity and integrity of samples taken by the
  Corporation it re-assays pulps and takes second cuts on rejects at a second
  recognized lab. As well, blank (non-mineralized) core samples are inserted within
  core samples from mineralized zones to check contamination. The core is regularly
  quartered and sent out to check for replicability. Core is handled by one person
  only, after being split and bagged securely.

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Quality Control

The results of the Corporations exploration programs
  have been reviewed, verified (including sampling, analytical and test data)
  and compiled by the Corporations geological staff. Furthermore, the Corporation
  has implemented a quality control program to ensure sampling and analysis of
  all exploration work is conducted in accordance with the best possible practices.
  The drill core is sawn in half with half of the core samples shipped to the
  Swastika Laboratories in Swastika, Ontario for analysis. The other half of the
  core is retained for future assay verification. Gold analysis is conducted by
  fire assay using atomic absorption or gravimetric finish. The laboratory re-assays
  at least 10% of all samples and additional checks may be run on anomalous values.
  Blank cores are added in the midst of mineralized zones. Quarter coring has
  been undertaken for replication purposes. Pulps and rejects are routinely sent
  to a second assay lab.

ITEM 5OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following should be read in conjunction with the Corporations
  financial statements, forming a part of this document, including note 19 to
  the annual financial statements which provides a reconciliation between US GAAP
  and Canadian GAAP.

Critical Accounting Policies

The Corporations most significant accounting policies
  are as follows:

|• | Revenue is recognized on transfer of title to the
        purchasers of the Corporations gold bullion sold in the spot market.
        This occurs when the gold is received by the purchasers. Adjustments to
        accounts receivable, if any, between the date of title transfer and the
        settlement date are recorded when determinable.                                                                                                                                                                                                                                                                                                        
|- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|• | Dore bars and gold in process are recorded in inventory
        at the lower of average production cost and net realizable value.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|• | Exploration expenditures and near term ore development
        costs are expensed as incurred.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                
|• | Property acquisition costs and longer term development
        costs incurred to expand ore reserves are deferred and depleted on a units-of-production
        basis over proven and probable reserves. The capitalized costs are reviewed
        annually, or more frequently if changes in circumstances warrant, to consider
        whether the carrying value can be recovered from estimated undiscounted
        future cash flows. If the carrying value is considered not recoverable
        on this basis, the Corporation will write down the carrying value to the
        estimated net recoverable amount, calculated on non-discounted basis.

A.           OPERATING
  RESULTS

The Corporation did not have any operating revenue during
  its fiscal year ended April 30, 2002. The Corporation began production from
  its gold mining and milling operations in Kirkland Lake, Ontario in May 2002.

Acquisition of Kirkland Lake Mining Assets

On December 14, 2001 the Corporation acquired the gold mining
  assets of Kinross Gold Corporation in Kirkland Lake, Ontario for $5 million,
  the assumption of $2,043,435 in reclamation bond obligations related to the
  closure plan for the properties and a net smelter return royalty. The $5 million
  purchase price was paid in instalments, which commenced in June 2002 and ended
  in December 2003.

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Results of Operation

The Corporation had mining revenue of $11,704,639 in fiscal
  2003 compared to nil in fiscal 2002 and 2001.

The net loss for fiscal 2003 was $4,934,979 ($0.25 per share)
  compared to losses of $2,178,587 ($0.16 per share) in 2002 and $385,149 ($0.04
  per share) in 2001. The Corporation had an operating profit of $131,665 in fiscal
  2003. The increased loss in fiscal 2002 was due to the increased operational
  and administrative activity and increased costs from acquiring the Kirkland
  Lake Properties in December 2001 and preparing them for a return to production.
  The increased loss in fiscal 2003 resulted primarily from the Corporation not
  attaining its production goals. Underground gold production did not take place
  in fiscal 2003 and thus a regularized cost profile has not yet been established.

Gold production during fiscal 2003 was 24,589 troy ounces,
  which fell short of the forecasted range of 50,000 to 70,000 ounces, primarily
  for two reasons. Firstly, on March 3, 2003, the Corporation announced a temporary
  halt in ore production from the Macassa Mine after a pillar failed in an existing
  ore pass near to Shaft No. 3. The ore pass, and an additional ore pass (also
  close to the shaft) were filled, some 200 feet of timber was realigned and underground
  activity re-commenced towards the latter half of April 2003. Secondly, the Corporation
  experienced slower than anticipated progress in its dewatering program. Consequently,
  gold production in the year was limited to surface ore and tailings. Underground
  mining on a commercial scale did not take place during the fiscal year and thus
  normalized operating costs were not established.

Operating Expenses

During fiscal 2003, a total of $10,787,637 (2002  nil
  and 2001  nil) was spent on operating costs relating to mining, milling,
  and on-site administration, which included $603,583 in municipal taxes. Of this
  amount, $3.8 million was paid to contractors for the supply of miners. The Corporation
  incurred $785,337 (2002  $225,593 and 2001  nil) in amortization
  and depletion of assets.

During fiscal 2003, the Corporation incurred a higher level
  of general and administrative expenses of $2,264,735 (2002 – $1,333,405
  and 2001 – $397,917). The principal reason for this increase relates to
  the Corporation’s staff increasing from four employees to 82 employees
  at the fiscal year-end. In addition, the Corporation incurred $702,078 (2002
  – $95,052) for listing related fees and additional professional fees in
  connection with the listing of its shares on the Toronto Stock Exchange and
  the TSX Venture Exchange. Similarly, expenses related to the Corporation’s
  investor relations activities amounted to $618,159 (2002 – $151,151 and
  2001 – $3,609). The increase in this expense on a year-over-year basis
  is due to the Corporation’s increased investor relations activities undertaken
  in conjunction with its listing on Canada’s senior stock exchange. Looking
  forward, the Corporation’s management hopes to list the Corporation’s
  shares on the American Stock Exchange, which would lead to higher levels of
  expenditures for legal and accounting costs over the next 12 months. In fiscal
  2003 salaries and related expenses for management totalled $491,676 (2002 –
  $351,773 and 2001 – nil). Travel expenses totalled $278,766 (2002 –
  $38,984 and 2001 – nil) for the fiscal year.

During 2003 the Corporation incurred $236,216 on royalties
  (2002  nil and 2001  nil), $1,798,836 on exploration (2002 
  $473,830 and 2001  nil), $237,016 on amortization of finance charges (2002
   nil and 2001  nil), $598,488 on interest and bank charges (2002
   $159,925 and 2001  nil), $142 in foreign exchange losses (gains)
  (2002  ($14,166) and 2001  ($5,802)) and a gain of $68,789 on interest
  and other income (2002  nil and 2001  $6,966). In general, expenses
  have increased due to costs incurred in connection with acquiring the Kirkland
  Lake Properties and the commencement of production.

During fiscal 2003, the Corporation maintained an aggressive
  exploration program, spending $1,798,836 (2002  $473,830 and 2001 
  nil) on drilling and related exploration.

29

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Interest and bank charges increased to $598,488 for fiscal
  2003 from $159,925 in 2002 and nil in 2001. The increase is reflective of amounts
  borrowed to finance the acquisition of the Macassa Mine and related properties
  and operations and the start-up of production operations. Accretion of interest
  related to the deferred payments of $5 million payable to Kinross in connection
  with the purchase of the Mine and amortization of finance charges connected
  with various financings completed by the Corporation totalled $606,163 for fiscal
  2003 and $187,761 for fiscal 2002. Accretion of interest represents the difference
  between the present value of the $5 million of cash payments due from June 2002
  to December 2003 discounted at an annual rate of 10%. During the year ended
  April 30, 2002 $187,671 of the interest expense relates to the accretion of
  the discount reported on the notes payable. The notes have been outstanding
  for approximately 4 1/2 months as of April 30, 2002.

During fiscal year 2003, the Corporation spent $622,600 on
  its eight primary consultants. Slightly less than half of this amount is associated
  with legal fees paid for filings, general purposes, and labour relations. Additionally,
  $100,000 was collectively paid to the Corporations accountants in Kirkland
  Lake, Ontario and its public auditor.

Production and Costs

Gold production during fiscal 2003 was 24,589 troy ounces,
  which fell short of the forecasted range of 50,000 to 70,000 ounces, primarily
  for two reasons. Firstly, on March 3, 2003, the Corporation announced a temporary
  halt in ore production from the Macassa Mine after a pillar failed in an existing
  ore pass near to Shaft No. 3. The ore pass, and an additional ore pass also
  close to the shaft were filled, some 200 feet of timber was realigned and underground
  activity re-commenced towards the latter half of April 2003. The second reason
  for the production shortfall was slower than anticipated progress in the Corporations
  dewatering campaign. Consequently, gold production in the year was limited to
  just ore from the surface. In short, underground mining on a commercial scale
  did not take place during the fiscal year and thus normalized operating costs
  were not established.

During fiscal 2003, a total of $10,787,637 was spent on operating
  costs relating to mining, milling, and on-site administration, which included
  $603,583 in municipal taxes. Of this amount $3.8 million was paid to a mining
  force that was contracted out by a third party. Another major reason relates
  to our staff increasing from 4 employees to 82 employees at year-end. The major
  reason for the increase was the increase in the Companys headcount. Moreover,
  for the year the Company incurred a higher level of general and administrative
  expenses of $2,264,735 (2002-$1,333,405), with $702,078 (2002-$95,052) for listing
  related fees and additional professional fees as we moved on to the TSE Exchange
  from the TSX Venture Exchange.

B.           LIQUIDITY
  AND CAPITAL RESOURCES

The Corporations cash balance at April 30, 2003 was
  $3,664,607 (2002  $3,669,390), a decrease of $4,783 from April 30, 2002.
  As at April 30, 2003, the Corporation had a working capital deficit of $2,372,658
  (compared to positive working capital in 2002  $239,522 and 2001 
  $115,808), which included a convertible loan in the principal amount of $2,187,500
  and a maturity date of June 11, 2003, which has been extended until June 11,
  2004.

The Corporation spent $857,584 (2002  nil and 2001 
  nil) on the acquisition of property plant & equipment in fiscal 2003. Of
  this amount, almost 50% or $333,861 related to the acquisition of new mining
  equipment.

The total amount of capital investment for developmental work
  for the 2003 fiscal year amounted to $6,188,717 (2002  $1,556,084 and
  2001  nil). Of this amount, general underground development amounted to
  $3,885,255, expenditures associated with the dewatering campaign totalled $1,408,865
  (2002  $508,657 and 2001  nil), and $842,682 (2002  nil and
  2001  nil) was spent on rehabilitating the Lake Shore Ramp.

30

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The underground development expenditures in fiscal 2003 included
  rehabilitation of levels and pre-mining stope preparation. The total for rehabilitation
  amounted to $586,000, which in addition to the work performed on Shaft No. 3,
  included the successful rehabilitation of two large levels (6,000 feet on the
  4250-foot level and 5,000 feet on the 4500-foot level). Two major programs for
  underground development activity were the $308,000 Alimak Program (422 feet)
  and the $302,000 Raisebore Program (1,475 feet).

During fiscal 2003 $1,408,865 (2002  $508,657) of pumping
  related costs were capitalized as a result of the Corporations dewatering
  campaign. The water level was lowered to below the 4750-foot level, advancing
  1,150 feet since the prior fiscal year. The total amount of water pumped from
  underground was 316 million gallons, or just under 1 million gallons per day.
  The net benefit of the dewatering campaign was to add four new levels (containing
  ore reserves) to the Corporations current mining plan.

The Corporation incurred $842,682 in fiscal 2003 to re-install
  all underground services and for necessary developmental work at the Lake Shore
  Ramp. The Lake Shore Ramp is being developed to provide an alternative source
  of ore for the Corporations milling complex.

Three financings were completed during the 2003 fiscal year.

On June 11, 2002 the Corporation received funding from a convertible
  loan financing totalling $2,500,000. The loans were repayable in one year with
  interest at 10% per year. The principal amount of the loans is convertible into
  common shares of the Corporation at the rate of $4.00 per share while interest
  is convertible at the rate equal to the higher of $4.00 per share or the prevailing
  market price. During the fiscal year one of the loans was repaid and subsequent
  to the fiscal year end the maturity date of the other loan in the principal
  amount of $2,187,500 was extended to June 2004 in consideration of the issuance
  of 109,375 shares which were issued at a fair value of $224,219. The lenders
  were issued 125,000 special warrants (which were subsequently converted into
  an equal number of common shares of the Corporation) as a bonus for making the
  loans, which were recorded at a fair value of $218,266. The Corporation incurred
  commissions $25,000 in connection with this financing.

On June 21,2002 the Corporation completed the
  sale, by way of private placement, of 1,000,000 common shares at $2.35 per share
  for gross proceeds of $2,350,000. The Corporation incurred commissions, fees
  and legal costs totalling $169,851 in connection with this placement. The agent
  also received an option to purchase 100,000 shares of the Corporation for two
  years at $2.35 per share, which was recorded at a fair value of $81,276.

On December 27, 2002 the Corporation completed the sale, by
  way of private placement, of 2,625,000 shares at $1.80 per share for gross proceeds
  of $4,725,000. The agents also received 393,750 warrants exercisable at $2.05
  until June 30, 2004 as compensation for the placement. The Corporation incurred
  commissions, fees, and legal costs totalling $465,834 in connection with this
  placement. The agents warrants have been recorded at a fair value of $233,935.

In fiscal 2003 the net proceeds from the issue of share capital
  pursuant to the foregoing private placements and exercise of share purchase
  warrants and stock options totalled $9,981,917 (2002  $8,274,369 and 2001
   $75,000) net of share issue costs. In addition, the Corporation made
  payments of $3,000,000 on notes payable.

Management estimates that funds on hand and raised from a
  financing subsequent to the Corporations fiscal year end (see Subsequent
  Events below), together with cash flow from operations, are sufficient
  to meet the Corporations obligations for the coming year and to undertake
  further development of its Kirkland Lake mining properties.

31

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Subsequent Events

On August 8 and 26, 2003 the Corporation completed the sale,
  by way of private placement, of 3,755,000 units at a price of $2.60 per unit
  for gross proceeds of $9,763,000. Each unit consisted of one common share and
  one-half of a share purchase warrant. Each whole warrant entitles the holder
  to purchase a further common share for a period of two years at a price of $3.00
  per share.

On August 11, 2003 the Corporation completed a convertible
  loan financing pursuant to which it borrowed $1,000,000 with interest at 10%
  per year payable every 18 months. The loan matures on February 11, 2005 but
  can be extended for a further 18 months upon the issuance of that number of
  common shares equal to 0.075 times the amount of unpaid principal. The outstanding
  principal is convertible into common shares of the Corporation at the rate of
  $4.00 per share and the accrued interest is convertible into common shares at
  that rate equal to the higher of $4.00 per share or the 10 day weighted volume
  average trading price at the time of conversion. If the loan is converted by
  the lender or redeemed by the Corporation within the first 18 months of the
  term of the loan, the lender is entitled to receive 18 months’ worth of
  interest. If redeemed by the Corporation within the first or second 18 month
  term, the lender shall also receive warrants to purchase that number of common
  shares equal to 0.2875 times the amount of unpaid principal. The warrants would
  be exercisable at $4.00 per share until the next 18 month anniversary of the
  loan. While the loan is outstanding, the Corporation is restricted from incurring
  certain indebtedness which is senior to the loan and from creating or permitting
  liens on its assets. Should the Corporation undergo a change of control (which
  includes the departure of both of the Corporation’s Chairman, D. Harry
  W. Dobson, or CEO, Brian A. Hinchcliffe, as officers or, in certain circumstances,
  as directors of the Corporation) the loan can become, on the lender’s
  election, immediately repayable together with the interest which would otherwise
  accrue over the balance of the remaining 18 month term. The lender was issued
  a bonus of 75,000 common shares for making the loan which were issued at a fair
  value of $225,000. The Corporation paid a commission of $50,000 in connection
  with this placement.

On November 14, 2003, the Corporation completed the sale,
  by way of private placement, of 1,925,000 common shares at a price of $4.00
  each for gross proceeds of $7,700,000. The shares were flow-through
  shares entitling the investors to certain tax benefits under applicable Canadian
  tax legislation. The agents for the placement were issued warrants to purchase
  96,250 common shares for a period of two years at a price of $3.60 per share
  and paid a $385,000 (5%) cash commission.

On December 1, 2003, the Corporation completed the sale, by
  way of private placement, of 2,200,000 common shares at a price of $3.90 each
  for gross proceeds of $8,580,000. The investors also received warrants to purchaser
  a further 1,100,000 shares at a price of $4.40 per share for a period of 18
  months. The agents for the placement were paid a $429,000 (5%) cash commission.

Outlook

The Corporation currently contemplates production of between
  30,000 and 50,000 ounces of gold in fiscal 2004. The major short-term challenge
  is to continue to build up its own mining workforce, which continues to progress.
  The re-commissioning of Shaft No. 2 and the installation of ore and waste handling
  devices together with rehabilitating the loading pocket at the 5150-foot level
  of Shaft No. 3, are two significant milestones recently achieved, essential
  to the Corporation reaching its goal of commercial production level during the
  third quarter of fiscal 2004. The majority of gold production is expected from
  Shaft No. 3 off the Macassa Mine, with theLake Shore Ramp and Shaft No. 2 contributing
  more and more asthe year progresses.

Capital expenditures for the fiscal year ending April 30, 2004
  are now expected to be reach approximately $10 million versus the prior estimate
  of $6 million. The increase is largely due to the decision to acquire additional
  mining equipment for underground production. Further, a recent decision has
  been made to re-commission Shaft No. 5 on the Lake Shore Property for exploration
  purposes has added to the capital expenditures.

The Corporations ability to continue as a going concern
  is dependent on future financings until the attainment of profitable and cash-generating
  operations sufficient to sustain it. The Corporations financial statements
  contained herein do not include any adjustments to the recoverability and classification
  of recorded asset amounts and classification of liabilities that might be necessary,
  should the Corporation be unable to continue as a going concern.

C.           RESEARCH
  AND DEVELOPMENT

Not applicable.

32

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D.           TREND
  INFORMATION

The Corporation commenced production at its Kirkland Lake
  Properties during May 2002. Continuing operation of these properties is dependent
  on there being a sufficient quantity and an economic grade of ore to be processed
   which is dependent on the price of gold. If the price of gold were to
  drop significantly, it is possible that the Kirkland Lake Properties would become
  uneconomical to operate which would have an adverse effect on the Corporations
  ability to raise funds in the equity markets.

The Corporation’s management considers the biggest challenge
  is meeting the Corporation’s gold production target in fiscal 2004 and
  thereafter. The Corporation is increasing the size of its mining workforce to
  meet the requirements of its production plan. While the Corporation has made
  considerable progress in its efforts to recruit experienced miners, additional
  progress must be made over the upcoming months

Provided the Corporation has adequate funding and the price
  of gold remains favourable, the Corporation plans to develop the Macassa and
  other properties. During its 2004 fiscal year the Corporation plans to produce
  30,000 to 50,000 ounces of gold.

E.           OFF-BALANCE
  SHEET ARRANGEMENTS

The Corporation 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.

For the purposes of the foregoing, the term off-balance
  sheet arrangement means any transaction, agreement or other contractual
  arrangement to which an entity unconsolidated with the Corporation is a party,
  under which it has:

|(a) | Any obligation under a guarantee contract
        that has any of the characteristics identified in paragraph 3 of the United
        States Financial Accounting Standards Board (FASB) Interpretation
        No. 45, Guarantors Accounting and Disclosure Requirements for
        Guarantees, Including Indirect Guarantees of Indebtedness of Others(November
        2002) (FIN 45), as may be modified or supplemented, excluding
        the types of guarantee contracts described in paragraphs 6 and 7 of FIN
        45;           
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(b) | A retained or contingent interest in
        assets transferred to an unconsolidated entity or similar arrangement
        that serves as credit, liquidity or market risk support to such entity
        for such assets;                                                                                                                                                                                                                                                                                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(c) | Any obligation under a derivative instrument
        that is both indexed to the Corporations shares and classified in
        stockholders equity, or not reflected, in the companys statement
        of financial position; or                                                                                                                                                                                                                                                                                                                
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
|(d) | Any obligation, including a contingent
        obligation, arising out of a variable interest (as referenced in FASB
        Interpretation No. 46, Consolidation of Variable Interest Entities(January 2003), as may be modified or supplemented) in an unconsolidated
        entity that is held by, and material to, the Corporation, where such entity
        provides financing, liquidity, market risk or credit risk support to,
        or engages in leasing, hedging or research and development services with,
        the Corporation.

33

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F.           TABULAR
  DISCLOSURE OF CONTRACTUAL OBLIGATIONS

As of the date of the balance sheet for the Corporations
  last fiscal year end contained herein, the Corporations known contractual
  obligations identified in the following table are:

|                                                                                                               | Payments Due by Period
|-------------------------------------------------------------------------------------------------------------- | ----------------------
|Contractual Obligations                                                                                        | Total                 
|Long-Term Debt Obligations                                                                                     | $2,043,435            
|Capital (Finance) Lease
      Obligations                                                                      |                      
|Operating Lease Obligations                                                                                    |                      
|Purchase Obligations                                                                                           |                      
|Other Long-Term Liabilities
      reflected on the Corporations
      Balance Sheet under Canadian
      GAAP |                      
|Total                                                                                                          | $2,043,435            

|(1) | This amount represents funds posted
        for reclamation bonds in connection with the acquisition of the Macassa
        Mine. See Item 4A History and Development of the Company 
        History  Current Operations  Acquisition of Macassa Mine.
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

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 Items 5E and F above.

ITEM 6DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES

A.           DIRECTORS
  AND SENIOR MANAGEMENT

All of the directors of the Corporation are elected annually
  by the shareholders and hold office until the next annual meeting of shareholders
  or until their successors are duly elected and qualified, unless they sooner
  resign or cease to be directors in accordance with the Corporations By-Laws.
  The Corporations last regular annual meeting was held on October 6, 2003.
  The Corporations officers are appointed by and serve at the pleasure of
  the Board of Directors.

As at the date hereof, the following persons were the officers, directors
  and senior management of the Corporation:

|Name(1)               | Position withthe Corporation                    | Since            
|--------------------- | ----------------------------------------------- | -----------------
|DOBSON, D. Harry W.   | Chairman of the Board of Directors              | October 11, 2001 
|HINCHCLIFFE, Brian A. | President, Chief Executive Officer and Director | February 26, 2001

34

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|Name(1)                | Position withthe Corporation | Since            
|---------------------- | ---------------------------- | -----------------
|HINCHCLIFFE, Robert P. | Chief Financial Officer      | January 6, 2003  
|LEE, Sandra            | Corporate Secretary          | February 27, 1995
|SUTTON, Michael W. (2) | Chief Geologist              | February 1, 2002 
|BELECQUE, Raymond A.   | General Manager              | January 1, 2002  
|BAYLEY, Brian E. (3)   | Director                     | October 15, 1998 
|HOLMES, Warren W. (3)  | Director                     | July 1, 2002     
|KOSTUIK, S. Paul (3)   | Director                     | February 26, 2001
|SINCLAIR, A. Murray    | Director                     | July 6, 1994     

|(1) | Other than Brian A. Hinchcliffe and Robert P. Hinchcliffe,
        who are brothers, none of such persons has any family relationship with
        any other and none were elected as a director or appointed as an officer
        as a result of an arrangement or understanding with a major shareholder,
        customer, supplier or any other party.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | The Corporation relies upon Mr. Sutton to review
        and approve all technical information contained in its written disclosure.                                                                                                                                                                                                                        
|(3) | Audit Committee member.                                                                                                                                                                                                                                                                                                                                    

The following is biographical information on each of the persons
  listed above:

D. HARRY W. DOBSON, age 56, has served as a director
  and the Chairman of the Board of Directors since October 11, 2001. In addition
  to his activities with the Corporation Mr. Dobson engages in various merchant
  banking and venture capital activities in North America and Europe. Mr. Dobson
  was formerly Deputy Chairman of Lytton Minerals Limited (publicly traded diamond
  exploration company). He is the founder and former Chairman of American Pacific
  Mining Company Inc. (publicly traded mining company). Mr. Dobson also holds
  the following principal directorships:

|Issuer                          | Business              
|------------------------------- | ----------------------
|Mountain Province Diamonds Inc. | Diamond exploration   
|Ovoca Resources PLC             | Base metal exploration

BRIAN A. HINCHCLIFFE, age 48, has served as President
  and Chief Executive Officer since February 26, 2001 and as a director since
  February 26, 2001. Mr. Hinchcliffe was formerly President of Jordex Resources
  Inc. (publicly traded mining company). Prior to that, he was the President of
  American Pacific Mining Company Inc. (publicly traded mining company). Mr. Hinchcliffe
  does not have any other principal directorships.

ROBERT P. HINCHCLIFFE,age 36, has served as Chief
  Financial Officer since January 6, 2003. Mr. Hinchcliffe holds a Bachelor of
  Arts with a Minor in Geology from the University of Arizona and a Master of
  Business Administration from Georgetown University. He served most recently
  as Senior Vice President at Banco Santander where he was responsible for equity
  research. Prior to that, Mr. Hinchcliffe was an equity analyst covering international
  mining and steel companies at Prudential Securities and Societe Generale. Before
  working as an analyst, Mr. Hinchcliffe worked for three years in project development
  for a Venezuelan mining company. Mr. Hinchcliffe does not have any other principal
  directorships.

35

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SANDRA LEE, age 39, has served as Corporate Secretary
  since February 27, 1995. Ms. Lee is a certified legal assistant and is currently
  Corporate Secretary of Quest Capital Corp. (a publicly traded merchant banking
  company), Quest Management Corp. (a management company wholly-owned by Quest
  Capital Corp.) and Quest Ventures Ltd. (a private merchant banking company).
  Previously, she was Assistant Corporate Secretary and Corporate Secretary of
  Quest Oil & Gas Inc. (publicly traded oil and gas company) from May, 1995
  to April, 1997 and before that she worked as a legal assistant for a number
  of large law firms in the areas of corporate and securities laws. She is the
  corporate secretary of a number of publicly traded companies, including the
  following principal companies:

|Issuer                       | Business                            
|---------------------------- | ------------------------------------
|Cypress Hills Resource Corp. | Petroleum and natural gas production
|Esperanza Silver Corporation | Precious metal exploration          
|Greystar Resources Ltd.      | Precious metal exploration          
|Midway Gold Corp.            | Precious metal exploration          
|Quest Capital Corp.          | Merchant banking                    

MICHAEL W. SUTTON, age 43, has served as Chief Geologist
  since February 1, 2002. Previously he was employed at the Macassa Mine as a
  Geologist for over eight years and as Chief Geologist since 1997 by Kinross
  Gold Corporation. Mr. Sutton does not have any business activities outside the
  Corporation other than prospecting.

RAYMOND A. BELECQUE, age 52, has served as General
  Manager since January 1, 2002. Previously he was employed as Operations Superintendent
  and Mill Superintendent for the Macassa Mine by Kinross Gold Corporation. Mr.
  Belecque has over 30 years of experience working at the mine site. Mr. Belecque
  does not have any business activities outside the Corporation.

BRIAN E. BAYLEY, age 50, has served as a director since
  October 15, 1998. Mr. Bayley is the President and Chief Executive Officer of
  Quest Capital Corp., President of Quest Management Corp., President of Torque
  Energy Inc. (a petroleum and natural gas production company) and a director
  of Quest Ventures Ltd. Mr. Bayley is an officer of a number of public companies
  and holds the following principal directorships:

|Issuer                        | Business                            
|----------------------------- | ------------------------------------
|American Natural Energy Corp. | Petroleum and natural gas production
|Greystar Resources Ltd.       | Precious metal exploration          
|PetroFalcon Corporation       | Petroleum and natural gas production
|Quest Capital Corp.           | Merchant banking                    

Previously, Mr. Bayley was the Vice-President, Corporate Administration
  from September, 1986 to October, 1990, the President and Chief Executive Officer
  from October, 1990 to October, 1996, a director from November, 1990 to April,
  1997 and the Corporate Secretary from October, 1996 to April, 1997 of Quest
  Oil & Gas Inc.

W. WARREN HOLMES, age 61, has served as a director
  since July 1, 2002. Mr. Holmes is the President and Chief Executive Officer
  of Nuinsco Resources Limited (publicly traded mineral exploration company).
  He was

36

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formerly Senior Vice President, Canadian Mining Operations
  of Falconbridge Limited (a publicly traded senior mining company) and formerly
  President and General Manager, Canadian Nickel Operations of Falconbridge Limited.
  Mr. Holmes is a director of a number of public companies and holds the following
  principal directorships:

|Issuer                            | Business                               
|--------------------------------- | ---------------------------------------
|Nuinsco Resources Limited         | Nickel exploration                     
|Wallbridge Mining Company Limited | Base & platinum group metal exploration

S. PAUL KOSTUIK, age 64, has served as a director since
  February 26, 2001. Mr. Kostuik is a Professional Engineer and a self-employed
  mining consultant. He was formerly Chairman and Chief Executive Officer of Jordex
  Resources Inc. and formerly President of Quintette Coal Ltd. (privately held
  senior coal mining company). Mr. Kostuik also holds the following principal
  directorships:

|Issuer                       | Business           
|---------------------------- | -------------------
|Arizona Star Resources Corp. | Gold mining company

A. MURRAY SINCLAIR, age 42, has served as a director
  since July 6, 1994. Mr. Sinclair is the Managing Director of Quest Capital Corp.,
  President of Quest Ventures Ltd. and a director of Quest Management Corp. Mr.
  Sinclair is also an officer of a number of publicly traded companies and holds
  the following principal directorships:

|Issuer                       | Business                                 
|---------------------------- | -----------------------------------------
|Gabriel Resources Ltd.       | Precious metal exploration and production
|General Minerals Corporation | Precious metal exploration               
|Quest Capital Corp.          | Merchant banking                         

Previously, Mr. Sinclair was Managing Director of Quest Oil
  & Gas Inc. from May, 1993 to April, 1997. Prior to that he was President
  and Director from June, 1991 to January, 1996 and Vice President, Finance from
  July, 1988 to June, 1991 of Noramco Capital Corp. (a private merchant banking
  company).

B.           COMPENSATION

Compensation Summary

The following table sets forth details of the compensation
  paid during the Corporations fiscal year ended April 30, 2003 to its directors,
  officers and senior management:

37

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|Name                   | Position                                                    | Salary(Cdn$) | Bonus(Cdn$) | Benefits &OtherCompensation(1)(Cdn$)
|---------------------- | ----------------------------------------------------------- | ------------ | ----------- | ------------------------------------
|DOBSON, D. Harry W.    | Chairman of the
      Board of Directors                    | 0            | 0           | 0                                   
|HINCHCLIFFE, Brian A.  | President,
      Chief Executive
      Officer and Director | 187,016      | 0           | 0                                   
|HINCHCLIFFE, Robert P. | Chief Financial
      Officer                               | 37,360       | 0           | 0                                   
|LEE, Sandra            | Secretary                                                   | 0            | 0           | 0                                   
|SUTTON, Michael W.     | Chief Geologist                                             | 70,000       | 30,000      | 0                                   
|BELECQUE, Raymond A.   | General Manager                                             | 72,000       | 0           | 0                                   
|BAYLEY, Brian E.       | Director                                                    | 0            | 0           | 0                                   
|HOLMES, Warren W.      | Director                                                    | 0            | 0           | 0                                   
|KOSTUIK, S. Paul       | Director                                                    | 0            | 0           | 0                                   
|SINCLAIR, A. Murray    | Director                                                    | 0            | 0           | 0                                   

|(1) | See Item 6E Share Ownership  Options
        to Purchase Securities from the Corporation or Subsidiary for particulars
        of stock options granted to directors and officers.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

Agreements with Senior Officers

The Corporation has entered into consulting agreements with
  certain senior officers as follows:

Brian A. Hinchcliffe, President and Chief Executive Office:Written consulting agreement dated March 15, 2001 pursuant to which Mr.
  Hinchcliffe provides the services of a chief executive officer for the Corporation
  at a remuneration of US$ 120,000 per year. In consideration of Mr. Hinchcliffe
  entering into the agreement the Corporation paid Mr. Hinchcliffe a bonus of
  US$ 30,000. In addition, bonuses and stock options may be paid or granted in
  the discretion of the Board of Directors. The agreement may be terminated upon
  two months notice.

Robert P. Hinchcliffe, Chief Financial Officer: Oral
  consulting agreement made in January 2003 pursuant to which chief financial
  officer services to the Corporation at a remuneration of US$ 85,000 per year.
  Pursuant to the agreement Mr. Hinchcliffe has been granted an incentive stock
  option to purchase 50,000 shares of the Corporation at $2.20 per share until
  January 10, 2008.The agreement may be terminated upon reasonable notice.

Pension, Retirement & Similar Benefits

The Corporation does not have any pension or retirement plans
  nor does it provide any similar benefits to its directors, officers and senior
  management.No amounts were set aside or accrued by the Corporation during
  fiscal 2003 to provide pension, retirement or similar benefits for directors,
  officers and senior management of the Corporation.

38

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Administration Agreement

Pursuant to an agreement dated as of February 1, 1997 between
  the Corporation and Quest Management Corp. (Management), of Suite
  300, 570 Granville Street, Vancouver, British Columbia, the Corporation pays
  $3,500 per month to Management in consideration of Management providing office
  space and certain services, including reception, secretarial, accounting and
  corporate records services, to the Corporation. These services include those
  of the Corporations corporate secretary.

Management is a wholly-owned subsidiary of Quest Capital Corp.
  (Capital), the shares of which trade on the Toronto Stock Exchange.
  Brian E. Bayley, the President and Chief Executive Officer and a director of
  Capital, and A. Murray Sinclair, the Managing Director of Capital, are both
  directors of the Corporation.

C.           BOARD
  PRACTICES

Directors, Officers and Term of Office

Members of the Board of Directors are elected by the Corporations
  shareholders to represent the interests of all shareholders. The Board of Directors
  meets periodically to review significant developments affecting the Corporation
  and to act on matters requiring Board approval. Directors hold office until
  they resign or the next Annual Meeting, whichever is earlier. The Board of Directors
  may appoint a director to fill a vacancy at any time in accordance with the
  By-Laws of the Corporation.

Officers are appointed from time to time by the Board of Directors.
  The Board, in its discretion, may remove any officer of the Corporation, otherwise
  each officer shall hold office until their successor is appointed or until they
  resign, whichever is earlier.

Senior management employees are retained by the Corporations
  Senior Officers from time to time. The Senior Officers, in their discretion,
  may remove any senior management employees of the Corporation, otherwise each
  officer shall hold office until their successor is appointed or until they resign,
  whichever is earlier.

Service Contracts with Directors

The Corporation does not compensate its directors for their
  services as directors and does not have any service contracts with directors
  providing for payment of benefits upon termination of employment.

Directors are entitled to reimbursement for reasonable travel
  and other out-of-pocket expenses incurred in connection with attendance at meetings
  of the Board of Directors. The Board of Directors makes separate remuneration
  to any director undertaking services on behalf of the Corporation other than
  services ordinarily required of a director.

Board Committees

The only standing committee of the Board of Directors of the
  Corporation is an Audit Committee. The Audit Committee is responsible for reviewing
  the Companys annual and quarterly interim financial statements before
  they are reviewed and approved by the Board, the Companys financial reporting
  procedures and internal controls and the performance of the Companys auditor.
  Such reviews are carried out with the assistance of the Companys auditor,
  as required, and the Companys senior financial management.

Members of the Audit Committee may be appointed any time by
  the Board of Directors. The Board, in its discretion, may change the membership
  and fill vacancies in the committee, otherwise members shall serve until

39

---

their successor is appointed or until their earlier resignation.
  The Audit Committee consists of W. Warren Holmes, Brian E. Bayley and S. Paul
  Kostuik.

D.           EMPLOYEES

All of the Corporations employees work at the Corporations
  Macassa Mine in Kirkland Lake, Ontario in the following areas:

|Area                                                | Number of Employees (by
      area) as at April 30
|--------------------------------------------------- | --------------------------------------------------
|2003                                                | 2002                                              
|Full-time                                           | Part-time                                         
|Administration                                      | 31                                                
|Maintenance                                         | 10(1)                                             
|Production    - Underground    -
      Above Ground | 16(1)13                                           

(1)           Some maintenance
  and underground production is carried out for the Corporation by independent
  contractors.

The Corporations employees voted to decertify as a union
  in fiscal 2003. During the summer of 2003, the union which claimed to represent
  former workers at the Mine withdrew its claims.

E.           SHARE
  OWNERSHIP

Common Share Ownership

The following table sets out the shares beneficially held
  by the directors, officers and senior management of the Corporation:

|Name                   | Position withthe Corporation                  | Number & Percentageof OutstandingCommon Shares Owned as atNovember 30, 2003(1)
|---------------------- | --------------------------------------------- | ------------------------------------------------------------------------------
|DOBSON, D. Harry W.    | Chairman of the Board of Directors            | 3,290,000 (10.0%)                                                             
|HINCHCLIFFE, Brian A.  | President, Chief Executive Officer & Director | 1,000,000 (3.0%)                                                              
|HINCHCLIFFE, Robert P. | Chief Financial Officer                       | 0                                                                             
|LEE, Sandra            | Corporate Secretary                           | 0                                                                             
|SUTTON, Michael W. (3) | Chief Geologist                               | 0                                                                             
|BELECQUE, Raymond A.   | General Manager                               | 20,000 (0.06%)                                                                
|BAYLEY, Brian E.(4)    | Director                                      | 9,700 (0.03%)                                                                 

40

---

|Name                  | Position withthe Corporation | Number & Percentageof OutstandingCommon Shares Owned as atNovember 30, 2003(1)
|--------------------- | ---------------------------- | ------------------------------------------------------------------------------
|HOLMES, Warren W. (4) | Director                     | 40,000 (0.12%)                                                                
|KOSTUIK, S. Paul (4)  | Director                     | 63,500 (0.19%)                                                                
|SINCLAIR, A. Murray   | Director                     | 65,000 (0.20%)                                                                

|(1) | A total of 33,008,714 common shares of the Corporation
        were issued and outstanding as at November 30, 2003. Numbers shown do
        not include shares issuable upon exercise of options or warrants. See
        Options to Purchase Securities from the Corporation or Subsidiary
        below.
|--- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

None of the persons set out in the foregoing table have different
  voting rights than other common shareholders.

Options to Purchase Securities from the Corporation or
  Subsidiary

The Corporation may grant, pursuant to its stock option plan,
  stock options to directors, officers and employees of and consultants to the
  Corporation or a subsidiary or to employees of a company providing management
  services to the Corporation in consideration of them providing their services
  to the Corporation or subsidiary. The number of shares subject to each option
  is determined by the Corporations Board of Directors within the guidelines
  established by the plan and the rules of the Toronto Stock Exchange. The options
  enable such persons to purchase shares of the Corporation at a price fixed pursuant
  to the rules of the Exchange. The option agreements must provide that the option
  can only be exercised by the optionee and only so long as the optionee shall
  continue in the capacity as a director, officer or employee of or consultant
  to the Corporation or subsidiary or as an employee of the management company
  and during a period of not more than 90 days after ceasing to be a director,
  officer, employee or consultant (30 days if employed in an investor relations
  capacity) or, if the optionee dies, one year from the date of the optionees
  death. The options are exercisable by the optionee giving the Corporation notice
  and payment of the exercise price for the number of shares to be acquired. The
  agreements further provide that disinterested shareholder approval will be obtained
  prior to the reduction of the exercise price of options granted to insiders.
  Other than stock options there are no arrangements with the Corporations
  employees to allow them to participate in the Corporations capital.

The following table sets out the names of the directors, officers
  and senior management of the Corporation to whom stock options have been granted
  and the number of shares subject to such stock options:

|Name                                                               | Number ofCommonSharesunderOptionsGranted inLast FiscalYear | Number of CommonShares under OptionsOutstanding at | PriceExercise(Cdn$) | Expiration Date
|------------------------------------------------------------------ | ---------------------------------------------------------- | -------------------------------------------------- | ------------------- | ---------------
|April 30,2003                                                      | November 30,2003                                          
|Officers:                                                          |                                                            |                                                    |                     |                
|DOBSON, D. Harry W.
      Chairman of the Board of
      Directors | -                                                          | 100,000(1)                                         | 100,000(1)          | 1.35           

41

---

|HINCHCLIFFE, Brian A.
      President & Chief
      Executive Officer | -        | 200,000             | 200,000             | 1.10            | March 27, 2006                        
|--------------------------------------------------------------------- | -------- | ------------------- | ------------------- | --------------- | --------------------------------------
|HINCHCLIFFE, Robert P.
      Chief Financial Officer                  | 50,000   | 35,000              | 35,000              | 2.20            | January 10, 2008                      
|LEE, Sandra
      Secretary                                           | -        | 5,000               | 0                   | 1.35            | October 3, 2008                       
|Directors:                                                            |          |                     |                     |                 |                                       
|BAYLEY, Brian E.                                                      | -        | 50,000              | 50,000              | 1.35            | October 3, 2006                       
|HOLMES, W. Warren                                                     | 75,000   | 75,000              | 35,000              | 2.05            | May 22, 2007                          
|KOSTUIK, S. Paul                                                      | -        | 150,000             | 0                   | 1.10            | March 27, 2006                        
|SINCLAIR, A. Murray                                                   | -        | 50,000              | 0                   | 1.35            | October 3, 2006                       
|Senior Management:                                                    |          |                     |                     |                 |                                       
|BELECQUE, Raymond                                                     | 45,000  | 45,000
      20,000 | 25,000
      20,000 | 1.35
      2.20 | October 3, 2006
      January 10, 2008
|SUTTON, Michael                                                       | 40,000  | 40,000
      20,000 | 40,000
      20,000 | 1.35
      2.20 | October 3, 2006
      January 10, 2008

|(1) | Mr. Dobson also held share purchase warrants acquired
        in a private placement with the Corporation in December 2001 which enabled
        him to purchase 800,000 shares for $1.55 per share until December 12,
        2003. The warrants were exercised on April 28, 2003.
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

ITEM 7MAJOR SHAREHOLDER AND RELATED PARTY TRANSACTIONS

A.           MAJOR
  SHAREHOLDERS

The Corporation is currently a publicly-held corporation,
  with its shares held by residents of Canada, the United States of America and
  other countries. To the best of its knowledge, the Corporation is not controlled,
  directly or indirectly, by another corporation, any government or any natural
  or legal persons, severally or jointly, and no person, corporation or other
  entity owns, directly or indirectly, or controls more than 5% of the shares
  of the Corporation, the only class of securities with voting rights, except
  for those listed below:

|Name andRelationship to Corporation                         | Number ofShares Beneficially Owned(1)as at November 30, 2003 | Percentage ofClass(2)
|----------------------------------------------------------- | ------------------------------------------------------------ | ---------------------
|D. Harry W. Dobson
      Chairman of the Board of Directors | 3,390,000(3)                                                 | 10.00%               
|RAB Europe Fund Ltd.
      Arms Length Investor            | 2,829,171(4)                                                 | 8.57%                

42

---

|(1) | For the purposes hereof Shares Beneficially
        Owned includes shares issuable pursuant to the exercise of warrants
        or stock options held by the named party.                                                                                                                                                                                                                                                                                                                                                                     
|--- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|(2) | Based on 33,008,714 shares issued and outstanding
        at November 30, 2003.                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|(3) | Of these shares, 890,000 were acquired pursuant to
        a private purchase in February 2001, 1.6 million were acquired in a private
        placement completed in December 2001 and 800,000 were acquired in April
        2003. Mr. Dobson also holds a stock option to purchase a total of 100,000
        shares at a price of $1.35 per share until October 3, 2006.                                                                                                                                                                    
|(4) | Of these shares, 1,312,500 were acquired in a private
        placement completed in March 2002 and 109,375 were acquired as a bonus
        pursuant to a convertible loan made to the Corporation in June 2002. In
        addition, the investor holds share purchase warrants to purchase 656,250
        shares at a price of $1.60 per share until March 5, 2004 and a loan totalling
        $2,187,500 the principal and interest of which is convertible into shares
        of the Corporation at $4.00 per share until June 11, 2004.

To the Corporations knowledge, it is not directly or
  indirectly owned or controlled by any other companies, any foreign government
  or any other natural or legal persons, severally or jointly. There are no arrangements
  known to the Corporation which, at a subsequent date, may result in a change
  in control of the Corporation.

The Corporations major shareholders do not have different
  voting rights from other shareholders of the Corporation.

Based on the records of Pacific Corporate Trust Company, the
  Corporations registrar and transfer agent, at November 30, 2003, there
  were 62 registered holders of the Corporations shares with United States
  addresses who collectively held 2,901,170 shares or approximately 8.79 % of
  the issued and outstanding shares at that time.

B.           RELATED
  PARTY TRANSACTIONS

Except as disclosed herein and Note 15 of the Corporations
  2003 annual financial statements, the Corporation has not, during its last fiscal
  year, and does not presently propose to:

|(1) | enter into any transactions
        which are material to the Corporation or a related party or any transactions
        unusual in their nature or conditions involving goods, services or tangible
        or intangible assets to which the Corporation was a party; or
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                           
|(2) | make any loans or guarantees
        to or for the benefit of any of the following persons:                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                           
|    | (a)                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                           
|    | (b)                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                           
|    | (c)                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                           
|    | (d)                                                                                                                                                                                                                                                                       
|    |                                                                                                                                                                                                                                                                           
|    | (e)                                                                                                                                                                                                                                                                       

For the purposes hereof:

43

---

|(1) | close members of an individuals
        family are those that may be expected to influence, or be influenced
        by, that person in their dealings with the Corporation; and                                                                                                                                                                                                   
|--- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                       
|(2) | significant influence over
        an enterprise is the power to participate in the financial and operating
        policy decisions of the enterprise but is less than control over those
        policies. Shareholders beneficially owning a 10% interest in the voting
        power of the Corporation are presumed to have a significant influence
        on the Corporation.

C.           INTERESTS
  OF EXPERTS AND COUNSEL

Not applicable.

ITEM 8FINANCIAL INFORMATION

A.           CONSOLIDATED
  STATEMENTS AND OTHER FINANCIAL INFORMATION

Financial Statements

The Corporations audited annual financial statements
  for the years ending April 30, 2003, 2002 and 2001 are contained and incorporated
  herein. See Item 17 Financial Statements.

Export Sales

Almost 100% of the gold and silver produced from the Corporations
  operations are sold into the North American gold and silver bullion markets.

Legal and Arbitration Proceedings

The Corporation is not involved in any legal or arbitration
  proceedings.

Dividends

The Corporation has not paid any dividends on any of its shares
  since incorporation. The Corporation does not presently have any intention of
  paying dividends. Its future dividend policy will be determined by its Board
  of Directors on the basis of earnings, financial requirements and other relevant
  factors.

B.           SIGNIFICANT
  CHANGES

The Corporation does not have any significant changes to report
  since the date of the financial statements included herein except as disclosed
  herein.

ITEM 9THE OFFER AND LISTING

The Corporation has only one class of shares authorized, namely,
  common shares. There are an unlimited number of shares authorized. All shares
  are initially issued registered in the name of the shareholder or its nominee.
  There are no restrictions on the transferability of the shares imposed by the
  Corporations constating documents.

44

---

A.           OFFER
  AND LISTING DETAILS

The following is a summary, on an annual basis, of the high
  and low prices of the Corporations shares on the Toronto Stock Exchange
  (since March 20, 2003) and TSX Venture Exchange (up to March 19, 2003) during
  the Corporations last five financial years:

|Fiscal Year | High(Cdn$) | Low(Cdn$)
|----------- | ---------- | ---------
|2003        | 3.10       | 1.50     
|2002        | 2.10       | 0.73     
|2001        | 1.45       | 0.58     
|2000        | 2.00       | 0.03     
|1999        | 0.34(1)    | 0.01(1)  

(1)
            Not adjusted for
  15 into one share consolidation effective October 21, 1999.

The following is a summary, on a fiscal quarter basis, of
  the high and low prices of the Corporations common shares on the Toronto
  Stock Exchange (since March 20, 2003) and TSX Venture Exchange (up to March
  19, 2003)during the Corporations two most recent financial years and any
  subsequent financial quarter.

|FiscalQuarter | High(Cdn$) | Low(Cdn$)
|------------- | ---------- | ---------
|2004         
|2ndQuarter    | 4.04       | 2.71     
|1stQuarter    | 3.15       | 2.44     
|2003         
|4thQuarter    | 3.10       | 1.90     
|3rdQuarter    | 2.45       | 1.60     
|2ndQuarter    | 2.22       | 1.50     
|1stQuarter    | 2.65       | 1.70     
|2002         
|4thQuarter    | 2.10       | 1.10     
|3rdQuarter    | 1.70       | 1.10     
|2ndQuarter    | 1.40       | 1.01     
|1stQuarter    | 1.25       | 0.73     

45

---

The following is a summary, on a monthly basis, of the high and low prices
  of the Corporations shares on the Toronto Stock Exchange during the past
  six months:

|Month     | High(Cdn$) | Low(Cdn$)
|--------- | ---------- | ---------
|2003     
|November  | 4.44       | 3.35     
|October   | 3.79       | 3.20     
|September | 4.04       | 3.25     
|August    | 3.55       | 2.71     
|July      | 2.94       | 2.44     
|June      | 3.08       | 2.80     

B.PLAN
  OF DISTRIBUTION

Not
  applicable.

C.
  MARKETS

The Corporations shares have traded on Toronto Stock
  Exchange (since March 20, 2003) and TSX Venture Exchange (up to March 19, 2003)
  (initially on the Vancouver Stock Exchange and then on the Canadian Venture
  Exchange  which was formed by the merger of the Vancouver Stock Exchange
  and the Alberta Stock Exchange on November 26, 1999 and which changed its name
  to the TSX Venture Exchange on May 1, 2002) in Canada since December
  10, 1984. On February 23, 2001 the Corporation was deemed inactive
  by the Venture Exchange for failing to maintain minimum business activity levels.
  As a result the Corporation was obligated to reorganize its business as described
  in Item 4A History and Development of the Company  History 
  Current Operations. The inactive status designation was removed
  on November 28, 2001.

Other than described above, the Corporations shares
  are not and have not been listed or quoted on any other exchange or regulated
  markets.

D.
  SELLING SHAREHOLDERS

Not
  applicable.

E.
  DILUTION

Not
  applicable.

F.
  EXPENSES OF THE ISSUE

Not
  applicable.

46

---

ITEM 10ADDITIONAL
  INFORMATION

A.           SHARE
  CAPITAL

Not
  applicable.

B.           MEMORANDUM
  AND ARTICLES OF ASSOCIATION

The description of the Corporations Articles of Incorporation
  and By-Laws and the laws applicable thereto are incorporated herein by reference
  from the Corporations Registration Statement on Form 20-F dated June 28,
  2002 and filed with the Securities and Exchange Commission on July 1, 2002.

C.           MATERIAL
  CONTRACTS

The Corporation has entered into the following material contracts,
  other than contracts entered into in the ordinary course of business, in the
  past two years:

|1. | Asset Purchase Agreement made as of
        October 29, 2001, Amending Agreement made as of December 13, 2001 and
        Net Smelter Return Royalty Agreement dated as of December 13, 2001 with
        Kinross Gold Corporation of Toronto, Ontario pursuant to which the Corporation
        bought the Kirkland Lake mining properties, Macassa Mine and related assets.
        See Item 4A History and Development of the Company History
         Current Operations  Acquisition of Macassa Mine.                                                                                                                                                                                                                                  
|-- | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|2. | Various Stock Option Agreements with
        directors, officers, employees and consultants pursuant to which such
        persons are entitled to purchase shares of the Corporation. See Item 6E
        Directors, Senior Management and Employees  Share Ownership
         Options to Purchase Securities from the Corporation or Subsidiary.                                                                                                                                                                                                                                                                                                                                                                                           
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|3. | Agency Agreement dated December 12,
        2001 pursuant to which Dundee Securities Corporation of Vancouver, British
        Columbia acted as the Corporations agent in connection with a private
        placement of 400,000 shares at $1.30 per share and 4.5 million units at
        $1.30 per unit (each unit consisting of one share and one-half of a share
        purchase warrant, each whole warrant entitling the holder to purchase
        one share for a period of 24 months at a price of $1.55 per share) and
        in consideration of which received a cash commission of $434,070 and warrants
        to purchase 490,000 shares of the Corporation at a price of $1.30 per
        share for a period of 24 months.
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|4. | Subscription Agreement dated December
        12, 2001 with the Corporations Chairman of the Board, D. Harry W.
        Dobson, in respect of the purchase of 1.6 million units for proceeds of
        $2.08 million and Subscription Agreements dated December 14, 2001 with
        various placees in respect of the purchase of 400,000 common shares for
        proceeds of $520,000 and 2.9 million units for proceeds of $3.77 million
        in respect of a private placement of shares and units.                                                                                                                                                                                                                                  
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|5. | Subscription Agreements dated March
        5, 2002 with RAB Europe Fund Ltd. of Grand Cayman, Cayman Islands (1,312,500
        shares) and RAB Europe Partners L.P. of Dover, Delaware (187,500 shares)
        in respect of a private placement of 1.5 million shares for proceeds of
        $1.95 million completed on March 5, 2002.                                                                                                                                                                                                                                                                                                                                                                                                      
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|6. | Loan Agreements dated May 22, 2002 with
        RAB Europe Fund Ltd. ($2,187,500) and RAB Europe Partners L.P. ($312,500)
        in respect of loans totalling $2.5 million made to the Corporation on
        June 11, 2002.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|7. | Investor Relations Agreement dated May
        30, 2002 with DSK Consulting Ltd. of Calgary, Alberta in                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          

47

---

|    | respect of the supply of investor relation
        services to the Corporation for a one year term at a remuneration of $3,000
        per month and a stock option to purchase 35,000 shares.                                                                                                                                                                                                                                                                                                                                                                   
|--- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|8   | Agency Agreement dated June 21, 2002
        pursuant to which Fahnestock Canada Inc. of Toronto, Ontario acted as
        the Corporations agent in connection with a private placement of
        1 million shares at $2.35 per share and in consideration of which received
        a cash commission of $152,750 and a compensation option to purchase 100,000
        shares of the Corporation at a price of $2.35 per share for a period of
        24 months.                                                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|9.  | Subscription Agreements dated June 21,
        2002 with four placees in respect of a private placement of 1 million
        shares for proceeds of $2.35 million completed on June 21, 2002.                                                                                                                                                                                                                                                                                                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|10. | Agency Agreement dated December 30,
        2002 pursuant to which Octagon Capital Corporation and Fahnestock Canada
        Inc. of Toronto, Ontario acted as the Corporations agents in connection
        with a private placement of 2.625 million shares at $1.80 per share and
        in consideration of which received cash commissions of $378,000 and compensation
        options to purchase 393,750 shares of the Corporation at a price of $2.05
        per share until June 30, 2004.                                                          
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|11. | Subscription Agreements dated December
        30, 2002 with various placees in respect of a private placement of 2.625
        million shares for proceeds of $4.725 million completed on December 30,
        2002.                                                                                                                                                                                                                                                                                                                                            
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|12. | Publicity Agreement dated March 27,
        2003 with Jefferson Financial, LLC of Jefferson, Louisiana in respect
        of the publication of a newsletter in respect of the Corporation at a
        cost of US$250,000.                                                                                                                                                                                                                                                                                                                                      
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|13. | Loan Agreement dated June 10, 2003 with
        CBG Compagnie Bancaire Genève in respect of a loan of $1 million
        made to the Corporation on June 10, 2003.                                                                                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|14. | Subscription Agreements dated August
        8, 2003 and August 26, 2003 with 13 placees in respect of a private placement
        of 3.755 million units (each unit consisting of one share and one-half
        of a share purchase warrant, each whole warrant entitling the holder to
        purchase one share for a period of 24 months at a price of $3.00 per share)
        for proceeds of $9.763 million completed on August 8, 2003 and August
        26, 2003.                                                                                    
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|15. | Agency Agreement dated November 14,
        2003 pursuant to which Fort House Inc. and Octagon Capital Corporation
        of Toronto, Ontario acted as the Corporations agents in connection
        with a private placement of 1.925 million flow-through shares
        at $4.00 per share and in consideration of which received cash commissions
        of $385,000 and warrants to purchase 96,250 shares of the Corporation
        at a price of $3.60 per share until November 14, 2005.                                                           
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|16. | Subscription Agreements dated November
        14, 2003 with various placees in respect of a private placement of 1.925
        million flow-through shares for proceeds of $7.7 million completed
        on November 14, 2003.                                                                                                                                                                                                                                                                                                                               
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|17. | Agency Agreement dated December 1, 2003
        pursuant to which Fort House Inc. and Octagon Capital Corporation of Toronto,
        Ontario acted as the Corporations agents in connection with a private
        placement of 2.2 million units at $3.90 per unit (each unit consisting
        of one common share and one-half common share purchase warrant, each whole
        warrant entitling the holder to purchase a common share for $4.40 until
        June 1, 2005) and in consideration of which received cash commissions
        of $283,584.
|    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  
|18. | Subscription Agreements dated December
        1, 2003 with eight placees in respect of a private placement of 2.2 million
        units (each unit consisting of one share and one-half of a share purchase
        warrant, each whole warrant entitling the holder to purchase one share
        until June 1, 2005 at a price of $4.40 per share) for proceeds of $8.58
        million completed on December 1, 2003.                                                                                                                                       

48

---

See also Item 6B Directors, Senior Management and Employees
   Compensation  Agreements with Senior Management for terms
  of verbal contracts entered into with an officer of the Corporation.

D.           EXCHANGE
  CONTROLS

There are no governmental laws, decrees or regulations in
  Canada relating to restrictions on the import of capital affecting the remittance
  of interest, dividends or other payments to non-resident holders of the Corporations
  shares. Any such remittances to United States residents, however, are subject
  to a 5% to 15% withholding tax pursuant to Article X of the reciprocal tax treaty
  between Canada and the United States. See Taxation.

E.           TAXATION

Canadian Federal Income Tax Consequences

The following is a general summary of all material Canadian
  federal income tax considerations generally applicable to a holder of the Corporations
  common shares who is not a resident of Canada for the purposes of the Income
  Tax Act (Canada) (the Act). The discussion does not address
  individual consequences to persons subject to special provisions of federal
  income tax law.

The summary is based on the current provisions of the Act
  and the regulations thereunder and the Corporations understanding of the
  current administrative practices published by, and press announcements released
  by Canada Customs and Revenue Agency and the Department of Finance. This summary
  takes into account proposals to amend the Act announced prior to the date hereof
  (although no assurances can be given that such changes will be enacted in the
  form presented or at all), but does not otherwise take into account or anticipate
  any other changes in law, whether by judicial, governmental or legislative action
  or decision nor does it take into account any provincial, territorial, local
  or foreign tax considerations. Accordingly, holders and prospective holders
  of the Corporations shares are urged to consult their own tax advisors
  about the federal, provincial, territorial, local and foreign tax consequences
  of purchasing, owning and disposing of such shares.

The Act provides in subsection 212(2) that dividends and other
  distributions which are deemed to be dividends and which are paid or credited
  or are deemed to be paid or credited by a Canadian resident Company to a nonresident
  of Canada shall be subject to non-resident withholding tax equal to 25 percent
  of the gross amount of the dividend or deemed dividend.

Subsections 2(3) and 115(1) of the Act provide that a non-resident
  person is subject to tax in Canada at the rates generally applicable to residents
  of Canada on any taxable capital gain arising on the disposition
  of the shares of a company which are listed on a prescribed stock exchange if
  such non-resident, together with persons with whom he does not deal at arms
  length, owned 25 percent or more of the issued shares of any class of the capital
  stock of the Corporation at any time in the five years immediately preceding
  the date of disposition of the shares. Subsections 2(3) and 115(1) also provide
  that a non-resident person is subject to tax in Canada on taxable capital gains
  arising on the disposition of shares that constitute capital property used in
  carrying on a business in Canada. The taxable portion of a capital gain is equal
  to one-half of the amount by which the proceeds of disposition of such shares,
  net of any reasonable costs associated with the disposition, exceeds the adjusted
  cost base to the holder of the shares.

Provisions in the Act relating to dividend and deemed dividend
  payments and gains realized by non-residents of Canada who are residents of
  the United States are subject to the Canada-United States Income Tax Convention
  (1980), as amended (the 1980 Convention).

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Article X of the 1980 Convention provides that for 1997 and
  subsequent taxation years pursuant to the Third Protocol to the 1980 Convention
  the rate of Canadian non-resident withholding tax on dividends paid to a U.S.
  company that beneficially owns at least 10% of the voting stock of the Corporation
  shall not exceed 5% of the dividends. Otherwise, and except in the case of dividends
  received by a resident of the United States who carries on business in Canada
  through a Canadian permanent establishment and the shares in respect of which
  the dividends are paid are effectively connected with that permanent establishment,
  the rate of non-resident withholding shall not exceed 15 percent of the dividend.
  Where the dividends are received by a United States person carrying on business
  in Canada through a Canadian permanent establishment and the shares in respect
  of which the dividends are paid are effectively connected with that permanent
  establishment the dividends are generally subject to Canadian tax as business
  profits, generally without limitation under the 1980 Convention.

Article XIII of the 1980 Convention provides that gains realized
  by a United States resident on the disposition of shares of a Canadian company
  may not generally be taxed in Canada unless the value of those shares is derived
  principally from real property situated in Canada or the shares form part of
  the business property of a permanent establishment which the United States shareholder
  has or had in Canada within the 12 month period preceding the date of disposition.
  Canada also retains the right to tax gains on property owned at the time of
  departure from Canada if it is sold by a person who was resident in Canada for
  120 months in any 20 consecutive years preceding the sale and who was a resident
  in Canada at any time in the 10 years preceding sale.

United States Federal Income Tax Consequences

The following is a general discussion of all material United
  States federal income tax consequences, under current law, generally applicable
  to a U.S. Holder (as hereinafter defined) of common shares of the Corporation.
  This discussion does not address individual consequences 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 Canadian
  Federal Tax Consequences).

The following discussion is based upon the sections of the
  Internal Revenue Code of 1986, as amended (the Code), Treasury Regulations,
  published Internal Revenue Service (IRS) rulings, published administrative
  positions of the IRS and court decisions that are currently applicable, any
  or all of which could be materially and adversely changed, possibly on a retroactive
  basis, at any time. This discussion does not consider the potential effects,
  both adverse and beneficial, of any recently proposed legislation which, if
  enacted, could be applied, possibly on a retroactive basis, at any time. This
  discussion is for general information only and it is not intended to be, nor
  should it be construed to be, legal or tax advise to any holder or prospective
  holder of common shares of the Corporation and no opinion or representation
  with respect to the United States federal income tax consequences to any such
  holder or prospective holder is made. Accordingly, holders and prospective holders
  of common shares of the Corporation are urged to consult their own tax advisors
  about the federal, state, local, and foreign tax consequences of purchasing,
  owning and disposing of common shares of the Corporation.

U.S. Holders

As used herein, a U.S. Holder means a holder of
  common shares of the Corporation 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 or a trust
  whose income is taxable in the United States irrespective of source. 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, nonresident
  alien individuals, persons or entities that have a functional currency
  other than the U.S. dollar, shareholders who hold common shares as part of a
  straddle, hedging or a conversion transaction, and shareholders who acquired

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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. 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.

Distribution on Common Shares of the Corporation

U.S. Holders receiving dividend distributions (including constructive
  dividends) with respect to common shares of the Corporation 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 dividends
  on the date of receipt (based on the exchange rate on such date) to the extent
  that the Corporation 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 the Corporation, 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 the common shares. Preferential tax rates
  for long-term capital gains are applicable to a U.S. Holder which is an individual,
  estate or trust. There are currently no preferential tax rates for long-term
  capital gains for a U.S. Holder which is a corporation.

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, to the
  extent that there are no expenses associated with the transaction that meet
  the requirement 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.

Dividends paid on the common shares of the Corporation will
  not generally 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 may, under certain circumstances, be entitled to a 70% deduction
  of the United States source portion of dividends received from the Corporation
  (unless the Corporation qualifies as a foreign personal holding company
  or a passive foreign investment company, as defined below) if such
  U.S. Holder owns shares representing at least 10% of the voting power and value
  of the Corporation. The availability of this deduction is subject to several
  complex limitations which are beyond the scope of this discussion.

Under current temporary Treasury Regulations, dividends paid
  on the Corporation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 paid, and the proceeds of a sale of the Corporations
  common shares, 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 31% 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 the Corporation
  may be entitled, at the option of the U.S. Holder, to either receive a

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deduction or a tax credit for such foreign tax paid or withheld.
  Generally, it will be more advantageous to claim a credit because a credit reduces
  United States federal income taxes on a dollar-for-dollar basis, while a deduction
  merely reduces the taxpayers income subject to tax. This election is made
  on a year-by-year basis and applies to all foreign taxes paid by (or withheld
  from) the U.S. Holder during that year. 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 sources 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 the Corporation 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 the Corporation should consult their own tax advisors regarding their
  individual circumstances.

Disposition of Common Shares of the Corporation

A U.S. Holder will recognize gain or loss upon the sale of
  common shares of the Corporation 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 the Corporation.
  Preferential tax rates apply to long-term capital gains of U.S. Holders who
  are individuals, estates or trusts. This gain or loss will be capital gain or
  loss if the common shares are a capital asset in the hands of the U.S. Holder,
  which will be long-term capital gain or loss if the common shares of the Corporation
  are held for more than one year. Lower long-term capital gain rates will apply
  if the U.S. Holder is an individual, estate or trust and such U.S. Holder has
  held the common shares for more than eighteen months. Deductions for 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 five years from the loss
  year to be offset against capital gains until such net capital loss is thereby
  exhausted.

Other Considerations

In the following circumstances, the above sections of this
  discussion may not describe 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 the Corporations outstanding
  shares is owned, directly or indirectly, by five or fewer individuals who are
  citizens or residents of the United States and 60% or more of the Corporations
  gross income for such year was derived from certain passive sources (e.g. from
  dividends received from its subsidiaries), the Corporation 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 the Corporation
  does not actually distribute such income.

Foreign Investment Company

If 50% or more of the combined voting power or total value
  of the Corporations outstanding shares are 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 the Code Section 7701(a)(31)), and the Corporation is found to be
  engaged primarily in the business of investing, reinvesting, or trading in

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securities, commodities, or any interest therein, it is possible
  that the Corporation 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.

Passive Foreign Investment Company

Certain United States income tax legislation 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 1296 of the Code defines
  a PFIC as a corporation that is not formed in the United States and, 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 a controlled
  foreign corporation or makes an election, adjusted tax basis) of its assets
  that produce or are held for the production of passive income is
  50% or more. The Corporation does not believe that it is a PFIC. Each U.S. Holder
  of the Corporation is urged to consult a tax advisor with respect to how the
  PFIC rules affect their tax situation.

A 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 two alternative tax regimes at the
  election of each such U.S. Holder. The following is a discussion of such two
  alternative tax regimes applied to such U.S. Holders of the Corporation. In
  addition, special rules apply if a foreign corporation qualifies as both a PFIC
  and a controlled foreign corporation (as defined below) and a U.S.
  Holder owns, directly or indirectly, ten percent (10%) or more of the total
  combined voting power of classes of shares of such foreign corporation (See
  more detailed discussion at Controlled Foreign Corporation below).

A U.S. Holder who elects in a timely manner to treat the Corporation
  as a QEF (an Electing U.S. Holder) will be subject, under Section
  1293 of the Code, to current federal income tax for any taxable year in which
  the Corporation qualifies as a PFIC on his pro rata share of the Corporation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
  to the Electing U.S. Holder and (ii) ordinary earnings (the excess
  of earnings and profits over net capital gain), which will be taxed as ordinary
  income to the Electing U.S. Holder, in each case, for the shareholders
  taxable year in which (or with which) the Corporations taxable year ends,
  regardless of whether such amounts are actually distributed.

The effective QEF election also allows the Electing U.S. Holder
  to (i) generally treat any gain realized on the disposition of their common
  shares of the Corporation (or deemed to be realized on the pledge of their shares)
  as capital gain; (ii) treat his share of the Corporations net capital
  gain, if any, as long-term capital gain instead of ordinary income; and (iii)
  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 the Corporations annual realized net capital gain
  and ordinary earnings subject, however, to an interest charge. If the Electing
  U.S. Holder is not a corporation, such an interest charge would be treated as
  personal interest that is not deductible.

The procedure a U.S. Holder must comply with in making an
  effective QEF election will depend on whether the year of the election is the
  first year in the U.S. Holders holding period in which the Corporation
  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, the Corporation qualified as a PFIC in a prior
  year, then in addition to filing documents, the U.S. Holder must elect to recognize
  (i) under the rules of Section 1291 of the Code (discussed below), any gain
  that he would otherwise recognize if the U.S. Holder sold his stock on the qualification
  date or (ii) if the Corporation is a controlled foreign corporation, the U.S.
  Holders pro rata share of the Corporations post-1986 earnings and
  profits as of the qualification date. The qualification date is the first day
  of the Corporations first tax year in which the Corporation qualified
  as a qualified electing fund with respect to such

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U.S. Holder. The elections to recognize such gain or earnings
  and profits can only be made if such U.S. Holders holding period for the
  common shares of the Corporation includes the qualification date. By electing
  to recognize such gain or earnings and profits, the U.S. Holder will be deemed
  to have made a timely QEF election. A U.S. Holder who made elections to recognize
  gain or earnings and profits after May 1, 1992 and before January 27, 1997 may,
  under certain circumstances, elect to change such U.S. Holders qualification
  date to the first day of the first QEF year. U.S. Holders are urged to consult
  a tax advisor regarding the availability of and procedure for electing to recognize
  gain or earnings and profits under the foregoing rules. In addition, special
  rules apply if a foreign corporation qualifies as both a PFIC and a controlled
  foreign corporation (as defined below) and a U.S. Holder owns, directly
  or indirectly, ten percent (10%) or more of the total combined voting power
  of classes of shares of such foreign corporation (See more detailed discussion
  at Controlled Foreign Corporation below).

If the Corporation no longer qualifies as a PFIC in a subsequent
  year, a timely QEF election will remain in effect, although not applicable,
  during those years that the Corporation is not a PFIC. Therefore, if the Corporation
  requalifies as a PFIC, the QEF election previously made is still valid, and
  the U.S. Holder is required to satisfy the requirements of that election. Furthermore,
  a QEF election remains in effect with respect to a U.S. Holder, although dormant,
  after a U.S. Holder disposes of its entire interest in the Corporation. Upon
  the U.S. Holders reacquisition of an interest in the Corporation, the
  QEF election will apply to the newly acquired stock of the Corporation.

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 annually elect to mark
  such stock to the market (a mark-to-market election). If such an
  election is made, such U.S. Holder will not be subject to the special taxation
  rules of Section 1291 described below for the taxable year for which the mark-to-market
  election is made. A U.S. Holder who makes such an election will include in income
  for the taxable year for which the election was made in an amount equal to the
  excess, if any, of the fair market value of the common shares of the Corporation
  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 the Corporation included by such U.S. Holder
  for prior tax years, including any amount which would have been included for
  any prior tax year but for Section 1291 interest on tax deferral rules discussed
  below with respect to Non-Electing U.S. Holders, over (B) the mark-to-market
  losses for shares that were allowed as deductions for prior tax years. U.S.
  Holders adjusted tax basis in the common shares of the Corporation will
  be increased to reflect the amount included or deducted as a result of a mark-to-market
  election. A mark-to-market election only applies to the taxable year in which
  the election was made. A separate election must be made by a U.S. Holder for
  each subsequent taxable year. Because the Internal Revenue Service has not established
  procedures for making a mark-to-market election, U.S. Holders should consult
  their tax advisor regarding the manner of making such an election.

If a U.S. Holder does not make a timely QEF election during
  a year in which it holds (or is deemed to have held) the shares in question
  and the Corporation is a PFIC (a Non-electing U.S. Holder), then
  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 common shares of the Corporation and (ii) certain excess distributions,
  as specifically defined, by the Corporation.

A Non-electing U.S. Holder generally would be required to
  pro rate all gains realized on the disposition of his common shares of the Corporation
  and all excess distribution of his common shares and all excess distributions
  over the entire holding period for the Corporation. All gains or excess distributions
  allocated to prior years of the U.S. Holder (other than years prior to the first
  taxable year of the Corporation during such U.S. Holders holding period
  and beginning after January 1, 1987 for which it 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

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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 nondeductible. The balance of the gain of 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.

If the Corporation is a PFIC for any taxable year during which
  a Non-electing U.S. Holder holds common shares of the Corporation, then the
  Corporation will continue to be treated as a PFIC with respect to such 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 a gain (which
  will be taxed under the rules discussed above for Non-electing U.S. Holders)
  as if such common shares had been sold on the last day of the last taxable year
  for which it was a PFIC.

Under Section 1291(f) of the Code, the IRS has issued proposed
  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 the Corporation
  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. 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 a transfer at death, for example, the transferees
  basis is equal to (i) the fair market value of the Electing U.S. Holders
  common shares, less (ii) the excess of the fair market value of the Electing
  U.S. Holders common shares reduced by the U.S. Holders adjusted
  basis in these common shares at death. 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 the Corporation is urged to consult a tax advisor
  with respect to how the PFIC rules affect their tax situation.

Certain special, generally adverse, rules will apply with
  respect to common shares of the Corporation while the Corporation is a PFIC
  whether or not it is treated as a QEF. For example under Section 1297(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.

Controlled Foreign Corporation

If more than 50% of the voting power of all classes of shares
  or the total value of the shares of the Corporation is owned, directly or indirectly,
  by citizens or residents of the United States, United States domestic partnerships
  and corporations or estates or trusts other than foreign estates or trusts,
  each of whom own 10% or more of the total combined voting power of all classes
  of shares of the Corporation (United States shareholder), the Corporation
  could be treated as a controlled foreign corporation 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 a United States shareholder of a
  CFC currently on their pro rata shares of the Subpart F income of the CFC. Such
  U.S. 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 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 the Corporation who is or was
  a United States shareholder at any time during the five-year period ending with
  the sale or exchange is treated as ordinary income to the extent of earnings
  and profits of the Corporation 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

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the special taxation rules under Section 1291 discussed above
  with respect to a PFIC. Because of the complexity of Subpart F, and because
  it is not clear that Subpart F would apply to U.S. Holders of common shares
  of the Corporation, a more detailed review of these rules is outside of the
  scope of this discussion.

F.           DIVIDENDS
  AND PAYING AGENTS

There are no restrictions on the Corporation paying dividends
  on its shares, other than it may not pay any dividend which would render it
  insolvent. The Corporation has not paid any dividends on any of its shares since
  incorporation. The Corporation does not presently have any intention of pay
  dividends. Its future dividend policy will be determined by its Board of Directors
  on the basis of earnings, financial requirements and other relevant factors.

G.           STATEMENTS
  BY EXPERTS

Not applicable.

H.           DOCUMENTS
  ON DISPLAY

The documents concerning the Corporation referred to herein
  may be viewed at Suite 1880, 1055 West Georgia Street, Vancouver, British Columbia,
  Canada during normal business hours.

I.           SUBSIDIARY
  INFORMATION

Not required.

ITEM 11QUANTITATIVE AND QUALITATIVE DISCLOSURE ABOUT MARKET RISK

There are no forms of market risk that apply to the Corporation
  beyond currency and gold price fluctuations. See Item 3D Risk Factors.

In view of the Corporations recent commencement of operations
  it does not have any hedging or similar program for the management of its exposure
  to gold price fluctuations.

ITEM 12DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

Not Applicable.

PARTII

ITEM 13DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

In December, 2003 the Corporation paid interest of $218,750
  which was due June 11, 2003 in respect of a convertible loan in the principal
  amount of $2,187,500.

56

---

ITEM 14          
  MATERIAL MODIFICATIONS TO THERIGHTS OF SECURITY HOLDERS AND
  USE OF PROCEEDS

None.

ITEM 15CONTROLS AND PROCEDURES

As required by Rule 13a-15 under the United States Securities
  Exchange Act of 1934 (the Exchange Act), the Corporation carried
  out an evaluation of the effectiveness of the design and operation of its disclosure
  controls and procedures as of April 30, 2003, being the date of the Corporations
  most recently completed fiscal year. This evaluation was carried out under the
  supervision and with the participation of the Corporations Chief Executive
  Officer, Brian A. Hinchcliffe, and Chief Financial Officer, Robert P. Hinchcliffe.
  Based upon that evaluation, the Chief Executive Officer and Chief Financial
  Officer concluded the Corporations disclosure controls and procedures
  are effective in timely alerting management to material information relating
  to the Corporation required to be included in its periodic filings with the
  United States Securities and Exchange Commission.

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

During the Corporations most recently completed fiscal
  year ended April 30, 2003, there were no changes in the Corporations internal
  control over financial reporting that have materially affected, or are reasonably
  likely to affect, the Corporations 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 Corporation;                                                                                                                                                                                                 
|--- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|    |                                                                                                                                                                                                                                                                                                                                                                                   
|(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 Corporation 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.                                                                                                                                           

57

---

ITEM 16AAUDIT COMMITTEE FINANCIAL EXPERT

Not applicable.

ITEM 16BCODE OF ETHICS

Not applicable.

PART III

ITEM 17FINANCIAL STATEMENTS

The following financial statements for the years ended April
  30, 2003, 2002 and 2001 are included herein.

|Number | Description                                                                                                | Page No.
|------ | ---------------------------------------------------------------------------------------------------------- | --------
|(i)    | Independent Auditors Report of
      PricewaterhouseCoopers LLP dated June 27, 2003 except as noted       | FA3     
|(ii)   | Independent Auditors Report of
      Davidson & Company dated July 6, 2001                                | FA4     
|(iii)  | Consolidated Balance Sheets as at April
      30, 2003 and 2002                                            | FA5     
|(iv)   | Consolidated Statements of Operations
      and Deficit for the years ended April 30, 2003, 2002, and 2001 | FA6     
|(v)    | Consolidated Statements of Cash Flow
      for the years ended April 30, 2003, 2002, and 2001              | FA7     
|(vi)   | Notes to Consolidated Financial Statements                                                                 | FA8     

The Corporations consolidated financial statements for
  the year ended April 30, 2001 are reported on by the Corporations former
  auditor, Davidson & Company, Chartered Accountants, and for the years ended
  April 30, 2003 and 2002 are reported upon by the Corporations current
  auditor, PricewaterhouseCoopers LLP, Chartered Accountants. The financial statements
  were prepared in accordance with Canadian GAAP and are presented in Canadian
  dollars. The significant measurement differences between United States and Canadian
  GAAP are set forth in Note 19 of the annual financial statements.

ITEM 18FINANCIAL STATEMENTS

The Corporation has elected to provide financial statements
  pursuant to Item 17.

ITEM 19EXHIBITS

The following exhibits are included herein:

58

---

|Number  | Description                                                                                                                                                                                   | Page No.
|------- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
|1.01    | Certificate of Continuance
        dated July 27, 1988                                                                                                                                        | Note (1)
|1.02    | Articles of Continuance
        dated July 14, 1988                                                                                                                                           | Note (1)
|1.03    | Certificate of Amendment
        dated May 19, 1994 together with Articles of Amendment dated April 22,
        1994                                                                          | Note (1)
|1.04    | Certificate of Amendment
        dated October 1, 1996 together with Articles of Amendment dated September
        24, 1996                                                                   | Note (1)
|1.05    | Certificate of Amendment
        dated November 26, 1996 together with Articlesof Amendment dated November
        18, 1996                                                                   | Note (1)
|1.06    | Certificate of Amendment
        dated October 21, 1999 together with Articles of Amendment dated September
        27, 1999                                                                  | Note (1)
|1.07    | By-laws dated July 27,
        1988                                                                                                                                                           | Note (1)
|2       | Not applicable                                                                                                                                                                                | --      
|3       | Not applicable                                                                                                                                                                                | --      
|4(a).01 | Asset Purchase Agreement
        made as of October 29, 2001 with Kinross Gold Corporation respecting acquisition
        of Kirkland Lake mining properties, Macassa Mine and related assets | Note (1)
|4(a).02 | Amending Agreement made
        as of December 13, 2001 with Kinross Gold Corporation respecting acquisition
        of Kirkland Lake mining properties, Macassa Mine and related assets      | Note (1)
|4(a).03 | Net Smelter Return Royalty
        Agreement dated as of December 13, 2001 with Kinross Gold Corporation
        granting a net smelter return royalty                                        | Note (1)
|4(a).04 | Agency Agreement dated
        December 12, 2001 with Dundee Securities Corporation                                                                                                           | Note (1)
|4(a).05 | Subscription Agreement
        in the form executed on December 12, 2001 and December 14, 2001 with respect
        to the sale of 4.5 million units                                          | Note (1)
|4(a).06 | Subscription Agreement
        in the form executed on December 14, 2001 with respect to the sale of
        400,000 common shares                                                            | Note (1)
|4(a).07 | Subscription Agreements
        dated March 5, 2002 with RAB Europe Fund Ltd. and RAB Europe Partners
        L.P. with respect to the private placement of 1.5 million shares                | Note (1)
|4(a).08 | Loan Agreements dated May
        22, 2002 with RAB Europe Fund Ltd. and RAB Europe Partners L.P. in respect
        of loans totalling $2.5 million                                          | Note (1)
|4(a).09 | Investor Relations Agreement
        dated May 30, 2002 with DSK Consulting Ltd.                                                                                                              | Note (1)
|4(a).10 | Agency Agreement dated
        June 21, 2002 with Fahnestock Canada Inc.                                                                                                                      | Note (1)

59

---

|Number  | Description                                                                                                                                                  | Page No.
|------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------
|4(a).11 | Subscription Agreement
        in the form executed on June 21, 2002 with respect to a private placement
        of 1 million shares.                        | Note (1)
|4(a).12 | Agency
        Agreement dated December 30, 2002 with Octagon Capital Corporation and
        Fahnestock Canada Inc.                                         | EX1     
|4(a).13 | Subscription
        Agreement in the form executed on December 30, 2002 with respect to a
        private placement of 2.625 million shares                 | EX2     
|4(a).14 | Publicity
        Agreement dated March 27, 2003 with Jefferson Financial, LLC                                                                               | EX3     
|4(a).15 | Loan
        Agreement dated June 10, 2003 with CBG Compagnie Bancaire Genève
        in respect of loan for $1 million                                      | EX4     
|4(a).16 | Subscription
        Agreement in the form executed on August 8, 2003 and August 26, 2003 with
        respect to a private placement of 3.755 million units | EX5     
|4(a).17 | Agency
        Agreement dated November 14, 2003 with Fort House Inc. and Octagon Capital
        Corporation                                                | EX6     
|4(a).18 | Subscription
        Agreement in the form executed on November 14, 2003 with respect to a
        private placement of 1.925 million flow-through shares  | EX7     
|4(a).19 | Agency
        Agreement dated December 1, 2003 with Fort House Inc. and Octagon Capital
        Corporation                                                 | EX8     
|4(a).20 | Subscription
        Agreement in the form executed on December 1, 2003 with respect to a private
        placement of 2.2 million units                     | EX9     
|4(c).01 | Consulting Agreement dated
        March 15, 2001 with the Corporations President and Chief Executive
        Officer, Brian A. Hinchcliffe                 | Note (1)
|4(c).02 | Form of Stock Option Agreement                                                                                                                               | Note (1)
|5       | Not applicable                                                                                                                                               | --      
|6       | Not applicable                                                                                                                                               | --      
|7       | Not applicable                                                                                                                                               | --      
|8       | Not applicable                                                                                                                                               | --      
|9       | Not applicable                                                                                                                                               | --      
|10      | Not applicable                                                                                                                                               | --      
|11      | Not applicable                                                                                                                                               | --      
|12.01   | Certification
        of the Chief Executive Officer of the Corporation pursuant to Rule 13a-14(a)
        of the Securities Exchange Act of 1934            | EX10    
|12.02   | Certification
        of the Chief Financial Officer of the Corporation pursuant to Rule 13a-14(a)
        of the Securities Exchange Act of 1934            | EX11    

60

---

|Number | Description                                                                                                                                                                                                                    | Page No.
|------ | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | --------
|13.01  | Certification
        of the Chief Executive Officer of the Corporation pursuant to Rule 13a-14(b)
        of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63
        of Title 18 of the United States Code | EX12    
|13.02  | Certification
        of the Chief Financial Officer of the Corporation pursuant to Rule 13a-14(b)
        of the Securities Exchange Act of 1934 and Section 1350 of Chapter 63
        of Title 18 of the United States Code | EX13    
|14     | Not applicable                                                                                                                                                                                                                 | --      

|Notes:(1) | Incorporated herein by reference from the Corporations
        Registration Statement on Form 20-F dated June 28, 2002 and filed with
        the Securities and Exchange Commission on July 1, 2002.
|--------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

61

---

SIGNATURES

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

|Date: January 14, 2004 |                         |                                     | 
|---------------------- | ----------------------- | ----------------------------------- | 
|                       | KIRKLAND LAKE GOLD INC. |                                    
|                       |                         |                                     | 
|                       |                         |                                     | 
|                       | Per:                    | (signed) Brian
      Hinchcliffe    | 
|                       |                         | BRIAN A. HINCHLIFFE,                | 
|                       |                         | President & Chief Executive Officer | 

62

---





Kirkland Lake Gold Inc.

Financial Statements April 30, 2003 and 2002 
  (expressed in Canadian dollars)





---

November 25, 2003Managements Responsibility for Financial Reporting

The accompanying financial statements of the company have been prepared by
  management in accordance with accounting principles generally accepted in Canada
  and reconciled to accounting principles generally accepted in the United States
  as set out in note 19, and contain estimates based on managements judgement.
  Management maintains an appropriate system of internal controls to provide reasonable
  assurance that transactions are authorized, assets safeguarded, and proper records
  maintained.

The audit committee of the board of directors has met with the companys
  independent auditors to review the scope and results of the annual audit, and
  to review the financial statements and related financial reporting matters prior
  to submitting the financial statements to the board for approval.

The companys independent auditors, PricewaterhouseCoopers LLP, are appointed
  by the shareholders to conduct an audit in accordance with generally accepted
  auditing standards in Canada and the United States and their report follows.

(signed) Brian A. Hinchcliffe
  Brian A. Hinchcliffe
  President and Chief Executive Officer

---

Independent Auditors Report

To the Shareholders of 
  Kirkland Lake Gold Inc.

We have audited the balance sheets of Kirkland Lake Gold Inc. (formerly
  Foxpoint Resources Ltd.) as at April 30, 2003 and 2002 and the statements of
  operations and deficit and cash flows for the years then ended. These financial
  statements are the responsibility of the companys management. Our responsibility
  is to express an opinion on these financial statements based on our audits.

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

In our opinion, these financial statements present fairly, in all material
  respects, the financial position of the company as at April 30, 2003 and 2002
  and the results of its operations and its cash flows for the years then ended
  in accordance with Canadian generally accepted accounting principles.

The financial statements for the year ended April 30, 2001 were audited by
  other auditors who expressed an opinion without reservation on those statements
  in their report dated July 6, 2001.



(signed) PricewaterhouseCoopers LLP

Chartered Accountants

Vancouver, B.C., Canada

June 27, 2003 
  (except as to note 1, which is as of August 26, 2003 and 
  note 20, which is as of November 25, 2003)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Balance Sheets As at April 30, 2003 and 2002
|---------------------------------------------------------------------------------------------------------------------------
|                                                                                                                           
|(expressed in Canadian dollars)                                                                                            

|                                                             | **2003**   |   | **2002**   |  
|------------------------------------------------------------ | ---------- | - | ---------- | -
|                                                             | **$**      |   | **$**      |  
|Assets                                                       |            |   |            |  
|                                                             |            |   |            |  
|Current assets                                               |            |   |            |  
|Cash and cash equivalents (note 18)                          | 3,664,607  |   | 3,669,390  |  
|Short-term investments (note 4)                              | 190,000    |   | 190,000    |  
|Accounts receivable                                          | 313,168    |   | 130,050    |  
|Inventories (note 5)                                         | 583,290    |   | -          |  
|Prepaid expenses and deposits                                | 444,220    |   | 130,798    |  
|                                                             | 5,195,285  |   | 4,120,238  |  
|Deferred finance charges(note 9)                             | 6,250      |   | -          |  
|Mineral properties(note 6)                                   | 8,117,495  |   | 2,037,369  |  
|Property, plant and equipment(note 7)                        | 5,971,094  |   | 5,790,256  |  
|Mine closure bonds(note 10)                                  | 2,043,435  |   | 2,043,435  |  
|                                                             | 21,333,559 |   | 13,991,298 |  
|Liabilities                                                  |            |   |            |  
|                                                             |            |   |            |  
|Current liabilities                                          |            |   |            |  
|Accounts payable and accrued liabilities (note 15(b))        | 3,464,472  |   | 966,195    |  
|Current portion of notes payable (note 8)                    | 1,926,849  |   | 2,914,521  |  
|Convertible loans (note 9)                                   | 2,176,622  |   | -          |  
|                                                             | 7,567,943  |   | 3,880,716  |  
|Notes payable(note 8)                                        | -          |   | 1,726,849  |  
|Provision for reclamation and site restoration(note 10)      | 2,043,435  |   | 2,043,435  |  
|                                                             | 9,611,378  |   | 7,651,000  |  
|Shareholders Equity                                         |            |   |            |  
|Capital stock(note 11)                                       |            |   |            |  
|Authorized                                                   |            |   |            |  
|Unlimited common
      shares without par value              |            |   |            |  
|Issued                                                       |            |   |            |  
|24,076,166 (April
      30, 2002 - 17,978,504) common shares | 17,757,582 |   | 7,177,882  |  
|Options(note 12)                                             | 112,362    |   | 128,168    |  
|Warrants(note 13)                                            | 696,270    |   | 1,044,040  |  
|Equity component of convertible loans(note 9)                | 82,728     |   | -          |  
|Contributed surplus(notes 9 and 12)                          | 18,010     |   | -          |  
|Deficit                                                      | (6,944,771 | ) | (2,009,792 | )
|                                                             | 11,722,181 |   | 6,340,298  |  
|                                                             | 21,333,559 |   | 13,991,298 |  
|Nature of operations and going concern(note 1)               |            |   |            |  
|Subsequent events(note 20)                                   |            |   |            |  

Approved by the Board of Directors

(signed)
  Brian A. Hinchcliffe
  Director          (signed) Brian E. Bayley  Director

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

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Statements of Operations and Deficit For the years ended April 30,
      2003, 2002 and 2001
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                           
|(expressed in Canadian dollars)                                                                                                                                            

|                                            | **2003**   |   | **2002**    |   | **2001**    |  
|------------------------------------------- | ---------- | - | ----------- | - | ----------- | -
|                                            | **$**      |   | **$**       |   | **$**       |  
|                                            |            |   |             |   |             |  
|Mining revenue                              | 11,704,639 |   | -           |   | -           |  
|Operating costs                             | 10,787,637 |   | -           |   | -           |  
|Amortization and depletion                  | 785,337    |   | 225,593     |   | -           |  
|                                            |            |   |             |   |             |  
|                                            | 131,665    |   | (225,593    | ) | -           |  
|                                            |            |   |             |   |             |  
|General and administrative                  | 2,264,735  |   | 1,333,405   |   | 397,917     |  
|Royalties                                   | 236,216    |   | -           |   | -           |  
|Exploration                                 | 1,798,836  |   | 473,830     |   | -           |  
|Amortization of finance charges             | 237,016    |   | -           |   | -           |  
|Interest and bank charges                   | 598,488    |   | 159,925     |   | -           |  
|Foreign exchange loss (gain)                | 142        |   | (14,166     | ) | (5,802      | )
|Interest and other income                   | (68,789    | ) | -           |   | (6,966      | )
|                                            |            |   |             |   |             |  
|                                            | 5,066,644  |   | 1,952,994   |   | 385,149     |  
|                                            |            |   |             |   |             |  
|Loss for the year                           | (4,934,979 | ) | (2,178,587  | ) | (385,149    | )
|                                            |            |   |             |   |             |  
|Deficit - Beginning of year                 | (2,009,792 | ) | (14,429,101 | ) | (14,043,952 | )
|                                            |            |   |             |   |             |  
|Reduction of stated capital against deficit |            |   |             |   |             |  
|(note 11(c))                                | -          |   | 14,597,896  |   | -           |  
|                                            |            |   |             |   |             |  
|Deficit - End of year                       | (6,944,771 | ) | (2,009,792  | ) | (14,429,101 | )
|                                            |            |   |             |   |             |  
|Basic and diluted loss per share            | (0.25      | ) | (0.16       | ) | (0.04       | )
|                                            |            |   |             |   |             |  
|Weighted average number of shares           |            |   |             |   |             |  
|outstanding                                 | 19,942,514 |   | 13,387,544  |   | 9,333,212   |  

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

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Statements of Operations and Deficit For the years ended April 30,
      2003, 2002 and 2001
|---------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                                                           
|(expressed in Canadian dollars)                                                                                                                                            

|                                                    | **2003**   |   | **2002**   |   | **2001** |  
|--------------------------------------------------- | ---------- | - | ---------- | - | -------- | -
|                                                    | **$**      |   | **$**      |   | **$**    |  
|                                                    |            |   |            |   |          |  
|Cash flows from operating activities                |            |   |            |   |          |  
|Loss for the year                                   | (4,934,979 | ) | (2,178,587 | ) | (385,149 | )
|Items not affecting
      cash                      |            |   |            |   |          |  
|Amortization
      and depletion                    | 785,337    |   | 225,593    |   | -        |  
|Accretion
      of interest and amortization of     |            |   |            |   |          |  
|finance
      charges                               | 606,163    |   | 187,671    |   | -        |  
|Stock-based
      compensation                      | 22,133     |   | 128,168    |   | -        |  
|Loss
      on sale of property, plant and           |            |   |            |   |          |  
|equipment                                           | -          |   | -          |   | 30,000   |  
|Loss
      on disposal of subsidiary                | -          |   | -          |   | 2,724    |  
|Write-down
      of deferred exploration costs      | -          |   | -          |   | 77,758   |  
|Changes in non-cash working capital items           |            |   |            |   |          |  
|Accounts receivable                                 | (183,118   | ) | (128,520   | ) | (466     | )
|Inventories                                         | (583,290   | ) | -          |   | -        |  
|Prepaid expenses                                    | (313,422   | ) | (121,831   | ) | (1,322   | )
|Accounts payable
      and accrued liabilities      | 2,498,277  |   | 877,937    |   | 111,488  |  
|                                                    |            |   |            |   |          |  
|                                                    | (2,102,899 | ) | (1,009,569 | ) | (164,967 | )
|                                                    |            |   |            |   |          |  
|Cash flows from financing activities                |            |   |            |   |          |  
|Net proceeds from issuance of capital stock         | 9,981,917  |   | 8,274,369  |   | 75,000   |  
|Proceeds from issuance of convertible loans         | 2,500,000  |   |            |   |          |  
|Finance charges                                     | (25,000    | ) | -          |   | -        |  
|Payment of notes payable and convertible loans      | (3,312,500 | ) | -          |   | -        |  
|                                                    |            |   |            |   |          |  
|                                                    | 9,144,417  |   | 8,274,369  |   | 75,000   |  
|                                                    |            |   |            |   |          |  
|Cash flows from investing activities                |            |   |            |   |          |  
|Purchase of property, plant and equipment           | (857,584   | ) | -          |   | -        |  
|Proceeds from sale of subsidiary                    | -          |   | -          |   | 149,988  |  
|Deferred exploration costs - net of amortization    | -          |   | -          |   | (55,431  | )
|Proceeds from sale of property, plant and equipment | -          |   | -          |   | 5,000    |  
|Purchase of short-term investments                  | -          |   | (190,000   | ) | -        |  
|Additions to mineral properties                     | (6,188,717 | ) | (1,556,084 | ) | -        |  
|Mine closure bonds                                  | -          |   | (2,043,435 | ) | -        |  
|                                                    |            |   |            |   |          |  
|                                                    | (7,046,301 | ) | (3,789,519 | ) | 99,557   |  
|                                                    |            |   |            |   |          |  
|(Decrease) increase in cash and                     |            |   |            |   |          |  
|cash equivalents                                    | (4,783     | ) | 3,475,281  |   | 9,590    |  
|                                                    |            |   |            |   |          |  
|Cash and cash equivalents -                         |            |   |            |   |          |  
|Beginning of
      year                             | 3,669,390  |   | 194,109    |   | 184,519  |  
|                                                    |            |   |            |   |          |  
|Cash and cash equivalents - End of year             | 3,664,607  |   | 3,669,390  |   | 194,109  |  
|                                                    |            |   |            |   |          |  
|Supplemental cash flow information(note 18)         |            |   |            |   |          |  

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

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|1 | Nature of operations and going concern
        Kirkland Lake Gold Inc. (formerly Foxpoint Resources Ltd.) (the company)
          owns gold mining and milling operations in Kirkland Lake, Canada, which
          were inactive when acquired in December 2001. During the year ended
          April 30, 2003, the company reached commercial production. The continued
          operations of the company are dependent upon the existence of economically
          recoverable reserves, the ability of the company to obtain financing
          as required to sustain the development, and upon future profitable production.
        At April 30, 2003, the company had working capital deficiency of $2,372,658.
          Included in current liabilities are convertible loans of $2,176,622,
          which are extendable for another year at the companys option (extended
          subsequent to year-end (note 9). Subsequent to year-end, the company
          raised $9.8 million gross proceeds in a private placement (note 20(a)).
          Management estimates that these funds, together with funds from operations
          will be sufficient to meet the companys obligations for the coming
          year. If necessary the company will raise additional financing to meet
          its obligations and while the company has been successful in obtaining
          financing in the past, there can be no assurance that it will be able
          to do so in the future.
        The companys ability to continue as a going concern is dependent
          on future financings until the attainment of profitable and cash-generating
          operations sufficient to sustain the company. These financial statements
          do not include any adjustments to the recoverability and classification
          of recorded asset amounts and classification of liabilities that might
          be necessary, should the company be unable to continue as a going concern.
|- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 
|2 | Significant accounting policies
        Generally accepted accounting principles
        These financial statements have been prepared in accordance with generally
          accepted accounting principles (GAAP) in Canada. The significant measurement
          differences between these principles and those that would be applied
          under United States GAAP, as they affect the company are disclosed in
          note 19.
        Principles of consolidation
        These financial statements were consolidated to include the accounts
          of the company and its wholly owned subsidiary, Brimstone Mining Inc.,
          and majority owned subsidiaries, Mayflower Mining Company and West Mayflower
          Mining Company, until February 26, 2001 at which time the subsidiaries
          were sold. All material intercompany transactions have been eliminated.
        Use of estimates
        The preparation of financial statements in conformity with GAAP requires
          management to make estimates and assumptions that affect the reported
          amounts of assets and liabilities and the disclosure of contingent assets
          and liabilities at the date of the financial statements and the reported
          amounts of revenues and expenses during the year. Actual results could
          differ from these estimates.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               

(1)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | Cash and cash equivalents
      Cash and cash equivalents include cash and short-term
        investments with an initial maturity of 90 days or less.
      Short-term investments
      Short-term investments represent term deposits with
        an initial maturity of greater than 90 days. Short-term investments are
        restricted to deposits with major Canadian banks and/or commercial paper
        of investment grade issuers. Short-term investments are carried at the
        lower of cost and market value.
      Inventories
      Dore bars and gold in process are recorded at the lower
        of average production cost and net realizable value. Production costs
        include all direct costs plus fixed costs associated with the mine site.
        The company uses a rolling period average cost to value the inventory
        of gold on hand. Mine operating supplies are valued at average cost less
        allowance for obsolescence.
      Mineral properties and deferred exploration costs
      The company expenses exploration expenditures and near
        term ore development costs as incurred. Property acquisition costs and
        longer term mine development costs incurred to expand ore reserves are
        deferred and depleted on a units-of-production basis over proven and probable
        reserves. The capitalized costs are reviewed annually, or more frequently
        if changes in circumstances warrant, to consider whether the carrying
        value can be recovered from estimated undiscounted future cash flows.
        If the carrying value is considered not recoverable on this basis, the
        company would write down the carrying value to the estimated net recoverable
        amount, calculated on a non-discounted basis.
      Property, plant and equipment
      Property, plant and equipment cost are recorded at cost
        and amortized on a straight-line basis over the following terms:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| | Mine and mill equipment                                                                                                                                                                                                                                                                                          | 10 years
| | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------
| | Computer equipment                                                                                                                                                                                                                                                                                               | 3 years 
| | Vehicles                                                                                                                                                                                                                                                                                                         | 5 years 
| |                                                                                                                                                                                                                                                                                                                  |         
| | Reclamation and site restoration liabilities
      Ongoing reclamation and site restoration costs are charged
        to operations in the year incurred. Post-closure costs for reclamation
        and site restoration are estimated based on current federal and provincial
        regulatory requirements.

(2)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | It is reasonably possible that the companys estimates
        of its ultimate reclamation and site restoration liability could change
        as a result of changes in regulations or cost estimates. The effects of
        changes in estimated costs, which could be material, are recognized on
        a prospective basis.
      Revenue recognition
      The company sells its gold bullion in the spot market.
        Revenue is recognized on title transfer of the gold to purchasers which
        occurs when the gold is received by the purchaser. Adjustments to accounts
        receivable, if any, between the date of title transfer and the settlement
        date are recorded when determinable.
      Foreign currency translation
      The company generally seeks to sell its gold in Canadian
        dollars. To the extent these transactions are denominated in foreign currencies,
        they are translated into their Canadian dollar equivalents at exchange
        rates prevailing at the transaction date. Gains and losses arising from
        restatement of foreign currency monetary assets and liabilities and transactions
        are included in earnings.
      Stock-based compensation
      The company has a stock option plan as described in
        note 12. Effective May 1, 2002, the company adopted the new accounting
        standard for stock-based compensation. The standard sets out a fair value
        approach that is required for certain, but not all, stock-based transactions.
        The company has elected not to follow the fair value method of accounting
        for stock options granted to directors and employees, and, as permitted
        under the standard, no compensation cost is recorded on the granting of
        stock options to employees and directors as the exercise price is equal
        to or greater than the market price at the date of grant. Consideration
        paid on exercise of stock options is credited to capital stock.
      Stock-based compensation on options granted to non-employees
        is recorded as an expense at the earlier of the completion of performance
        or vesting of the options granted, based upon the estimated fair value
        on the grant date.
      Income taxes
      Income taxes are accounted for using the liability method.
        Temporary differences arising from the difference between the tax basis
        of an asset or liability and its carrying amount on the balance sheet
        are used to calculate future income tax liabilities or assets. Future
        income tax liabilities or assets are calculated using the tax rates anticipated
        to apply in the periods that the temporary differences are expected to
        reverse.
      Earnings (loss) per share
      The company follows the treasury stock method
        in the calculation of diluted earnings per share and requires the presentation
        of both basic and diluted earnings per share on the face of the statement
        of operations and deficit regardless of the materiality of the difference
        between them.
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

(3)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|      | The effect of potential issuances
        of shares under options and warrants would be anti-dilutive, and therefore
        basic and diluted losses per share are the same.
      Comparative figures
      Certain of the comparative figures have been reclassified
        to conform to the current years presentation.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|----- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|**3** | Acquisition of mineral
        properties and property, plant and equipment
      On December 14, 2001, the company acquired various mining
        properties and mining assets located in and around Kirkland Lake, Ontario.
        These assets included five contiguous gold mining properties known as
        the Macassa, Lake Shore, Wright-Hargreaves, Teck-Hughes and Kirkland Lake
        Gold properties and all plant and equipment located on the properties
        at the date of the purchase agreement. All of the mining properties were
        previously operating gold mines, the last of which suspended operations
        indefinitely in June of 1999. The mine had been allowed to flood to near
        surface by the vendor prior to the sale.
        The terms of the acquisition were:
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      | c)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           
|      | The properties acquired
        comprise an aggregate of 224 patented and unpatented mining claims and
        crown leases. Some of the mining interests are subject to royalty interests
        payable to parties other than the vendor. These royalty interests differ
        depending on the claim, and range from net smelter royalties of 1% to
        2%, production royalties of $0.10 to $4.00 per ton of ore mined or net
        profit royalties from 2% to 5%, while some claims have a royalty of 1%
        of gross proceeds from production or a net profit royalty of 20%. During
        the year ended April 30, 2003, these royalties amounted to $3,000 (2002
        - $nil).                                                                                                                 

(4)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | The purchase consideration has been recorded as follows:
| | --------------------------------------------------------

| |  |                                                          | $          |  
| |  | -------------------------------------------------------- | ---------- | -
| |  |                                                          |            |  
| |  | Consideration paid                                       |            |  
| |  | Present value of
      $5 million cash payments due from |            |  
| |  | June
      2002 to December 2003 discounted at 10%       | 4,453,699  |  
| |  | Cash provided to
      secure mine closure bonds         | 2,043,435  |  
| |  | Closing
      adjustments and other direct costs         | 314,389    |  
| |  | Total                                                    | 6,811,523  |  
| |  |                                                          |            |  
| |  | Assets acquired and liabilities assumed                  |            |  
| |  | Mine
      closure bonds                                 | 2,043,435  |  
| |  | Property, plant
      and equipment                      | 6,015,849  |  
| |  | Mineral
      properties                                 | 795,674    |  
| |  | Provision for reclamation
      and site restoration     | (2,043,435 | )
| |  | Total                                                    | 6,811,523  |  

|4 | Short-term investments
      The companys short-term investment is held as
        collateral to provide a letter of credit to the Independent Electricity
        Market Operator as security for payment in connection with ongoing electricity
        usage.
|- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|  |                                                                                                                                                                                                                                                                  
|5 | Inventories                                                                                                                                                                                                                                                      

| |                         | 2003    |  | 2002  | 
| | ----------------------- | ------- |  | ----- | 
| |                         | $       |  | **$** | 
| | Mine operating supplies | 74,802  |  | -     | 
| | Gold in process         | 508,488 |  | -     | 
| |                         |         |  |       | 
| |                         | 583,290 |  | -     | 

(5)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|**6** | Mineral properties
      The companys mineral properties comprise five contiguous mining
        properties in and around Kirkland Lake, Ontario (note 3).
|----- | -----------------------------------------------------------------------------------------------------------------------------------------------------------

|  |                                            | 2003      |   | 2002      | 
|- | ------------------------------------------ | --------- | - | --------- | 
|  |                                            | $         |   | $         | 
|  | Balance - Beginning of year                | 2,037,369 |   | -         | 
|  | Acquisition costs                          | -         |   | 795,674   | 
|  | Rehabilitation and development costs       | 6,188,717 |   | 1,241,695 | 
|  | Depletion                                  | (108,591  | ) | -         | 
|  |                                            |           |   |           | 
|  | Balance - End of year                      | 8,117,495 |   | 2,037,369 | 
|  |                                            |           |   |           | 
|  |                                            |           |   |           | 
|  |                                            | 2003      |   | 2002      | 
|  |                                            | $         |   | $         | 
|  | Acquisition allocation (note 3)            | 795,674   |   | 795,674   | 
|  | Underground development                    | 4,412,246 |   | 528,991   | 
|  | Underground pumping                        | 1,917,522 |   | 508,657   | 
|  | Mill and surface facilities rehabilitation | 149,371   |   | 204,047   | 
|  | Lakeshore underground access ramp          | 842,682   |   | -         | 
|  |                                            |           |   |           | 
|  |                                            | 8,117,495 |   | 2,037,369 | 
|  |                                            |           |   |           | 
|7 | Property, plant and equipment             

| |                         |           |  |              |  | 2003      | 
| | ----------------------- | --------- |  | ------------ |  | --------- | 
| |                         |           |  |              |  |           | 
| |                         |           |  | Accumulated  |  |           | 
| |                         | Cost      |  | amortization |  | Net       | 
| |                         | $         |  | $            |  | $         | 
| |                         |           |  |              |  |           | 
| | Computer equipment      | 115,359   |  | 29,040       |  | 86,319    | 
| | Mine and mill equipment | 6,712,710 |  | 865,971      |  | 5,846,739 | 
| | Vehicles                | 45,364    |  | 7,328        |  | 38,036    | 
| |                         |           |  |              |  |           | 
| |                         | 6,873,433 |  | 902,339      |  | 5,971,094 | 
| |                         |           |  |              |  |           | 
| |                         |           |  |              |  |           | 
| |                         |           |  |              |  | 2002      | 
| |                         |           |  |              |  |           | 
| |                         |           |  | Accumulated  |  |           | 
| |                         | Cost      |  | amortization |  | Net       | 
| |                         | $         |  | $            |  | $         | 
| |                         |           |  |              |  |           | 
| | Mine and mill equipment | 6,015,849 |  | 225,593      |  | 5,790,256 | 

(6)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|**8** | Notes payable
      The company signed notes payable in connection with
        the acquisition of the mining properties and mining assets in Kirkland
        Lake, Ontario (note 3(a)). The notes are non-interest bearing and are
        repayable on the following dates:
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |                                                                                                                                                                                                   | **Principal** |  | 2003      |  | 2002      | 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------- |  | --------- |  | --------- | 
| |                                                                                                                                                                                                   | $             |  | $         |  | $         | 
| | June 11, 2002                                                                                                                                                                                     | 1,000,000     |  | -         |  | 988,494   | 
| | June 14, 2002                                                                                                                                                                                     | 1,000,000     |  | -         |  | 987,671   | 
| | December 13, 2002                                                                                                                                                                                 | 1,000,000     |  | -         |  | 938,356   | 
| | June 11, 2003                                                                                                                                                                                     | 1,000,000     |  | 988,493   |  | 888,494   | 
| | December 13, 2003                                                                                                                                                                                 | 1,000,000     |  | 938,356   |  | 838,355   | 
| |                                                                                                                                                                                                   |               |  |           |  |           | 
| |                                                                                                                                                                                                   |               |  | 1,926,849 |  | 4,641,370 | 
| | Less: Current portion                                                                                                                                                                             |               |  | 1,926,849 |  | 2,914,521 | 
| |                                                                                                                                                                                                   |               |  |           |  |           | 
| |                                                                                                                                                                                                   |               |  | -         |  | 1,726,849 | 
| |                                                                                                                                                                                                   |               |  |           |  |           | 
| | The non-interest bearing notes have been
        discounted at 10% per annum, which is estimated to be consistent with
        similar borrowings which would have been available to the company.

|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | 2003       |   | 2002      | 
|----- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------ | ---------- | - | --------- | 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  | $          |   | $         | 
|      | Balance - Beginning of year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                      | 4,641,370  |   | -         | 
|      | Acquisition (note 3)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             | -          |   | 4,453,699 | 
|      | Accretion of interest                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 285,479    |   | 187,671   | 
|      | Less: Payments                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   | (3,000,000 | ) |           | 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |            |   |           | 
|      | Balance - End of year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            | 1,926,849  |   | 4,641,370 | 
|      |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                  |            |   |           | 
|**9** | Convertible loans
        On June 11, 2002, the company completed loan financing of $2,500,000.
          The loans have a term of one year, which can be extended for one year
          at the companys option (extended subsequent to year end), and
          bear interest at the rate of 10% per year.
        The principal amount of the loans are convertible at the lenders
          option into special warrants at the rate of $4.00 per special warrant
          and the accrued interest is convertible into special warrants at the
          rate equal to the higher of $4.00 per special warrant or the then market
          price of the companys shares. Each special warrant, including
          those issued as a bonus, is exercisable, without further consideration,
          to acquire one common share of the company. If the loans are converted
          or repaid before the first anniversary date, the lenders shall receive
          one years worth of interest (excluding interest converted into
          shares) on the original loan amounts.

(7)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | The company has determined the value of the equity
        conversion feature of the convertible loans to be $94,546 using the Black-Scholes
        option pricing model. The remainder of $2,405,454 has been classified
        as debt.
      During the year ended April 30, 2003, the company redeemed
        part of the convertible loans with a face value of $312,500.
      As a result of the redemption of $11,818 of the value
        of the equity conversion feature of the convertible loans was transferred
        to contributed surplus leaving a balance of $82,728 as the equity component
        of convertible loans.
      The lenders received an aggregate of 125,000 special
        warrants exercisable at deemed value of $2.05 for 10 years, as a bonus
        for making the loans, which were recorded as finance charges at an estimated
        fair value of $218,266.
      At the companys option, the maturity date of the
        loans may be extended for one year by the issuance to the lenders of special
        warrants convertible into 125,000 common shares of the company (reduced
        to 109,375 special warrants upon the partial redemption of convertible
        loans noted above). The special warrants, if issued, will be subject to
        a four month hold period from issuance of such special warrants.
      The company paid a finders fee of $25,000 on closing
        of the financing, which, together with the recorded fair value of the
        125,000 special warrants of $218,266, has been deferred and is being amortized
        over the initial term of the debt. A summary of deferred finance charges
        incurred and amortization during the year is shown below:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | 2003     |   | 2002 | 
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------- | - | ---- | 
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 | $        |   | $    | 
|       | Balance - Beginning of year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     | -        |   | -    | 
|       | Finance charges incurred                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | 243,266  |   | -    | 
|       | Less: Amortization                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                              | (237,016 | ) | -    | 
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |          |   |      | 
|       | Balance - End of year                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           | 6,250    |   | -    | 
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                 |          |   |      | 
|**10** | Provision for reclamation and site restoration
      The company has assumed responsibility for the reclamation
        and site restoration plans originally filed with the Ontario Ministry
        of Northern Development and Mining (MNDM) in connection with the Macassa
        and the Lake Shore properties. The estimated total costs of reclamation
        and site restoration are $2,043,435 and financial assurance has been provided
        to the MNDM by way of mine closure bonds. The remaining properties will
        require geotechnical investigations and possible closure remediation to
        meet the MNDMs approval, the cost of which is not yet determinable,
        but which management does not believe to be significant on the basis of
        current legislation. The company recorded the estimated costs of reclamation
        and site restoration of $2,043,435 at the time of acquisition of the properties.

(8)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|11 | Capital stock                                    |            |  |             |  
|-- | ------------------------------------------------ | ---------- |  | ----------- | -
|   |                                                  |            |  |             |  
|   |                                                  | Number     |  | **Amount**  |  
|   |                                                  | of shares  |  | **$**       |  
|   |                                                  |            |  |             |  
|   | Balance - April 30, 2000                         | 9,309,239  |  | 14,470,449  |  
|   | Exercise of warrants (note 13)                   | 250,000    |  | 75,000      |  
|   |                                                  |            |  |             |  
|   | Balance - April 30, 2001                         | 9,559,239  |  | 14,545,449  |  
|   | Exercise of options (note 12)                    | 7,500      |  | 10,125      |  
|   | Exercise of warrants (note 13)                   | 2,011,765  |  | 618,236     |  
|   | Common shares issued for cash (a) and (b)        | 6,400,000  |  | 8,320,000   |  
|   | Share proceeds allocated to warrants (a) and (b) | -          |  | (1,044,040  | )
|   | Share issuance costs                             | -          |  | (673,992    | )
|   | Reduction of stated capital (c)                  | -          |  | (14,597,896 | )
|   |                                                  |            |  |             |  
|   | Balance - April 30, 2002                         | 17,978,504 |  | 7,177,882   |  
|   | Exercise of options (note 12)                    | 97,500     |  | 184,721     |  
|   | Exercise of warrants (note 13)                   | 2,375,162  |  | 4,270,874   |  
|   | Private placements (d) and (e)                   | 3,625,000  |  | 7,075,000   |  
|   | Share issuance costs                             | -          |  | (950,895    | )
|   |                                                  |            |  |             |  
|   | Balance - April 30, 2003                         | 24,076,166 |  | 17,757,582  |  

| | a) | On December 12 and 14, 2001, the company issued 400,000
        flow-through common shares at $1.30 per share and 4,500,000 units at a
        price of $1.30 per unit for gross proceeds of $6,370,000. Each unit was
        comprised of one (non-flow-through) common share and one-half of a share
        purchase warrant. Each whole warrant entitles the holder to purchase a
        further (non-flow-through) common share for a period of 24 months at a
        price of $1.55 per share. The agent was issued warrants which entitle
        the agent to purchase 490,000 shares for a period of 24 months at a price
        of $1.30 per share. The company incurred commissions, fees and legal costs
        totalling $565,582 in connection with these share issuances. The share
        purchase warrants issued as part of these private placement units have
        been recorded at a fair value of $805,223.
| | -- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | b) | On March 5, 2002, the company issued 1,500,000 units
        at a price of $1.30 per unit for gross proceeds of $1,950,000. Each unit
        is comprised of one common share and one-half of a share purchase warrant.
        Each whole warrant entitles the holder to purchase a further common share
        for a period of 24 months at a price of $1.60 per share. The company incurred
        commissions, fees and legal costs totalling $108,410 in connection with
        this share issuance. The share purchase warrants issued as part of these
        private placement units have been recorded at a fair value of $238,817.                                                                                                                                                                                                                                                                                        
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| | c) | At the companys annual general meeting, held
        on October 17, 2001, shareholders approved a reduction of stated capital
        of $14,597,896.                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   

(9)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|       | d)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | On June 21, 2002, the company closed a brokered private placement of 1,000,000
      shares at a price of $2.35 per share for gross proceeds of $2,350,000. The
      agent also received a compensation option to purchase 100,000 common shares
      for a period of 24 months at a price of $2.35 per share. The company incurred
      commissions, fees and legal costs totalling $169,851 in connection with
      this placement. The agents options have been recorded at a fair value
      of $81,276.
|------ | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|       | e)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                        | On December 30, 2002, the company closed a brokered private placement
      of 2,625,000 shares at a price of $1.80 per share for gross proceeds of
      $4,725,000. The agent also received 393,750 warrants exercisable at $2.05
      until June 30, 2004 as compensation for the placement. The company incurred
      commissions, fees and legal costs totalling $465,834 in connection with
      this placement. The agents warrants have been recorded at a fair value
      of $233,935.              
|       |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                           |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|**12** | Options
        The company has adopted a stock option plan. The plan allows the company
          to grant options to directors, senior officers and employees of or consultants
          to the company and its subsidiaries or employees of a corporation providing
          management services to the company to acquire up to 2,000,000 common
          shares.
        The plan provides that the exercise price of an option granted under
          the plan shall not be less than the market price at the time of granting
          the option. Options have a maximum term of 10 years and terminate on
          the 90th day after the optionee ceased to be any of a director, officer,
          consultant or employee; on the 30th day after the optionee ceased to
          be an employee or consultant if the optionee was engaged in providing
          investor relations services for the company; or the earlier of the 90th
          day and the third month after the optionee ceased to be an employee
          or officer if the optionee is subject to the tax laws of the United
          States of America.
        Notwithstanding that options can have a maximum term of 10 years it
          is presently the policy of the company to issue options for terms of
          five years.
        The change in stock options issued during the years ended April 30
          is as follows:

| |                                   |           |   | **2003** |  |           |   | **2002** |  |           |  | 2001     | 
| | --------------------------------- | --------- | - | -------- |  | --------- | - | -------- |  | --------- |  | -------- | 
| |                                   |           |   |          |  |           |   |          |  |           |  |          | 
| |                                   |           |   | Weighted |  |           |   | Weighted |  |           |  | Weighted | 
| |                                   |           |   | average  |  |           |   | average  |  |           |  | average  | 
| |                                   | Number    |   | exercise |  | Number    |   | exercise |  | Number    |  | exercise | 
| |                                   | of shares |   | price    |  | of shares |   | price    |  | of shares |  | price    | 
| |                                   |           |   | $        |  |           |   | $        |  |           |  | $        | 
| | Options outstanding - Beginning   |           |   |          |  |           |   |          |  |           |  |          | 
| | of year                           | 1,173,000 |   | 1.34     |  | 350,000   |   | 1.10     |  | -         |  | -        | 
| | Granted                           | 679,500   |   | 2.20     |  | 830,500   |   | 1.44     |  | 350,000   |  | 1.10     | 
| | Exercised                         | (97,500   | ) | 1.57     |  | (7,500    | ) | 1.35     |  | -         |  | -        | 
| | Forfeited                         | (20,000   | ) | 1.85     |  | -         |   | -        |  | -         |  | -        | 
| |                                   |           |   |          |  |           |   |          |  |           |  |          | 
| | Options outstanding - End of year | 1,735,000 |   | 1.65     |  | 1,173,000 |   | 1.34     |  | 350,000   |  | 1.10     | 
| |                                   |           |   |          |  |           |   |          |  |           |  |          | 
| | Options exercisable - End of year | 1,077,500 |   | 1.36     |  | 882,500   |   | 1.25     |  | -         |  | -        | 

(10)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

The following table summarizes information about stock options outstanding
  and exercisable at April 30, 2003:

| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  | Outstanding |  | Exercisable | 
| | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | ----------------- |  | ----------- |  | ----------- |  | ----------- |  | ----------- | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  | options     |  | options     | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  | weighted    |  | weighted    | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  | average     |  | average     | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | Exercise          |  | Options     |  | Options     |  | remaining   |  | remaining   | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | price             |  | outstanding |  | exercisable |  | life        |  | life        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | $                 |  |             |  |             |  | (years)     |  | (years)     | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.10              |  | 350,000     |  | 350,000     |  | 2.91        |  | 2.91        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.35              |  | 545,500     |  | 545,500     |  | 3.46        |  | 3.46        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.60              |  | 160,000     |  | 80,000      |  | 3.95        |  | 3.95        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.05              |  | 75,000      |  | 75,000      |  | 4.06        |  | 4.06        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.20              |  | 569,500     |  | -           |  | 4.70        |  | -           | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 2.45              |  | 35,000      |  | 27,000      |  | 4.11        |  | 4.11        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  |             |  |             | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         | 1.10
      - 2.45 |  | 1,735,000   |  | 1,077,500   |  | 3.84        |  | 3.38        | 
| |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         |                   |  |             |  |             |  |             |  |             | 
| | The company grants all
        employee stock options with an exercise price equal to the market value
        of the underlying common shares on the date of grant. Accordingly, under
        the intrinsic method, no compensation expense has been recognized on the
        employee stock option in the statements of operations. If compensation
        expense for all grants under the employee stock option plan had been determined
        by the fair value method, net income and earnings per share would have
        been as follows:

| |                                                                                                                                                                |                                  | **2003**   |  
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------- | ---------- | -
| |                                                                                                                                                                |                                  | **$**      |  
| |                                                                                                                                                                | Loss for the year                |            |  
| |                                                                                                                                                                | As reported                      | (4,934,979 | )
| |                                                                                                                                                                | Pro forma                        | (5,096,965 | )
| |                                                                                                                                                                |                                  |            |  
| |                                                                                                                                                                | Basic and diluted loss per share |            |  
| |                                                                                                                                                                | As reported                      | (0.25      | )
| |                                                                                                                                                                | Pro forma                        | (0.26      | )
| |                                                                                                                                                               
| | The fair value of each option at the
        date of grant was estimated using the Black-Scholes option-pricing method
        with the following assumptions:

| |  |                                        | 2003    | 
| |  | -------------------------------------- | ------- | 
| |  |                                        |         | 
| |  | Expected life of options               | 5 years | 
| |  | Risk-free interest rate                | 3 - 5%  | 
| |  | Expected stock price volatility        | 70%     | 
| |  | Expected dividend yield                | -       | 
| |  | Weighted-average fair value of options | $2.18   | 

(11)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | Option pricing models require the input of highly subjective
        assumptions including the expected price volatility. Changes in the subjective
        input assumptions can materially affect the fair value estimate, and therefore,
        the existing models do not necessarily provide a reliable measure of the
        fair value of the companys stock option.
      During the year ended April 30, 2003, the fair value
        recorded for stock options granted to non-employees for consulting services
        is $22,133. The fair value of these options is estimated using the Black-Scholes
        option pricing model.
      The value ascribed to unexercised options recorded as
        a component of equity is as follows:
| | -------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

|       |                                                                    |                                  | 2003    |   | 2002    | 
|------ | ------------------------------------------------------------------ | -------------------------------- | ------- | - | ------- | 
|       |                                                                    |                                  | $       |   | $       | 
|       |                                                                    |                                  |         |   |         | 
|       |                                                                    | Balance - Beginning of year      | 128,168 |   | -       | 
|       |                                                                    | Options granted to non-employees | 22,133  |   | 128,168 | 
|       |                                                                    | Exercise of options              | (31,747 | ) | -       | 
|       |                                                                    | Options forfeited                | (6,192  | ) | -       | 
|       |                                                                    |                                  |         |   |         | 
|       |                                                                    | Balance - End of year            | 112,362 |   | 128,168 | 
|       |                                                                    |                                  |         |   |         | 
|**13** | Warrants
      The changes in warrants outstanding are as follows:

| |  |                                  |            |   | 2003     |  |            |   | 2002     |  |           |   | 2001     | 
| |  | -------------------------------- | ---------- | - | -------- |  | ---------- | - | -------- |  | --------- | - | -------- | 
| |  |                                  |            |   |          |  |            |   |          |  |           |   |          | 
| |  |                                  |            |   | Weighted |  |            |   | Weighted |  |           |   | Weighted | 
| |  |                                  |            |   | average  |  |            |   | average  |  |           |   | average  | 
| |  |                                  | Number     |   | exercise |  | Number     |   | exercise |  | Number    |   | exercise | 
| |  |                                  | of shares  |   | price    |  | of shares  |   | price    |  | of shares |   | price    | 
| |  |                                  |            |   | $        |  |            |   | $        |  |           |   | $        | 
| |  |                                  |            |   |          |  |            |   |          |  |           |   |          | 
| |  | Warrants outstanding - Beginning |            |   |          |  |            |   |          |  |           |   |          | 
| |  | of year                          | 3,478,235  |   | 1.53     |  | 2,000,000  |   | 0.30     |  | 2,250,000 |   | 0.30     | 
| |  | Granted                          | 618,750    |   | 2.10     |  | 3,490,000  |   | 1.53     |  | -         |   | -        | 
| |  | Exercised                        | (2,375,162 | ) | 1.43     |  | (2,011,765 | ) | 0.31     |  | (250,000  | ) | 0.30     | 
| |  |                                  |            |   |          |  |            |   |          |  |           |   |          | 
| |  | Warrants outstanding - End       |            |   |          |  |            |   |          |  |           |   |          | 
| |  | of year                          | 1,721,823  |   | 1.63     |  | 3,478,235  |   | 1.53     |  | 2,000,000 |   | 0.30     | 

(12)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | The value ascribed to unexercised warrants recorded as a component
      of equity is as follows:
| | -------------------------------------------------------------------------------------------------
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  
| |                                                                                                  

|14 | Financial instruments
      The companys financial instruments consist of
        cash and cash equivalents, short-term investments, accounts receivable,
        accounts payable, accrued liabilities and notes payable. At April 30,
        2003, the carrying values of these instruments approximate their fair
        values based on the nature of these instruments. Unless otherwise noted,
        it is managements opinion that the company is not exposed to significant
        interest, currency or credit risks arising from these financial instruments.
|-- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|15 | Related party transactions
      The following related party transactions occurred during
        the year:                                                                                                                                                                                                                                                                                                                                                                                                                                                                   
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | a)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | b)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                            
|   |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                               
|   | These transactions were
        in the normal course of operations and were measured at the exchange value
        which represented the amount of consideration established and agreed to
        by the related parties.                                                                                                                                                                                                                                                                                                                                                    

(13)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|**16** | Income taxes
|------ | ------------
|       |             
|       | a)          

| |    |                                                                                                                                                                                                                                                                                                                                                                  |                                   | 2003       |   | 2002       |   | 2001     |  
| | -- | ---------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------- | --------------------------------- | ---------- | - | ---------- | - | -------- | -
| |    |                                                                                                                                                                                                                                                                                                                                                                  |                                   | $          |   | $          |   | $        |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  |                                   |            |   |            |   |          |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Loss before income taxes recovery | (4,934,979 | ) | (2,178,587 | ) | (385,149 | )
| |    |                                                                                                                                                                                                                                                                                                                                                                  |                                   |            |   |            |   |          |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Expected income taxes recovery    | (1,870,357 | ) | (862,720   | ) | (171,776 | )
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Differences in foreign tax rates  | -          |   | -          |   | 8,786    |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Losses for which an income tax    |            |   |            |   |          |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | benefit has not recognized        | 1,472,291  |   | 862,720    |   | 162,990  |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Resource allowance and            |            |   |            |   |          |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | non-deductible items              | 398,066    |   | -          |   | -        |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  |                                   |            |   |            |   |          |  
| |    |                                                                                                                                                                                                                                                                                                                                                                  | Actual income taxes (recovery)    | -          |   | -          |   | -        |  
| |    |                                                                                                                                                                                                                                                                                                                                                                 
| | b) | Future income taxes reflect the net tax
        effects of non-capital loss carry-forwards and temporary differences between
        the carrying amounts of assets and liabilities for financial reporting
        purposes and the amounts used for income tax purposes. The significant
        components of the companys future tax assets are as follows:

| |  |  |                                   | 2003       |   | 2002       |   | 2001     |  
| |  |  | --------------------------------- | ---------- | - | ---------- | - | -------- | -
| |  |  |                                   | $          |   | $          |   | $        |  
| |  |  |                                   |            |   |            |   |          |  
| |  |  | Net operating loss carry-forwards | 1,040,125  |   | 1,105,309  |   | 426,622  |  
| |  |  | Mineral properties                | 1,845,256  |   | 234,886    |   | 503,812  |  
| |  |  | Property, plant and equipment     | 269,879    |   | (253,958   | ) | -        |  
| |  |  | Share issuance costs              | 361,076    |   | 191,952    |   | -        |  
| |  |  |                                   |            |   |            |   |          |  
| |  |  |                                   | 3,516,336  |   | 1,278,189  |   | 930,434  |  
| |  |  | Less: Valuation allowance         | (3,516,336 | ) | (1,278,189 | ) | (930,434 | )
| |  |  |                                   |            |   |            |   |          |  
| |  |  | Net future tax assets             | -          |   | -          |   | -        |  

(14)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | c) | The company has non-capital losses, which may be
        carried forward and applied against taxable income in future years. These
        losses expire during the following years:
| | -- | ------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |      |  | $         | 
| |  | ---- |  | --------- | 
| |  |      |  |           | 
| |  | 2004 |  | 102,271   | 
| |  | 2005 |  | 58,882    | 
| |  | 2006 |  | 162,661   | 
| |  | 2007 |  | 123,249   | 
| |  | 2008 |  | 412,780   | 
| |  | 2009 |  | 916,624   | 
| |  | 2010 |  | 1,676,802 | 
| |  |      |  |           | 
| |  |      |  | 3,453,269 | 
| |  |      |  |           | 

|17 | Segmented information
        The company has one operating segment consisting of a mining and mill
          operation located in Kirkland Lake, Canada. During the years ended April
          30, 2003 and 2002, all of the companys capital assets, revenues
          earned and operations were in Canada.
|-- | -----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
|   |                                                                                                                                                                                                                                                                                                                  
|18 | Supplemental cash flow information
        Cash and cash equivalents are comprised of:                                                                                                                                                                                                                           

| |                                                                                                                                           |                                                          | 2003      |  | 2002      | 
| | ----------------------------------------------------------------------------------------------------------------------------------------- | -------------------------------------------------------- | --------- |  | --------- | 
| |                                                                                                                                           |                                                          | $         |  | $         | 
| |                                                                                                                                           |                                                          |           |  |           | 
| |                                                                                                                                           | Cash                                                     | 3,664,607 |  | 919,266   | 
| |                                                                                                                                           | Short-term investments with maturities less than 90 days | -         |  | 2,750,124 | 
| |                                                                                                                                           |                                                          |           |  |           | 
| |                                                                                                                                           |                                                          | 3,664,607 |  | 3,669,390 | 
| |                                                                                                                                           |                                                          |           |  |           | 
| | During the years ended April 30, 2003, 2002 and 2001, the
      company conducted non-cash financing and investing activities as follows:

| |  |                                             | 2003    |  | 2002      |  | 2001 | 
| |  | ------------------------------------------- | ------- |  | --------- |  | ---- | 
| |  |                                             | $       |  | $         |  | $    | 
| |  |                                             |         |  |           |  |      | 
| |  | Mineral property, plant and equipment       |         |  |           |  |      | 
| |  | acquired under note payable                 | -       |  | 4,453,699 |  | -    | 
| |  | Warrants issued as share issuance costs     | 312,500 |  | 1,044,040 |  | -    | 
| |  | Warrants issued as finance charges for loan | 218,266 |  | -         |  | -    | 
| |  | Stock-based compensation                    | 22,133  |  | 128,168   |  | -    | 

(15)

---

|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|**19** | Material differences between Canadian and United States GAAP
        The financial statements of the company have been prepared in accordance
          with Canadian GAAP, which differs in some respects from U.S. GAAP. The
          significant measurement differences between GAAP in Canada and the United
          States and their effect on these financial statements are as follows:
|------ | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------

| |  |                                            | 2003       |   | 2002       |   | 2001     |  
| |  | ------------------------------------------ | ---------- | - | ---------- | - | -------- | -
| |  |                                            | $          |   | $          |   | $        |  
| |  |                                            |            |   |            |   |          |  
| |  | Loss for the year                          |            |   |            |   |          |  
| |  | Loss for the year following Canadian GAAP  | (4,934,979 | ) | (2,178,587 | ) | (385,149 | )
| |  | Adjustments and writedown of mineral       |            |   |            |   |          |  
| |  | properties (a)                             | -          |   | -          |   | 70,000   |  
| |  | Accretion of convertible loan (b)          | 83,668     |   | -          |   | -        |  
| |  |                                            |            |   |            |   |          |  
| |  | Loss for the year following U.S. GAAP      | (4,851,311 | ) | (2,178,587 | ) | (315,149 | )
| |  |                                            |            |   |            |   |          |  
| |  | Basic and diluted loss per share following |            |   |            |   |          |  
| |  | U.S. GAAP                                  | (0.24      | ) | (0.16      | ) | (0.03    | )
| |  |                                            |            |   |            |   |          |  
| |  | Convertible loans                          |            |   |            |   |          |  
| |  | Convertible loans following Canadian GAAP  | 2,176,622  |   | -          |   | -        |  
| |  | Equity component of convertible loan (b)   | 94,546     |   | -          |   | -        |  
| |  | Accretion of convertible loan (b)          | (83,668    | ) | -          |   | -        |  
| |  |                                            |            |   |            |   |          |  
| |  | Convertible loans following U.S. GAAP      | 2,187,500  |   | -          |   | -        |  
| |  |                                            |            |   |            |   |          |  
| |  | Shareholders Equity                       |            |   |            |   |          |  
| |  | Shareholders equity following             |            |   |            |   |          |  
| |  | Canadian GAAP                              | 11,722,181 |   | 6,340,298  |   | 116,348  |  
| |  | Equity component of convertible loan (b)   | (94,546    | ) | -          |   | -        |  
| |  | Accretion of convertible loan (b)          | 83,668     |   | -          |   | -        |  
| |  |                                            |            |   |            |   |          |  
| |  | Shareholders equity following U.S. GAAP   | 11,711,303 |   | 6,340,298  |   | 116,348  |  
| |  |                                            |            |   |            |   |          |  
| |  | Cash Flows                                 |            |   |            |   |          |  
| |  | Cash flows from operating activities       |            |   |            |   |          |  
| |  | Following Canadian
      GAAP              | (2,102,899 | ) | (1,009,569 | ) | (164,967 | )
| |  | Exploration expenditures (a)               | -          |   | -          |   | (55,431  | )
| |  |                                            |            |   |            |   |          |  
| |  | Following U.S. GAAP                        | (2,102,899 | ) | (1,009,569 | ) | (220,398 | )
| |  |                                            |            |   |            |   |          |  
| |  | Cash flows from financing activities       |            |   |            |   |          |  
| |  | Following Canadian
      and U.S. GAAP     | 9,144,417  |   | 8,274,369  |   | 75,000   |  
| |  |                                            |            |   |            |   |          |  
| |  | Cash flows from investing activities       |            |   |            |   |          |  
| |  | Following Canadian GAAP                    | (7,046,301 | ) | (3,789,519 | ) | 99,557   |  
| |  | Exploration expenditures
      (a)         | -          |   | -          |   | 55,431   |  
| |  |                                            |            |   |            |   |          |  
| |  | Following U.S. GAAP                        | (7,046,301 | ) | (3,789,519 | ) | 154,988  |  

(16)

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|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| | a) | Mineral properties
      The company expenses exploration costs as incurred relating
        to unproven mineral properties under both Canadian and U.S. GAAP. When
        proven and probable reserves are determined for a property, subsequent
        exploration and development costs of the property are capitalized. The
        capitalized costs of such properties are assessed, on a periodic basis,
        to ensure that the carrying value can be recovered on an undiscounted
        cash flow basis. If the carrying value cannot be recovered on this basis,
        the mineral properties are written down to fair value on a discounted
        cash flow basis.
| | -- | ----------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | b) | Convertible loans
      The company issued convertible loans (note 9). Under
        Canadian GAAP, the fair value of the equity conversion feature of $94,546
        is recorded as a component of shareholders equity. The carrying
        amount of the loans are accreted to face value over the initial term to
        maturity through a charge to interest expense. Under U.S. GAAP, the full
        face value of the convertible loans is classified as a liability and any
        accretion charges under Canadian GAAP are reversed. During the year ended
        April 30, 2003, accretion expense of $83,668 was reversed for U.S. GAAP.                            
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | c) | Reduction of stated capital
      Canadian GAAP allows for the deficit of a company to
        be offset against the recorded amount of share capital upon approval of
        the shareholders such as the reduction of $14,597,866 approved by the
        shareholders on October 17, 2001. U.S. GAAP does not generally allow such
        an offset to be given accounting recognition. Accordingly, under U.S.
        GAAP, the amounts recorded for each of share capital and deficit would
        be increased by $14,597,896 to eliminate the reductions recorded by the
        company under Canadian GAAP.                                                                
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| | d) | Flow-through shares
      Under Canadian tax legislation, corporations are permitted
        to issue shares whereby the corporation agrees to incur qualifying expenditures
        under the Canadian income tax act and to renounce the related income tax
        deductions to the investors who acquire the shares.                                                                                                                                                                                                                                                                                                                                                               

(17)

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|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

| |    | Under Canadian GAAP, the
        company has accounted for the issue of flow-through shares as follows:                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                     
| | -- | --------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------------
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | i)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                          
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| |    | ii)                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                         
| |    |                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                                             
| | e) | Impact of Recently Issued
        Accounting Standards
      The FASB has issued SFAS No. 143, Accounting for
        Asset Retirement Obligations, which is effective for years beginning
        on or after June 15, 2002. This statement addresses financial accounting
        and reporting for obligations associated with the retirement of tangible
        long-lived assets and the associated asset retirement costs. It requires
        that the fair value of a liability for an asset retirement obligation
        be recognized in the period in which it is incurred if a reasonable estimate
        of fair value can be made. The associated asset retirement costs are capitalized
        as part of the carrying amount of the long-lived asset. The company is
        analyzing the impact of SFAS No. 143.
      The CICA has issued CICA 3110, Asset Retirement
        Obligations. The standard, which is similar to SFAS No. 143, is
        effective for years beginning on or after January 1, 2004. The standard
        requires recognition of a liability at its fair value for the obligation
        associated with the retirement of a tangible long-lived asset. A corresponding
        asset retirement cost would be added to the carrying amount of the related
        asset and amortized to expense over the useful life of the asset. The
        company is analyzing the impact of this new standard.
      The Accounting Standards Board of the Canadian Institute
        of Chartered Accountants (CICA) has issued CICA 3063, Impairment
        of Long-Lived Assets which is effective for years beginning on or
        after April 1, 2003. This statement establishes standards for recognition,
        measurement and disclosure of the impairment of non-monetary long-lived
        assets, including property, plant and equipment, intangible assets with
        finite useful lives, deferred pre-operating costs and long-term prepaid
        assets. The company does not expect that the implementation of this new
        standard will have a material impact on its consolidated financial position
        or results of operations.
      The CICA has released amendments to Section 3870, Stock-based
        Compensation and Other Stock-based Payments, which require an expense
        to be recognized in financial statements for all forms of employee stock-based
        compensation, including stock options, effective for periods beginning
        on or after January 1, 2004, for public companies. The company will be
        required to adopt the standard on May 1, 2004.

(18)

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|Kirkland
      Lake Gold Inc. 
      (formerly Foxpoint Resources Ltd.) 
      Notes to Financial Statements April 30, 2003, 2002 and 2001
|------------------------------------------------------------------------------------------------------------------------------------------
|                                                                                                                                          
|(expressed in Canadian dollars)                                                                                                           

|**20** | Subsequent events
|------ | -----------------
|       |                  
|       | a)               
|       |                  
|       | b)               
|       |                  
|       | c)               
|       |                  
|       | d)               

(19)

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