UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
 WASHINGTON, D.C. 20549
 FORM 20-F
 o
    
    REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF
1934
 OR
 þ
    
    ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 For the fiscal year ended December 31, 2007
 OR
 o
    
    TRANSITIONAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 OR
 o
    
    SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934
 Date of event requiring this shell company report
 Commission File Number 1-8488
 (CAMPBELL RESOURCES INC. LOGO)
  Canada
 1155 rue University, Suite 1405
Montréal, Québec, CANADA H3B 3A7
  Title of each class
    
    Name of each exchange on which registeredcommon shares
    
    TSX and OTC-BB
  None
  None
  432,404,881 common shares
 o þ
 o þ
 þ o
  Large accelerated filer o
    
    Accelerated filer o
    
    Non-accelerated filer þ
    
    Smaller reporting company o(Do not check if a smaller reporting company)
 þ o
 o þ




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##### 



CAMPBELL RESOURCES INC.TABLE OF CONTENTS
 Item 1. Identity of Directors, Senior Management and Advisors
    
    
    4Item 2. Offer Statistics and Expected Timetable
    
    
    4Item 3. Key Information
    
    
    4A. Selected Financial Data
    
    
    4Summary of Differences Between US and Canadian GAAP
    
    
    6B. Capitalization and indebtedness
    
    
    6C. Reasons for the offer and use of proceeds
    
    
    6D. Risk factors
    
    
    6Mining Risks
    
    
    6Environmental Matters
    
    
    11Item 4. Information on the Company
    
    
    12A. History and Development of the Company
    
    
    12General Background
    
    
    12Significant Subsidiaries
    
    
    12MSV Resources Inc. and GéoNova Explorations Inc.
    
    
    12Meston Resources Inc.
    
    
    12Corporation Copper Rand Inc.
    
    
    121329498 Alberta Ltd. and MSV Resources 2007 Inc.
    
    
    13Acquisition or Disposition of Material Assets
    
    
    14Mexican Assets
    
    
    14Discovery Project
    
    
    14Bachelor Lake Property
    
    
    14The Eastmain Mine
    
    
    15Joe Mann Mine
    
    
    15The Chevrier Project
    
    
    15Bankruptcy, Receivership or Similar Proceedings
    
    
    15Capital Expenditures and Divestitures for the Last Three Financial Years
    
    
    16AlbertaCo
    
    
    16Joe Mann Mine
    
    
    16Copper Rand Mine and Corner Bay Project
    
    
    17Methods of Financing
    
    
    18B. Business Overview
    
    
    20Nature of the Companys Operations and Activities
    
    
    20Joe Mann Mine
    
    
    21Copper Rand Mine
    
    
    21Corner Bay Property
    
    
    22Seasonality
    
    
    22Material Effects of Government Regulations
    
    
    22C. Organizational Structure
    
    
    23D. Property, Plants and Equipment
    
    
    23Campbell Material Tangible Fixed Assets
    
    
    23Location of the mines and principal exploration properties of Campbell Ressources inc.
    
    
    24Properties of Meston
    
    
    24History
    
    
    24Location, Access and Ownership
    
    
    26Geology
    
    
    26Mineral Reserves and Resources
    
    
    26Mineral
Resources (Measured and Indicated Resources)
    
    
    28Mineral resources (inferred resources)
    
    
    28Mining
    
    
    29Milling
    
    
    30Employees
    
    
    30Royalties
    
    
    31Environmental Matters
    
    
    32Mineral Exploration Properties
    
    
    32Chibougamau Exploration Properties
    
    
    32
 i




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##### 



Properties of MSV
    
    
    33The Copper Rand Mine
    
    
    33Location and Title
    
    
    33History
    
    
    34Copper Rand 5000 Project Background
    
    
    34Financing of
The Copper Rand Project and Details of The Management of The Copper Rand Project
    
    34Other Aspects of The Copper Rand Project
    
    
    36Geology
    
    
    36Mineral Reserves
    
    
    36Mineral Resources
    
    
    37Inferred Resources
    
    
    37Mining
    
    
    38The Copper Rand Mill
    
    
    38Milling
    
    
    39Environmental Fund
    
    
    39Tailings and Waste Disposal
    
    
    39Employees
    
    
    39Royalties
    
    
    39The Corner Bay Property
    
    
    40Location and Title
    
    
    40History
    
    
    40Geology
    
    
    41Mineral Resources
    
    
    42Inferred Resources
    
    
    43Royalties
    
    
    43The Cedar Bay Property
    
    
    43The Merrill Pit
    
    
    44Location and Title
    
    
    44History
    
    
    44Properties of GéoNova
    
    
    44Berthiaume Syndicate
    
    
    45Property, Location and Access
    
    
    45Geology
    
    
    45The Pitt Gold Property
    
    
    47Location, Access and Ownership
    
    
    47Geology
    
    
    47Item 5. Operating and Financial Review and Prospects
    
    
    47Managements Discussion and Analysis
    
    
    47Item 6. Directors, Senior Management and Employees
    
    
    70A. Directors and Senior Management
    
    
    70Directors
    
    
    70Senior Management
    
    
    72B. Compensation
    
    
    72Executive Compensation
    
    
    72Bonus or Profit-Sharing Plans and Stock Options
    
    
    74Options / Stock Appreciation Rights (SAR) Granted during the Most Recent Financial Year
    
    
    74Aggregate Options Exercised During the Most Recent Financial Year and Year End Option Value
    
    
    74Securities Authorized for Issuance Under Equity Compensation Plans
    
    
    75C. Board Practices
    
    
    75Date of expiration of current term of office
    
    
    75Directors Service Contracts
    
    
    75Audit Committee
    
    
    76Audit Committee Charter
    
    
    76Composition of Audit Committee
    
    
    76Audit Committee Oversight
    
    
    77Pre-Approval Policies and Procedures
    
    
    77Compensation Committee
    
    
    77Composition of the Compensation Committee
    
    
    77Executive Compensation Philosophy and Policy
    
    
    77Report on Executive Compensation
    
    
    78
 ii




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##### 



Statement of Corporate Governance Practices
    
    
    78D. Employees
    
    
    83E. Share Ownership
    
    
    84Arrangements Involving the Employees in the Capital of the Company
    
    
    85Employee Incentive Plan
    
    
    85Share Option Plan
    
    
    86Share Purchase Plan
    
    
    87Share Bonus Plan
    
    
    88Share Loan Plan
    
    
    88Directors Stock Option Plan
    
    
    89Item 7. Major Shareholders and Related Party Transactions
    
    
    90A. Major Shareholders
    
    
    91B. Related Party Transactions
    
    
    91Item 8. Financial Information
    
    
    92A. Consolidated Statements and Other Financial Information
    
    
    92Legal Proceedings
    
    
    92Dividend Record and Policy
    
    
    94B. Significant Changes
    
    
    94Item 9. The Offer and Listing
    
    
    94A. Offer and listing details
    
    
    94Toronto Stock Exchange
    
    
    94OTC-BB
    
    
    95B. Plan of distribution
    
    
    96Not applicable
    
    
    96C. Markets
    
    
    96D. Selling Shareholders
    
    
    96E. Dilution
    
    
    96F. Expenses of the issue
    
    
    96Item 10.
Additional Information
    
    
    96A. Share Capital
    
    
    96B. Memorandum and Articles of Incorporation
    
    
    96Election and Qualifications of Directors
    
    
    97Meetings
    
    
    98Limitations on Ownership of Securities
    
    
    98Change in Control of Company
    
    
    98C. Material Contracts
    
    
    98D. Exchange Controls
    
    
    99E. Taxation
    
    
    100Certain Canadian Federal Income Tax Consequences
    
    
    100Dividends on Common Shares
    
    
    100Disposition of Common Shares
    
    
    101Flow-Through Shares
    
    
    102Certain United States Federal Income Tax Considerations
    
    
    102U.S. Holders
    
    
    102Distributions of Common Shares
    
    
    103Foreign Tax Credit
    
    
    103Disposition of Common Shares
    
    
    103Other Considerations
    
    
    104Passive Foreign Investment Corporation
    
    
    104Backup Withholding
    
    
    104F. Dividends and paying agents
    
    
    105G. Statements by experts
    
    
    105H. Documents on Display
    
    
    105I. Subsidiary Information
    
    
    105Item 11.
Quantitative and Qualitative Disclosures about Market Risk
    
    
    105Copper and Gold Risk Disclosures
    
    
    105Foreign Currency Risk Disclosures
    
    
    105Competition
    
    
    106
 iii




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##### 



Item 12. Description of Securities other than Equity Securities
    
    
    106PART II
    
    
    106Item 13.
Defaults, Dividend Arrearages and Delinquencies
    
    
    106Credit facility with Investissement Québec
    
    
    106Convertible debentures
    
    
    106CCAA Procedures
    
    
    106Item 14. Material Modifications to the Right of Security Holders and Use of Proceeds
    
    
    107Item 15. Controls and Procedures
    
    
    107Item 16A. Audit Committee Financial Expert
    
    
    108Item 16B. Code Of Ethics
    
    
    108Item 16C. Principal Accountant Fees And Services
    
    
    108(a) Audit Fees
    
    
    108(b) Audit-Related Fees
    
    
    109(c) Tax Fees
    
    
    109(d) All Other Fees
    
    
    109(e) Audit Committees Pre-Approval Policies
    
    
    109(f) Auditors Use of Non-Permanent Employees
    
    
    109Interest of Auditors
    
    
    109Item 16D. Exemptions From The Listing Standards For Audit Committees
    
    
    109Item 16E. Purchases Of Equity Securities By The Issuer And Affiliated Purchasers
    
    
    109PART III
    
    
    110Item 17. Financial Statements
    
    
    110Item 19. Exhibits
    
    
    61
  iv




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##### 



FORWARD-LOOKING STATEMENTS
  CURRENCY AND METRIC EQUIVALENTS
  Rate at
    
    AverageDecember 31
    
    Rate(1)
    
    High
    
    Low2002
    
    
    1.5800
    
    
    
    1.5702
    
    
    
    1.6049
    
    
    
    1.51902003
    
    
    1.2923
    
    
    
    1.3916
    
    
    
    1.5286
    
    
    
    1.29232004
    
    
    1.2034
    
    
    
    1.3016
    
    
    
    1.3970
    
    
    
    1.17752005
    
    
    1.1656
    (2)
    
    
    1.2083
    
    
    
    1.2703
    
    
    
    1.15072006
    
    
    1.1654
    (3)
    
    
    1.1304
    
    
    
    1.1722
    
    
    
    1.09832007
    
    
    0.9881
    
    
    
    1.0666
    
    
    
    1.1852
    
    
    
    0.9168




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##### 



Notes:(1)
    
    The average rate means the average of the exchange rates on the last day of
each month during the year.(2)
    
    Rate at December 30.(3)
    
    Rate at December 29.  High
    
    LowMarch 2008
    
    
    1.0275
    
    
    
    0.9841February 2008
    
    
    1.0188
    
    
    
    0.9717January 2008
    
    
    1.0294
    
    
    
    0.9905December 2007
    
    
    1.0216
    
    
    
    0.9784November 2007
    
    
    1.0007
    
    
    
    0.9168October 2007
    
    
    1.0002
    
    
    
    0.9496September 2007
    
    
    1.0546
    
    
    
    0.9959
   Conversion Table
 Imperial System
    
    
    
    Metric System1 foot (ft)
    
    =
    
    0.3048 metre (m)1 yard (yd)
    
    =
    
    0.9144 metre (m)1 mile (mi)
    
    =
    
    1.6093 kilometre (km)1 square mile (mi2)
    
    =
    
    2.5900 square kilometres (km2)1 acre (ac)
    
    =
    
    0.4047 hectare (ha)1 troy ounce (oz)
    
    =
    
    31.1035 grams (g)1 short ton
    
    =
    
    0.9072 tonne (t)1oz/ short ton
    
    =
    
    28.2 g/t
 - 2 -




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##### 



RESERVE AND RESOURCE ESTIMATES
 Audit of the Mineral Resources and
Mineral Reserves of the Joe Mann Mine Audit of the Mineral Resources and
Mineral Reserves of the Copper Rand Mine Corner Bay deposit,
Audit of Mineral Resources, .
 GLOSSARY OF SIGNIFICANT TERMS
  Proven mineral reserve
 Probable mineral reserve
 Measured mineral resource
 Indicated mineral resource
 Inferred mineral resource
 - 3 -




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##### 



Mineral resource
 Qualified person National Instrument 43-101 Standards of
Disclosure for Mineral Projects
 
 ITEM 1. IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS
  
 ITEM 2. OFFER STATISTICS AND EXPECTED TIMETABLE
  
 ITEM 3. KEY INFORMATION
 
 A. Selected Financial Data
    FIVE YEAR COMPARATIVE SUMMARY OF SELECTED FINANCIAL DATA
 (expressed in thousands of Canadian dollars unless otherwise indicated)
(In accordance with Canadian GAAP) (1)
 Years ended December 31
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Operating resultsNet metal sales
    
    
    23,043
    
    
    
    10,919
    
    
    
    18,274
    
    
    
    20,461
    
    
    
    20,812Loss from operations
    
    
    24,953
    
    
    
    41,681
    
    
    
    28,259
    
    
    
    9,515
    
    
    
    6,368
 - 4 -




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##### 



Years ended December 31
    
    2007
    
    
    2006
    
    
    2005
    
    
    2004
    
    
    2003Net loss
    
    
    18,988
    
    
    
    41,195
    
    
    
    24,430
    
    
    
    8,192
    
    
    
    3,940Cash flow (used for) provided by operations
    
    
    (5,005
    )
    
    
    (5,779
    )
    
    
    (748
    )
    
    
    1,193
    
    
    
    (4,380
    )Capital expenditures
    
    
    (13,226
    )
    
    
    (4,674
    )
    
    
    (2,696
    )
    
    
    (28,053
    )
    
    
    (4,193
    )Financial positionCash and short-term deposits
    
    
    474
    
    
    
    1,964
    
    
    
    1,772
    
    
    
    1,191
    
    
    
    4,752Total assets
    
    
    65,350
    
    
    
    115,142
    
    
    
    134,643
    
    
    
    177,756
    
    
    
    159,773Long-term debt (2)
    
    
    21,025
    
    
    
    65,357
    
    
    
    67,782
    
    
    
    66,502
    
    
    
    60,079Capital stock
    
    
    96,639
    
    
    
    85,572
    
    
    
    69,958
    
    
    
    69,610
    
    
    
    55,429Shareholders equity
    
    
    6,131
    
    
    
    12,006
    
    
    
    30,503
    
    
    
    54,585
    
    
    
    45,803Per share data (in dollars per share)Loss from operation per share
    
    
    0.06
    
    
    
    0.28
    
    
    
    0.26
    
    
    
    0.10
    
    
    
    0.12Net loss per share
    
    
    0.05
    
    
    
    0.27
    
    
    
    0.23
    
    
    
    0.08
    
    
    
    0.07
 
 Notes:(1)
    
    please refer to Note 22 of the consolidated financial statements in Item 17 for differences
between Canadian GAAP and U.S. GAAP.(2)
    
    Long term debt includes current portion of long term debt.  Foreign exchangerate Canadian to USdollar:
    
    2007
    
    2006
    
    2005
    
    2004
    
    2003Year end/average
    
    
    0.9881 /1.0666
    
    
    
    1.1654 /1.1304
    
    
    
    1.1656 /1.2083
    
    
    
    1.2034 /1.3016
    
    
    
    1.2923 /1.3916High/low
    
    
    1.1852 /0.9168
    
    
    
    1.1722 /1.0983
    
    
    
    1.2703 /1.1507
    
    
    
    1.3970 /1.1775
    
    
    
    1.5286 /1.2923
 Month Ended
    
    High
    
    LowMarch 31, 2008
    
    
    1.0275
    
    
    
    0.9841February 29, 2008
    
    
    1.0188
    
    
    
    0.9717January 31, 2008
    
    
    1.0294
    
    
    
    0.9905December 31, 2007
    
    
    1.0216
    
    
    
    0.9784November 30, 2007
    
    
    1.0007
    
    
    
    0.9168October 31, 2007
    
    
    1.0002
    
    
    
    0.9496September 28, 2007
    
    
    1.0546
    
    
    
    0.9959
 Month
    
    Monthly AverageMarch 2008
    
    
    1.00294
 - 5 -




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##### 



Month
    
    Monthly AverageFebruary 2008
    
    
    0.99855January 2008
    
    
    1.00995December 2007
    
    
    1.00207November 2007
    
    
    0.96613October 2007
    
    
    0.97513September 2007
    
    
    1.02520
  SELECTED QUARTERLY FINANCIAL DATA (UNAUDITED)
 expressed in thousands of Canadian dollars except per share amounts)
 Year ended December 31, 2007
    
    1st Quarter
    
    
    2nd Quarter
    
    
    3rd Quarter
    
    
    4th QuarterMetal sales
    
    
    1,714
    
    
    
    1,482
    
    
    
    14,201
    
    
    
    9,395Loss from operations
    
    
    (5,535
    )
    
    
    (5,037
    )
    
    
    (4,749
    )
    
    
    (9,632
    )Net earnings (loss)
    
    
    (1,745
    )
    
    
    (4,341
    )
    
    
    (3,940
    )
    
    
    (8,962
    )Net earnings (loss) per share
    
    
    (0.01
    )
    
    
    (0.01
    )
    
    
    (0.01
    )
    
    
    (0.02
    )
 Year ended December 31, 2006
    
    1st Quarter
    
    
    2nd Quarter
    
    
    3rd Quarter
    
    
    4th QuarterMetal sales
    
    
    2,644
    
    
    
    3,840
    
    
    
    2,267
    
    
    
    3,174Loss from operations
    
    
    (2,501
    )
    
    
    (1,888
    )
    
    
    (4,262
    )
    
    
    (33,030
    )Net earnings (loss)
    
    
    (2,298
    )
    
    
    (1,755
    )
    
    
    (4,902
    )
    
    
    (32,240
    )Net earnings (loss) per share
    
    
    (0.02
    )
    
    
    (0.02
    )
    
    
    (0.04
    )
    
    
    (0.19
    )
 
 Summary of Differences Between US and Canadian GAAP
  
 B. Capitalization and indebtedness.
  
 C. Reasons for the offer and use of proceeds
  
 D. Risk factors
 
 Mining Risks
  - 6 -




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- 7 -




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- 8 -




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##### 



- 9 -




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##### 



- 10 -




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##### 



Environmental Matters
 Environment Quality Act Mining
Act
 Mining Act
  ministère des Ressources naturelles et de la Faune Société de développement de la Baie-James
 ministère du Développement durable, de
lEnvironnement et des
 - 11 -




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##### 



Parcs
 
 ITEM 4. INFORMATION ON THE COMPANY
 
 A.
    
    History and Development of the Company
 
 General Background
 Canada Business Corporations Act
 
 Significant Subsidiaries
 
 MSV Resources Inc. and GéoNova Explorations Inc.
  
 Meston Resources Inc.
   
 Corporation Copper Rand Inc.
  Société générale de financement du Québec
 - 12 -




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##### 



Investissement Québec
 Investissement Québec Investissement Québec
    
 1329498 Alberta Ltd. and MSV Resources 2007 Inc.
   - 13 -




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##### 



Acquisition or Disposition of Material Assets
 
 Mexican Assets
   2 3
 
 Discovery Project
  
 Bachelor Lake Property
   - 14 -




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##### 



Sale and Purchase Agreement Option and Joint Venture Letter of Agreement
 
 The Eastmain Mine
  
 Joe Mann Mine
  
 The Chevrier Project
  
 Bankruptcy, Receivership or Similar Proceedings
 Companies
 - 15 -




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##### 



Creditors Arrangement Act
    
 Capital Expenditures and Divestitures for the Last Three Financial Years
 
 AlbertaCo
  
 Joe Mann Mine
 Investissement Québec
  - 16 -




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##### 



Copper Rand Mine and Corner Bay Project
    - 17 -




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##### 



Participation Agreement
 
 Methods of Financing
    - 18 -




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##### 



- 19 -




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##### 



B. Business Overview
 
 Nature of the Companys Operations and Activities
  - 20 -




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##### 



Joe Mann Mine
   
 Copper Rand Mine
    - 21 -




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##### 



2007
    
    2006
    
    2005Sales
    
    Quantities
    
    $000
    
    Quantities
    
    $000
    
    Quantities
    
    $000Gold (ounces)
    
    
    4,733
    
    
    
    3,365
    
    
    
    3,631
    
    
    
    2,769
    
    
    
    7,098
    
    
    
    4,036Copper (lbs)
    
    
    4,044,066
    
    
    
    13,594
    
    
    
    3,271,000
    
    
    
    12,969
    
    
    
    6,777,000
    
    
    
    15,489Silver (ounces)
    
    
    10,749
    
    
    
    126
    
    
    
    8,813
    
    
    
    134
    
    
    
    21,820
    
    
    
    183Gain (loss ) on foreign exchange
    
    
    
    
    
    
    (56
    )
    
    
    
    
    
    
    38
    
    
    
    
    
    
    
    (144
    )Total gross metal sales
    
    
    
    
    
    
    17,029
    
    
    
    
    
    
    
    15,910
    
    
    
    
    
    
    
    19,564
 
 Corner Bay Property
  Corner Bay deposit, Audit of Mineral Resources
  
 Seasonality
  
 Material Effects of Government Regulations
  - 22 -




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##### 



C. Organizational Structure
  
 
 Notes:(1)
    
    See discussion of agreement with Strateco discussed in Item
4 under subsection entitled History and Development of the
Company.(2)
    
    See discussion of agreement with Eastmain Resources Inc.
discussed in Item 4 under subsection entitled History and
Development of the Company.(3)
    
    See discussion of agreement with Metanor discussed in Item
4 under subsection entitled History and Development of the
Company.(4)
    
    See discussion of agreement with Tawsho discussed in Item 4
under subsection entitled History and Development of the
Company.(5)
    
    See discussion of agreement with Gold Bullion discussed in
Item 4 under subsection entitled History and Development
of the Company.(6)
    
    One (1) common share representing 0.001% of the capital
stock of AlbertaCo is owned by an arms length party. See
discussion in Item 4 under subsection entitled History and
Development of the Company. 
 D. Property, Plants and Equipment
 
 Campbell Material Tangible Fixed Assets
  - 23 -




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##### 



Location of the mines and principal exploration properties of Campbell Ressources inc.
 
 
 
 
 Properties of Meston
 The Joe Mann Mine
 
 History
   - 24 -




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##### 



- 25 -




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##### 



Location, Access and Ownership
  
 Geology
     
 Mineral Reserves and Resources
  - 26 -




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##### 



Audit of the Mineral Resouces and
Mineral Resources of the Joe Mann Mine
 Mineral ReservesDecember 31, 2007
    
    December 31, 2006
    
    December 31, 2005Grade
    
    
    
    
    
    Grade
    
    
    
    
    
    GradeTons
    
    (oz./ton)
    
    Tons
    
    (oz./ton)
    
    Tons
    
    (oz./ton)Proven
    
    
    0
    
    
    
    
    
    
    
    32,000
    
    
    
    0.201
    
    
    
    45,300
    
    
    
    0.236Probable
    
    
    0
    
    
    
    
    
    
    
    6,000
    
    
    
    0.211
    
    
    
    64,000
    
    
    
    0.245Total
    
    
    0
    
    
    
    
    
    
    
    38,000
    
    
    
    0.203
    
    
    
    109,300
    
    
    
    0.241
 
 Notes:(1)
    
    These estimates were verified internally by Ghislain Deschênes (2006) and Jean Tanguay (2005) both Qualified
Persons who are practicing as geologists since 1982 and 1996 respectively.(2)
    
    Details and parameters of mineral resource calculations at December 31, 2005, 2006 and 2007. Calculation method
    
    Data bloc modellingCut off grade: 2007 (2006, 2005)
    
    N/A oz Au/T (0.200, 0.225)High-grade cut Au
    
    2.0 ozDilution: 2007 (2006, 2005)
    
    6 ft. min. horz. WidthMill recovery (Au): 2007 (2006, 2005)
    
    82.7%, (84.6%, 83%)Price assumption (Au): 2007
    
    US$800/oz(2006, 2005)
    
    (US$575/oz, US $425/oz)Exchange rate CAN$/US$: 2007 (2006, 2005)
    
    1.000, (0.893, 0.800)
    - 27 -




---



##### 



Mineral resources (measured and indicated resources)
  Audit of the Mineral Resouces and Mineral
Resources of the Joe Mann Mine
 Cautionary Note to U.S.Investors concerning estimates of Measured and Indicated Resources.
 Mineral Resources (excluding reserves)December 31, 2007
    
    December 31, 2006
    
    December 31, 2005Grade
    
    
    
    
    
    Grade
    
    
    
    
    
    GradeTons
    
    (oz/ton)
    
    Tons
    
    (oz/ton)
    
    Tons
    
    (oz./ton)Measured
    
    
    0
    
    
    
    
    
    
    
    9,000
    
    
    
    0.240
    
    
    
    162,000
    
    
    
    0.229Indicated
    
    
    0
    
    
    
    
    
    
    
    142,000
    
    
    
    0.239
    
    
    
    264,000
    
    
    
    0.288
 
 Notes:(1)
    
    These estimates were verified internally by Ghislain Deschênes (2006) and Jean Tanguay (2005) both Qualified Persons who are
practicing as geologists since 1982 and 1996 respectively.(2)
    
    Details and parameters of mineral resource calculations at December 31, 2005, 2006 and 2007. Calculation method
    
    Data bloc modellingCut off grade: 2007 (2006, 2005)
    
    N/A oz Au/T (0.200, 0.225)High-grade cut Au
    
    2.0 ozDilution: 2007 (2006, 2005)
    
    6 ft. min. horz. WidthMill recovery (Au): 2007 (2006, 2005)
    
    82.7%, (84.6%, 83%)Price assumption (Au): 2007
    
    US$800/oz(2006, 2005)
    
    (US$575/oz, US $425/oz)Exchange rate CAN$/US$: 2007 (2006, 2005)
    
    1.000, (0.893, 0.800)
 
 Mineral resources (inferred resources)
 Cautionary Note to U.S.Investors concerning estimates of inferred resources.
 - 28 -




---



##### 



Mineral Resources (excluding reserves)December 31, 2007
    
    December 31, 2006
    
    December 31, 2005Grade
    
    
    
    
    
    Grade
    
    
    
    
    
    GradeTons
    
    (oz/ton)
    
    Tons
    
    (oz./ton)
    
    Tons
    
    (oz/ton)Inferred
    
    
    0
    
    
    
    
    
    
    
    165,000
    
    
    
    0.233
    
    
    
    180,000
    
    
    
    0.191
 
 Notes:(1)
    
    These estimates were verified internally by Ghislain Deschênes (2006) and Jean Tanguay (2005) both Qualified Persons who are
practicing as geologists since 1982 and 1996 respectively.(2)
    
    Details and parameters of mineral resource calculations at December 31, 2005, 2006 and 2007. Calculation method
    
    Data bloc modellingCut off grade: 2007 (2006, 2005)
    
    N/A oz Au/T (0.200, 0.225)High-grade cut Au
    
    2.0 ozDilution: 2007 (2006, 2005)
    
    6 ft. min. horz. WidthMill recovery (Au): 2007 (2006, 2005)
    
    82.7%, (84.6%, 83%)Price assumption (Au): 2007
    
    US$800/oz(2006, 2005)
    
    (US$575/oz, US $425/oz)Exchange rate CAN$/US$: 2007 (2006, 2005)
    
    1.000, (0.893, 0.80)
 
 Mining
    - 29 -




---



##### 



Joe Mann Mine Production Summary Year ended December 31
    
    2007 (2)
    
    2006
    
    2005Tons Milled
    
    
    67,292
    
    
    
    80,639
    
    
    
    139,064Gold Grade (oz./ton)
    
    
    0.181
    
    
    
    0.207
    
    
    
    0.254Copper Grade (%)
    
    
    0.22
    
    
    
    0.29
    
    
    
    0.34Gold Produced (ounces)
    
    
    10,092
    
    
    
    14,146
    
    
    
    29,434Copper Produced (000s lbs.)
    
    
    281
    
    
    
    440
    
    
    
    897Cash Operating Costs(1) (US$  per oz. of gold)
    
    
    794
    
    
    
    818
    
    
    
    427
 
 Notes:(1)
    
    Operating costs include all on-site mining, processing and administrative costs, net of copper and silver by-product
credits.(2)
    
    As discussed earlier, the Joe Mann Mine was placed on care and maintenance as of September 11, 2007. 
 Milling
  
 Employees
 La Fédération des Infirmiers et Infirmières du Québec
  - 30 -




---



##### 



Royalties
     - 31 -




---



##### 



Environmental Matters
   
 Mineral Exploration Properties
 
 Chibougamau Exploration Properties
    - 32 -




---



##### 



Properties of MSV
  
 The Copper Rand Mine
 
 Location and Title
  - 33 -




---



##### 



History
   
 Copper Rand 5000 Project Background
   
 Financing of the Copper Rand Project and Details of the Management of the Copper Rand
Project
 Investissement Québec Investissement Québec
 - 34 -




---



##### 



Investissement Québec Investissement Québec Investissement Québec Investissement Québec
 Centre local demploi
    Investissement Québec
 - 35 -




---



##### 



Investissement
Québec
   
 Other Aspects of the Copper Rand Project
  
 Geology
    
 Mineral Reserves
  - 36 -




---



##### 



Tons (short)
    
    Cu (%)
    
    Au (opt)ReservesProven
    
    
    407,000
    
    
    
    1.92
    
    
    
    0.070Probable
    
    
    840,000
    
    
    
    1.55
    
    
    
    0.093Total reserves
    
    
    1,247,000
    
    
    
    1.67
    
    
    
    0.085
 
 Notes:Information on calculations of mineral reserves and resources at Copper Rand:
- All data verified by V. Larouche, Chief Geologist for Campbell;
Economic parameters: Au = US$800/oz, Cu = US$2.75/lb US$/CAN$=1.00;
All high gold grades brought back to 0.40 opt Au; All high copper grades brought back to 6.0%;
Method used, polygon on orthogonal projection. Cut off = $58 NSR;
Mill recovery = Au : 81.33% Cu = 96.6%. 
 Mineral Resources
  Cautionary Note to U.S.Investors concerning estimates of Measured and Indicated Resources.
 Tons (short)
    
    Cu (%)
    
    Au (opt)ResourcesMeasured
    
    
    104,000
    
    
    
    1.23
    
    
    
    0.061Indicated
    
    
    591,000
    
    
    
    1.39
    
    
    
    0.087Total resources
    
    
    695,000
    
    
    
    1.37
    
    
    
    0.083
 
 Notes:Information on calculations of mineral reserves and resources at Copper Rand:
- All data verified by V. Larouche, Chief Geologist for Campbell;
Economic parameters: Au = US$800/oz, Cu = US$2.75/lb US$/CAN$=1.00;
All high gold grades brought back to 0.40 opt Au; All high copper grades brought back to 6.0%;
Method used, polygon on orthogonal projection. Cut off = $58 NSR;
Mill recovery = Au : 81.33% Cu = 96.6%. 
 Inferred Resources
 Cautionary Note to U.S.Investors concerning estimates of inferred resources.
 - 37 -




---



##### 



Tons (short)
    
    Cu (%)
    
    Au (opt)ResourcesInferred
    
    
    459,000
    
    
    
    1.89
    
    
    
    0.081
 
 Notes:Information on calculations of mineral reserves and resources at Copper Rand:
- All data verified by V. Larouche, Chief Geologist for Campbell;
Economic parameters: Au = US$800/oz, Cu = US$2.75/lb US$/CAN$=1.00;
All high gold grades brought back to 0.40 opt Au; All high copper grades brought back to 6.0%;
Method used, polygon on orthogonal projection. Cut off = $58 NSR;
Mill recovery = Au : 81.33% Cu = 96.6%. 
 Mining
     
 The Copper Rand Mill
  - 38 -




---



##### 



Milling
  
 Environmental Fund
  
 Tailings and Waste Disposal
  
 Employees
  
 Royalties
   - 39 -




---



##### 



The Corner Bay Property
 
 Location and Title
  
 History
     - 40 -




---



##### 



Corner Bay
deposit, Audit of Mineral Resources
    
 Geology
  - 41 -




---



##### 



Mineral Resources
 Corner Bay Deposit, Audit of Mineral Resources
 Cautionary Note to U.S.Investors concerning estimates of Measured and Indicated Resources.
 Tons (short)
    
    Cu (%)ResourcesMeasured
    
    
    181,000
    
    
    
    5.07Indicated
    
    
    265,000
    
    
    
    5.93Total resources
    
    
    446,000
    
    
    
    5.58
 
 Notes:(1)
    
    Ref: GÉOSTAT Technical Report on Corner Bay, July 2006.
(Available on SEDAR: www.sedar.com) Calculation method
    
    PolygonCut off grade
    
    3.00 % CuHigh-grade cut (Cu)
    
    12.00 % Cu.Dilution
    
    Long hole: 15% Shrinkage: 20%Mill recovery (Cu)
    
    95%Price assumption (Cu)
    
    1.25US$/poundExchange rate CAN $/US$
    
    0.833
 - 42 -




---



##### 



Inferred Resources
 Cautionary Note to U.S.Investors concerning estimates of inferred resources.
 Tons (short)
    
    Cu (%)ResourcesInferred
    
    
    1,441,000
    
    
    
    6.76
 
 Notes:(1)
    
    Ref: GÉOSTAT Technical Report on Corner Bay, July 2006.
(Available on SEDAR: www.sedar.com) Calculation method
    
    PolygonCut off grade
    
    3.00 % CuHigh-grade cut (Cu)
    
    12.00 % Cu.Dilution
    
    Long hole: 15% Shrinkage: 20%Mill recovery (Cu)
    
    95%Price assumption (Cu)
    
    1.25US$/poundExchange rate CAN $/US$
    
    0.833
 
 Royalties
  
 The Cedar Bay Property
    - 43 -




---



##### 



The Merrill Pit
 
 Location and Title
  
 History
  
 Properties of GéoNova
   - 44 -




---



##### 



Berthiaume Syndicate
  
 Property, Location and Access
  
 Geology
   - 45 -




---



##### 



The Pitt Gold Property
       - 46 -




---



##### 



Location, Access and Ownership
  
 Geology
   
 ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS
 
 Managements Discussion and Analysis
 www.sedar.com
  Highlights
  - 47 -




---



##### 




    
    Executed, along with subsidiaries GéoNova and MSV Resources, its obligations pursuant to
the Plans of Arrangement with creditors and exited from protection under the CCAA. An
extension of CCAA protection was granted by the Court for subsidiary Meston Resources.
    
    Entered into a three year off take contract effective January 1, 2007 with Ocean
Partners UK Limited (Ocean Partners) for the sale of its concentrate. In February 2008,
the contract was extended to December 31, 2013.
    
    Sold the Eastmain Mine property for $4.1 million pursuant to the Companys obligations
under the Plan of Arrangement.
    
    Sold the Chevrier property for $1.5 million.
    
    Raised $16.1 million in convertible debt and equity, including:
 o
    
    $7.0 million in flow-through shares and $4.0 million in guaranteed
convertible debentures to complete development of the high-grade Corner Bay copper
deposit;o
    
    $3.0 million in flow-through shares for its exploration program;o
    
    $2.1 million in convertible demand debenture.
 Mining and development
 
    
    Awarded the contract for Corner Bay development to CMAC-Thyssen, who began mine
development in May.
    
    Began development and shipment of Corner Bay ore to the Copper Rand mill in early 2008.
    
    Implemented the Alimak mining system to increase ore production and improve ground
conditions at the Copper Rand Mine.
    
    Increased throughput at the Copper Rand Mill by 69% over 2006 to 261,650 tons of ore.
    
    Received the final permits from the Quebec Ministry of Environment to allow mining of
the Merrill Pit in line with the Companys strategy of developing satellite deposits to
provide additional feed for the Copper Rand Mill.
    
    Began production from the Merrill Pit in October 2007.
    
    Placed the Joe Mann Mine on care and maintenance in September 2007 and in discussions as
to its potential sale.
    
    Increased total metal production over 2006 as follows: copper by 34%, silver by 18%.
    
    Commissioned the paste backfill plant and completed the back filling of mined-out areas
to stabilize ground conditions at the Copper Rand Mine.
 Creditor protection and restructuring
    - 48 -




---



##### 



-
    
    2 million common shares of the Company upon commencement of the provision of services;-
    
    1 million common shares of the Company upon completion of the equity financing; and-
    
    $25,000 plus 200,000 common shares of the Company per month, in advance (up to a
maximum of 4 million common shares).
    Summary
 Development
    - 49 -




---



##### 



Exploration
  Copper Rand Mill
  Write-downs
  - 50 -




---



##### 



Recent property transactions
  " "
 Recent financing initiatives
    Selected annual information
 (Expressed in thousands of Canadian dollars except perSummary operating results data
    
    share amounts and unless otherwise indicated)Years ended December 31
    
    2007
    
    
    2006
    
    
    2005Gross metal sales
    
    $
    26,792
    
    
    $
    11,925
    
    
    $
    19,915Mining expenses
    
    $
    38,260
    
    
    $
    13,897
    
    
    $
    16,346
 - 51 -




---



##### 



(Expressed in thousands of Canadian dollars except perSummary operating results data
    
    share amounts and unless otherwise indicated)Years ended December 31
    
    2007
    
    
    2006
    
    
    2005Property write down
    
    
    -0-
    
    
    $
    25,001
    
    
    $
    18,512Net loss
    
    $
    18,988
    
    
    $
    41,195
    
    
    $
    24,430Net loss per share
    
    $
    0.05
    
    
    $
    0.27
    
    
    $
    0.23Years ended December 31
    
    
    2007
    
    
    
    2006
    
    
    
    2005Summary balance sheet dataTotal assets
    
    $
    65,350
    
    
    $
    115,142
    
    
    $
    134,643Long-term financial liabilities (1)
    
    $
    21,025
    
    
    $
    65,357
    
    
    $
    67,782Other dataShort tons produced (in 2005 and 2006,
from Joe Mann Mine only)
    
    
    261,650
    
    
    
    80,639
    
    
    
    139,064Sales revenue per ton ($/ton)
    
    $
    102.40
    
    
    $
    147.88
    
    
    $
    143.21Mining expenses per ton ($/ton)
    
    $
    146.23
    
    
    $
    172.34
    
    
    $
    117.54Ounces of gold sold
    
    
    15,380
    
    
    
    13,816
    
    
    
    30,460Average selling price ($/oz Au)
    
    $
    711
    
    
    $
    682
    
    
    $
    539Production costs ($/oz Au) (2)
    
    
    N/A
    
    
    $
    927
    
    
    $
    517Grade (oz/t Au)
    
    
    0.072
    
    
    
    0.207
    
    
    
    0.254Recovery
    
    
    81.83
    %
    
    
    84.87
    %
    
    
    83.36
    %Average selling price ($/lb Cu) (2)
    
    $
    3.35
    
    
    
    N/A
    
    
    
    N/AProduction costs ($/lb Cu)
    
    $
    5.71
    
    
    
    N/A
    
    
    
    N/AGrade (% Cu)
    
    
    0.99
    %
    
    
    N/A
    
    
    
    N/ARecovery
    
    
    95.94
    %
    
    
    N/A
    
    
    
    N/A
 
 (1)
    
    Long-term debt including current portion of long-term debt(2)
    
    The Company is now considered as a copper producer having the Copper Rand Mine in
commercial production and having ceased operations at the Joe Mann Mine in September 2007. Results of operations
  Sales
    
    2007
    
    
    2006
    
    
    2005Quantities
    
    
    000 $
    
    
    Quantities
    
    
    000 $
    
    
    Quantities
    
    
    000 $Gold (ounces)
    
    
    15,380
    
    
    
    11,007
    
    
    
    13,816
    
    
    
    9,795
    
    
    
    30,460
    
    
    
    17,818Copper (lbs)
    
    
    4,601,598
    
    
    
    15,514
    
    
    
    440,000
    
    
    
    1,973
    
    
    
    903,000
    
    
    
    2,039Silver (ounces)
    
    
    19,394
    
    
    
    238
    
    
    
    9,282
    
    
    
    120
    
    
    
    22,286
    
    
    
    194Gain (Loss) on
foreign exchange
    
    
    
    
    
    
    33
    
    
    
    
    
    
    
    37
    
    
    
    
    
    
    
    (136
    )Total
    
    
    
    
    
    
    26,792
    
    
    
    
    
    
    
    11,925
    
    
    
    
    
    
    
    19,915
 - 52 -




---



##### 



Fiscal years ended December 31, 2007 and December 31, 2006
  
    
    Ore tonnage was reduced by 17% at Joe Mann from 80,639 tons in 2006 to 67,292 tons
in 2007; gold grade was also reduced by 13% from 0.207 oz/t in 2006 to 0.181 oz/t in
2007.
    
    Ore tonnage increased by 69% at Copper Rand from 76,250 tons in 2006 to 129,161 tons
in 2007; copper grade was reduced by 23% from 2.19% in 2006 to 1.69% in 2007.
    
    Ore tonnage from Merrill Pit was 65,197 tons with a copper grade of 0.39% compared
to nil in 2006.
    
    Average selling price per ounce of gold increased by 4% from $682 ($601 US) in 2006
to $711 ($686 US) in 2007.
    
    Average selling price per pound of copper decreased from $3.72 ($3.29 US) in 2006 to
$3.35 ($3.37 US) in 2007. The strength of the Canadian dollar vis-à-vis the US dollar
had a major impact on revenue.
  
    
    In 2006, the Copper Rand production costs of $16 million were capitalized as development
costs.
    
    Additional expenses totalling $8.4 million were incurred in implementing the Alimak
mining method, developing access to different mining zones, commissioning the backfill
plant and backfilling all mined open stopes as well as by an increase in maintenance
expenses, the re-initiation of a definition drilling program and high rehabilitation costs
following the rock fall in the main ramp at the end of February 2007.
     - 53 -




---



##### 



Fiscal years ended December 31, 2006 and December 31, 2005
       - 54 -




---



##### 



Summary of quarterly results
  Q-1
    
    
    Q-2
    
    
    Q-3
    
    
    Q-42007Gross metal sales (in thousands of dollars)
    
    $
    1,714
    
    
    $
    1,482
    
    
    $
    14,201
    
    
    $
    9,395Loss from operations (in thousands of dollars)
    
    $
    (5,535
    )
    
    $
    (5,037
    )
    
    $
    (4,749
    )
    
    $
    (9,632
    )Net loss (in thousands of dollars)
    
    $
    (1,745
    )
    
    $
    (4,341
    )
    
    $
    (3,940
    )
    
    $
    (8,962
    )Basic and fully diluted loss from operations
per share
    
    $
    (0.02
    )
    
    $
    (0.01
    )
    
    $
    (0.01
    )
    
    $
    (0.02
    )
 - 55 -




---



##### 



Q-1
    
    
    Q-2
    
    
    Q-3
    
    
    Q-4Basic and diluted net loss per share
    
    $
    (0.01
    )
    
        $
    (0.01
    )
    
        $
    (0.01
    )
    
        $
    (0.02
    )2006Gross metal sales (in thousands of dollars)
    
    $
    2,644
    
    
    $
    3,840
    
    
    $
    2,267
    
    
    $
    3,174Loss from operations (in thousands of dollars)
    
        $
    (2,501
    )
    
        $
    (1,888
    )
    
        $
    (4,262
    )
    
        $
    (33,030
    )Net loss (in thousands of dollars)
    
        $
    (2,298
    )
    
    $
    (1,755
    )
    
        $
    (4,902
    )
    
        $
    (32,240
    )Basic and fully diluted loss from operations
per share
    
        $
    (0.02
    )
    
        $
    (0.02
    )
    
        $
    (0.04
    )
    
        $
    (0.20
    )Basic and diluted net loss per share
    
        $
    (0.02
    )
    
    $
    (0.02
    )
    
        $
    (0.04
    )
    
        $
    (0.19
    )
 Summary of production data
 Joe Mann Mine
    Q-1
    
    
    Q-2
    
    
    Q-3
    
    
    Q-42007Tons produced
    
    
    16,744
    
    
    
    28,083
    
    
    
    22,465
    
    

    NilGradesAu (oz./t)
    
    
    0.218
    
    
    
    0.171
    
    
    
    0.167Cu (%)
    
    
    0.21
    
    
    
    0.23
    
    
    
    0.22Ag (oz./t)
    
    
    0.157
    
    
    
    0.161
    
    
    
    0.143RecoveryAu (%)
    
    
    82.60
    
    
    
    82.51
    
    
    
    83.07Cu (%)
    
    
    92.86
    
    
    
    95.15
    
    
    
    93.81Ag (%)
    
    
    59.55
    
    
    
    59.02
    
    
    
    61.16Metal producedAu (oz.)
    
    
    3,019
    
    
    
    3,952
    
    
    
    3,121Cu (lbs)
    
    
    66,435
    
    
    
    122,065
    
    
    
    92,861Ag (oz.)
    
    
    1,564
    
    
    
    2,670
    
    
    
    1,9622006Tons produced
    
    
    22,556
    
    
    
    23,006
    
    
    
    16,808
    
    
    
    18,269GradesAu (oz./t)
    
    
    0.186
    
    
    
    0.215
    
    
    
    0.194
    
    
    
    0.237Cu (%)
    
    
    0.32
    
    
    
    0.33
    
    
    
    0.25
    
    
    
    0.23Ag (oz./t)
    
    
    0.177
    
    
    
    0.185
    
    
    
    0.139
    
    
    
    0.167
 - 56 -




---



##### 



Q-1
    
    
    Q-2
    
    
    Q-3
    
    
    Q-4RecoveryAu (%)
    
    
    82.72
    
    
    
    86.08
    
    
    
    84.13
    
    
    
    86.12Cu (%)
    
    
    96.79
    
    
    
    96.24
    
    
    
    95.56
    
    
    
    93.30Ag (%)
    
    
    70.23
    
    
    
    68.25
    
    
    
    65.27
    
    
    
    68.40Metal producedAu (oz.)
    
    
    3,464
    
    
    
    4,265
    
    
    
    2,695
    
    
    
    3,722Cu (lbs)
    
    
    137,963
    
    
    
    144,866
    
    
    
    79,369
    
    
    
    77,580Ag (oz.)
    
    
    2,802
    
    
    
    2,899
    
    
    
    1,528
    
    
    
    2,093
 Copper Rand Mine
   Q1
    
    
    Q2
    
    
    Q3
    
    
    Q42007
    
    Commercial productionTons produced
    
    
    22,043
    
    
    
    24,656
    
    
    
    47,758
    
    
    
    34,704GradesAu (oz./t)
    
    
    0.047
    
    
    
    0.048
    
    
    
    0.049
    
    
    
    0.038Cu (%)
    
    
    2.08
    
    
    
    1.92
    
    
    
    1.66
    
    
    
    1.32Ag (oz./t)
    
    
    0.157
    
    
    
    0.150
    
    
    
    0.144
    
    
    
    0.132RecoveryAu (%)
    
    
    85.38
    
    
    
    82.17
    
    
    
    81.11
    
    
    
    77.84Cu (%)
    
    
    97.62
    
    
    
    97.54
    
    
    
    96.64
    
    
    
    94.44Ag (%)
    
    
    67.81
    
    
    
    59.61
    
    
    
    56.19
    
    
    
    64.23Metal producedAu (oz.)
    
    
    883
    
    
    
    969
    
    
    
    1,909
    
    
    
    1,035Cu (lbs)
    
    
    895,206
    
    
    
    922,132
    
    
    
    1,533,065
    
    
    
    868,306Ag (oz.)
    
    
    2,350
    
    
    
    2,209
    
    
    
    3,869
    
    
    
    2,9362006
    
    Preproduction periodTons produced
    
    
    21,867
    
    
    
    20,969
    
    
    
    18,021
    
    
    
    15,393GradesAu (oz./t)
    
    
    0.061
    
    
    
    0.061
    
    
    
    0.044
    
    
    
    0.064Cu (%)
    
    
    2.15
    
    
    
    2.15
    
    
    
    1.66
    
    
    
    2.90Ag (oz./t)
    
    
    0.181
    
    
    
    0.165
    
    
    
    0.144
    
    
    
    0.182RecoveryAu (%)
    
    
    82.73
    
    
    
    86.01
    
    
    
    85.02
    
    
    
    85.62Cu (%)
    
    
    98.44
    
    
    
    98.44
    
    
    
    98.38
    
    
    
    97.83Ag (%)
    
    
    69.64
    
    
    
    68.75
    
    
    
    66.08
    
    
    
    70.51Metal producedAu (oz.)
    
    
    1,104
    
    
    
    1,095
    
    
    
    671
    
    
    
    846Cu (lbs)
    
    
    927,218
    
    
    
    886,229
    
    
    
    587,038
    
    
    
    874,761Ag (oz.)
    
    
    2,760
    
    
    
    2,373
    
    
    
    1,709
    
    
    
    1,980
 - 57 -




---



##### 



Merrill Pit
   Development activities
 Corner Bay Deposit
    - 58 -




---



##### 



Mineral resources
  TonnageClassification
    
    (tonnes*)
    


Cu %Measured
    
    
    181,000
    
    
    
    5.07Indicated
    
    
    265,000
    
    
    
    5.93Total
    
    
    446,000
    
    
    
    5.58Inferred
    
    
    1,441,000
    
    
    
    6.76
 (www.sedar.com)
 
 
 Liquidity and capital resources
  2007
    
    
    2006
    
    
    2005(in thousands of dollars)Long-term debt
    
    
    21,025
    
    
    
    65,357
    
    
    
    67,782Shareholders equity
    
    
    6,131
    
    
    
    12,006
    
    
    
    30,503Cash and cash equivalents
    
    
    474
    
    
    
    1,964
    
    
    
    1,772
  
    
    Guaranteed Convertible Debentures, which are accounted at the present value and
included accrued interest of $0.3 million for total value of $2.35 million;

    
    Convertible Demand Debentures for total value of $2.08 million;

    
    A Credit Facility in the amount of $15.45 million repayable in 16 quarterly
instalments of $966,000;

    
    Convertible Debentures for total value of $0.52 million;

    
    Other capital leases totalling $0.62 million.
   - 59 -




---



##### 





    
    A decrease of $19.2 million due to the net loss for the year resulting from the
operations of the Copper Rand and Joe Mann mines of $19.0 million and recent accounting
changes on financial instruments  Recognition and measurement of $0.2 million.

    
    An increase of $13.3 million mainly represented by an $11.0 million increase in
capital stock and a $0.2 million increase for warrants, stock options and conversion
rights following the three flow-through equity financings and exercise of warrants.
Contributed surplus increased by $2.1 million following the cancellation and the
expiration of warrants and options.
       Capital stock
 Managements Discussion
and Analysis
 Expiry
    
    Exercisedate
    
    price
    
    Total
    
    TotalCommon shares
    
    
    
    
    
    
    
    432,604,881Share purchase option
    
    October 14, 2008
    
    0.80
    
    20,000May 31, 2009
    
    0.64
    
    370,000August 16, 2011
    
    0.15
    
    3,750,000May 9, 2012
    
    0.15
    
    200,000August 8, 2012
    
    0.16
    
    2,350,000
    
    6,690,000WarrantsMay 26, 2008
    
    0.15
    
    111,188,578
 - 60 -




---



##### 



Expiry
    
    Exercisedate
    
    price
    
    Total
    
    TotalOctober 23, 2008
    
    0.13
    
    3,360,000December 22, 2008
    
    0.105
    
    150,000January 18, 2009
    
    0.10
    
    63,807,429
    
    178,506,007
  Critical accounting principles
  Impairment of long-lived assets
  Depreciation and amortization
  Financial instruments
  Fair value
  - 61 -




---



##### 



Interest rate risk
  Credit risk
   Asset retirement obligations
  Revenue recognition
   - 62 -




---



##### 



Stripping costs
   Recent accounting changes for Canadian GAAP
 2007
 Financial instruments  Recognition and measurement
 Financial Instruments -
Recognition and Measurement
  
    
    Cash and cash equivalents and restricted cash are classified as financial assets
held for trading and are measured at fair value. Changes in fair value are charged
to earnings.
    
    Short-term investments are classified as available for sale and are
marked-to-market through comprehensive loss at each period end.
    
    Receivables and settlements receivable are classified as loans and receivables
and are initially measured at fair value and, subsequently, recorded at amortized
cost using the effective interest rate method.
    
    Short-term loans, accounts payable, accrued liabilities, prepayments for
concentrate inventory shipped and long-term debt are classified as other liabilities
and are initially measured at fair value and, subsequently, recorded at amortized
cost using the effective interest rate method.
    
    Embedded derivatives that have been bifurcated from their host contract are
grouped on the balance sheet with the host contract. Embedded derivatives are
classified as held for trading, with variations in fair value recognized in
earnings.
 - 63 -




---



##### 



Financial instruments  Disclosure and presentation
 Financial Instruments -
Disclosure and Presentation
 Comprehensive income
 Comprehensive Income.
  Equity
 Equity, Surplus Comprehensive Income
 Hedges
 Hedges Hedging Relationships
 - 64 -




---



##### 



Accounting changes
 Accounting Changes
 Future accounting changes
 Capital disclosures
 Capital Disclosures
  Financial instruments  Disclosure and Financial instruments  Presentation
 Financial Instruments  Disclosure Financial Instruments  Presentation Financial Instruments  Disclosure and
Presentation
  Inventories
 Inventories,
 - 65 -




---



##### 




    
    Inventories be valued at the lower of cost and net realizable value, with
disclosure of the basis of determining the cost of inventory, including information
relating to overhead and other costs charged to the cost of inventory.
    
    First in  first out or weighted average cost method be systematically used to
evaluate cost of inventory.
    
    Major spare parts to be classified as property, plant and equipment.
    
    Write-downs recorded in prior years have to be reversed whenever an increase in
fair value occurs.
    
    Requirement to disclose the value of inventory charged to earnings during the
period.
  General standards of financial statement presentation
 General Standards of Financial Statement Presentation
  Goodwill and intangible assets
 Goodwill and Intangible Assets, Goodwill and Other Intangible Assets, Research and Development Costs, Revenue and
Expenditures During the Pre-operating Period, Entreprises in
the Development Stage
  International financial reporting standards
  - 66 -




---



##### 



Tabular disclosure of contractual obligations
  Payments due by period
 Contractual obligations
    
    
    
    
    
    Less than 1
    
    
    
    
    
    
    
    
    
    
    More than 5(in million dollars)
    
    Total
    
    
    year
    
    

1-3 years
    
    

4-5 years
    
    
    yearsLongterm debt obligations
    
    
    21.0
    
    
    
    18.3
    
    
    
    2.7
    
    
    
    
    
    
    
    Pension plan actuarial deficit (2)
    
    
    5.9
    
    
    
    0.7
    
    
    
    1.4
    
    
    
    1.3
    
    
    
    2.5Asset retirement obligations(1)
    
    
    4.4
    
    
    
    0.2
    
    
    
    0.9
    
    
    
    0.1
    
    
    
    3.2Total
    
    
    31.3
    
    
    
    19.2
    
    
    
    5.0
    
    
    
    1.4
    
    
    
    5.7
 
 Notes:(1)
    
    Asset retirement obligations exclude obligations assumed by the Copper Rand/Portage Fiduciary Fund in
the amount of $3.0 million.(2)
    
    Based on December 31, 2005 actuarial valuation. Risk factors
    - 67 -




---



##### 



Subsequent Events
    - 68 -




---



##### 



Outlook
 Copper Rand Mine
  Corner Bay
   Merrill Pit
   Financial reporting controls and procedures
  - 69 -




---



##### 



ITEM 6. DIRECTORS, SENIOR MANAGEMENT AND EMPLOYEES
 
 A. Directors and Senior Management
 
 Directors
  Number andPercentage ofCommonSharesBeneficiallyName, Residence and
    
    Director
    
    
    
    
    
    Owned orOffice Held
    
    Since
    
    Principal Occupation
    
    Age
    
    ControlledLouis Archambault(2)(3)(4)
    
    2001
    
    President, Groupe Conseil Entraco
    
    57
    
    6,000 (6)Montréal, Québec, Canada
    
    
    
    Inc., Montréal, Québec,
    
    
    
    (0.001%)Director
    
    
    
    environmental consulting firm.Graham G. Clow(1)(4)
    
    1996
    
    Managing Director, Scott Wilson
    
    57
    
    130,250(13)Toronto, Ontario, Canada
    
    
    
    Mining Group, Toronto, Ontario,
    
    
    
    (0.03%)Director
    
    
    
    mining consultants;Director of Baffinland Iron MinesCorporationAndré Y. Fortier(5)
    
    2000
    
    President and Chief Executive
    
    67
    
    2,122,439 (7)Montréal, Québec, Canada
    
    
    
    Officer of Campbell;
    
    
    
    (0.49%)President and Chief Executive
    
    
    
    Prior to June 2001: Chairman andOfficer and Director
    
    
    
    Chief Executive Officer of MSVResources Inc. and President andChief Executive Officer of Géonova;Director of Excellon Resources Inc.and Norcast Income FundRené R. Galipeau
    
    2006
    
    Vice-Chairman and Chief Executive
    
    62
    

    1,655,030 (8)Toronto, Ontario, Canada
    
    
    
    Officer of Nuinsco and Victory
    
    
    
    (0.38%)Director
    
    
    
    Nickel Inc.;Director of Wallbridge MiningCompany Limited;Formerly Executive Vice-Presidentand Chief Financial Officer ofBreakwater Resources Ltd., a basemetals company, to early 2004; andSenior Vice-President and ChiefFinancial Officer of HMZ Metals Inc.from September 2004 to February 2006W. Warren Holmes
    
    2006
    
    Chairman of Nuinsco and Victory
    
    65
    
    2,968,299 (9)Timmins, Ontario, Canada
    
    
    
    Nickel Inc., formerly Chief
    
    
    
    (0.69%)Director
    
    
    
    Executive Officer of Nuinsco, MiningExecutive;
 - 70 -




---



##### 



Number andPercentage ofCommonSharesBeneficiallyName, Residence and
    
    Director
    
    
    
    
    
    Owned orOffice Held
    
    Since
    
    Principal Occupation
    
    Age
    
    ControlledPrior to July 2002, SeniorVice-President, Canadian MiningOperations, Falconbridge Ltd., abase metals producer.James C. McCartney Q.C.(1) (2)(3)
    
    1993
    
    Chairman of Campbell;
    
    70
    
    22,500 (10)Toronto, Ontario, Canada
    
    
    
    
    
    
    
    (0.001%)DirectorCounsel, McCarthy Tétrault LLP,Toronto, Ontario, law firm; 40 yearsas a practising lawyer in corporatefinance and mergers andacquisitions;Director and SecretaryTreasurer,Labrador Iron Ore Royalty IncomeFund;Director, Iron Ore Company of Canada;Prior to January 2003, Partner andPast Chairman, McCarthy TétraultLLP.G.E. Kurt Pralle(1)
    
    1993
    
    Mining and Metallurgical Consultant
    
    73
    
    10,000 (11)Ramsey, New Jeyser, United States
    
    
    
    
    
    
    
    (0.002%)DirectorJames D. Raymond(2)(5)
    
    1979
    
    Private Investor
    
    83
    
    0 (12)Montréal, Québec, Canada
    
    
    
    
    
    
    
    (0%)Director
 
 Notes:(1)
    
    Member of the Audit Committee.(2)
    
    Member of the Compensation Committee.(3)
    
    Member of the Corporate Governance Committee.(4)
    
    Member of the Environmental Committee.(5)
    
    Member of the Executive Committee.(6)
    
    Excludes 375,000 shares of the Company subject to options.(7)
    
    Excludes 1,100,000 shares of the Company subject to options.(8)
    
    Excludes 350,000 shares of the Company subject to options.(9)
    
    Excludes 350,000 shares of the Company subject to options.(10)
    
    Excludes 450,000 shares of the Company subject to options.(11)
    
    Excludes 375,000 shares of the Company subject to options.(12)
    
    Excludes 375,000 shares of the Company subject to options.(13)
    
    Excludes 375,000 shares of the Company subject to options.  - 71 -




---



##### 



Senior Management
  Yearappointed to
    
    Other Positions andName
    
    Office
    
    Office
    
    Business Experience
    
    AgeAndré Y. Fortier
    
    President and Chief Executive Officer
    
    2000
    
    Business Executive(1)
    
    67Réal Savoie
    
    Vice-President, Finance
    
    2006
    
    C.G.A.
    
    54Alain Blais
    
    Vice President and General Manager
    
    2001
    
    Geologist(2)
    
    52Sébastien Vézina
    
    Secretary
    
    2008(3)
    
    Lawyer(4)
    
    34
 
 Notes:(1)
    
    See description of Principal Occupation and Business Experience under subsection entitled Directors.(2)
    
    Prior to the merger in June 2001, Mr. Blais was Vice President, Geology & Development with MSV Resources Inc. and has worked as a geologist in Chibougamau
since 1979.(3)
    
    Sébastien Vézina replaced Mr. Michel Blouin as Secretary of the Corporation on February 28, 2008.(4)
    
    Mr. Vézina is a partner at the law firm Lavery, de Billy, L.L.P.    
 B. Compensation
 
 Executive Compensation
 Named Executive Officers
  §
    
    each Chief Executive Officer;§
    
    each Chief Financial Officer;§
    
    each of the Companys three most highly compensation executive officers, other than the
Chief Executive Officer and the Chief Financial Officer, who were serving as executive
officers at the end of the most recently completed financial year and whose total salary
and bonus exceeds $150,000; and
 - 72 -




---



##### 



§
    
    any additional individuals for whom disclosure would have been provided under (c) except
that the individual was not serving as an officer of the Company at the end of the most
recently completed financial year-end.
   Summary Compensation Table
 Long-Term CompensationAwards
    
    
    PayoutsSecuritiesUnder
    
    
    RestrictedAnnual Compensation
    
    
    Options /
    
    
    Shares orName and
    
    
    
    
    
    
    
    
    
    
    
    
    
    Other Annual
    
    
    SARs
    
    
    Restricted
    
    
    LTIP
    
    
    All OtherPrincipal
    
    
    
    
    
    Salary
    
    
    Bonus
    
    
    Compensation
    
    
    Granted
    
    
    Share Units
    
    
    Payouts
    
    
    CompensationPosition
    
    Year
    
    
    ($)
    
    
    ($)
    
    
    ($)
    
    
    (#)
    
    
    ($)
    
    
    ($)
    
    
    ($)André Y. Fortier
    
    
    2007
    
    
    
    235,000
    
    
    
    
    
    
    
    19,000
    
    
    
    400,000
    
    
    
    
    
    
    
    
    
    
    
    14,973President
and Chief Executive Officer
    
    
    2006
    
    
    
    235,000
    
    
    
    
    
    
    
    18,000
    
    
    
    600,000
    
    
    
    
    
    
    
    
    
    
    
    14,8662005
    
    
    
    229,845
    
    
    
    
    
    
    
    16,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,165Claude Bégin(1)
    
    
    2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Former Executive Vice President &
    
    
    2006
    
    
    
    95,008
    
    
    
    3,303
    
    
    
    18,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    14,866Chief Operating Officer
    
    
    2005
    
    
    
    138,000
    
    
    
    5,035
    
    
    
    16,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    16,165Alain Blais
    
    
    2007
    
    
    
    153,892
    
    
    
    7,982
    
    
    
    19,000
    
    
    
    200,000
    
    
    
    
    
    
    
    
    
    
    
    11,923Vice President and General Manager
    
    
    2006
    
    
    
    114,893
    
    
    
    7,179
    
    
    
    18,000
    
    
    
    200,000
    
    
    
    
    
    
    
    
    
    
    
    9,8952005
    
    
    
    107,200
    
    
    
    7,021
    
    
    
    16,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    10,009Lucie Brun(2)
    
    
    2007
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Former Executive Vice President &
    
    
    2006
    
    
    
    61,347
    
    
    
    5,923
    
    
    
    18,000
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    9,048Chief Administrative Officer
    
    
    2005
    
    
    
    110,000
    
    
    
    6,207
    
    
    
    16,500
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    12,255Réal Savoie(3)
    
    
    2007
    
    
    
    118,077
    
    
    
    
    
    
    
    19,000
    
    
    
    200,000
    
    
    
    
    
    
    
    
    
    
    
    4,400Vice President, Finance
    
    
    2006
    
    
    
    96,231
    
    
    
    
    
    
    
    16,818
    
    
    
    200,000
    
    
    
    
    
    
    
    
    
    
    
    1,8692005
    
    
    
    77,404
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    1,391
 
 Notes:(1)
    
    Resigned on June 30, 2006.(2)
    
    Resigned on September 30, 2006.(3)
    
    Appointed on August 9, 2006. - 73 -




---



##### 



Bonus or Profit-Sharing Plans and Stock Options
 
 Options / Stock Appreciation Rights (SAR) Granted during the Most Recent Financial Year
  Market Value ofSecurities% of Total
    
    
    
    UnderlyingSecurities under
    
    Options Granted
    
    Exercise or Base
    
    Options on theOptions Granted
    
    to Employees in
    
    Price ($) /
    
    Date of Grant ($)/Name
    
    (#)
    
    2007(2)
    
    Common Share
    
    Common Share
    
    Expiration DateAndré Y. Fortier
President and Chief Executive Officer
    
    400,000 (1)
    
    14.03
    
    0.16
    
    0
    
    August 8, 2012Alain Blais
Vice President and General Manager
    
    200,000 (1)
    
    7.02
    
    0.16
    
    0
    
    August 8, 2012Réal Savoie
Vice President, Finance
    
    200,000 (1)
    
    7.02
    
    0.16
    
    0
    
    August 8, 2012
 
 Notes:(1)
    
    Granted pursuant to the Share Option Plan as defined herein.(2)
    
    A total of 2,850,000 options were granted to employees of the Company pursuant to the Employee Incentive Plan, as defined herein
and pursuant to the Directors Stock Option Plan, as defined herein, in 2007. 
 Aggregate Options Exercised During the Most Recent Financial Year and Year End Option Value
  Value of Unexercised in-the-Unexercised Options/SARs as
    
    Money Options/SARsSecurities
    
    
    
    at December 31, 2007
    
    as at December 31, 2007Acquired on
    
    Aggregate
    
    (#)
    
    ($)(2)Exercise
    
    Value Realized
    
    
    
    
    
    Exercisable
    
    UnexercisableName
    
    (#)
    
    ($)(1)
    
    Exercisable
    
    Unexercisable
    
    ($)
    
    ($)André Y. Fortier
President and Chief Executive Officer
    
    Nil
    
    N/A
    
    1,100,000
    
    Nil
    
    Nil (3)
    
    
    N/AAlain Blais
Vice President and General Manager
    
    Nil
    
    N/A
    
    450,000
    
    Nil
    
    Nil (3)
    
    
    N/ARéal Savoie
Vice President Finance
    
    Nil
    
    N/A
    
    400,000
    
    Nil
    
    Nil (3)
    
    
    N/A
 - 74 -




---



##### 



Notes:(1)
    
    Aggregate Value Realized is the difference between the market price of the Companys Common Shares on the date of exercise and the option
exercise price, multiplied by the number of common shares acquired.(2)
    
    Value of Unexercised Options is equal to the difference between the closing price of the Common Shares of the Company on the TSX on December
31, 2007 and the exercise prices of options outstanding, multiplied by the number of shares purchasable under such options.(3)
    
    None of the options held by the Named Executive Officer was in-the-money as at December 31, 2007. 
 Securities Authorized for Issuance Under Equity Compensation Plans
  Equity Compensation Plan Information
 Number of Common SharesNumber of CommonShares
    
    
    Weighted Average Exercise
    
    
    Remaining Available forto be Issued Upon Exercise
    
    
    Price of Outstanding
    
    
    Future Issuance Under thePlan Category
    
    of Outstanding Option
    
    
    Options
    
    
    Equity Compensation PlansEquity Compensation
Plans of the
Company approved by
the shareholders
    
    
    7,165,000
    
    
    
    0.18
    
    
    
    685,000Equity Compensation
Plans of the
Company not
approved by the
shareholders
    
    
    0
    
    
    
    N/A
    
    
    
    0Total:
    
    
    7,165,000
    
    
    
    
    
    
    
    685,000
 
 C. Board Practices
 
 Date of expiration of current term of office
  
 Directors Service Contracts
   - 75 -




---



##### 



Audit Committee
 
 Audit Committee Charter
  
 Composition of Audit Committee
 Name
    
    Independent
    
    
    Financially LiterateGraham G. Clow
    
    Yes
    
    YesJames C. McCartney
    
    Yes
    
    YesG.E. Kurt Pralle
    
    Yes
    
    Yes
       - 76 -




---



##### 



Audit Committee Oversight
  
 Pre-Approval Policies and Procedures
  
 Compensation Committee
 
 Composition of the Compensation Committee
  
 Executive Compensation Philosophy and Policy
   Base Salary:
 - 77 -




---



##### 



Annual Incentive Compensation:
 Stock Option Programs:
 
 Report on Executive Compensation
  
 Statement of Corporate Governance Practices
  Form 58-101-F1 - Corporate GovernanceDisclosure
    
    
    

The Companys Practices1.
    
    Board of Directorsa)
    
    Disclose the identity of
directors who are independent.
    
    The Board of Directors
was composed of nine
directors until Michel
Blouins resignation
on December 11, 2007.
The remaining eight
persons, Louis
Archambault, Graham G.
Clow, James C.
McCartney, G.E. Kurt
Pralle, René R.
Galipeau, W. Warren
Holmes and James D.
Raymond are
independent. These
directors are
independent as none of
them has a direct or
indirect material
relationship with the
Company.b)
    
    Disclose the identity of
directors who are not independent,
and describe the basis for that
determination.
    
    The other director is
André Y. Fortier that
is not independent as
he holds the position
of President and Chief
Executive Officer.c)
    
    Disclose whether or not a
majority of directors are
independent. If a majority of
directors are not independent,
describe what the board of
directors (the board)
    
    A majority of the
Companys Directors
are independent.
 - 78 -




---



##### 



Form 58-101-F1 - Corporate GovernanceDisclosure
    
    
    

The Companys Practicesdoes to
facilitate its exercise of
independent judgement in carrying
out its responsibilities.d)
    
    If a director is presently a
director of any other issuer that
is a reporting issuer (or the
equivalent) in a jurisdiction or a
foreign jurisdiction, identify both
the director and the other issuer.
    
    André Y. Fortier is
also a director of
Excellon Resources,
Inc. and Norcast
Income Fund. 
Graham G. Clow is also
director of Baffinland
Iron Mines
Corporation. 
René R. Galipeau is
also director of
Nuinsco Resources
Limited and Victory
Nickel Inc. 
W. Warren Holmes is
also Chairman of
Nuinsco Resources
Limited and Victory
Nickel Inc.e)
    
    Disclose whether or not the
independent directors hold
regularly scheduled meetings at
which non-independent directors and
members of management are not in
attendance. If the independent
directors hold such meetings,
disclose the number of meetings
held since the beginning of the
issuers most recently completed
financial year. If the independent
directors do not hold such
meetings, describe what the board
does to facilitate open and candid
discussion among its independent
directors.
    
    When required, the
independent Directors
hold scheduled
meetings at which
non-independent
Directors and members
of management are not
in attendance. In
2007, no such meetings
was held.f)
    
    Disclosure whether or not the
chair of the board is an
independent director. If the board
has a chair or lead director who is
an independent director, disclose
the identity of the independent
chair or lead director, and
describe his or her role and
responsibilities. If the board has
neither a chair that is independent
nor a lead director that is
independent, describe what the
board does to provide leadership
for its independent directors.
    
    James C. McCartney
serves as
non-executive Chair of
the Board. He has
served in that
position since April
26, 1995.g)
    
    Disclose the attendance record
of each director for all board
meetings held since the beginning
of the issuers most recently
completed financial year.
    
    All Directors attended
all Board meetings,
except James C.
McCartney, W. Warren
Holmes, Michel Blouin
(who resigned on
December 11, 2007) and
Louis Archambault who
were each absent from
one meeting and Graham
G. Clow who was absent
from two meetings.2.
    
    Board Mandate
 - 79 -




---



##### 



Form 58-101-F1 - Corporate GovernanceDisclosure
    
    
    

The Companys Practicesa)
    
    Disclose the text of the boards
written mandate. If the board does
not have a written mandate,
describe how the board delineates
its role and responsibilities.
    
    The Boards mandate is
set forth in the
Governance Policy of
the Company, a copy of
which is attached
hereto as Exhibit
15.4.3.
    
    Position Descriptionsa)
    
    Disclose whether or not the
board has developed written
position descriptions for the chair
and the chair of each board
committee. If the board has not
developed written position
descriptions for the chair and/or
the chair of each board committee,
briefly describe how the board
delineates the role and
responsibilities of each such
position.
    
    The Board has
developed written
position descriptions
for the Chair of the
Board and the Chair of
each Board committees.
These descriptions are
set forth in the
Governance Policy of
the Corporation, a
copy of which is
attached hereto as
Exhibit 15.4.b)
    
    Disclose whether or not the
board and CEO have developed a
written position description for
the CEO. If the board and CEO have
not developed such a position
description, briefly describe how
the board delineates the role and
responsibilities of the CEO.
    
    The Board and the
Chief Executive
Officer have developed
a written position
description for the
Chief Executive
Officer. This
description is set
forth in the
Governance Policy of
the Company, a copy of
which is attached
hereto as Exhibit
15.4.4.
    
    Orientation and Continuing Educationa)
    
    Briefly describe what measures
the board takes to orient new
directors regarding
    
    Orientation and
education of directors
is an ongoing matter. As such, ongoing
informal discussions between management and
members of the Board
is encouraged and
formal presentations
by management
throughout the year in
addition to regularly
scheduled site visits
to the Companys
operations are
mandated.i) the role of the board, its committees
and its directors,    andii) the nature and operation of the
issuers business.b)
    
    Briefly describe what measures,
if any, the board takes to provide
continuing education for its
directors. If the board does not
provide continuing education,
describe how the board ensures that
its directors maintain the skill
and knowledge necessary to meet
their obligations as directors.
    
    Orientation and
education of directors
is an ongoing matter.
As such, ongoing
informal discussions
between management and
members of the Board
is encouraged and
formal presentations
by management
throughout the year in
addition to regularly
scheduled site visits
to the Companys
operations are
mandated.5.
    
    Ethical Business Conducta)
    
    Disclose whether or not the
board has adopted a written code
for the directors, officers and
employees. If the board has
    
    The Board has adopted
a written Code of
Conduct for directors,
officers and
employees.
 - 80 -




---



##### 



Form 58-101-F1 - Corporate GovernanceDisclosure
    
    
    

The Companys Practicesadopted a written code:i)    disclose how a person or
Corporation may obtain a copy of
the code;
    
    A copy of the Code of
Conduct is attached
hereto as Exhibit
11.1.ii)   describe how the board monitors
compliance with its code, or if the
board does not monitor compliance,
explain whether and how the board
satisfies itself regarding
compliance with its code and
    
    Employees, officers
and directors must
confirm having read
and understood the
Code of Conduct and
the Company has
implemented a
complaint procedure
which allows employees
to report any conduct
that is not compliant
with the Code of
Conduct on an
anonymous and/or
confidential basis.
Mid-level and upper
levels of management
are required to report
to senior management
any instances of
fraud, illegal acts
and compliance issues.
When situations of
non-compliance have
become known to
management,
appropriate
disciplinary action
has been taken.iii)  provide a cross-reference to
any material change report filed
since the beginning of the issuers
most recently completed financial
year that pertains to any conduct
of a director or executive officer
that constitutes a departure from
the code.
    
    The Company has not
filed any material
change report during
the financial year
ended December 31,
2007 that pertains to
any conduct of a
Director or executive
officer that
constitutes a
departure from the
Code of Conduct. No
waivers from the Code
of Conduct have been
sought or granted.b)
    
    Describe any steps the board
takes to ensure directors exercise
independent judgement in
considering transactions and
agreements in respect of which a
director or executive officer has a
material interest.
    
    In the event any
transactions or
agreements occur in
respect of which a
Director or executive
officer has a material
interest, the matter
must be initially
reviewed by the Audit
Committee and is then
submitted to the Board
of Directors. The
Board may implement
any measures that it
finds necessary in
order to ensure the
exercise of
independent judgment.
In the event a
Director has a
material interest in
any transaction or
agreement, such
Director will abstain
from voting in that
regard.c)
    
    Describe any other steps the
board takes to encourage and
promote a culture of ethical
business conduct.
    
    Through the
above-noted methods,
the Board encourages
and promotes a culture
of ethical business
conduct. This is
reinforced by the
behaviour of the
Board, as provided in
its mandate, which is
in strict compliance
with the terms and the
spirit of these
measures.6.
    
    Nomination of Directorsa)
    
    Describe the process by which
the board identifies new candidates
for board nomination.
    
    The Corporate
Governance Committee
oversees the process
by which the Board
identifies new
candidates for Board
nomination.
 - 81 -




---



##### 



Form 58-101-F1 - Corporate GovernanceDisclosure
    
    
    
    The Company's Practicesb)
    
    Disclose whether or not the
board has a nominating committee
composed entirely of independent
directors. If the board does not
have a nominating committee
composed entirely of independent
directors, describe what steps the
board takes to encourage an
objective nomination process.
    
    This Governance
Committee is composed
entirely of
independent Directors.c)
    
    If the board has a nominating
committee, describe the
responsibilities, powers and
operation of the nominating
committee.
    
    The Corporate
Governance Committee
oversees the process
by which the Board
identifies new
candidates for Board
nomination.7.

    Compensationa)
    
    Describe the process by which
the board determines the
compensation for the issuers
directors and officers.
    
    Each year, the
Compensation Committee
reviews data of
director compensation
for companies of a
comparable size. Using
such information, the
Compensation Committee
formulates a
recommendation to the
Board of Directors and
the final decision is
made by the Board of
Directors.As concerns the
officers, the
Compensation Committee
is responsible for
establishing the
annual compensation of
all senior executives
following discussions
with the President and
Chief Executive
Officer and after
reviewing their
recommendations. The
level of compensation
for senior executives
is to be consistent
with the compensation
provided for senior
executives of
companies in local
markets of comparable
size and type facing
similar operating and
financial issues.As concerns the
President and Chief
Executive Officer, the
Committee reviews and
recommends to the
Board the compensation
and performance
criteria with respect
to the President and
Chief Executive
Officer basing its
recommendations on
available data for
comparable companies.The Compensation
Committee met only
once in 2007.b)
    
    Disclose whether or not the
board has a compensation committee
composed entirely of independent
directors. If the board does not
have a compensation committee
composed entirely of independent
directors, describe what steps the
board takes to ensure an objective
process for determining such
compensation.
    
    The Compensation
Committee oversees
compensation matters
and is composed
entirely of
independent Directors.c)
    
    If the board has a compensation
    
    Compensation matters are overseen by the
 - 82 -




---



##### 



Form 58-101-F1 - Corporate Governance
    

The Companys PracticesDisclosurecommittee, describe the
responsibilities, powers and
operation of the compensation
committee.
    
    Compensation
Committee.d)
    
    If a compensation consultant or
advisor has, at any time since the
beginning of the issuers most
recently completed financial year,
been retained to assist in
determining compensation for any of
the issuers directors and
officers, disclose the identity of
the consultant or advisor and
briefly summarize the mandate for
which they have been retained. If
the consultant or advisor has been
retained to perform any other work
for the issuer, state that fact and
briefly describe the nature of the
work.
    
    During the 2007
financial year, the
Company did not retain
the services of a
compensation
consultant.8.
    
    Other Board CommitteesIf the board has standing
committees other than the audit,
compensation and nominating
committees, identify the committees
and describe their function.
    
    Other than the Audit
Committee and the
Compensation
Committee, the Board
has the following
standing committees:
The Environment
Committee, the
Corporate Governance
Committee and the
Executive Committee.9.
    
    AssessmentsDisclose whether or not the board,
its committees and individual
directors are regularly assessed
with respect to their effectiveness
and contribution. If assessments
are regularly conducted, describe
the process used for the
assessments. If assessments are not
regularly conducted, describe how
the board satisfies itself that the
board, its committees, and its
individual directors are performing
effectively.
    
    Given the recent
proceedings of the
Corporation under the
CCAA, the Board, in
conjunction with its
Corporate Governance
Committee, has
informally assessed
the effectiveness of
the Board as a whole
and the contribution
of individual
directors from
time-to-time as
appropriate.
 
 D. Employees
   - 83 -




---



##### 



Le Syndicat des Travailleurs-euses de la Mine
Meston
   
 E. Share Ownership
  Number and Percentage ofName
    
    Position Held
    
    Outstanding Common Shares OwnedLouis Archambault
    
    Director
    
    
    6,000 (0.001
    %)Alain Blais
    
    Vice President and General Manager
    
    
    274,424 (0.06
    %)Graham G. Clow
    
    Director
    
    
    130,250 (0.03
    %)André Y. Fortier
    
    President and Chief Executive Officer and Director
    
    
    2,122,439 (0.49
    %)René R. Galipeau
    
    Director
    
    
    1,655,030 (0.38
    %)W. Warren Holmes
    
    Director
    
    
    2,968,299 (0.69
    %)James C. McCartney Q.C.
    
    Director
    
    
    22,500 (0.001
    %)G.E. Kurt Pralle
    
    Director
    
    
    10,000 (0.002
    %)James D. Raymond
    
    Director
    
    
    0 (0
    %)Réal Savoie
    
    Vice President Finance
    
    
    55,411 (0.01
    %)Sébastien Vézina
    
    Secretary
    
    
    0 (0
    %)
  Name
    
    Grant Date
    
    Expiry Date
    
    Exercise Price
    
    Number of Options(1)Louis Archambault
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    25,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000
 - 84 -




---



##### 



Name
    
    Grant Date
    
    Expiry Date
    
    Exercise Price
    
    Number of Options(1)Alain Blais
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    50,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    200,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    200,000Graham G. Clow
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    25,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000André Y. Fortier
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    100,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    600,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    400,000René R. Galipeau
    
    August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000W. Warren Holmes
    
    August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000James C. McCartney Q.C.
    
    August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    50,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    400,000G.E. Kurt Pralle
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    25,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000James D. Raymond
    
    May 31, 2004
    
    May 31, 2009
    
    $0.64
    
    25,000August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    250,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    100,000Réal Savoie
    
    August 16, 2006
    
    August 16, 2011
    
    $0.15
    
    200,000August 8, 2007
    
    August 8, 2012
    
    $0.16
    
    200,000
 
 Note:(1)
    
    Each option entitles its holder to purchase one common share of the Company at the exercise price. 
 Arrangements Involving the Employees in the Capital of the Company
 
 Employee Incentive Plan
   - 85 -




---



##### 



(a)
    
    materially increase the benefits under the Employee Incentive Plan;(b)
    
    materially increase the number of common shares which would be issued under the
Employee Incentive Plan;(c)
    
    materially modify the requirements as to eligibility for participation in the
Employee Incentive Plan; or(d)
    
    otherwise require approval by shareholders (or disinterested shareholders as
the case may be) in accordance with the requirements of any regulatory body having
jurisdiction over the common shares;
   
 Share Option Plan
   - 86 -




---



##### 



(a)
    
    if such employment ceases by reason of permanent disability of the optionee, or
the retirement of the optionee on or after attaining the age of sixty years or the
death of the optionee, any option granted to the optionee may be exercised in full by
the optionee or by his legal representatives as if such employment had not ceased
provided that all options held by the optionee or his legal representatives must be
exercised on or before one (1) year after employment so ceased and thereafter any
portion which remains unexercised shall terminate and be of no force or effect; and(b)
    
    the Board or the Compensation Committee may in its discretion, in special
circumstances, give its express consent to the exercise, after the effective date of
the optionee ceasing to be employed by the Company, of any options which are
exercisable at the time the optionees employment ceases.
    
 Share Purchase Plan
   - 87 -




---



##### 



Share Bonus Plan
  
 Share Loan Plan
   (a)
    
    if the loan and any interest thereon have not been repaid in full to the
Company within eighteen (18) months of the date the participant ceases to be an
employee:
 (i)
    
    the trustee shall sell on behalf of such share loan participant
all or such part of the common shares then held by it on his behalf as shall be
necessary to repay the loan and any interest thereon in full and the trustee
shall pay to the Company the proceeds of such sale;(ii)
    
    the trustee shall transfer and deliver to the share loan
participant the balance of the common shares, if any, that are not so sold; and(iii)
    
    the Board or the Compensation Committee shall fix such terms
and conditions with regard to repayment of all or part of the balance of the
loan or forgiveness of all or part of the balance of the loan as the Board or
the Compensation Committee may in its discretion determine.
 - 88 -




---



##### 



(b)
    
    if the loan and any interest thereon have been repaid in full to the Company
within eighteen (18) months of the date the Participant ceases to be an employee, the
Trustee shall forthwith upon repayment transfer and deliver to the Share Loan
Participant the Shares, if any, then held by it on behalf of such Share Loan
Participant.
  (a)
    
    if the loan and any such interest thereon have not been repaid in full to the
Company within one year from the date of death of such Share Loan participant;
 (i)
    
    the trustee shall sell on behalf of such deceased Share Loan
participant all or such part of the common shares then held by it on his behalf
as shall be necessary to repay to the Company the loan and such interest in
full and the trustee shall pay to the Company the proceeds of such sale;(ii)
    
    the trustee shall transfer and deliver the balance of the
common shares, if any, to the legal personal representatives of the deceased
Share Loan participant; and(iii)
    
    the Board or the Compensation Committee shall fix such terms
and conditions with regard to repayment of all or part of the balance of the
loan or forgiveness of all or part of the balance of the loan as the Board or
the Compensation Committee may in its discretion determine.
 (b)
    
    if the loan and any interest thereon have been repaid in full to the Company
within one year of the date of the death of the share loan participant, the trustee
shall then transfer and deliver the common shares held by it to the legal personal
representatives of the deceased participant.
 
 Directors Stock Option Plan
    - 89 -




---



##### 



(a)
    
    the original grant of probate or letters of administration or a court certified
copy thereof; or(b)
    
    the original of a court certified or authenticated copy of the grant of
representation, will, order, or other instrument or such other evidence as the
Administrator may require of his or their authority to act for the estate.
       
 ITEM 7. MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS
  - 90 -




---



##### 



A. Major Shareholders
  
 B. Related Party Transactions
   
    
    $633,000 in consulting fees under the Operating Consulting Agreement, of which
$333,000 was paid through the issuance of 2,400,000 common shares of the Company;
    
    $100,000 in loan setup fees, $50,000 each for the $2,000,000 Guaranteed Convertible
Debenture and the Revolving Credit Facility; and
    
    $218,000 in interest on the Guaranteed Convertible Debentures, Revolving Credit
Facility and $2,000,000 advances, converted into the Guaranteed Convertible Debentures,
of $103,000, $34,000 and $81,000, respectively.
  
    
    $132,000 in accounts payable and accrued liabilities,
    
    $1,500,000 Revolving Credit Facility plus $34,000 of accrued interest,
    
    $2,000,000 Guaranteed Convertible Debenture plus accrued interest of $104,000.
 
   C. Interests of Experts and Counsels
  - 91 -




---



##### 



ITEM 8. FINANCIAL INFORMATION
 
 A. Consolidated Statements and Other Financial Information
   
 Legal Proceedings
    - 92 -




---



##### 



- 93 -




---



##### 



Commission de la santé et sécurité au travail Act Respecting Industrial Accidents
and Occupational Diseases
 
 Dividend Record and Policy
 Income Tax Act
 
 B.  Significant Changes
  
 ITEM 9. THE OFFER AND LISTING
 
 A.  Offer and listing details
  
 Toronto Stock Exchange
 Period
    
    High
    
    Low
    
    VolumeMonth EndedMarch 2008
    
    
    0.14
    
    
    
    0.12
    
    
    
    4,988,046February 2008
    
    
    0.13
    
    
    
    0.11
    
    
    
    7,523,300January 2008
    
    
    0.14
    
    
    
    0.09
    
    
    
    10,046,200December 2007
    
    
    0.15
    
    
    
    0.12
    
    
    
    9,236,500November 2007
    
    
    0.18
    
    
    
    0.13
    
    
    
    16,878,300October 2007
    
    
    0.20
    
    
    
    0.12
    
    
    
    32,308,300September 2007
    
    
    0.15
    
    
    
    0.13
    
    
    
    14,380,400
 Period
    
    High
    
    Low
    
    VolumeQuarter Ended
 - 94 -




---



##### 



Period
    
    High
    
    Low
    
    VolumeDecember 31, 2007
    
    
    0.20
    
    
    
    0.12
    
    
    
    58,423,100September 30, 2007
    
    
    0.19
    
    
    
    0.11
    
    
    
    66,724,800June 30, 2007
    
    
    0.16
    
    
    
    0.12
    
    
    
    90,310,700March 31, 2007
    
    
    0.19
    
    
    
    0.10
    
    
    
    246,930,900December 31, 2006
    
    
    0.16
    
    
    
    0.07
    
    
    
    213,666,100September 30, 2006
    
    
    0.18
    
    
    
    0.09
    
    
    
    9,251,200June 30, 2006
    
    
    0.22
    
    
    
    0.15
    
    
    
    18,852,600March 31, 2006
    
    
    0.27
    
    
    
    0.11
    
    
    
    35,819,700
 Period
    
    
    High
    
    Low
    
    VolumeFiscal Year EndedDecember 2007
    
    
    
    
    0.20
    
    
    
    0.10
    
    
    
    462,398,500December 2006
    
    
    
    
    0.27
    
    
    
    0.07
    
    
    
    277,589,600December 2005
    
    
    
    
    0.98
    
    
    
    0.05
    
    
    
    96,176,400December 2004
    
    
    
    
    1.11
    
    
    
    0.37
    
    
    
    25,997,200December 2003
    
    
    
    
    0.91
    
    
    
    0.33
    
    
    
    23,030,700
 
 Note:(1)
    
    All prices and volumes have been adjusted to
reflect the one for ten consolidation in May
2000. Prices are in Canadian dollars. 
 OTC-BB
 Period
    
    High
    
    Low
    
    VolumeMonth EndedMarch 2008
    
    
    0.14
    
    
    
    0.11
    
    
    
    2,823,601February 2008
    
    
    0.14
    
    
    
    0.11
    
    
    
    5,288,000January 2008
    
    
    0.14
    
    
    
    0.10
    
    
    
    3,900,100December 2007
    
    
    0.17
    
    
    
    0.11
    
    
    
    2,646,200November 2007
    
    
    0.20
    
    
    
    0.13
    
    
    
    4,137,600October 2007
    
    
    0.23
    
    
    
    0.11
    
    
    
    4,225,500September 2007
    
    
    0.15
    
    
    
    0.08
    
    
    
    3,856,300
 Period
    
    High
    
    Low
    
    VolumeQuarter EndedDecember 31, 2007
    
    
    0.23
    
    
    
    0.11
    
    
    
    11,009,300September 30, 2007
    
    
    0.18
    
    
    
    0.08
    
    
    
    15,266,200June 30, 2007
    
    
    0.14
    
    
    
    0.10
    
    
    
    13,685,900March 31, 2007
    
    
    0.17
    
    
    
    0.08
    
    
    
    28,657,600December 31, 2006
    
    
    0.14
    
    
    
    0.06
    
    
    
    25,423,200September 30, 2006
    
    
    0.19
    
    
    
    0.08
    
    
    
    3,347,500June 30, 2006
    
    
    0.21
    
    
    
    0.13
    
    
    
    11,259,700
 - 95 -




---



##### 



Period
    
    High
    
    Low
    
    VolumeMarch 31, 2006
    
    
    0.24
    
    
    
    0.01
    
    
    
    10,178,300
 Period
    
    High
    
    Low
    
    VolumeFiscal Year EndedDecember 2007
    
    
    0.23
    
    
    
    0.08
    
    
    
    68,619,000December 2006
    
    
    0.21
    
    
    
    0.01
    
    
    
    50,208,700December 2005
    
    
    0.48
    
    
    
    0.02
    
    
    
    21,494,700December 2004
    
    
    0.78
    
    
    
    0.29
    
    
    
    10,352,942December 2003
    
    
    0.84
    
    
    
    0.20
    
    
    
    11,209,588
 
 Notes:(1)
    
    Traded on the New York Stock Exchange until
November 23, 2001 and commenced trading on the
OTC-BB on November 29, 2001.(2)
    
    All prices and volumes have been adjusted to
reflect the one for ten consolidation in May
2000. Prices are in U.S. dollars. 
 B. Plan of distribution
 
  
 C. Markets
  
 D. Selling Shareholders
  
 E. Dilution
  
 F. Expenses of the issue
  
 ITEM 10. ADDITIONAL INFORMATION
 
 A. Share Capital
  
 B. Memorandum and Articles of Incorporation
  - 96 -




---



##### 



Election and Qualifications of Directors
     - 97 -




---



##### 



Meetings
   
 Limitations on Ownership of Securities
  
 Change in Control of Company
  
 C. Material Contracts
  §
    
    Nuinsco Letter Agreement dated April 18, 2006, between Campbell and Nuinsco as described
under Item 4  Information on the Company.§
    
    Operating Consulting Agreement dated May 1, 2006 between Campbell and Nuinsco as
described under Item 4  Information on the Company.§
    
    Concentrate purchase agreement effective January 1, 2007 between Campbell and Ocean
Partners as described under Item 3  Key Information.§
    
    Purchase and Sale Agreement dated February 26, 2007 between MSV Resources Inc.,
Campbell, Eastmain and Eastmain Mines Inc. as described under Item 4  Information on the
Company.§
    
    Investment Agreement dated June 13, 2007 between Cambell, MSV Resources Inc., MSV,
AlbertaCo. and a private capital firm as described under Item 4  Information on the
Company.§
    
    Participation Agreement dated July 23, 2007 between Nuinsco and MSV (at the time called
6479499 Canada Inc.) as described under Item 4  Information on the Company.§
    
    Memorandum of Understanding dated September 20, 2007 between Meston and Gold Bullion as
described under Item 4  Information on the Company.
 - 98 -




---



##### 




    
    Sale and Purchase Agreement dated November 8, 2007 between GéoNova and Tawsho as
described under Item 4  Information on the Company.
 
 D. Exchange Controls
 Investment Canada Act
     (a)
    
    by the acquisition of voting shares or the voting interests by any person in
the ordinary course of that persons business as a trader or dealer in securities;(b)
    
    in connection with the realization of security granted for a loan or other
financial assistance and not for any purpose related to the Investment Act;
 - 99 -




---



##### 



(c)
    
    for facilitating its financing and not for any purpose related to the
Investment Act on the condition that the acquirer divest control within two years after
control was acquired; and(d)
    
    by reason of an amalgamation, merger, consolidation or corporate reorganization
following which the ultimate or indirect control in fact of the Company through the
ownership of voting interests remains unchanged.
   
 E. Taxation
 
 Certain Canadian Federal Income Tax Consequences
 Income Tax
Act
  
 Dividends on Common Shares
  - 100 -




---



##### 



Disposition of Common Shares
     (a)
    
    the value of the shares is derived principally from real property in Canada,
including the right to explore for or exploit natural resources and rights to amounts
computed by reference to production,(b)
    
    the shareholder was resident in Canada for 120 months during any period of 20
consecutive years preceding the disposition, was resident in Canada at any time during
the 10 years immediately preceding the disposition, the shares were owned by him when
he ceased to be resident in Canada and the shares were not property that the
shareholders was treated as having alienated by reason of ceasing to be a resident of
Canada, or(c)
    
    the shares formed part of the business property of a permanent establishment
that the shareholder has or had in Canada within the 12 months preceding the
disposition.
  - 101 -




---



##### 



Flow-Through Shares
     
 Certain United States Federal Income Tax Considerations
   
 U.S. Holders
  - 102 -




---



##### 



Distributions of Common Shares
   
 Foreign Tax Credit
  
 Disposition of Common Shares
  - 103 -




---



##### 



Other Considerations
  
 Passive Foreign Investment Corporation
    
 Backup Withholding
  - 104 -




---



##### 



F. Dividends and paying agents
  
 G. Statements by experts
  
 H. Documents on Display
  
 I. Subsidiary Information
  
 ITEM 11. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK
  
 Copper and Gold Risk Disclosures
  
 Foreign Currency Risk Disclosures
  - 105 -




---



##### 



Competition
   
 ITEM 12. DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES
  
 PART II
 
 ITEM 13. DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES
 
 Credit facility with Investissement Québec
  
 Convertible debentures
  
 CCAA Procedures
   - 106 -




---



##### 



ITEM 14. MATERIAL MODIFICATIONS TO THE RIGHT OF SECURITY HOLDERS AND USE OF PROCEEDS
  
 ITEM 15. CONTROLS AND PROCEDURES
 A.   Disclosure
Controls and Procedures
 Certification of Disclosure in Issuers
Annual and Interim Filing
  B.   Managements
annual report on internal control over financial reporting
  Internal Control  Integrated Framework
   - 107 -




---



##### 



ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT
     Audit Committees
  
 ITEM 16B. CODE OF ETHICS
  
 ITEM 16C. PRINCIPAL ACCOUNTANT FEES AND SERVICES
 
 (a) Audit Fees
  - 108 -




---



##### 



(b) Audit-Related Fees
  
 (c) Tax Fees
  
 (d) All Other Fees
  
 (e) Audit Committees Pre-Approval Policies
   
 (f) Auditors Use of Non-Permanent Employees
  
 Interest of Auditors
 Ordre des comptables Agréés du
Québec
 
 ITEM 16 D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES
  
 ITEM 16 E. PURCHASES OF EQUITY SECURITIES BY THE ISSUER AND AFFILIATED PURCHASERS
  - 109 -




---



##### 



PART III
 
 ITEM 17. FINANCIAL STATEMENTS
   ITEM 18. FINANCIAL STATEMENTS
  - 110 -




---



##### 



Consolidated financial statements of
 CAMPBELL RESOURCES INC.
 December 31, 2007, 2006 and 2005




---



##### 



CAMPBELL RESOURCES INC.
Table of contents
 Auditors report
    
    
    1Consolidated statements of operations
    
    
    2Consolidated statements of comprehensive loss, contributed surplus and deficit
    
    
    3Consolidated balance sheets
    
    
    4Consolidated statements of cash flows
    
    
    5-6Notes to the consolidated financial statements
    
    
    7-57




---



##### 



Deloitte & Touche LLP1 Place Ville MarieSuite 3000Montreal QC H3B 4T9CanadaTel: 514-393-5239Fax: 514-390-4111www.deloitte.ca
 Report of Independent Registered Chartered Accountants




---



##### 



Deloitte & Touche LLP1 Place Ville MarieSuite 3000Montreal QC H3B 4T9CanadaTel: 514-393-5239Fax: 514-390-4111www.deloitte.ca
 Comments by Independent Registered Chartered Accountants on Canada-United States of America
Reporting Differences




---



##### 



CAMPBELL RESOURCES INC.
 
 Consolidated statements of operations
 years ended December 31
 (expressed in thousands of Canadian dollars except per share amounts)
 2007
    
    2006
    
    2005$
    
    $
    
    $Gross metal sales
    
    
    26,792
    
    
    
    11,925
    
    
    
    19,915Treatment charges
    
    
    3,749
    
    
    
    1,006
    
    
    
    1,641Net metal sales
    
    
    23,043
    
    
    
    10,919
    
    
    
    18,274ExpensesOperating
    
    
    38,260
    
    
    
    13,897
    
    
    
    16,346Amortization of property, plant and equipment
    
    
    3,042
    
    
    
    2,743
    
    
    
    4,675Write-down of properties (Note 8)
    
    
    
    
    
    
    25,001
    
    
    
    18,512General administration
    
    
    3,473
    
    
    
    2,945
    
    
    
    2,716Stock-based compensation expense (Note 13c)
    
    
    336
    
    
    
    496
    
    
    
    CCAA and reorganization costs
    
    
    779
    
    
    
    6,511
    
    
    
    972Exploration
    
    
    
    
    
    
    (159
    )
    
    
    854Care and maintenance
    
    
    175
    
    
    
    146
    
    
    
    34546,065
    
    
    
    51,580
    
    
    
    44,420Loss before the following items
    
    
    23,022
    
    
    
    40,661
    
    
    
    26,146Interest on short-term loan
    
    
    312
    
    
    
    501
    
    
    
    392Interest and financial expenses on long-term debt (Note 14)
    
    
    1,770
    
    
    
    692
    
    
    
    770Interest income
    
    
    (151
    )
    
    
    (173
    )
    
    
    (900
    )Amortization of deferred charges related
to the sale of the royalty (Note 5)
    
    
    
    
    
    
    
    
    
    
    1,851Loss from operations
    
    
    24,953
    
    
    
    41,681
    
    
    
    28,259Other (income) expenseForeign exchange (gain) loss
    
    
    (1,217
    )
    
    
    31
    
    
    
    (334
    )Other income (Note 15)
    
    
    (4,748
    )
    
    
    (552
    )
    
    
    (3,577
    )(5,965
    )
    
    
    (521
    )
    
    
    (3,911
    )Loss before taxes
    
    
    18,988
    
    
    
    41,160
    
    
    
    24,348Income and mining tax expense (Note 16)
    
    
    
    
    
    
    35
    
    
    
    82Net loss
    
    
    18,988
    
    
    
    41,195
    
    
    
    24,430Weighted average number of common shares (000)
    
    
    394,131
    
    
    
    150,562
    
    
    
    107,925Basic and fully diluted loss per share
    
    
    0.05
    
    
    
    0.27
    
    
    
    0.23




---



##### 



CAMPBELL RESOURCES INC.
 
 Consolidated statements of comprehensive loss, contributed surplus
and deficit
 years ended December 31
 (expressed in thousands of Canadian dollars)
 2007$Comprehensive lossNet loss
    
    
    18,988Other comprehensive loss, net of tax:Unrealized losses on available-for-sale investments
arising during the period
    
    
    199Reclassification adjustment for gains and losses
included in net income
    
    
    (190
    )Other comprehensive loss
    
    
    9Comprehensive loss
    
    
    18,997
 2007
    
    2006
    
    2005$
    
    $
    
    $Contributed surplusBalance, beginning of year
    
    
    1,996
    
    
    
    1,404
    
    
    
    1,101Warrants and options expired and cancelled
during the year (Note 13d)
    
    
    2,113
    
    
    
    132
    
    
    
    303Conversion rights expired (Note 13d)
    
    
    
    
    
    
    460
    
    
    
    Balance, end of year
    
    
    4,109
    
    
    
    1,996
    
    
    
    1,404DeficitBalance, beginning of year, as previously reported
    
    
    84,825
    
    
    
    43,630
    
    
    
    19,200Financial instruments  Recognition and measurement (Note 3)
    
    
    227
    
    
    
    
    
    
    
    Restated balance, beginning of year
    
    
    85,052
    
    
    
    43,630
    
    
    
    19,200Net loss
    
    
    18,988
    
    
    
    41,195
    
    
    
    24,430Balance, end of year
    
    
    104,040
    
    
    
    84,825
    
    
    
    43,630




---



##### 



CAMPBELL RESOURCES INC.
 
 Consolidated balance sheets
 as at December 31
 (expressed in thousands of Canadian dollars)
 2007
    
    2006$
    
    $AssetsCurrent assetsCash
    
    
    474
    
    
    
    1,964Restricted cash (Note 4)
    
    
    1,113
    
    
    
    2,784Short-term investments
    
    
    33
    
    
    
    792Restricted deposits and exchange agreements (Note 7)
    
    
    
    
    
    
    50,000Receivables
    
    
    3,066
    
    
    
    1,591Settlements receivable
    
    
    739
    
    
    
    5,413Production inventories
    
    
    1,218
    
    
    
    401Supply inventories
    
    
    2,882
    
    
    
    3,844Prepaids
    
    
    408
    
    
    
    1,1949,933
    
    
    
    67,983Amount receivable from Copper Rand/Portage Restoration Fiduciary Trust (Note 6)
    
    
    3,028
    
    
    
    2,826Restricted cash (Notes 4 and 11c)
    
    
    1,158
    
    
    
    1,158Future income tax assets (Note 16)
    
    
    1,317
    
    
    
    1,484Property, plant and equipment (Note 8)
    
    
    45,017
    
    
    
    37,135Accrued benefit asset (Note 20)
    
    
    4,897
    
    
    
    4,427Deferred charges and other assets (Note 9)
    
    
    
    
    
    
    12965,350
    
    
    
    115,142LiabilitiesCurrent liabilitiesShort-term loans (Note 10)
    
    
    1,996
    
    
    
    3,891Accounts payable
    
    
    15,411
    
    
    
    13,973Accrued liabilities
    
    
    5,954
    
    
    
    5,475Prepayments for concentrate inventory shipped
    
    
    965
    
    
    
    Current portion of long-term debt (Note 12)
    
    
    18,337
    
    
    
    65,28742,663
    
    
    
    88,626Asset retirement obligations (Note 11)
    
    
    7,396
    
    
    
    7,804Long-term debt (Note 12)
    
    
    2,688
    
    
    
    70Future income and mining tax liabilities (Note 16)
    
    
    6,472
    
    
    
    6,63659,219
    
    
    
    103,136Commitments and contingencies (Note 18)Shareholders equityCapital stock (Note 13)
    
    
    96,639
    
    
    
    85,572Warrants, stock options and conversion rights (Note 13d)
    
    
    9,432
    
    
    
    9,263Contributed surplus
    
    
    4,109
    
    
    
    1,996Deficit
    
    
    (104,040
    )
    
    
    (84,825
    )Accumulated other comprehensive loss
    
    
    (9
    )
    
    
    (104,049
    )
    
    
    (84,825
    )6,131
    
    
    
    12,00665,350
    
    
    
    115,142
  Approved on behalf of the Board
 (s) André Y. Fortier
 (s) G. E. Kurt Pralle




---



##### 



CAMPBELL RESOURCES INC.
 
 Consolidated statements of cash flows
 years ended December 31
 (expressed in thousands of Canadian dollars)
 2007
    
    
    2006
    
    
    2005$
    
    
    $
    
    
    $Operating activitiesNet loss
    
    
    (18,988
    )
    
    
    (41,195
    )
    
    
    (24,430
    )Adjustments to reconcile net loss to net cash
used for operating activitiesAmortization
    
    
    3,042
    
    
    
    2,743
    
    
    
    4,675Write-down of properties (Note 8)
    
    
    
    
    
    
    25,001
    
    
    
    18,512Deferred royalty amortization
    
    
    
    
    
    
    
    
    
    
    (2,860
    )Gain on sale of property, plant and equipment (Note 15)
    
    
    (4,714
    )
    
    
    (1
    )
    
    
    (4
    )Gain on repurchase of royalty (Notes 5 and 15)
    
    
    
    
    
    
    
    
    
    
    (1,571
    )Loss (gain) on sale of short-term investments (Note 15)
    
    
    384
    
    
    
    (262
    )
    
    
    Asset retirement accretion expense, net of the share
assumed by the Restoration Fiduciary Trust (Note 11)
    
    
    489
    
    
    
    252
    
    
    
    258Amortization of deferred charges and other assets
    
    
    129
    
    
    
    442
    
    
    
    2,248Amortization of conversion right on long-term debt
    
    
    
    
    
    
    191
    
    
    
    202Accretion of long-term debt
    
    
    491
    
    
    
    
    
    
    
    Stock-based compensation expense (Note 13)
    
    
    336
    
    
    
    496
    
    
    
    Deferred interest accrued on long-term debt
    
    
    1,089
    
    
    
    53
    
    
    
    51Excess of amount paid over pension plan costs
    
    
    (49
    )
    
    
    (42
    )
    
    
    (354
    )Share purchase plan
    
    
    
    
    
    
    
    
    
    
    12Shares and warrants issued for payment of services
    
    
    295
    
    
    
    4,476
    
    
    
    Other
    
    
    (102
    )
    
    
    (196
    )
    
    
    (23
    )Changes in non-cash operating working
capital items (Note 17a)
    
    
    12,593
    
    
    
    2,263
    
    
    
    2,536Cash used for operating activities
    
    
    (5,005
    )
    
    
    (5,779
    )
    
    
    (748
    )Financing activities(Decrease) increase in short-term loan
    
    
    (1,896
    )
    
    
    (2,715
    )
    
    
    3,920Increase (decrease) in long-term debt
    
    
    6,582
    
    
    
    (3 944
    )
    
    
    (8
    )Issuance of capital stock (Note 13)
    
    
    11,279
    
    
    
    16,435
    
    
    
    25Future mining taxes
    
    
    3
    
    
    
    1,748
    
    
    
    51Share issue costs (Note 13)
    
    
    (752
    )
    
    
    (1,478
    )
    
    
    (3
    )Warrants issued as part of placements (Note 13)
    
    
    
    
    
    
    2,262
    
    
    
    Cash provided by financing activities
    
    
    15,216
    
    
    
    12,308
    
    
    
    3,985




---



##### 



CAMPBELL RESOURCES INC.
Consolidated statements of cash flows (continued)
years ended December 31
(expressed in thousands of Canadian dollars)
 2007
    
    2006
    
    2005$
    
    $
    
    $Investing activitiesRestricted cash
    
    
    (4,810
    )
    
    
    (2,784
    )
    
    
    Acquisition of short-term investments
    
    
    (20
    )
    
    
    (12
    )
    
    
    Investment in shares (Note 15)
    
    
    
    
    
    
    515
    
    
    
    Increase in property, plant and equipment
    
    
    (13,226
    )
    
    
    (4,674
    )
    
    
    (2,696
    )Proceeds on sale of short-term investments
    
    
    1,985
    
    
    
    363
    
    
    
    Proceeds on sale of property, plant and equipment (Note 8)
    
    
    4,370
    
    
    
    515
    
    
    
    40Amount paid in excess of the pension plan costs
capitalized to property, plant and equipment
    
    
    
    
    
    
    (260
    )
    
    
    Cash used in investing activities
    
    
    (11,701
    )
    
    
    (6,337
    )
    
    
    (2,656
    )(Decrease) increase in cash
    
    
    (1,490
    )
    
    
    192
    
    
    
    581Cash, beginning of year
    
    
    1,964
    
    
    
    1,772
    
    
    
    1,191Cash, end of year
    
    
    474
    
    
    
    1,964
    
    
    
    1,772




---



##### 



1.  Description of business
 Canada Business Corporations Act
 2.  Going concern
 Companies Creditors Arrangement Act




---



##### 



2. Going concern (continued)
       (Note 18 c)).




---



##### 



2.  Going concern (continued)
    3.  Summary of significant accounting policies
 Use of estimates




---



##### 



3. Summary of significant accounting policies (continued)
 Principles of consolidation
  Cash
  Short-term investments
  Production inventories
   Supply inventories




---



##### 



3. Summary of significant accounting policies (continued)
 Property, plant and equipment
     Impairment of long-lived assets
 Impairment of
Long-Lived Assets,
 Deferred charges and other assets




---



##### 



3. Summary of significant accounting policies (continued)
 Stock-based compensation plans
  Deferred royalty
  Asset retirement obligations
  Income taxes
   Share issue costs




---



##### 



3. Summary of significant accounting policies (continued)
 Revenue recognition
   Stripping costs
   Earnings per share
  Flow-through shares




---



##### 



3. Summary of significant accounting policies (continued)
 Employee future benefits
  Foreign currency translation
  Recent accounting changes
 2007
 Financial instruments  Recognition and measurement
 Financial
Instruments  Recognition and Measurement
  
    
    Cash and cash equivalents and restricted cash are classified as financial assets
held for trading and are measured at fair value. Changes in fair value are charged
to earnings.
    
    Short-term investments are classified as available for sale and are
marked-to-market through comprehensive loss at each period end.




---



##### 



3. Summary of significant accounting policies (continued)
 Recent accounting changes (continued)
 Financial instruments  Recognition and measurement (continued)
 
    
    Receivables and settlements receivable are classified as loans and receivables
and are initially measured at fair value and, subsequently, recorded at amortized
cost using the effective interest rate method.
    
    Short-term loans, accounts payable, accrued liabilities, prepayments for
concentrate inventory shipped and long-term debt are classified as other liabilities
and are initially measured at fair value and, subsequently, recorded at amortized
cost using the effective interest rate method.
    
    Embedded derivatives that have been bifurcated from their host contract are
grouped on the balance sheet with the host contract. Embedded derivatives are
classified as held for trading, with variations in fair value recognized in
earnings.
    Financial instruments  Disclosure and presentation
 Financial
Instruments  Disclosure and Presentation




---



##### 



3. Summary of significant accounting policies (continued)
 Recent accounting changes (continued)
 Comprehensive income
 Comprehensive
Income.
  Equity
 Equity, Surplus Comprehensive Income
 Hedges
 Hedges Hedging Relationships
 Accounting changes
 Accounting Changes




---



##### 



3. Summary of significant accounting policies (continued)
 Future accounting changes
 Capital disclosures
 Capital Disclosures
  Financial instruments  Disclosure and Financial instruments  Presentation
 Financial Instruments  Disclosure Financial Instruments  Presentation Financial Instruments -
Disclosure and Presentation




---



##### 



3. Summary of significant accounting policies (continued)
 Inventories
 Inventories,
  
    
    Inventories be valued at the lower of cost and net realizable value, with
disclosure of the basis of determining the cost of inventory, including information
relating to overhead and other costs charged to the cost of inventory.
    
    First in, first out or weighted average cost method be systematically used to
evaluate cost of inventory.
    
    Major spare parts to be classified as property, plant and equipment.
    
    Write-downs recorded in prior years have to be reversed whenever an increase in
fair value occurs.
    
    Requirement to disclose the value of inventory charged to earnings during the
period.
  General standards of financial statement presentation
 General Standards of Financial Statement
Presentation
  Goodwill and intangible assets
 Goodwill and Intangible Assets, Goodwill and Other Intangible Assets, Research and Development Costs, Revenue and Expenditures During the Pre-operating Period, Entreprises in the Development Stage




---



##### 



3.  Summary of significant accounting policies (continued)
 International financial reporting standards
  4.  Restricted cash
 2007
    
    2006$
    
    $Short-termIn trust deposit for the settlement of creditors in
accordance with the plans of arrangement
    
    
    1,113
    
    
    
    2,784Long-termDeposit to the Ministère des Ressources Naturelles
as a guarantee for restoration work (Note 11c)
    
    
    1,158
    
    
    
    1,1582,271
    
    
    
    3,942




---



##### 



5.  Notes receivable and deferred royalty




---



##### 



6.  Amount receivable from Copper Rand/Portage Restoration Fiduciary Trust
    7.  Restricted deposits and Exchange Agreements




---



##### 



8.  Property, plant and equipment
 2007Accumulated
    
    Net bookCost
    
    amortization
    
    value$
    
    $
    
    $Property, plant and equipmentRoad
    
    
    976
    
    
    
    730
    
    
    
    246Plant
    
    
    2,088
    
    
    
    996
    
    
    
    1,092Mining, exploration and milling equipment
    
    
    36,623
    
    
    
    28,251
    
    
    
    8,372Office furniture and computer equipment
    
    
    1,386
    
    
    
    1,323
    
    
    
    6341,073
    
    
    
    31,300
    
    
    
    9,773Mining propertiesJoe Mann property
    
    
    116,727
    
    
    
    116,727
    
    
    
    Copper Rand property
    
    
    23,286
    
    
    
    2,159
    
    
    
    21,127Corner Bay property
    
    
    13,989
    
    
    
    
    
    
    
    13,989Exploration properties(1)
    
    
    128
    
    
    
    
    
    
    
    128154,130
    
    
    
    118,886
    
    
    
    35,244195,203
    
    
    
    150,186
    
    
    
    45,017
 (1)
    
    In 2007, the Chevrier property was sold for proceeds of $1,500,000
in cash. A gain of $710,000 was realized on the sale. Also, in 2007, the Eastmain
property was sold for proceeds of $2,500,000 in cash, $1,600,000 in shares of the
purchaser, 1,000,000 share purchase warrants and a 2% net smelter return royalty, net of
any prior royalty. A gain of $3,870,000 was realized on the sale.




---



##### 



8. Property, plant and equipment (continued)
 2006Accumulated
    
    Net bookCost
    
    amortization
    
    value$
    
    $
    
    $Property, plant and equipmentRoad
    
    
    730
    
    
    
    730
    
    
    
    Plant
    
    
    7,892
    
    
    
    6,593
    
    
    
    1,299Mining, exploration and milling equipment
    
    
    38,043
    
    
    
    28,978
    
    
    
    9,065Office furniture and computer equipment
    
    
    1,386
    
    
    
    1,312
    
    
    
    7448,051
    
    
    
    37,613
    
    
    
    10,438Mining propertiesJoe Mann property
    
    
    116,727
    
    
    
    116,727
    
    
    
    Copper Rand property
    
    
    21,671
    
    
    
    
    
    
    
    21,671Corner Bay property
    
    
    4,108
    
    
    
    
    
    
    
    4,108Exploration properties(1)
    
    
    918
    
    
    
    
    
    
    
    918143,424
    
    
    
    116,727
    
    
    
    26,697191,475
    
    
    
    154,340
    
    
    
    37,135
 (1)
    
    In 2006, the Discovery property was sold for proceeds of $500,000
in cash and $1,000,000 in shares of the purchaser. No gain or loss was realized on the
sale since the property had been written down in 2005 to its net realizable value.




---



##### 



9.  Deferred charges and other assets
 2006Accumulated
    
    Net bookCost
    
    amortization
    
    value$
    
    $
    
    $Fees related to the Operating Consulting Agreement
    
    
    388
    
    
    
    259
    
    
    
    129Fees related to the long-term debt
    
    
    455
    
    
    
    455
    
    
    
    843
    
    
    
    714
    
    
    
    129
 10. Short-term loans
 2007
    
    2006$
    
    $Revolving Credit Facility (a)
    
    
    1,500
    
    
    
    Advance Facility (b)
    
    
    496
    
    
    
    In-Process Working Capital Facility (c)
    
    
    
    
    
    
    3,8911,996
    
    
    
    3,891
 a)
    
    The Revolving Credit Facility, from Nuinsco, is for a minimum term of six months
(Initial Term), bears interest, payable quaterly, at the rate of 12% per annum and is
secured by a second or third ranking, as applicable, immovable and movable hypothec on
all the present and future assets of the Company and its subsidiary, MSV 2007. Following
the Initial Term, the principal amount outstanding, together with interest accrued
thereon, shall be payable on demand.b)
    
    The Advance Facility of US$1,500,000 bears interest at the rate of 11.5% per
annum. As at December 31, 2007, an amount of US$500,000 has been drawn upon the
facility.c)
    
    The In-Process Working Capital Facility was bearing interest at the LIBOR rate
plus 4% per annum and was secured by the settlements receivable. The credit facility
expired on December 31, 2006 and the outstanding balance of US$3,339,333 was reimbursed
gradually until April 2007 at each settlement date of the settlements receivable.




---



##### 



11. Asset retirement obligations
   a)
    
    Change in obligationThe following tables set forth the evolution of the asset retirement obligations for the
years ended December 31, 2007, 2006 and 2005:
 Balance at
    
    Accretion
    
    Adjusted
    
    Balance atbeginning
    
    expense
    
    (incurred)
    
    end$
    
    $
    
    $
    
    $2007Campbell Mill
    
    
    2,942
    
    
    
    176
    
    
    
    136
    
    
    
    3,254Joe Mann Mine
    
    
    850
    
    
    
    51
    
    
    
    94
    
    
    
    995Eastmain Mine
    
    
    1,088
    
    
    
    11
    
    
    
    (1,099
    )
    
    
    Cedar Bay Mine
    
    
    31
    
    
    
    
    
    
    
    (3
    )
    
    
    28Corner Bay project
    
    
    21
    
    
    
    1
    
    
    
    19
    
    
    
    41Henderson I and II
    
    
    46
    
    
    
    2
    
    
    
    2
    
    
    
    50Copper Rand Mine
    
    
    2,682
    
    
    
    156
    
    
    
    98
    
    
    
    2,936Portage,
Jaculet and Copper Cliff Mines
    
    
    144
    
    
    
    4
    
    
    
    (56
    )
    
    
    927,804
    
    
    
    401
    
    
    
    (809
    )
    
    
    7,3962006Campbell Mill
    
    
    2,778
    
    
    
    165
    
    
    
    (1
    )
    
    
    2,942Joe Mann Mine
    
    
    829
    
    
    
    50
    
    
    
    (29
    )
    
    
    850Eastmain Mine
    
    
    1,027
    
    
    
    61
    
    
    
    
    
    
    
    1,088Cedar bay Mine
    
    
    29
    
    
    
    2
    
    
    
    
    
    
    
    31Corner Bay project
    
    
    20
    
    
    
    1
    
    
    
    
    
    
    
    21Henderson I and II
    
    
    43
    
    
    
    3
    
    
    
    
    
    
    
    46Copper Rand Mine
    
    
    2,882
    
    
    
    173
    
    
    
    (373
    )
    
    
    2,682Portage,
Jaculet and Copper Cliff Mines
    
    
    130
    
    
    
    8
    
    
    
    6
    
    
    
    1447,738
    
    
    
    463
    
    
    
    (397
    )
    
    
    7,804




---



##### 



11. Asset retirement obligations (continued)
 a)
    
    Change in obligation (continued)
 Balance at
    
    Accretion
    
    Adjusted
    
    Balance atbeginning
    
    expense
    
    (incurred)
    
    end$
    
    $
    
    $
    
    $2005Campbell Mill
    
    
    2,622
    
    
    
    157
    
    
    
    (1
    )
    
    
    2,778Joe Mann Mine
    
    
    786
    
    
    
    47
    
    
    
    (4
    )
    
    
    829Eastmain Mine
    
    
    968
    
    
    
    58
    
    
    
    1
    
    
    
    1,027Cedar Bay Mine
    
    
    29
    
    
    
    
    
    
    
    
    
    
    
    29Corner Bay project
    
    
    19
    
    
    
    1
    
    
    
    
    
    
    
    20Henderson I and II
    
    
    44
    
    
    
    2
    
    
    
    (3
    )
    
    
    43Copper Rand Mine
    
    
    2,722
    
    
    
    162
    
    
    
    (2
    )
    
    
    2,882Portage,
Jaculet and Copper Cliff Mines
    
    
    131
    
    
    
    5
    
    
    
    (6
    )
    
    
    1307,321
    
    
    
    432
    
    
    
    (15
    )
    
    
    7,738
 b)
    
    Information used in the calculation of the asset retirement obligationsThe Company is using a credit adjusted risk free rate of 6%. The following table sets
forth the assumptions used in the calculation of the obligations for the year ended
December 31, 2007:
 Total estimated
    
    Discountcash flow
    
    periods$
    
    yearsCampbell Mill
    
    
    4,716
    
    
    
    16Joe Mann Mine
    
    
    836
    
    
    
    4Cedar Bay Mine
    
    
    28
    
    
    
    2Corner Bay project
    
    
    41
    
    
    
    2Henderson I and II
    
    
    50
    
    
    
    2Copper Rand Mine
    
    
    3,430
    
    
    
    10Portage,
Jaculet and Copper Cliff Mines
    
    
    90
    
    
    
    19,191
 c)
    
    Fair value of the assetsThe asset retirement obligations for Copper Rand, Portage, Jaculet and Copper Cliff Mines
are assumed by the Copper Rand/Portage Restoration Fiduciary Trust (Note 6). Furthermore,
at December 31, 2007, the Company had posted security deposits of $350,000 for the Joe
Mann Mine and $808,000 for the Campbell Mill.




---



##### 



12. Long-term debt
 2007
    
    2006$
    
    $Guaranteed Subordinated Debentures, bearing interest
at varying rates (effective average rate of
6.11% in 2006), repaid at maturity in January
2007 (a)
    
    
    
    
    
    
    38,000Guaranteed Non-Cumulative Redeemable Retractable
Preferred Shares of a subsidiary (50 shares),
with a nominal value of $12,000,000 retracted in
January 2007 (a)
    
    
    
    
    
    
    12,000
    
    
    
    50,000Guaranteed Convertible Debentures with interest accrued thereon of $254,000 (b)
    
    
    2,350
    
    
    
    Convertible Demand Debenture with interest accrued thereon of $30,000 (c)
    
    
    2,080
    
    
    
    Credit facility, secured by a first-ranking
encumbrance on the assets of the Copper Rand
Mine, bearing interest at the average prime rate
of six Canadian banks plus 1.5%, repayable from
September 30, 2008 in quarterly instalments of
$966,000 maturing on June 30, 2012 (d)
    
    
    15,452
    
    
    
    14,325Convertible Debentures with interest accrued thereon of nil ($291,000 in 2006) (e)
    
    
    520
    
    
    
    941Other
    
    
    623
    
    
    
    9121,025
    
    
    
    65,357Current portion
    
    
    18,337
    
    
    
    65,2872,688
    
    
    
    70




---



##### 



12. Long-term debt (continued)
 a)
    
    In 1991, a subsidiary of the Company entered into a financing arrangement
(Arrangement) whereby it issued, to a group of Canadian financial institutions,
$38,000,000 of Guaranteed Subordinate Debentures and Notes (Debentures) and
$12,000,000 of Guaranteed Non-Cumulative Redeemable Retractable Preferred Shares
(Preferred Shares). The Debentures are guaranteed by a series of restricted deposit
and Exchange Agreements (Note 8), subordinate to all existing non-tradable debt and
future senior debt and cannot be prepaid. The Preferred Shares are redeemable at any
time at an amount of $240,000 per Preferred Share, rank equally and pari passu with the
common shares for dividends when declared and are retractable in January 2007.In order to secure the performance and repayment of the Debentures and Preferred Shares,
the Companys subsidiary entered into a series of Interest Rate and Currency Exchange
Agreements, referred to as Exchange Agreements, with a major international bank. The
Exchange Agreements provide for the conversion of one floating rate interest basis to
another and for differences in the timing of payments so as to match the interest payment
requirements under the Debentures, repayment of the Debentures upon maturity and
retraction of the Preferred Shares. The Companys subsidiary invested $29,850,000 in
restricted deposits and $16,150,000 as an initial payment under the Exchange Agreements
with the counterparty, all of which have been assigned to secure all payments due under
the Exchange Agreements (Note 8). The deposits and Exchange Agreements were irrevocably
assigned directly to and accepted by the investors.The Preferred Shares have increased to their nominal value of $12,000,000 over the term
of the financing period.Under the term of the Exchange Agreements, the deposit was drawn down to nil in January
2007. The Exchange Agreements provided for termination payments to be made to the
subsidiary of the Company totalling $50,000,000 in January 2007.In January 2007, the Debentures were reimbursed and the Preferred Shares redeemed.




---



##### 



12. Long-term debt (continued)
 b)
    
    On July 20, 2007, the Company completed a private placement of Guaranteed
Convertible Debentures (Guaranteed Debentures) of $4,000,000. The Guaranteed Debentures
mature on July 20, 2009, are secured by a first-ranking encumbrance on the assets of the
Corner Bay property and bear interest at the rate of 11.5% per annum. Principal and
interest are repayable at maturity. The principal is convertible at the option of the
holder into units of the Company at a conversion rate of $0.13 per unit, each unit
consisting of one common share and one half warrant, each whole warrant entitling the
holder to purchase one common share at a price of $0.16 per share for a period of 24
months from the date of execution and delivery of the Guaranteed Debentures. The holder
of the Guaranteed Debentures surrendered for conversion shall not be entitled to receive
any accrued and unpaid interest in respect thereof. The Company will have the right to
redeem up to 50% of the principal amount on July 1, 2008 after giving a 30 days prior
notice to the holders. Upon notice being given of the redemption by the Company, the
holders may, at their option, convert all or part of such principal amount to be redeemed
into units. If the holders do not exercise such option, the Company shall nevertheless
issue to such holders the number of warrants they would have been entitled to receive had
they so converted.The Guaranteed Debentures are accounted for in accordance with their substance and are
presented in the financial statements in their component parts, measured at their fair
value at the time of issue. The liability component has been estimated at the present
value of the required principal and interest payments discounted at a rate approximating
the interest rate that would have been applicable to a non-convertible debt at the time
the Guaranteed Debentures were issued. Issuance costs have been expensed.
 Liability component as at July 20, 2007
    
    
    1,846Equity component as at July 20, 2007
    
    
    2,1544,000Guaranteed Convertible Debentures
    
    
    1,846Interest accrual
    
    
    5042,350




---



##### 



12. Long-term debt (continued)
 c)
    
    On November 9, 2007, a subsidiary of the Company issued a Convertible Demand
Debenture of $2,050,000. The debenture and interest accrued have no maturity and are
payable on demand by the holder, bear interest at a rate of 10% per annum, compounded
monthly, and is secured by a first priority general assignment and security interest on
all the present and after acquired assets of the subsidiary. The holder shall have the
right, at any time, upon the giving of written notice, to convert all of the principal
amount of the debenture with accrued interest thereon into 35% of the outstanding common
shares of the subsidiary at time of conversion (including those common shares to be
issued on such conversion) and such number of non-voting common shares of the subsidiary
as, when combined with the common shares, is equal to 75% of the outstanding shares of
the subsidiary after conversion.The Convertible Demand Debenture is accounted for as a liability only and no portion of
the proceeds from the issuance of the debenture was accounted for as attributable to the
conversion right, since it is convertible into shares of the consolidated subsidiary.d)
    
    On December 13, 2007, the Company and the lender amended the terms of the Credit
Facility, whereas, the principal and $3,452,000 of capitalized interest up to December
31, 2007 shall be reimbursed in 16 equal quarterly instalments, with the first
instalment on September 30, 2008. Starting in 2008, current interest shall be reimbursed
monthly on the last day of each month.e)
    
    The Convertible Debentures are unsecured and, therefore, based on new information
received from the Monitor, the Company was advised that no additional interest was
payable to the holders since the deposit of the proof of claim in late 2005. Since
accrued interest had been recorded up to December 2007, the Company reversed all
interest accrued in excess. Also in 2007, two dividend payments were issued by the
Monitor and recorded as $222,000 as accrued interest payment and $130,000 as principal
reimbursement.
  $2008
    
    
    18,3372009
    
    
    2,6012010
    
    
    782011
    
    
    921,025




---



##### 



13. Capital stock
 a)
    
    Authorized sharesPreference shares  unlimited, issuable in series, without par valueCommon shares  unlimitedb)
    
    Issued and outstanding shares
 2007
    
    2006
    
    2005Shares
    
    Amount
    
    Shares
    
    Amount
    
    Shares
    
    Amount(in thousands)
    
    $
    
    (in thousands)
    
    $
    
    (in thousands)
    
    $Common sharesBalance, beginning
of year
    
    
    346,529
    
    
    
    85,572
    
    
    
    108,213
    
    
    
    69,958
    
    
    
    107,238
    
    
    
    69,610IssuedPrivate placements (1)
    
    
    
    
    
    
    
    
    
    
    156,250
    
    
    
    9,565
    
    
    
    
    
    
    
    Rights offering (2)
    
    
    
    
    
    
    
    
    
    
    69,966
    
    
    
    4,417
    
    
    
    
    
    
    
    For services (Note 2)
    
    
    2,200
    
    
    
    296
    
    
    
    3,600
    
    
    
    627
    
    
    
    
    
    
    
    Flow-through shares (3)
    
    
    74,006
    
    
    
    9,131
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    Payment of debt
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    871
    
    
    
    311Exercise of warrants (d)
    
    
    9,670
    
    
    
    1,613
    
    
    
    7,500
    
    
    
    900
    
    
    
    
    
    
    
    Share purchase plan
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    
    104
    
    
    
    37Issued
    
    
    432,405
    
    
    
    96,612
    
    
    
    345,529
    
    
    
    85,467
    
    
    
    108,213
    
    
    
    69,958To be issuedFor services (Note 2)
    
    
    200
    
    
    
    27
    
    
    
    1,000
    
    
    
    105
    
    
    
    
    
    
    
    Balance, end of year
    
    
    432,605
    
    
    
    96,639
    
    
    
    346,529
    
    
    
    85,572
    
    
    
    108,213
    
    
    
    69,958




---



##### 



13. Capital stock (continued)
 b)
    
    Issued and outstanding shares (continued)
 (1)
    
    On September 27, 2006, the Brokered Placement was completed, generating
gross proceeds in cash of $10,000,000. This amount was allocated as follows:
$8,750,000 to capital stock and $1,250,000 to warrants, stock options and conversion
rights. Share issue costs of $1,355,839 were applied in reduction of capital stock.On December 30, 2006, the Nuinsco Placement was completed, generating gross proceeds in
cash of $2,500,000. This amount was allocated as follows: $2,187,500 to capital stock
and $312,500 to warrants, stock options and conversion rights. Share issue costs of
$16,659 were applied in reduction of capital stock.(2)
    
    On November 24, 2006, the rights offering was completed, generating gross
proceeds in cash of $5,597,301. This amount was allocated as follows: $4,897,638 to
capital stock and $699,663 to warrants, stock options and conversion rights. Share
issue costs of $480,628 were applied in reduction of capital stock.(3)
    
    In 2007, three flow-through share financings were completed, generating
gross proceeds in cash of $10,028,000. Share issue costs of $896,527, excluding tax
effect of renounciation, which will be recorded only on deposit of renounciation
documents, were applied in reduction of capital stock.
 c)
    
    Employee Incentive Plan and Directors Stock Option PlanThe Employee Incentive Plan comprises a Share Option Plan, a Share Purchase Plan, a Share
Bonus Plan and a Share Loan Plan. The Share Purchase Plan calls for Company contributions
of an amount equal to 50% of the employee contributions, which can amount to a maximum of
5% of their basic annual salaries or wages. The common shares are issued on a quarterly
basis at market value. In 2007 and 2006, no common shares were issued under the Share
Purchase Plan (in 2005, the Company issued a total of 103,724 common shares at an average
current market price of $0.36 per share).Under the Share Bonus Plan, common shares can be issued to full-time salaried employees as
a bonus in recognition of services as determined by the Compensation Committee or the
Board of Directors. In 2007, 2006 and 2005, no shares were issued.The Share Loan Plan provides the Compensation Committee or the Board of Directors the
discretion to make loans to full-time employees to enable them to acquire common shares in
the Company. No loans are presently outstanding under this plan.




---



##### 



13. Capital stock (continued)
 c)
    
    Employee Incentive Plan and Directors Stock Option Plan (continued)Options granted under the Directors Stock Option Plan and Employee Share Option Plan,
having no vesting period, expire no later than five years from the date on which they were
granted and all current options expire on or before August 8, 2012. Changes in the share
options outstanding are as follows:
 2007
    
    2006
    
    2005Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    Weightedaverage
    
    
    
    
    
    average
    
    
    
    
    
    averageexercise
    
    
    
    
    
    exercise
    
    
    
    
    
    exerciseOptions
    
    price
    
    Options
    
    price
    
    Options
    
    price(in thousands)
    
    $
    
    (in thousands)
    
    $
    
    (in thousands)
    
    $Outstanding,
beginning of year
    
    
    5,245
    
    
    
    0.23
    
    
    
    2,135
    
    
    
    0.61
    
    
    
    2,270
    
    
    
    0.62Granted
    
    
    2,850
    
    
    
    0.16
    
    
    
    4,950
    
    
    
    0.15
    
    
    
    
    
    
    
    Expired and cancelled (1)
    
    
    (930
    )
    
    
    0.36
    
    
    
    (1,840
    )
    
    
    0.46
    
    
    
    (135
    )
    
    
    0.74Outstanding,
end of year
    
    
    7,165
    
    
    
    0,18
    
    
    
    5,245
    
    
    
    0.23
    
    
    
    2,135
    
    
    
    0.61
 (1)
    
    450,000 options initially accounted for as stock-based compensation
expense, for an amount of approximately $49,000, were cancelled in 2007 and applied
to contributed surplus (655,000 options for $132,000 in 2006 and 120,000 options for
$45,000 in 2005).
  Options outstanding and exercisableWeightedaverage
    
    WeightedRange of
    
    
    
    
    
    remaining
    
    averageexercise
    
    Number
    
    contractual
    
    exerciseprice
    
    outstanding
    
    life
    
    price$
    
    (in thousands)
    
    (years)
    
    $0.15 - 0.16
    
    
    6,750
    
    
    
    4.0
    
    
    
    0.150.64 - 0.80
    
    
    415
    
    
    
    1.4
    
    
    
    0.657,165
    
    
    
    3.8
    
    
    
    0.18




---



##### 



13. Capital stock (continued)
 c)
    
    Employee Incentive Plan and Directors Stock Option Plan (continued)The fair value of the options granted and the assumptions are as follows:
 2007
    
    2006
    
    2005Fair value of each option
    
    $
    0.12
    
    
    $
    0.10
    
    
    
    Stock-based compensation expense
    
    $
    336
    
    
    $
    496
    
    
    
    Number of options
    
    
    2,850
    
    
    
    4,950
    
    
    
    AssumptionsRisk-free interest rate
    
    
    4.18 - 4.28
    %
    
    
    3.86
    %
    
    
    Expected return on share
    

    nil
    
    
    nil
    
    
    
    Expected volatility
    
    
    95
    %
    
    
    107
    %
    
    
    Expected duration
    
    5 years
    
    
    3 years
    
    
    
    
 d)
    
    Warrants, stock options and conversion rightsDuring the three-year period ended December 31, 2007, the Company entered into various
capital stock issuances and rights offering, long-term and short-term debt financings and
granted stock options as part of the Employee Incentive Plan and Directors Stock Option
Plan. The value assigned to the warrants, stock options and conversion rights issued
during the three-year period can be summarized as follows:
 2007
    
    2006
    
    2005$
    
    $
    
    $Balance, beginning of year
    
    
    9,263
    
    
    
    2,771
    
    
    
    3,074Warrants issued as part of the private placements (3)
    
    
    
    
    
    
    1,562
    
    
    
    Warrants issued as part of the rights offering (4)
    
    
    
    
    
    
    700
    
    
    
    Warrants issued as remuneration of the broker (1) (5)
    
    
    154
    
    
    
    375
    
    
    
    Warrants issued on exercise of the broker warrants (5)
    
    
    
    
    
    
    75
    
    
    
    Warrants issued under the management
and operating agreement (7)
    
    
    
    
    
    
    4,218
    
    
    
    Debentures conversion rights (2)
    
    
    2,154
    
    
    
    
    
    
    
    ECU-conversion rights expired
    
    
    
    
    
    
    (460
    )
    
    
    Warrants issued in connection with the
short-term loan (6)
    
    
    
    
    
    
    33
    
    
    
    Stock-based compensation expense
    
    
    336
    
    
    
    496
    
    
    
    Warrants exercised (5)
    
    
    (362
    )
    
    
    (375
    )
    
    
    Warrants and options expired and cancelled
    
    
    (2,113
    )
    
    
    (132
    )
    
    
    (303
    )Balance, end of year
    
    
    9,432
    
    
    
    9,263
    
    
    
    2,771




---



##### 



13. Capital stock (continued)
 d)
    
    Warrants, stock options and conversion rights (continued)2007In 2007, an amount of $2,064,000 related to expired warrants was applied against the
contributed surplus and $362,000 related to exercised warrants was added to the proceeds
received of $1,251,000. Also, $49,000 related to expired and cancelled employees and
directors stock options was applied to contributed surplus.
 (1)
    
    As part of the $7,000,000 flow-through share placement, the broker was
issued 3,360,000 share purchase warrants. Each warrant entitles the holder to
purchase one common share at $0.13 per share until October 23, 2008. The fair value
of the warrants as at the date of issuance was estimated at $154,000 and accounted
for as issuance costs.(2)
    
    On July 20, 2007, the Company completed a private placement of Guaranteed
Debentures as detailed in Note 12b). The fair value of the conversion rights as at
the date of issuance was estimated at $2,154,000.
  2007
    
    2006
    
    2005Weighted
    
    
    
    
    
    Weighted
    
    
    
    
    
    Weightedaverage
    
    
    
    
    
    average
    
    
    
    
    
    averageexercise
    
    
    
    
    
    exercise
    
    
    
    
    
    exerciseWarrants
    
    price
    
    Warrants
    
    price
    
    Warrants
    
    price(in thousands)
    
    $
    
    (in thousands)
    
    $
    
    (in thousands)
    
    $Outstanding, beginning of year
    
    
    190,728
    
    
    
    0.16
    
    
    
    5,737
    
    
    
    1.18
    
    
    
    6,343
    
    
    
    1.13Granted
    
    
    3,360
    
    
    
    0.13
    
    
    
    192,516
    
    
    
    0.13
    
    
    
    
    
    
    
    Exercised
    
    
    (9,670
    )
    
    
    0.13
    
    
    
    (7,500
    )
    
    
    0.08
    
    
    
    
    
    
    
    Expired and cancelled
    
    
    (5,712
    )
    
    
    1.18
    
    
    
    (25
    )
    
    
    1.03
    
    
    
    (606
    )
    
    
    0.66Outstanding, end of year
    
    
    178,706
    
    
    
    0.13
    
    
    
    190,728
    
    
    
    0.16
    
    
    
    5,737
    
    
    
    1.18
  WeightedRange of
    
    Number of
    
    average remaining
    
    Weighted averageexercise price
    
    outstanding
    
    contractual life
    
    exercise price$
    
    (in thousands)
    
    (years)
    
    $0.10 - 0.20
    
    
    178,706
    
    
    
    0.6
    
    
    
    0.13




---



##### 



13. Capital stock (continued)
 d)
    
    Warrants, stock options and conversion rights (continued)The Company recorded the fair value of the warrants and conversion rights issued as of the
measurement date using the Black-Scholes pricing model with various assumptions regarding
risk-free interest rate, expected dividend yield, expected volatility and expected
duration as follows:
 Conversion
    
    Brokerrights
    
    warrantsFair value of conversion rights and warrants, per unit
    
    Note 12 b)
    
    $
    0.05Total fair value
    
    $
    2,154
    
    
    $
    154Number of warrants or conversion rights
    
    
    46,154
    
    
    
    3,360Assumptions:Risk-free interest rate
    
    
    n/a
    
    
    
    3.75
    %Expected return on share
    
    nil
    
    
    nilExpected volatility
    
    
    n/a
    
    
    
    77
    %Expected duration
    
    2 years
    
    
    1.5 year
 2006In 2006, an amount of $460,000 related to expired conversion rights was applied against
the contributed surplus. These conversion rights were issued as part of the ECU financing
in 2004 and expired on September 29, 2006, upon full reimbursement of the debt by the
Company. Also, $132,000 related to cancelled employees stock options was applied to
contributed surplus.
 (3)
    
    As part of the Brokered Placement and Nuinsco Placement, 78,125,000 share
purchase warrants were issued. Each warrant entitles the holder to purchase one
common share at $0.15 per share until May 26, 2008. The warrants are subject to an
accelerated expiry if, on or after May 26, 2007, the volume weighted average price of
the shares of the Company is at least $0.30 for any period of 20 consecutive trading
days. The fair value of the warrants as at the date of issuance was estimated at
$1,562,000 and allocated to warrants, stock options and conversion rights.




---



##### 



13. Capital stock (continued)
 (4)
    
    As part of the rights offering, 34,983,312 share purchase warrants were
issued. Each warrant entitles the holder to purchase one common share at $0.15 per
share until May 26, 2008. The warrants are subject to an accelerated expiry if, on or
after May 26, 2007, the volume weighted average price of the shares of the Company is
at least $0.30 for any period of 20 consecutive trading days. The fair value of the
warrants as at the date of issuance was estimated at $700,000 and allocated to
warrants, stock options and conversion rights.(5)
    
    In relation to the Brokered Placement, the broker was issued 7,500,000
special broker warrants. Each special broker warrant entitles its holder to purchase,
until May 26, 2007, one unit at a price of $0.08 per unit. Each unit consists of one
common share and one-half of one common share purchase warrant. The fair value of the
special broker warrants as at the date of issuance was estimated at $375,000 and
accounted for as issuance costs. The special broker warrants were exercised in
December 2006 and, consequently, 3,750,000 share purchase warrants were issued; each
warrant having the same conditions as the warrants issued with regard to the Brokered
Placement, rights offering and Nuinsco Placement. The fair value of the warrants as
at the date of issuance was estimated at $75,000. Upon exercise of the special broker
warrants, the $375,000 value attributed to the special warrants was reversed from
warrants, stock options and conversion rights and was recorded in capital stock.(6)
    
    As part of the renewal of the short-term loan, the Company granted warrants
to purchase 200,000 common shares at a price of $0.195 until January 31, 2008. The
fair value was estimated at the date of grant at $25,000 and accounted for as
administrative costs.Also in 2006, in order to obtain a bridge loan, the Company granted warrants to
purchase 150,000 common shares at a price of $0.105 per share until December 22, 2008.
The fair value at the date of the grant was estimated at $8,000 and accounted for as
administrative costs.(7)
    
    Pursuant to the Operating Consulting Agreement (Note 2), Nuinsco was
entitled to receive share purchase warrants equal to 20% of the outstanding shares of
the Company, after completion of the Brokered Placement, rights offering and Nuinsco
Placement. The Company accounted for these warrants in 2006, since all the conditions
had been met as at December 30, 2006, even if the issuance of the warrants was
delayed to January 18, 2007 due to the necessity of obtaining additional regulatory
approval required by the increase in the total number of warrants to be issued,
compared to the pre-approved number. The fair value of the 67,807,429 warrants,
exercisable at a price of $0.10 per share until January 18, 2009, was estimated at
$4,218,000 and accounted for as reorganization costs.




---



##### 



13. Capital stock (continued)
 d)
    
    Warrants, stock options and conversion rights (continued)The Company recorded the fair value of the warrants issued as of the measurement date
using the Black-Scholes pricing model with various assumptions regarding risk-free
interest rate, expected dividend yield, expected volatility and expected duration as
follows:
 Short-Private
    
    Broker
    
    termPlacements (1)
    
    warrant
    
    loanFair value of warrants
    
    $
    0.02
    
    
    $
    0.05
    
    
    $
    0.13Fair value
    
    $
    2,262
    
    
    $
    375
    
    
    $
    25Number of warrants
    
    
    113,108
    
    
    
    7,500
    
    
    
    200Assumptions:Risk-free interest rate
    
    
    3.75
    %
    
    
    3.75
    %
    
    
    3.86
    %Expected return on shares
    

    nil
    
    
    nil
    
    
    nilExpected volatility
    
    
    91
    %
    
    
    60
    %
    
    
    126
    %Expected duration
    

    1.2 years
    
    
    0.67 year
    
    
    2 years
 Exerciseof broker
    
    Bridge
    
    Nuinscowarrants
    
    loan
    
    warrantsFair value of warrants
    
    $
    0.02
    
    
    $
    0.05
    
    
    $
    0.06Fair value
    
    $
    75
    
    
    $
    8
    
    
    $
    4,218Number of warrants
    
    
    3,750
    
    
    
    150
    
    
    
    67,808Assumptions:Risk-free interest rate
    
    
    3.75
    %
    
    
    3.75
    %
    
    
    3.75
    %Expected return on shares
    

    nil
    
    
    nil
    
    
    nilExpected volatility
    
    
    91
    %
    
    
    113
    %
    
    
    121
    %Expected duration
    
    1.2 years
    
    
    1.5 years
    
    
    2 years
 
 (1)
    
    Rights offering, Brokered Placement and Nuinsco Placement.




---



##### 



14.
    
    Interest and financial expenses on long-term debt
 2007
    
    2006
    
    2005$
    
    $
    
    $Exchangeable Capital Units facility
    
    
    
    
    
    
    637
    
    
    
    713Guaranteed Convertible Debentures
    
    
    669
    
    
    
    
    
    
    
    Convertible Demand Debentures
    
    
    30
    
    
    
    
    
    
    
    Guaranteed Subordinated Debentures
    
    
    
    
    
    
    2,323
    
    
    
    1,958Credit Facility
    
    
    1,127
    
    
    
    
    
    
    
    Convertible Debentures (Note 12e))
    
    
    (69
    )
    
    
    53
    
    
    
    55Other
    
    
    13
    
    
    
    2
    
    
    
    21,770
    
    
    
    3,015
    
    
    
    2,728Interest revenue on restricted deposits (Note 7)
    
    
    
    
    
    
    (2,323
    )
    
    
    (1,958
    )1,770
    
    
    
    692
    
    
    
    770
 15.
    
    Other income
 2007
    
    2006
    
    2005$
    
    $
    
    $(Loss) gain on sale of short-term investments
    
    
    (384
    )
    
    
    262
    
    
    
    Gain on repurchase of royalty (Note 5)
    
    
    
    
    
    
    
    
    
    
    1,571Gain on sale of property, plant and equipment
    
    
    4,714
    
    
    
    1
    
    
    
    2,002Gain on an investment in shares (a)
    
    
    
    
    
    
    515
    
    
    
    Gain on creditors settlement
    
    
    243
    
    
    
    
    
    
    
    Other
    
    
    175
    
    
    
    (226
    )
    
    
    44,748
    
    
    
    552
    
    
    
    3,577
 (a)
    
    On October 23, 2006, the Company acquired all of the outstanding shares of
Pinnacle International (Taylor) Plaza Inc. (PINNACLE), which then became a
wholly-owned subsidiary of the Company. On November 9, 2006, PINNACLE, a corporation
involved in residential development, was dissolved and wound-up in Meston Resources Inc.
As at December 22, 2006, the development project was completed and sold. The acquisition
was not accounted for as a business combination as it did not meet the definition of a
business in accordance with the criteria in EIC 124.




---



##### 



16.  Income and mining taxes
 a)
    
    Effective tax rateThe income tax recovery varies from the amounts that would be computed by applying the
combined Canadian federal and provincial statutory tax rates to earnings before taxes as
follows:
 2007
    
    2006
    
    2005$
    
    $
    
    $Expected income tax recovery using
statutory income tax rates
    
    
    (6,083
    )
    
    
    (13,244
    )
    
    
    (7,552
    )Resource allowance
    
    
    
    
    
    
    181
    
    
    
    220Valuation allowance
    
    
    6,083
    
    
    
    13,098
    
    
    
    7,414Income and mining tax expense
    
    
    
    
    
    
    35
    
    
    
    82
 b)
    
    Future income and mining taxesAt December 31, future income and mining taxes are as follows:
 2007
    
    2006$
    
    $Current future income tax assetsInventories of ore and supplies
    
    
    177
    
    
    
    99Other
    
    
    8
    
    
    
    54185
    
    
    
    153Long-term future income tax assetsProperty, plant and equipment
    
    
    23,346
    
    
    
    28,383Operating loss carry forwards
    
    
    22,970
    
    
    
    24,685Capital loss carry forwards
    
    
    8,745
    
    
    
    11,006Other
    
    
    4,364
    
    
    
    5,63159,425
    
    
    
    69,70559,610
    
    
    
    69,858Valuation allowance
    
    
    (58,293
    )
    
    
    (68,374
    )Future income tax assets
    
    
    1,317
    
    
    
    1,484Long-term future income and mining tax liabilitiesMining taxes
    
    
    5,155
    
    
    
    5,152Other
    
    
    1,317
    
    
    
    1,484Future income and mining tax liabilities
    
    
    6,472
    
    
    
    6,636Net future income and mining tax liabilities
    
    
    5,155
    
    
    
    5,152




---



##### 



16.  Income and mining taxes (continued)
 c)
    
    Loss carry forwardsAt December 31, 2007, the Company and its subsidiaries had operating losses for income tax
purposes in Canada approximating $89,400,000, which are available to reduce taxable income
in future years and expire over the period to 2027. $72,400,000 of the $89,400,000
operating losses for income tax purposes are available in inactive subsidiaries and
therefore will not be available to reduce future taxable income In addition, the Company
and its subsidiaries had capital losses for income tax purposes in Canada of approximately
$65,000,000, which can be applied against future taxable capital gains.
 17.  Changes in non-cash operating working capital items and supplementary information
 a)
    
    Changes in non-cash operating working capital items
 2007
    
    2006
    
    2005$
    
    $
    
    $Receivables and settlements receivable
    
    
    3,050
    
    
    
    1,809
    
    
    
    (2,923
    )Production and supply inventories
    
    
    145
    
    
    
    (752
    )
    
    
    1,178Prepaids
    
    
    786
    
    
    
    (317
    )
    
    
    (699
    )Accounts payable and accrued liabilities
    
    
    7,647
    
    
    
    1,523
    
    
    
    4,980Prepayments for concentrate inventory shipped
    
    
    965
    
    
    
    
    
    
    
    12,593
    
    
    
    2,263
    
    
    
    2,536




---



##### 



17.
    
    Changes in non-cash working operating capital items and supplementary information (continued)
 b)
    
    Supplementary information
 2007
    
    2006
    
    2005$
    
    $
    
    $Income taxes paid
    
    
    
    
    
    
    136
    
    
    
    98Interest paid
    
    
    665
    
    
    
    2,809
    
    
    
    2,013Shares issued for services under the Management
and Operating Agreement (Note 13)
    
    
    333
    
    
    
    732
    
    
    
    Warrants issued for the short-term loan
(capitalized as deferred charges in 2004)
    
    
    
    
    
    
    25
    
    
    
    Warrants issued for the bridge loan
    
    
    
    
    
    
    8
    
    
    
    Warrants issued under the Operating
Consulting Agreement
    
    
    
    
    
    
    4,218
    
    
    
    Shares issued for debt settlement (Note 13)
    
    
    
    
    
    
    
    
    
    
    314Proceeds on sale of mining interest received
in shares (Note 8)
    
    
    1,600
    
    
    
    1,000
    
    
    
    Interest capitalized to mining properties (Note 12b))
    
    
    14
    
    
    
    998
    
    
    
    759Redemption of royalty
    
    
    
    
    
    
    
    
    
    
    5,900Mining rights receivable
    
    
    
    
    
    
    
    
    
    
    1,214Mining rights held as security
deposit for site restoration
    
    
    
    
    
    
    808
    
    
    
    Mining rights held as reimbursement
of property, plant and equipment
acquisition grant
    
    
    
    
    
    
    378
    
    
    
    Restricted cash used for settlement of
accounts payable and accrued liabilities
    
    
    6,231
    
    
    
    
    
    
    
    Restricted cash used for settlement of
Convertible Debentures
    
    
    130
    
    
    
    
    
    
    
    Restricted cash used for settlement of
interest on Convertible Debentures
    
    
    222
    
    
    
    
    
    
    
    Restricted deposit and exchange agreements applied
to redemption of Guaranteed Non-Cumulative
Redeemable Retractable Preferred Shares and
reimbursement of Guaranteed Subordinated
Debentures
    
    
    50,000
    
    
    
    
    
    
    
    




---



##### 



18.  Commitments and contingencies
 a)
    
    The Company is committed to pay royalties calculated on the net smelter return at
various rates or based on the tonnage of ore processed at the mills. These agreements
are also subject to repurchase rights at various prices.b)
    
    The Company is committed, under the agreements of the flow-through share
financing of 2007, to spend $3,028,000 in qualifying exploration expenditures in 2008.c)
    
    Under a participation agreement, the Company is committed to pay to Nuinsco a
participation fee on the operating cash flow of the Corner Bay property. The cash flow
generated by the Corner Bay property will be allocated as follows:
 a.
    
    First, all positive cash flows required to cover investments made by the
Company from January 1, 2007 onwards, will remain with the Company;b.
    
    After the investments made by the Company from January 1, 2007 onwards
have been fully repaid, the Company will keep 50% of the positive cash flows to
repay all investments made prior to January 1, 2007, up to $4.1M; the other 50% will
be split equally between the Company and Nuinsco:c.
    
    Thereafter, the Company and Nuinsco will split the positive cash flows
equally.
 d)
    
    Under the financing arrangement (Arrangement) referred to in Note 12 a),
mineral development expenditures, which were renounced in favour of the investors as
part of the Arrangement, were based, in part, on independent valuations of certain
related mineral properties. The Canada Revenue Agency (CRA) has challenged certain of
those valuations, and disallowed certain of the renounced flow-through deductions for
certain of the investors. The Company may be contingently liable for certain losses or
damages to investors, if any, that may result if the CRA is ultimately successful in its
challenges. No provision for losses has been recorded at year end since it is not
possible to determine either the outcome of the challenges or the financial consequences
to the Company.e)
    
    The Oujibougoumou Cree initiated legal proceedings against the Company, claiming
that the poor condition of lakes in the region of Chibougamau, Quebec was due to mining
activities in the area. The Public Health Department, the Quebec Environment Ministry
and the Quebec Fish and Wildlife Association began to study the issue. As a temporary
measure, the Company and the plaintiffs jointly agreed to request that proceedings be
suspended for two years. It is not possible at this time to determine either the outcome
of the proceedings or the financial consequences for the Company.f)
    
    On November 28, 2007, the holders of royalty units (Unitholders) under the
Royalty Agreement dated October 15, 2001 (Note 5) initiated legal proceedings against
the Company, claiming that each Unitholder continues to own the royalty units , that no
retraction or repurchase has occurred since they claim not having exercised their
retraction rights and that the valuation report establishing the value of the royalty at
$5,900,000 is wrong and of no force. No provision for losses has been recorded at year
end since it is not possible to determine either the outcome of the proceedings or the
financial consequences to the Company.




---



##### 



19.  Related party transactions
   
    
    $633,000 in consulting fees under the Operating Consulting Agreement, of which
$333,000 was paid through the issuance of 2,400,000 common shares of the Company;
    
    $100,000 in loan setup fees, $50,000 each for the $2,000,000 Guaranteed Convertible
Debenture and the Revolving Credit Facility; and
    
    $218,000 in interest on the Guaranteed Convertible Debentures, Revolving Credit
Facility and $2,000,000 advances, converted into the Guaranteed Convertible Debentures,
of $103,000, $34,000 and $81,000, respectively.
  
    
    $132,000 in accounts payable and accrued liabilities,
    
    $1,500,000 Revolving Credit Facility plus $34,000 of accrued interest,
    
    $2,000,000 Guaranteed Convertible Debenture plus accrued interest of $104,000.




---



##### 



20.  Employee future benefits
  Total cash payments
  2007
    
    2006$
    
    $Accrued benefit obligationBalance, beginning of year
    
    
    15,824
    
    
    
    15,377Current service cost
    
    
    243
    
    
    
    169Benefits paid
    
    
    (948
    )
    
    
    (986
    )Interest cost
    
    
    796
    
    
    
    786Actuarial loss
    
    
    (756
    )
    
    
    478Balance, end of year
    
    
    15,159
    
    
    
    15,824




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##### 



20.
    
    Employee future benefits (continued)
 2007
    
    2006$
    
    $Plan assets fair valueBalance, beginning of year
    
    
    13,214
    
    
    
    12,203Employer contribution
    
    
    870
    
    
    
    920Employees contributions
    
    
    3
    
    
    
    4Benefits paid
    
    
    (948
    )
    
    
    (986
    )Actual return on plan assets
    
    
    (266
    )
    
    
    1,073Balance, end of year
    
    
    12,873
    
    
    
    13,214
  Percentage of plan assets2007
    
    2006%
    
    %Employer contribution receivable
    
    
    5
    
    
    
    10Canadian equity securities
    
    
    15
    
    
    
    30American equity securities
    
    
    
    
    
    
    12International equity securities
    
    
    26
    
    
    
    13International real estate
    
    
    5
    
    
    
    Bonds
    
    
    48
    
    
    
    28Campbell common shares
    
    
    1
    
    
    
    1Other (including cash and cash equivalents)
    
    
    
    
    
    
    6100
    
    
    
    100
  2007
    
    2006$
    
    $Fair value of plan assets
    
    
    12,873
    
    
    
    13,214Accrued benefit obligation
    
    
    (15,159
    )
    
    
    (15,824
    )Funded status of pension plans (deficit)
    
    
    (2,286
    )
    
    
    (2,610
    )Unamortized net actuarial loss
    
    
    7,183
    
    
    
    7,037Accrued benefit asset
    
    
    4,897
    
    
    
    4,427




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##### 



20.
    
    Employee future benefits (continued)
  2007
    
    2006$
    
    $Accrued benefit obligation
    
    
    11,982
    
    
    
    12,424Fair value of plan assets
    
    
    9,545
    
    
    
    9,700Funding deficit
    
    
    (2,437
    )
    
    
    (2,724
    )
  2007
    
    2006$
    
    $Current service cost, net of employee contributions
    
    
    240
    
    
    
    165Interest cost
    
    
    796
    
    
    
    786Actual return on plan assets
    
    
    266
    
    
    
    (1,073
    )Actuarial losses
    
    
    (756
    )
    
    
    478Elements of employee pension plans costs before
adjustments to recognize the long-term nature of
employee pension plans costs
    
    
    546
    
    
    
    356Adjustments to recognize the long-term nature of
employee pension plans costsDifference between expected return and actual return
on plans assets for the year
    
    
    (1,189
    )
    
    
    221Difference between actuarial loss recognized for the
year and actual actuarial loss on accrued benefit
obligation for the year
    
    
    1,043
    
    
    
    (187
    )Defined benefit pension costs
    
    
    400
    
    
    
    390Amount capitalized to property, plant and equipment
    
    
    
    
    
    
    (388
    )Net pension costs
    
    
    400
    
    
    
    2




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##### 



20.
    
    Employee future benefits (continued)
  2007
    
    2006%
    
    %Accrued benefit obligation as of December 31Discount rate
    
    
    5.30
    
    
    
    5.12Rate of compensation increase
    
    
    2.50
    
    
    
    2.50Benefit costs for years ended December 31Discount rate
    
    
    5.12
    
    
    
    5.25Expected long-term rate of return on plans assets
    
    
    7.00
    
    
    
    7.00Rate of compensation increase
    
    
    2.50
    
    
    
    2.50Average remaining service period of active employees
    
    
    19 years
    
    
    
    19 years
 21.
    
    Financial instruments
 Fair value
  Interest rate risk
  Credit risk




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##### 



21.
    
    Financial instruments (continued)
 Foreign exchange rate and metal price risks
   2007
    
    2006$
    
    $Cash
    
    
    424
    
    
    
    1,325Settlements receivable
    
    
    740
    
    
    
    4,631Short-term loans
    
    
    500
    
    
    
    3,339Accounts payable and accrued liabilities
    
    
    922
    
    
    
    29Prepayments for concentrate inventory shipped
    
    
    974
    
    
    
    
 22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP)
  2007
    
    2006
    
    2005$
    
    $
    
    $Reconciliation of net lossNet loss  Canadian GAAP
    
    
    18,988
    
    
    
    41,195
    
    
    
    24,430Adjustments:Amortization adjustment (a)
    
    
    
    
    
    
    (188
    )
    
    
    (233
    )Reversal of impairment of property,
plant and equipment (b)
    
    
    
    
    
    
    780
    
    
    
    970Warrants of the entity subject to
significant influence (i)
    
    
    
    
    
    
    
    
    
    
    485Exploration expenses (c)
    
    
    9,634
    
    
    
    (658
    )
    
    
    (109
    )Derivative instruments (d)
    
    
    
    
    
    
    256
    
    
    
    16Capital stock (h)
    
    
    (1,481
    )
    
    
    
    
    
    
    Debentures  conversion rights (j)
    
    
    (143
    )
    
    
    
    
    
    
    Net loss  United States GAAP
    
    
    26,998
    
    
    
    41,385
    
    
    
    25,559Unrealized loss on short-term investments
    
    
    9
    
    
    
    
    
    
    
    Employee defined benefit plans (f)
    
    
    146
    
    
    
    816
    
    
    
    1,360Comprehensive loss  United States GAAP (g)
    
    
    27,153
    
    
    
    42,201
    
    
    
    26,919Basic and fully diluted loss  United States GAAP
    
    
    0.07
    
    
    
    0.28
    
    
    
    0.25




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##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 2007
    
    2006
    
    2005$
    
    $
    
    $Reconciliation of shareholders equityShareholders equity  Canadian GAAP
    
    
    6,131
    
    
    
    12,006
    
    
    
    30,503Adjustments:Amortization adjustment (a)
    
    
    
    
    
    
    
    
    
    
    (188
    )Reversal of impairment of property, plant and equipment (b)
    
    
    
    
    
    
    
    
    
    
    780Exploration expenses (c)
    
    
    (12,487
    )
    
    
    (2,853
    )
    
    
    (3,511
    )Derivative instruments (d)
    
    
    
    
    
    
    (228
    )
    
    
    (28
    )Employee defined benefit plans (f)
    
    
    (7,183
    )
    
    
    (7,037
    )
    
    
    (6,221
    )Flow-through shares (e)
    
    
    (293
    )
    
    
    
    
    
    
    Capital stock (h)
    
    
    
    
    
    
    (1,481
    )
    
    
    (1,481
    )Debentures- conversion rights (j)
    
    
    (1,088
    )
    
    
    
    
    
    
    Shareholders deficiency  United States GAAP
    
    
    (14,920
    )
    
    
    407
    
    
    
    19,854
 a)
    
    Amortization adjustment
 Impairment of long-lived assets
   b)
    
    Reversal of impairment of property, plant and equipment




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 c)
    
    Exploration expenses
   d)
    
    Derivative instruments
 Financial Instruments  Recognition and Measurement




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 d)
    
    Derivative instruments (continued)
 Financial
Instruments  Recognition and Measurement
  e)
    
    Flow-through shares  Income tax expense




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 f)
    
    Employee defined benefit plans
 Employers Accounting
for Defined Benefit Pension and Other Postretirement Plans
 g)
    
    Comprehensive income
 Comprehensive income.
 h)
    
    Capital stock




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 i)
    
    Warrants of the entity subject to significant influence
    j)
    
    Debentures  conversion rights




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 k)
    
    Elimination of deficit
  l)
    
    Income taxes
  m)
    
    Recent and future accounting changes
 Accounting for Uncertainty in Income Taxes, Accounting for Income Taxes.
 Fair Value Measurements
 The Fair Value Option for Financial Assets
and Financial Liabilities




---



##### 



22.
    
    Differences between Canadian and United States generally accepted accounting principles
(GAAP) (continued)
 m)
    
    Recent and future accounting changes (continued)
 Business Combinations Noncontrolling Interests in Consolidated Financial Statements  an amendment
of ARB No. 51.
 
    
    Recognize 100% of the fair value of assets acquired, liabilities
assumed, and noncontrolling interests in acquisitions of less than 100% controlling
interest when the acquisition results in a change in control of the acquired
entity;
    
    Measure acquirer shares issued in consideration for a business
combination at fair value on the acquisition date;
    
    Recognize contingent consideration arrangements at their
acquisition-date fair values, with subsequent changes in fair value generally
reflected in earnings;
    
    Expense, as incurred, acquisition-related costs;
    
    Capitalize acquisition-related restructuring costs only if the criteria
in Statement 146 are met as of the acquisition date; and
    
    Recognize noncontrolling interest in subsidiaries at fair value and
classify as a separate component of equity.
  23.
    
    Subsequent events




---



##### 



23.
    
    Subsequent events (continued)
   24.
    
    Comparative figures




---



##### 



ITEM 19. EXHIBITS
 EXHIBIT INDEX
 ExhibitNumber
    
    Exhibit Description1.1
    
    Restated Articles of Incorporation dated August 9, 1999 (E) (Exhibit 4(a)).1.2
    
    Articles of Amendment dated May 19, 2000 consolidating the common shares on
the basis of one post consolidation common share for every ten
pre-consolidation common share. (F) (Exhibit 3.1)1.3
    
    Articles of Arrangement effective June 30, 2001 relating to the merger with
GéoNova Explorations Inc. (I) (Exhibit 3.3)1.4
    
    By-Law No. 1 as amended and as in effect on the date hereof (A) (Exhibit 3.12)1.5
    
    Amendment of By-Law No. 1 (A) (Exhibit 3.11)1.6
    
    Restated Certificate of Incorporation dated January 7, 2005 (L) (Exhibit 1.6)4.1
    
    The Companys Employee Incentive Plan as amended (E) (Exhibit 99)4.2
    
    Employment Agreement dated August 6, 2002 between the Company and André Y.
Fortier (J) (Exhibit 10.2)4.5
    
    Employment Agreement dated August 6, 2002 between the Company and Lucie Brun
(J) (Exhibit 10.5)4.6
    
    Directors Stock Option Plan (I) (Exhibit 10.8)4.7
    
    Royalty Agreement with Repadre Capital Corporation made as of April 23, 1993.
I (Exhibit 10.14) and amendment dated June 30, 2001 (I) (Exhibit 10.4)4.10
    
    Sale and Purchase Agreement dated November 10, 2004 between GéoNova and
Metanor (L) (Exhibit 4.10)4.12
    
    Operating and Consulting Agreement dated May 1, 2006 between Campbell and
Nuinsco (N) (Exhibit 4.12)4.13
    
    Purchase and Sale Agreement dated February 26, 2007 between MSV, Campbell,
Eastmain and Eastmain Mines Inc. (N) (Exhibit 4.13)4.15
    
    Investment Agreemend dated June 13, 2007 between Campbell, MSV Resources
Inc., MSV, AlbertaCo. and a private capital firm (EXHIBIT 4.15) (O)4.16
    
    Contract No. CP-0089 between Campbell and Ocean Partners (EXHIBIT 4.16) (P)6.1
    
    Statement detailing computation of per share earnings8.1
    
    Significant subsidiaries11.1
    
    Standards of Ethical Conduct (K)12.1
    
    Certification of André Y. Fortier pursuant to Section 302 of the
Sarbanes-Oxley Act of 200212.2
    
    Certification of Réal Savoie pursuant to Section 302 of the Sarbanes-Oxley
Act of 200213.1
    
    Certification of André Y. Fortier pursuant to 18 U.S.C. Section 1350 as
adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002




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##### 



ExhibitNumber
    
    Exhibit Description13.2
    
    Certification of Réal Savoie pursuant to 18 U.S.C. Section 1350 as adopted
pursuant to Section 906 of the Sarbanes-Oxley Act of 200215.1
    
    Consent of Deloitte & Touche LLP15.2
    
    Consent of Systemes Geostat International Inc. (EXHIBIT 15.2)15.3
    
    Audit Committee Charter (L)15.4
    
    Governance Policy (M) (Exhibit 15.4)
 (A)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
10-K for the year ended December 31, 1987 and incorporated herein by reference.(B)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
10-K for the year ended December 31, 1994 and incorporated herein by reference.(C)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
10-K for the year ended December 31, 1993 and incorporated herein by reference.(D)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
10-K for the year ended December 31, 1999 dated March 27, 2000 and incorporated herein by
reference.(E)
    
    refers to documents previously filed as an exhibit to Campbells registration statement
on Form S-8 (Registration No. 333-93063) and incorporated herein by reference.(F)
    
    refers to documents previously filed as an exhibit to Campbells Current Report on Form
8-K dated May 19, 2000 and incorporated herein by reference.(G)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
10-K for the year ended December 31, 2000 dated April 12, 2001 and incorporated herein by
reference.(H)
    
    refers to documents previously filed as an exhibit to Campbells Current Report on Form
8-K dated July 13, 2001 and incorporated herein by reference.(I)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2001 dated May 14, 2002 and incorporated herein by
reference.(J)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2002 dated May 15, 2003 and incorporated herein by
reference.(K)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2003 dated May 19, 2004 and incorporated herein by
reference.(L)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2004 dated March 30, 2005 and incorporated herein by
reference.(M)
    
    refers to documents previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2005 dated March 31, 2006 and incorporated herein by
reference.




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##### 



ExhibitNumber
    
    Exhibit Description(N)
    
    refers to document previously filed as an exhibit to Campbells Annual Report on Form
20-F for the year ended December 31, 2006 dated March 30, 2006 and incorporated herein by
reference.(O)
    
    portions of this exhibit have been omitted and filed separately with the secretary of
the SEC pursuant to a confidential treatment request.(P)
    
    portions of this exhibit have been omitted and filed separately with the secretary of
the SEC pursuant to a confidential treatment request.Exhibits in parentheses are references to the Exhibit No. of the filing indicated.




---



##### 



SIGNATURES
  CAMPBELL RESOURCES INC.Dated: March 31, 2008
    
    By: (s) André Y. Fortier

André Y. Fortier,President and Chief Executive Officer