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

                                    FORM 40-F

(Check one)

          REGISTRATION STATEMENT PURSUANT TO SECTION 12 OF THE SECURITIES
 -----      EXCHANGE ACT OF 1934

                                       OR
   X      ANNUAL REPORT PURSUANT TO SECTION 13(A) OR 15(D) OF THE SECURITIES
 -----      EXCHANGE ACT OF 1934


For the fiscal year ended: December 31, 2002      Commission file number 0-29382
                           -----------------                             -------

                          MINEFINDERS CORPORATION LTD.
                         -----------------------------
             (Exact name of Registrant as specified in its charter)

<TABLE>
<CAPTION>
<S>                                   <C>                                     <C>
------------------------------------------------------------------------------------------------------------------
         Not Applicable                          Ontario, Canada                         Not Applicable
------------------------------------------------------------------------------------------------------------------
(Translation of Registrant's name     (Province of other jurisdiction of      (I.R.S. Employer Identification
  into English (if applicable))         incorporation or organization)            Number (if applicable))
------------------------------------------------------------------------------------------------------------------
</TABLE>


                                      1000
                                      -----
    (Primary Standard Industrial Classification Code Number (if applicable))

   2288 - 1177 West Hastings Street Vancouver, British Columbia Canada V6E 2K3
                                 (604) 687-6263
   ---------------------------------------------------------------------------
   (Address and telephone number of Registrant's principal executive offices)

     C T Corporation System, 111 - 8th Avenue, New York City New York 10011
                                 (212) 894-8890
    ------------------------------------------------------------------------
 (Name, address (including zip code) and telephone number (including area code)
                   of agent for service in the United States)

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

       Title of each class            Name of each exchange on which registered
  Common Shares without par value              American Stock Exchange

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

                                      None
                                     ------
                                (Title of Class)

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

                                      None
                                     ------
                                (Title of Class)

For annual reports, indicate by check mark the information filed with this Form:


   X    Annual information form        X    Audited annual financial statements
 -----                               -----

<PAGE>

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

As at  December  31,  2002,  28,411,737  Common  Shares  without  par value were
outstanding.

Indicate  by check  mark  whether  the  Registrant  by  filing  the  information
contained  in this  Form is  also  thereby  furnishing  the  information  to the
Commission  pursuant to Rule 12g3-2(b) under the Securities Exchange Act of 1934
(the "Exchange Act"). If "Yes" is marked, indicate the filing number assigned to
the Registrant in connection with such Rule.


        Yes: 82-                               X     No
 -----           ----------                  -----

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

   X    Yes                                          No
 -----                                       -----

<PAGE>

Explanatory   Note:   Minefinders   Corporation   Ltd.  (the  "Company"  or  the
"Registrant")  is a Canadian  issuer eligible to file its annual report pursuant
to Section 13 of the  Securities  Exchange  Act of 1934 (the "1934 Act") on Form
40-F.  The Company is a "foreign  private  issuer" as defined in Rule 3b-4 under
the 1934 Act and in Rule 405 under the Securities Act of 1933. Equity securities
of the Company are accordingly exempt from Sections 14(a),  14(b),  14(c), 14(f)
and 16 of the 1934 Act pursuant to Rule 3a12-3.

Some of the statements contained in this report are forward-looking  statements,
such as estimates  and  statements  that  describe the  Company's  future plans,
objectives  or  goals,  including  words  to the  effect  that  the  Company  or
management  expects a stated condition or result to occur. Such  forward-looking
statements are made pursuant to the safe harbour provisions of the United States
Private  Securities   Litigation  Reform  Act  of  1995.  Since  forward-looking
statements  address  future  events and  conditions,  by their very  nature they
involve  inherent risks and  uncertainties.  Actual  results  relating to, among
other things,  reserves,  resources,  results of exploration,  capital costs and
production  costs could differ  materially from those  currently  anticipated in
such  statements  by reason of  factors  such as  changes  in  general  economic
conditions and conditions in the financial markets, changes in demand and prices
for the  minerals  the  Company  is  engaged  in  exploration  for,  litigation,
legislative,   environmental  and  other  judicial,  regulatory,  political  and
competitive  developments  in domestic  and  foreign  areas in which the Company
operates,  technological and operational  difficulties encountered in connection
with the  Company's  mining  activities,  labour  relations  matters  and costs,
changing foreign exchange rates and other matters discussed under  "Management's
Discussion and Analysis of Financial Condition and Results of Operations".  This
list is not  exhaustive  of the  factors  that may affect  any of the  Company's
forward-looking  statements.  These  and  other  factors  should  be  considered
carefully  and  readers  should  not  place  undue  reliance  on  the  Company's
forward-looking  statements.  Further  information  regarding  these  and  other
factors is included in the filings by the  Company  with the U.S.  Securities  &
Exchange Commission and Canadian provincial securities  regulatory  authorities.
Unless  otherwise  indicated,  all dollar  amounts in this  report are  Canadian
dollars.

The exchange rate of Canadian  dollars into United States  dollars,  on December
31, 2002,  based upon the noon buying rate in New York City for cable  transfers
payable in Canadian  dollars as  certified  for customs  purposes by the Federal
Reserve Bank of New York, was U.S.$1.00 = CDN $1.5800.

<PAGE>

                          MINEFINDERS CORPORATION LTD.

                         RENEWAL ANNUAL INFORMATION FORM

                      for the year ended December 31, 2002

                                   May 6, 2003

<PAGE>

                                TABLE OF CONTENTS
                                                                            Page
GLOSSARY AND DEFINED TERMS ................................................... i
REFERENCE INFORMATION ........................................................ v
CORPORATE STRUCTURE .......................................................... 1
GENERAL DEVELOPMENT OF THE BUSINESS .......................................... 1
    Significant Acquisitions and Dispositions ................................ 2
    Background and Trends .................................................... 2
NARRATIVE DESCRIPTION OF THE BUSINESS ........................................ 3
    Overview ................................................................. 3
    PRINCIPAL PROPERTY - THE DOLORES PROPERTY ................................ 3
    Description and Location ................................................. 3
    Accessibility, Climate, Local Resources, Infrastructure and Physiography . 6
    History .................................................................. 6
    Geology .................................................................. 7
    Exploration .............................................................. 8
    Drilling ................................................................. 8
    Mineralization .......................................................... 10
    Sampling and Analysis ................................................... 11
    Mineral Resource and Mineral Reserve Estimates .......................... 13
    NORTHERN SONORA PROPERTY ................................................ 15
    Description and Location ................................................ 15
    Climate, Accessibility, Local Resource Infrastructure and Physiography .. 15
    Nature of Transport ..................................................... 16
    Sampling and Integrity of Samples ....................................... 16
    La Bolsa Property: Location and Access .................................. 17
    El Malacate Recon: Description and Location ............................. 19
    OTHER PROPERTIES ........................................................ 22
    La Reserva/El Correo Property ........................................... 22
    San Antonio Property .................................................... 23
    Other Interests In Properties ........................................... 23
    NUMBER OF EMPLOYEES ..................................................... 26
    BANKRUPTCY, RECEIVERSHIP OR OTHER SIMILAR PROCEEDINGS ................... 26
    COMPETITION ............................................................. 26
    RISK FACTORS ............................................................ 26
SELECTED CONSOLIDATED FINANCIAL INFORMATION ................................. 30
    Dividend Record and Policy .............................................. 32
MANAGEMENT'S DISCUSSION AND ANALYSIS ........................................ 32
MARKET FOR SECURITIES ....................................................... 32
DIRECTORS AND OFFICERS ...................................................... 32
    Shareholdings of Directors and Officers ................................. 33
    Committees of the Board of Directors .................................... 33
    Corporate Cease Trade Orders or Bankruptcies ............................ 33
    Penalties or Sanctions .................................................. 34
    Personal Bankruptcies ................................................... 34
    Conflicts of Interest ................................................... 34
ADDITIONAL INFORMATION ...................................................... 34

<PAGE>

                           GLOSSARY AND DEFINED TERMS

The  following  is a  glossary  of  certain  mining  terms  used in this  Annual
Information Form.

Adit

A horizontal passage from the surface into the mine, also called a tunnel.

Adularization

Potassic alteration, introduction or replacement by Adularia.

Anomaly

A geological feature distinguished by geophysical or geochemical means, which is
different  from the  general  surroundings  and is often of  potential  economic
value.

Breccia

A coarse-grained clastic rock composed of angular broken fragments.

Cretaceous

The final  period of the  Mesozoic  area  (after  the  Jurassic  and  before the
Tertiary  period),  thought to have  covered the span of time between 65 and 144
million years ago.

Dome

A circular or elliptical uplift, typically volcanic in origin.

Epithermal

Hydrothermal  mineral deposit formed within 1 kilometre of the earth's  surface,
in the temperature range of 50-200(degree)C.

g/t or gpt

Grams per tonne.

Graben

An elongate downfaulted basin.

Horst

An elongate block of upfaulted rock.

Hydrothermal

Processes associated with heated or superheated water, especially mineralization
or alteration.

Igneous Rock

Rock which formed directly by crystallization from magma.

Interbedded

Beds laid between or alternating with others of different character.

Intrusive

The process of, and rock formed by, intrusion.

Jurassic

The middle system of the Mesozoic,  above the Triassic and below the Cretaceous,
thought to have covered the span of time between 200 and 145 million years ago.

Lithology

The  description  of rocks in hard  specimen  and in  outcrop,  relative to such
characteristics as color, mineralogic composition, and grain size.

Mesozoic

The  era  of  geologic   time  above  the  Paleozoic  and  below  the  Cenozoic,
approximately from 245 to 65 million years ago.

Metamorphic

Affected by physical, chemical, and structural processes imposed by depth in the
earth's crust.

Metasediment

Metamorphic rock of volcanic origin.

Mineral Reserve, Proven Mineral Reserve, Probable Mineral Reserve

Means that part of a measured  mineral  resource or indicated  mineral  resource
that can be extracted legally and at a profit under economic conditions that are
specified and generally  accepted as reasonable by the mining industry and which
is demonstrated by a preliminary feasibility study or feasibility study.

THE TERMS "MINERAL  RESERVE",  "PROVEN MINERAL  RESERVE",  AND "PROBABLE MINERAL
RESERVE"  USED IN THIS ANNUAL  INFORMATION  FORM ARE  CANADIAN  MINING  TERMS AS
DEFINED IN ACCORDANCE WITH NATIONAL  INSTRUMENT 43-101 - STANDARDS OF DISCLOSURE
FOR MINERAL  PROJECTS UNDER THE GUIDELINES SET OUT IN THE CANADIAN  INSTITUTE OF
MINING,  METALLURGY AND PETROLEUM (THE "CIM") STANDARDS ON MINERAL RESOURCES AND
MINERAL RESERVES DEFINITIONS AND GUIDELINES ADOPTED BY THE CIM COUNCIL ON AUGUST
20,  2000.  IN THE UNITED  STATES,  A MINERAL  RESERVE IS DEFINED AS A PART OF A
MINERAL DEPOSIT WHICH COULD BE ECONOMICALLY AND LEGALLY EXTRACTED OR PRODUCED AT
THE TIME THE RESERVE DETERMINATION IS MADE.

                                      -i-

<PAGE>

RESERVES ARE  CATEGORIZED AS FOLLOWS ON THE BASIS OF THE DEGREE OF CONFIDENCE IN
THE ESTIMATE OF THE QUALITY AND GRADE OF THE DEPOSIT.

Proven Mineral Reserve means, in accordance with CIM Standards,  for the part of
a deposit which is being mined,  or which is being developed and for which there
is a detailed  mining plan, the estimated  quantity and grade or quality of that
part of a measured mineral resource for which the size,  configuration and grade
or quality and  distribution  of values are so well  established,  and for which
economic viability has been demonstrated by adequate information on engineering,
operating, economic and other relevant factors, that there is the highest degree
of confidence in the estimate.

THE DEFINITION FOR "PROVEN MINERAL  RESERVES" UNDER CANADIAN  STANDARDS  DIFFERS
FROM THE STANDARDS IN THE UNITED STATES,  WHERE PROVEN OR MEASURED  RESERVES ARE
DEFINED AS RESERVES IN RESPECT OF WHICH (A) QUANTITY IS COMPUTED FROM DIMENSIONS
REVEALED IN OUTCROPS,  TRENCHES,  WORKINGS OR DRILL HOLES;  GRADE AND/OR QUALITY
ARE  COMPUTED  FROM THE  RESULTS  OF  DETAILED  SAMPLING  AND (B) THE  SITES FOR
INSPECTION,  SAMPLING  AND  MEASUREMENT  ARE SPACED SO CLOSELY AND THE  GEOLOGIC
CHARACTER  IS SO WELL  DEFINED THAT SIZE,  SHAPE,  DEPTH AND MINERAL  CONTENT OF
RESERVES ARE WELL ESTABLISHED.

Probable Mineral Reserve: means, in accordance with CIM Standards, the estimated
quantity and grade or quality of that part of an indicated  mineral resource for
which  economic  viability  has been  demonstrated  by adequate  information  on
engineering,  operating,  economic and other relevant  factors,  at a confidence
level which would serve as a basis for decisions on major expenditures.

THE DEFINITION FOR "PROBABLE MINERAL RESERVES" UNDER CANADIAN  STANDARDS DIFFERS
FROM THE STANDARDS IN THE UNITED STATES,  WHERE PROBABLE RESERVES ARE DEFINED AS
RESERVES IN RESPECT OF WHICH QUANTITY AND GRADE AND/OR QUALITY ARE COMPUTED FROM
INFORMATION  SIMILAR  TO THAT USED FOR  PROVEN  RESERVES  (UNDER  UNITED  STATES
STANDARDS),  BUT THE SITES FOR INSPECTION,  SAMPLING AND MEASUREMENT ARE FURTHER
APART OR ARE  OTHERWISE  LESS  ADEQUATELY  SPACED,  AND THE DEGREE OF ASSURANCE,
ALTHOUGH  LOWER  THAN  THAT  FOR  PROVEN  RESERVES,  IS HIGH  ENOUGH  TO  ASSUME
CONTINUITY BETWEEN POINTS OF OBSERVATION.

Mineral  Resource,  Measured  Mineral  Resource,   Indicated  Mineral  Resource,
Inferred Mineral Resource

Under CIM  Standards,  Mineral  Resource is a  concentration  or  occurrence  of
natural,  solid,  inorganic or fossilized  organic material in or on the Earth's
crust in such  form and  quantity  and of such a grade  or  quality  that it has
reasonable prospects for economic  extraction.  The location,  quantity,  grade,
geological  characteristics  and  continuity  of a Mineral  Resource  are known,
estimated or interpreted from specific geological evidence and knowledge.

THE TERMS "MINERAL  RESOURCE",  "MEASURED MINERAL RESOURCE",  "INDICATED MINERAL
RESOURCE",  AND "INFERRED MINERAL RESOURCE" USED IN THIS ANNUAL INFORMATION FORM
ARE CANADIAN  MINING TERMS AS DEFINED IN  ACCORDANCE  WITH  NATIONAL  INSTRUMENT
43-101 - STANDARDS OF DISCLOSURE  FOR MINERAL  PROJECTS UNDER THE GUIDELINES SET
OUT IN THE CIM  STANDARDS.  THEY  ARE NOT  DEFINED  TERMS  UNDER  UNITED  STATES
STANDARDS AND MAY

                                      -ii-

<PAGE>

NOT GENERALLY BE USED IN DOCUMENTS  FILED WITH THE UNITED STATES  SECURITIES AND
EXCHANGE COMMISSION BY U.S. COMPANIES.  AS SUCH,  INFORMATION  CONTAINED IN THIS
ANNUAL REPORT CONCERNING DESCRIPTIONS OF MINERALIZATION AND RESOURCES MAY NOT BE
COMPARABLE TO INFORMATION MADE PUBLIC BY U.S. COMPANIES SUBJECT TO THE REPORTING
AND  DISCLOSURE  REQUIREMENTS  OF THE  UNITED  STATES  SECURITIES  AND  EXCHANGE
COMMISSION.

A mineral  resource  estimate  is based on  information  on the  geology  of the
deposit and the continuity of mineralization.  Assumptions  concerning  economic
and operating  conditions  including  cut-off grades and economic mining widths,
based on factors  typical for the type of deposit,  may be used if these factors
have  not  been  specifically  established  for the  deposit  at the time of the
mineral resource estimate.

A mineral  resource is  categorised  on the basis of the degree of confidence in
the estimate of quantity and grade or quality of the deposit, as follows:

Inferred Mineral Resource:  Under CIM Standards, an Inferred Mineral Resource is
that part of a Mineral  Resource for which  quantity and grade or quality can be
estimated  on  the  basis  of  geological  evidence  and  limited  sampling  and
reasonably  assumed,  but not verified,  geological  and grade  continuity.  The
estimate  is  based  on  limited   information  and  sampling  gathered  through
appropriate techniques from locations such as outcrops, trenches, pits, workings
and drill holes.

Indicated Mineral Resource:  Under CIM Standards,  an Indicated Mineral Resource
is that  part of a  Mineral  Resource  for  which  quantity,  grade or  quality,
densities, shape and physical characteristics,  can be estimated with a level of
confidence  sufficient  to allow the  appropriate  application  of technical and
economic  parameters,  to support mine  planning and  evaluation of the economic
viability  of the  deposit.  The  estimate  is based on  detailed  and  reliable
exploration and testing information gathered through appropriate techniques from
locations such as outcrops,  trenches,  pits,  workings and drill holes that are
spaced  closely  enough for  geological  and grade  continuity  to be reasonably
assumed.

Measured Mineral Resource:  Under CIM Standards,  a Measured Mineral Resource is
that part of a Mineral Resource for which quantity, grade or quality, densities,
shape,  physical  characteristics  are so  well  established  that  they  can be
estimated with  confidence  sufficient to allow the  appropriate  application of
technical and economic parameters, to support production planning and evaluation
of the economic viability of the deposit.  The estimate is based on detailed and
reliable   exploration,   sampling  and  testing  information  gathered  through
appropriate techniques from locations such as outcrops, trenches, pits, workings
and drill holes that are spaced  closely  enough to confirm both  geological and
grade continuity.

Mineralization

A mineralized body which has been intersected by sufficient closely spaced drill
holes  and/or  sampling  to support  sufficient  tonnage  and  average  grade of
metal(s) to warrant further  exploration-development work. This mineralized body
does not  qualify as a  commercially  mineable  ore body,  as  prescribed  under
Securities and Exchange  Commission  standards,  until a final and comprehensive
economic,  technical and legal  feasibility study based upon the test results is
concluded and supports Proven/Probable Reserves.

Mineralized

Deposit  A  mineralized  body  which  has been  delineated  by  drilling  and/or
underground  sampling  to support a  sufficient  tonnage  and  average  grade of
metal(s).  Under SEC  standards,  such a deposit  does not  qualify as a reserve
until comprehensive evaluation,  based on unit cost, grade, recoveries and other
factors, concludes economic feasibility.

opt

Ounces per ton.

                                     -iii-

<PAGE>

Ore

Naturally  occurring  material  from which  minerals  of  economic  value can be
extracted.

Paleozoic

The era of geologic  time from 570 to 225 million years ago, from the end of the
Precambrian to the beginning of the Mesozoic.

Placer

A  surficial  mineral  deposit  formed by  mechanical  concentration  of mineral
particles from weathered debris.

Porphyry

An igneous rock  characterized  by visible  crystals in a  fine-grained  matrix.

Resistivity

A geophysical technique which measures the electrical  resistivity between a set
of spaced electrodes to generate a profile of subsurface geology.

Sedimentary Rock

Rock formed by the process of erosion and deposition.

Sericitization

A hydrothermal or metamorphic  alteration process involving the introduction of,
or replacement by, sericite muscovite.

Silicification

Alteration  process  involving the  introduction  of, or replacement by, silica,
generally  resulting in the formation of  fine-grained  quartz,  chalcedony,  or
opal, which may fill pores and replace existing minerals.

Stockwork

A three-dimensional network of closely spaced planar to irregular veinlets.

Tertiary

The first period of the Cenozoic, after the Cretaceous and before the Quatenary,
thought to begin about 65 million years ago.

Tuff

Consolidated or cemented volcanic ash.  Sometimes used as a general term for all
consolidated pyroclastic rocks.

Volcaniclastic

Refers to fragments derived from volcanic sources (which may be transported some
distance from their place of origin.)

                    NOTE REGARDING FORWARD-LOOKING STATEMENTS

This Annual  Information Form ("AIF") and the documents  incorporated  herein by
reference,  contain forward-looking  statements. Such forward-looking statements
include,  but  are  not  limited  to,  statements  about  mineral  reserves  and
resources, in that they constitute estimates,  based on certain assumptions,  of
mineralization  that may be  encountered  if a  deposit  were to be  mined.  Any
statements  that express or involve  discussions  with  respect to  predictions,
expectations,  plans, projections,  objectives,  assumptions or future events or
performance (often, but not always,  using words or phrases such as "expects" or
"does not  expect",  "is  expected",  "anticipates"  or "does  not  anticipate",
"plans",  "estimates" or "intends",  or stating that certain actions,  events or
results "may",  "could",  "would" or "will" be taken,  occur or be achieved) are
not statements of historical fact and may be "forward-looking statements".

Forward-looking  statements  involve known and unknown risks,  uncertainties and
other factors which may cause the actual results, performance or achievements of
the Company,  or industry  results,  to be materially  different from any future
results,   performance   or   achievements   expressed   or   implied   by  such
forward-looking  statements.  Although  the  Company has  attempted  to identify
factors that could cause actual actions,  events or results to differ materially
from those described in forward-looking  statements,  there may be other factors
that cause  actions,  events or results not to be as  anticipated,  estimated or
intended.  There can be no assurance that forward-looking  statements will prove
to be accurate, as actual results and future events could differ materially from
those  anticipated  in such  statements.  Accordingly,  readers should not place
undue reliance on forward-looking statements.

SOME OF THE IMPORTANT RISKS AND UNCERTAINTIES THAT COULD AFFECT  FORWARD-LOOKING
STATEMENTS  ARE DESCRIBED  FURTHER IN THIS DOCUMENT  UNDER  HEADINGS  "NARRATIVE
DESCRIPTION OF THE  BUSINESS",  "RISK  FACTORS" AND  "MANAGEMENT  DISCUSSION AND
ANALYSIS".  SHOULD ONE OR MORE OF THESE RISKS OR UNCERTAINTIES  MATERIALIZE,  OR
SHOULD  UNDERLYING   ASSUMPTIONS  PROVE  INCORRECT,   ACTUAL  RESULTS  MAY  VARY
MATERIALLY FROM THOSE ANTICIPATED,  BELIEVED, ESTIMATED OR EXPECTED. THE COMPANY
DOES NOT  INTEND TO  UPDATE  THESE  FORWARD-LOOKING  STATEMENTS.  INVESTORS  ARE
CAUTIONED AGAINST ATTRIBUTING UNDUE CERTAINTY TO FORWARD-LOOKING STATEMENTS.

                                      -iv-

<PAGE>

               CURRENCY PRESENTATION AND EXCHANGE RATE INFORMATION

This AIF contains references to both US dollars and Canadian dollars. All dollar
amounts  referenced,  unless  otherwise  indicated,  are  expressed  in Canadian
dollars and US dollars are referred to as "US dollars" or "US$".

The annual high, low, average and end of period exchange rates for the US dollar
in terms of Canadian dollars for each of the periods indicated, such rates being
the rates in New York City for cable transfers payable in Canadian  dollars,  as
certified for customs  purposes by the Federal Reserve Bank of New York, were as
follows:

--------------------------------------------------------------------------------

                   Corporation's Fiscal Year Ended December 31
--------------------------------------------------------------------------------

                 2002          2001           2000          1999           1998
--------------------------------------------------------------------------------

High           $1.5190       $1.4995        $1.4505       $1.4440        $1.4180
--------------------------------------------------------------------------------

Low            $1.6049       $1.5925        $1.5335       $1.5095        $1.5745
--------------------------------------------------------------------------------

Average        $1.5702       $1.4192        $1.4870       $1.4827        $1.4894
--------------------------------------------------------------------------------

Period End     $1.5800       $1.5925        $1.4995       $1.4440        $1.5375
--------------------------------------------------------------------------------

On April 23, 2003,  the  exchange  rate of Canadian  dollars into United  States
dollars,  based upon the noon buying  rate in New York City for cable  transfers
payable in Canadian  dollars as  certified  for customs  purposes by the Federal
Reserve Bank of New York, was U.S. $1.00 equals CDN$1.4512.

INCORPORATION OF FINANCIAL STATEMENTS AND MD&A

Incorporated by reference into this AIF are the audited consolidated financial
statements of the Company, which include its balance sheets as at December 31,
2002 and 2001 and the consolidated statements of loss and deficit, cash flows
and mineral properties and deferred exploration costs of the Company for the
years ended December 31, 2002, 2001 and 2000, together with the summary of
significant accounting policies and notes thereon, included in the Company's
2002 Annual Report. Also incorporated by reference in this AIF is the Company's
management's discussion and analysis ("MD&A") set out at pages 11 through 12 of
the Company's 2002 Annual Report. All financial information in this AIF is
prepared in accordance with Canadian generally accepted accounting principles
("GAAP"). Differences between Canadian and US GAAP pertaining to the Company are
described in Note 10 to our 2002 consolidated financial statements.

                              REFERENCE INFORMATION

Unless otherwise noted or the context otherwise indicates,  "Corporation" refers
to Minefinders Corporation Ltd. alone, and "the Company",  "we", "us", "our" and
"our company" refers to Minefinders Corporation Ltd. and its subsidiaries.

Unless otherwise  noted,  the information  contained in this AIF is given at the
date of this AIF.

                                      -v-

<PAGE>

                               CORPORATE STRUCTURE

The Company was incorporated by articles of incorporation  under the laws of the
Province  of Ontario on  February  4, 1975,  under the name  "Twentieth  Century
Explorations  Inc.".  On May  10,  1979,  the  Company  changed  its  name  from
"Twentieth Century Explorations Inc." to " Minefinders Corporation Ltd.".

The Company's head and principal  office is located at 2288 - 1177 West Hastings
Street,  Vancouver,  British Columbia,  Canada V6E 2K3. The Company's registered
and  records  office is located at Suite 1100 - 200 King Street  West,  Toronto,
Ontario M5H 3T4.  The Company  also  maintains  an  exploration  office in Reno,
Nevada, United States of America.

The  following  table sets  forth the name of each  material  subsidiary  of the
Company,  the  jurisdiction  of its  incorporation  and the  direct or  indirect
percentage ownership by the Company of such subsidiary.

                        Principal Operating Subsidiaries

--------------------------------------------------------------------------------
Name                                          Place of                Percentage
                                           Incorporation               Ownership
--------------------------------------------------------------------------------

Minera Minefinders S.A. de C.V.                Mexico                    100%

Compania Minera Dolores S.A de C.V.            Mexico                    100%

Minefinders (U.S.A.) Inc.                      Nevada                    100%
--------------------------------------------------------------------------------

The Company's operations in Mexico are conducted through Minera Minefinders S.A.
de C.V.  ("Minera") and Compania Minera Dolores S.A. de C.V. ("Minera  Dolores")
and in the U.S.A., through Minefinders (U.S.A.) Inc.

The Company is a reporting issuer in British  Columbia,  Alberta,  Saskatchewan,
Manitoba,  Ontario  and Quebec and the  Company's  common  shares are listed for
trading on the Toronto Stock Exchange  ("TSX") under the symbol "MFL" and on the
American Stock Exchange ("AMEX") under the symbol "MFN".

                       GENERAL DEVELOPMENT OF THE BUSINESS

The Company is in the business of  exploration  and  development of precious and
base metal properties. Interests in these properties are currently held directly
and indirectly and through leases, options and working interests.  The Company's
properties  are  primarily  located  in  Mexico  and the  U.S.A.  The  Company's
principal  mineral  property  interests  are the  Dolores  Property  located  in
Chihuahua,  Mexico (the "Dolores  Property")  and the Northern  Sonora  Property
located in Sonora, Mexico (the "Northern Sonora Property").  The Northern Sonora
Property includes the La Bolsa gold deposit and the El Malacate project and more
than a dozen other prospects  (including the La Reserva/El Correo Property) each
at various levels of exploration. The Company's other mineral property interests
include the Clear, Dottie and Gutsy/Buckskin  Mountain Properties in Nevada, the
Oro Blanco  Property  in Arizona  and the San  Antonio  Property  in  Zacatecas,
Mexico. The Company also has mineral property  interests in Quebec,  Canada, but
has no active exploration projects in Canada.

Exploration and Development

In June of 2002, the Company initiated a 30,000 metre drilling program, designed
to bring the Dolores  property to final  feasibility over the next 12-18 months,
and  lead  to  a  production  decision.  At  the  earliest,  production  is  not
anticipated to commence on the Dolores  deposit until early 2005. Over the three
year period ended  December 31, 2002,  the Company  completed an  additional  59
diamond core holes,  totalling 18,300 metres and 32 reverse  circulation  ("RC")
drill holes totalling  6,197 metres of infill  drilling on the Dolores  deposit,
bringing the total drilling  completed on the Dolores  property through December
2002 to 195 core and 187 RC holes  totalling  85,937  metres.  The  Company  has
selected independent  engineering firms to provide an updated resource model and
final feasibility  study in 2003.  Drilling will continue through the first half
of 2003. Other activities over the past three years on the Dolores property have
included geological mapping and sampling,  road construction,  re-assaying 9,000

                                      -1-

<PAGE>

drill  intercepts for silver using  multi-acid  digestion,  completing in August
2002 an  independent  audit of the  measured,  indicated  and inferred  resource
contained  in  the  Dolores  main  zone   deposit  and   initiating   additional
metallurgical studies.  During this period, the Company also conducted extensive
exploration  of  the  Northern  Sonora  properties,  which  led  to  a  $521,043
investment by a subsidiary of Placer Dome Exploration  Inc.  ("Placer Dome") for
drilling  programs in 2002. In December 2001, the Company entered into an option
agreement  with Placer  Exploration  Mexico Ltd.  ("Placer")  whereby Placer was
granted an option to earn up to a 70%  interest in the El  Malacate  Property by
incurring  work  costs  in  the  exploration  of  the  property.  Subsequent  to
completing the initial drilling program, Placer notified the Company that it was
terminating the option agreement.  Consequently,  the property has reverted 100%
back to the Company. Exploration activities will continue on the Company's other
properties  over the next 12 months  with  additional  drilling  planned for the
Northern Sonora properties and the Nevada properties in 2003.

Financing

In  September  2000,  the  Company  issued  405,818  units  by way of a  private
placement  for gross  proceeds of  $446,400.  Each unit  consisted of one common
share and  one-half  of a warrant.  Each whole  warrant  entitled  the holder to
purchase one common share at $1.35 per share for a two year period.

In January  2001,  the  Company  completed  private  placements  financing  (the
"January 2001  Financing") of 1,599,643  units for gross proceeds of $1,477,180.
Each unit consisted of one common share and one warrant  entitling the holder to
purchase one common share at $1.00 and $1.15 for a two year period.

During the remainder of 2001, the Company completed private  placements to issue
a further  1,402,080  units  for total  proceeds  of  $1,612,392  with each unit
consisting  of one common  share and one-half of a warrant.  Each whole  warrant
entitled the holder to purchase one common share at $1.40 per share for a period
of two  years.  Related  issuance  costs  totalled  $122,485  in respect of this
financing.

In April 2002, the Company completed a brokered private  placement  financing of
4,400,000  common shares at $2.30 per share for total  proceeds of  $10,120,000.
Related  share  issue  costs  of  $745,593  were  incurred  in  respect  of this
financing.

On February 7, 2003, the Company  completed a brokered  placement  consisting of
2,587,500  common shares (the "February 2003  Financing") at $7.00 per share for
gross  proceeds  of  $18,112,500.  The shares  issued  under the  February  2003
Financing were qualified by way of short form  prospectus.  The final short form
prospectus  of the  Company  in  respect  of the  February  2003  Financing  was
receipted by the British Columbia, Alberta,  Saskatchewan,  Manitoba and Ontario
Securities Commissions on January 31, 2003.

Significant Acquisitions and Dispositions

There were no  significant  acquisitions  or  dispositions  made by the  Company
during its most recently completed financial year.

Background and Trends

As the  Company  is a  mineral  exploration  and  development  company  with  no
producing properties, the information required by this sub-item is inapplicable.
The Company's  management  believes that gold and silver prices will continue to
firm up over the next  several  years and that the  Company  will  benefit  from
rising precious metal prices.

For further  information on the Company's material mineral  properties,  see the
Property  discussions  in  Item 4  commencing  on page 3 of  this  AIF.  See the
Selected  Consolidated   Financial  Information  in  Item  5  of  this  AIF  for
information  on  significant  transactions  affecting  the  development  of  the
Company's business in the last three years.

                                      -2-

<PAGE>

                      NARRATIVE DESCRIPTION OF THE BUSINESS

Overview

The information  provided hereunder has been prepared by Mark H. Bailey,  M.Sc.,
P.Geo.,  President  of the Company,  who is a  "qualified  person" as defined in
National  Instrument  43-101 - Standards of Disclosure for Mineral Projects ("NI
43-101").

The Company is a mining  exploration  and  development  company.  The  Company's
principal  properties are the Dolores  Property and the Northern Sonora Property
(which  includes  the La Bolsa  deposit and the El Malacate  project) as well as
more than a dozen other  projects  including the La  Reserva/El  Correo group of
claims.  All of these properties are without a known body of commercial ore. The
Company's  activities  on these  properties  to date  have been  exploratory  in
nature. There is no surface plant or equipment on any of these properties.

Since  November  1995,  the  Company  has been  actively  working on the Dolores
Property  completing  aerial  photos and  topography,  satellite  imagery,  road
construction and infrastructure development,  surface mapping, surface sampling,
underground sampling,  geophysics,  diamond core and RC drilling,  metallurgical
studies, environmental base line studies and initial resource modelling and mine
engineering.  Results from these  efforts  have led to the  discovery of a major
epithermal gold and silver deposit  containing an initial estimated 2.77 million
ounces of gold and 161 million ounces of silver.

The La Bolsa  mineralized  system on the Northern Sonora Property was discovered
and staked in 1994 by Company personnel,  and a first phase exploration drilling
program was completed in 1996. A second  program was completed in 1998 producing
an independent  mineralized  deposit estimate of up to 208,000 ounces gold and 2
million  ounces of silver.  Exploration  work was  suspended  in 1998 pending an
increase in gold prices or a  substantial  cash influx.  Exploration  activities
including  geological  mapping and  sampling  and  drilling  continued on the El
Malacate  project  covering a portion of the Northern  Sonora  Property with the
completion  of nine widely  spaced drill holes  during  2002.  Work on the other
northern  Sonora  mineral claims from 1996 through 2002 has led to the discovery
of twelve additional gold-silver mineralized systems and several porphyry copper
related base metal systems.

The Company also has  interests in a number of  secondary  properties.  Detailed
mapping and sampling  conducted  over the past five years has defined  anomalous
gold zones on the San Antonio  Property in Zacatecas,  Mexico,  where an initial
drilling  program is proposed to confirm and test the down dip extension of this
gold  mineralization.  In  addition,  we have  interests  in the  Gutsy/Buckskin
Mountain Properties,  Nevada,  U.S.A., the Clear Property,  Nevada,  U.S.A., the
Dottie Property,  Nevada, U.S.A., the Oro Blanco Property,  Arizona,  U.S.A. and
the  Dubuisson  Property,  Val  d'Or,  Quebec.  The  Company's  interest  in the
Dubuisson Property consists only of a 2% net royalty interest.

                    PRINCIPAL PROPERTY - THE DOLORES PROPERTY

For a full report on the Company's principal property, the Dolores Property, see
the report  prepared for the Company by Pincock  Allen & Holt (the "PAH Report")
entitled  "Audit of  Resources  at the Dolores  Gold-Silver  Project  Chihuahua,
Mexico",  dated December 2, 2002,  which has been previously filed on SEDAR. The
PAH Report was  authored by George  Armbrust  and Robert  Sandefur  who are both
"independent  qualified  persons"  as defined  in NI  43-101.  The PAH Report is
incorporated herein by reference and a brief summary of the information provided
in the PAH Report is provided below.

The Company's  current  primary  focus is on the Dolores  Property in respect of
which a drilling and feasibility  study is underway.  The Dolores  Property is a
structurally-controlled,  gold-silver  deposit  located  within  a  sequence  of
volcanic  rocks.  Gold and silver  mineralization  identified at surface  occurs
within a zone over 4,000  metres  long and 1,000  metres in width at  elevations
that range from 1,400 metres to 1,700 metres above sea level. Mineralization has
also been  investigated  to the depth of drilling at 1,150  metres  elevation or
over 550 metres of vertical extent.

Description and Location

The Dolores Project is located in the Sierra Madre  Occidental Range of northern
Mexico at  geographic  coordinates  29 degrees  north  latitude,  108 degrees 32
minutes west  longitude,  in the westernmost  part of the State of Chihuahua.  A
property  location  map is shown in Figure 1 and a land  status  map is shown in
Figure 2. The project area is  approximately  250 kilometres west of the city of
Chihuahua.

                                      -3-

<PAGE>

The Company,  through its 100% owned Mexican subsidiary,  Minera Dolores,  has a
controlling  interest  in the Dolores  mineral  concessions  and surface  rights
covering  the  project  area.  The  Company   executed  a  Mining   Exploration,
Exploitation  and Unilateral  Promise of Sale Agreement with Liebano Saenz Ortiz
("Saenz"),  the owner of seven  exploitation  concessions  comprising a total of
1,920 hectares covering the core of the Dolores Mining District.  This agreement
was subsequently assigned to Minera Dolores.  Minera can earn a 100% interest in
these  concessions  by paying a total of US$1.5  million in cash payments at the
rate of US$25,000 each calendar quarter.  Through December 2002, the Company has
paid a total of US$967,000.  A Net Smelter Return ("NSR")  royalty of 2% on gold
and  silver is payable to Saenz upon  commercial  production  and an  additional
1.25% NSR on gold only is payable  to  another  party.  Two  peripheral  mineral
concessions  (Silvia and Dolores) were staked by the Company  bringing the total
area of concessions to 27,700 hectares.

The Dolores Property consists of the nine concessions described in the following
table,  comprising a total of 27,700  hectares.  All  environmental  permits are
current and in order and allow the Company to conduct exploration of the Dolores
Property  through  to the actual  permitting  for a mine site.  In  addition  to
permits  allowing the Company to construct all access and drill roads  necessary
to complete the development  drilling now underway,  the Company has permits for
the use of a nearby  landing  strip.  The  Company has also  negotiated  surface
rights agreements with the Ejido Huizopa and certain  individual  members of the
Ejido for access and right to conduct all exploration activities on the property
up to and  including  all mining  operations  that may occur on these lands as a
result of these exploration activities.

                                [OBJECT OMITTED]
                          Figure 1: Property Locations

                                      -4-

<PAGE>

The  following  table lists  pertinent  information  with respect to the Dolores
Property Mining Concessions.

                       Dolores Property Mining Concessions

--------------------------------------------------------------------------------
    Concession Name              Title No.    Area (hectares)      Expiry Date
--------------------------------------------------------------------------------
    Silvia                         217587          2,866       August 20, 2052
    Real Cananea                   184981            394       December 12, 2039
    Real Cananea Uno               184982            180       December 12, 2039
    San Judas Tadeo                184983            150       December 12, 2039
    Alma Maria                     191728              6       December 18, 2041
    Ampliacion Real Cananea        184984            350       December 12, 2039
    Ampliacion Real Cananea Uno    184985            360       December 12, 2039
    Ampliacion Real Cananea Dos    184986            480       December 12, 2039
    Dolores                        206344         22,914       December 1, 2003
--------------------------------------------------------------------------------
    Total Area                                    27,700
--------------------------------------------------------------------------------

Eight of the nine concessions have been granted  exploitation  status. Taxes are
due every six months,  in January and July,  on all  concessions.  Taxes paid in
January 2003 totalled 506,311 Pesos (approximately US$50,000). Annual assessment
work is required for  exploration  concessions  and work  expenditures  to date,
which can be  carried  forward,  will  cover the  concessions  for the next five
years.

Gold and silver mineralization, identified at surface, occurs within a zone over
4,000 metres long and 1,000 metres in width and has been intersected in drilling
to depths of over 450 metres below the highest topographical elevation. Historic
underground  mining was carried out along  three main,  sub-parallel  structures
that occur  both  within and beyond  the  resource  study  area.  Figure 2 below
illustrates the location of the known  mineralized  zones,  the mineral resource
area and concession boundaries.

                                [OBJECT OMITTED]
      Figure 2: Dolores Property Mineral Concessions and Mineralized Areas

                                      -5-

<PAGE>

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The project area is  approximately  250 kilometres west of the city of Chihuahua
and is accessed from the town of Madera (pop.  +/- 35,000).  Madera is linked by
paved highway and railway with the rest of Mexico and the United States.  The 87
kilometre,  3.5 hour trip to Dolores  from  Madera by  vehicle  is mostly  along
narrow, winding and rough gravel logging roads.

The  climate in the area is  semi-arid  with  average  annual  precipitation  of
approximately  25 cm.  Most of the  precipitation  falls  during  the wet season
lasting from July to mid September.  Temperatures range from -10 degrees Celsius
in winter  to 45  degrees  Celsius  in  summer.  Exploration  can be  undertaken
throughout the year.

The  local  economy  is  supported  mainly  by  cattle  ranching,   logging  and
subsistence  level farming.  Unskilled  labour is available at several  villages
within the area.  Water for drilling is available from a local  reservoir,  from
flooded historic  underground mine workings and the nearby Rio Tutuaca.  Surface
rights to all known mineralization, areas suitable for potential waste disposal,
tailings, storage, heap leach pads and plant sites are held by the Company.

The project area is serviced by narrow, winding, rough roads. A network of roads
to provide access for drilling has been established on the property. Most modern
services are available at Madera.

Site topography is  characterized  by moderately  rugged terrain with elevations
ranging from 1,200 metres above sea level, at the Rio Tutuaca,  to 2,000 metres,
at the Mesa Aterrizaje.

The mountaintops are covered with pine, while vegetation in the valleys consists
mainly of thorny  shrubs and cactus.  Active,  intermittent  stream  erosion has
resulted in the formation of deep V-shaped valleys throughout the area.

History

Mining activity in the area of the Dolores  Property is believed to have started
with placer  mining circa 1860.  In 1898,  organized  lode mining is reported to
have begun in the area.  By 1915, a power line had been  installed  from Madera,
and processing was  accomplished  by pulverizing  the ores in 25 stamp mills and
recovering  gold and  silver in a cyanide  leach and zinc  precipitate  circuit.
Records from 1922 through 1929 indicate  that the property was producing  nearly
50,000  tonnes per year until the mill was  destroyed  in a fire in early  1929.
Only sporadic high-grade  production occurred during 1929 to 1931, and there are
no records of any production since that time.

The  Company  began  acquiring  a land  position  in the  district  in 1993  and
initiated a preliminary  surface  exploration program to evaluate the district's
mineral potential. Between 1996 and 2001, the Company completed more than 61,000
metres of drilling,  including  approximately 136 core holes totalling  32,048.8
metres  and  approximately  155 RC holes  totalling  29,392.2  metres.  Detailed
geologic  mapping  of  approximately   six  square   kilometres  and  widespread
reconnaissance  mapping and  sampling  covering 12 square  kilometres  have been
combined with ore microscopy,  metallurgical  study,  petrographic  analysis and
geochemical studies to form the data base. Geophysical surveys, including 14,900
line metres of induced polarization,  resistivity, and magnetic surveys, as well
as base-line  environmental  studies,  were also  completed  during this period.
Since July of 2002, the Company has completed an additional 24,500 metres (6,197
metres RC and 18,300  metres core) of a planned  30,000 - 35,000 metre  drilling
program for 2002-2003.

                                      -6-

<PAGE>

The  following  table shows the  historical  production  of the  Dolores  Mining
District for the years 1922 to 1931. The accuracy of this information is unknown
to the Company.

              Recorded Production from the Dolores Mining District
<TABLE>
<CAPTION>
<S>    <C>       <C>           <C>       <C>       <C>     <C>        <C>         <C>         <C>     <C>
     ----------------------------------------------------------------------------------------------------------
       Year    Tons Mined    Average Grade      Average Grade            Contained               Contained
                                (gm/ton)           (oz/ton)              Kilograms               Kilograms
                              Au       Ag        Au        Ag        Au            Ag          Au        Ag
       1922      63,494       *6.1      *635       0.18    18.52     *388.5      *40,313.8    12,492  1,296,088
       1923      65,885        6.8       559       0.20    16.30      451.0       36,862.0    14,500  1,185,113
       1924      54,005       *8.4      *527       0.24    15.37     *451.0      *28,471.3    14,501    915,351
       1925      51,261       *9.6      *505       0.28    14.73     *492.7      *25,862.1    15,841    831,466
       1926      48,523       12.7       548       0.37    15.98      606.0       25,718.0    19,483    826,834
       1927      42,082       12.5       554       0.36    16.16   ***526.0    ***23,313.4    16,912    749,526
       1928      38,146       12.5       400       0.37    11.67      478.0       15,250.0    15,368    490,288
     Mill burned in early 1929, subsequent higher grade ore shipped off property for milling (?)
       1929       1,306       24.6       872       0.72    25.43       32.0        1,140.0     1,029     36,651
       1930       3,686     **30.7  **1671.5       0.90    48.75      118.0        6,153.0     3,794    197,819
       1931       3,384     **27.6  **1458.2       0.81    42.53     **93.4     ***4,934.5     3,004    158,646
     Total/ weighted average
                371,771        9.8       563      0.286    16.26    3,636.7      208,018.1   116,921  6,687,782
     ----------------------------------------------------------------------------------------------------------
</TABLE>

              *        Back calculated from production using 96% recovery from
                       Au and 87% recovery of Ag (Average recoveries listed in
                       annual reports)
              **       Weighted average from several ore shipments
              ***      Calculated from Tons Mined and Average Grade

         Sources:      Anuario de Estaddistica Minero, 1922, 1923, 1926, 1927,
                       1928, 1929 and 1930, 1931, Annual Reports
--------------------------------------------------------------------------------

Geology

The Dolores deposit is a  structurally-controlled,  gold-silver deposit, located
within a sequence of volcanic rocks composed  primarily of andesite flows,  flow
breccias,  and tuffs, which are overlain by latite  volcaniclastic  breccias.  A
variety of  intrusive  bodies are coeval with the  volcanic  sequence,  the most
common  being  dikes of  latite  composition  which  generally  strike  in a NNW
direction.

The  dominant  structural  features  are  regional,  sub-parallel,  NNW-trending
faults, which dip steeply to the west. Continued  down-to-the-west offset within
this  structural  set is believed to have caused the  development of a series of
dilational  conjugate  faults  between the  primarily  parallel to  sub-parallel
faults.   These  faults  are  believed  to  have  been  influential  during  the
mineralizing  event  and  locally  may  help  to  explain  the  geometry  of the
mineralization.

Gold and silver  mineralization  identified at surface occurs within a zone over
4,000 metres long and 1,000 metres in width at elevations  that range from 1,400
metres  to  1,700  metres  above  sea  level.   Mineralization   has  also  been
investigated  to the depth of drilling  at 1,150  metres  elevation  or over 550
metres of vertical extent.

Precious  metal  mineralization  has been  encountered  from the  surface to the
deepest drilling completed to date, exceeding 500 metres and over wide intervals
(30 to 100 metres). Within this broad zone of mineralization, relatively narrow,
2 to 20 metre wide intense  stockwork or mineralized  breccia zones,  that often
occur along, but not confined to, intrusive contacts contain bonanza grades that
may range from 10 to over 200 grams per tonne gold and 300 to over 13,000  grams
per tonne silver.

At intermediate  levels in the system,  mineralized  feeders widen into breccias
containing  druzy cavities,  comb  structures,  crustifications  and symmetrical
banding in silica veins and veinlets.  Strong hydrothermal brecciation is common
and frequently overprints areas of original tectonic breccia and/or fractures.

The upper extent of  widespread  mineralization  is generally  confined to a few
tens of metres  above the contact of the latitic  volcaniclastic  tuffs with the
underlying  intermediate andesitic volcanics.  It is likely that high porosities
and  permeabilities  resulted in dispersal and lateral migration of hydrothermal
fluids  at  the  volcaniclastic   contact  with  concimitant  cooling  generally
restricting ascension of hydrothermal fluids.

                                      -7-

<PAGE>

For more  details on the geology on the Dolores  Property,  see section 3 of the
PAH Report, which is incorporated herein by reference.

Exploration

The  Company  acquired  its right to explore  the  Dolores  Property in 1993 and
initiated a preliminary  surface  exploration program to evaluate the district's
mineral potential.  Between 1993 and August 1994, several  reconnaissance visits
by Company  personnel  and various  consultants  resulted in the  collection  of
several hundred rock chip samples,  including  surface grab and channel samples.
Since November 1995,  the Company has actively  worked on the Dolores  Property,
resulting in the discovery of a significant gold and silver deposit.

Exploration  efforts have included  reconnaissance and detailed surface mapping,
channel sampling on surface and in accessible old underground workings totalling
more than 16,000 rock chip assays,  metallurgical studies, initial mine planning
and engineering  studies,  environmental base line studies,  road up-grading and
construction,  airphoto  and  topographical  maps and a total of 382  holes  for
85,937 metres, providing more than 44,000 drill samples for assay on the Dolores
Property as of the end of fiscal  year 2002.  Drilling  during 2002  included 59
diamond drill holes for 18,300 metres and 32 RC holes for 6,197 metres completed
as part of the current 30,000 to 35,000 metre drill program.

Work on the property was carried out by professional  geologists employed by the
Company and a number of independent  consulting  geologists  and engineers.  The
principal outside  independent  consultants over the last 7 years include: H. J.
Choates and W.E. Brereton,  of MPH Consulting Limited;  McClelland Labs of Reno,
Nevada; Golder and Associates,  Tucson,  Arizona;  Mine Development  Associates,
Reno, Nevada; MRDI Canada; SRK Canada; J. Nilsson, P. Eng; Pincock Allen & Holt,
Denver, Colorado; Hazen Research, Inc, Golden Colorado, Roscoe Postle Associates
Inc, Vancouver, B.C. and M3 Engineering & Technology Corp. Tucson, Arizona.

Drilling

Since the start of the first phase of drilling in August 1996,  more than 86,000
metres of drilling in 382 holes have been completed to date. Diamond drill holes
amounting  to more than 50,348  metres in 195 holes and 187 reverse  circulation
drill holes for 35,600  metres  constitute  the drilling  database with drilling
continuing at the time of this AIF.

Of the total holes drilled, more than 328 holes were drilled within the resource
area and will be used in the a new resource calculation. Two holes were lost and
six additional holes were water well and water test wells. Fifty-four holes were
drilled to test targets  peripheral to the resource area;  three were drilled on
the La Bohemia target,  18 tested the East Dike target,  13 tested the Norte and
north end of the East Dike target,  16 were drilled on the Sur Zone and one hole
was drilled on the La Central target.

Reverse  circulation holes were sampled at 1.52 metre intervals and diamond core
holes were typically  split at 2 metre assay  intervals.  One-half of the sample
was sent to the lab for assay and  one-half  was  placed in  storage  for future
reference.

Through  2002,  more than  45,500  samples  were  assayed  and  compiled  into a
database.

A first phase of diamond  drilling was carried out by the Company between August
and December 1996,  with 6,609 metres of HQ/NQ core recovered in 30 holes.  Most
of the drill holes encountered  significant gold and silver  mineralization over
substantial  widths along a 1,000 metre strike length within the Chabacan target
area. One of the better intersections in D96-22 averaged 2.64 g/t gold and 116.2
g/t silver over 29.8 metres.

A second phase of drilling commenced in January 1997 and ended in February 1997.
At the end of this program,  45 diamond drill holes totalling  10,115 metres had
been completed since initial  drilling  started in August 1996. The second phase
drilling tested a 2,000 metre strike length south of the Chabacan main zone. One
of the  better  drill  holes in this  program,  D97-36,  intersected  96  metres
averaging 2.00 g/t gold and 32.2 g/t silver.

                                      -8-

<PAGE>

A third phase drill  program was  initially  carried out under the  direction of
Echo Bay Mines Ltd.  ("Echo Bay") staff and later managed by Company  personnel.
The drill program  consisted of infill drilling to confirm the existing resource
and  step-out  drilling to expand the resource to include the Hondo and Chabacan
target areas.

All of the  infill  holes  drilled  during  this phase  intersected  potentially
economic grade gold and silver  mineralization  and confirmed  continuity of the
main zone deposit over a strike length of 2,000  metres.  All holes were drilled
at  angles  of -450 to -750 and  directed  to test  the  down-dip  extension  of
outcropping surface gold and silver  mineralization to depths of 350 metres (see
Figure 3).

                               [OBJECT OMITTED]
              Figure 3: Representative Drill Section with General
                    Geology and Highlighted Assay Intervals

In August  1997,  an  independent  resource  was  calculated  by Humbolt  Mining
Services,  based on 107 drill holes. A drill indicated and inferred resource was
estimated at 27.84  million tons with an average grade of 0.038 oz/ton (1.3 g/t)
gold and 1.38 oz/ton (47.3 g/t) silver at a 0.015 oz/ton gold cut-off.

In September  1997,  Echo Bay  completed a 56 hole drill  program with all holes
intersecting  significant gold and silver  mineralization.  In October 1997, the
Company reacquired Echo Bay's interest in the Dolores Property and

                                      -9-

<PAGE>

continued  with  the  phase-one  feasibility  study  initiated  by Echo Bay that
included column leach testing, environmental base line studies and a preliminary
geotechnical study.

In June 1998, MRDI Canada provided an updated resource  calculation as part of a
pre-feasibility  scoping  study.  The  calculation  was based on 160 drill holes
totalling 35,000 metres of drilling over 1,800 metres of strike length.  Using a
0.5 g/t cut-off  and  uncapped  gold  equivalent,  the  following  resource  was
calculated.

                  Indicated          23,912,000 tonnes of 1.45 g/t Au Eq.
                  Inferred           30,385,000 tonnes of 1.245 g/t Au Eq.
                  --------------------------------------------------------------
                  Total              54,297,000 tonnes of 1.338 g/t Au Eq.

In September 1998,  additional infill drilling was completed on the main zone at
25 metre centres along the 1,800 metre strike length.  Incorporating  the latest
drill results,  an updated resource  calculation by MRDI Canada was completed in
November 1998,  with indicated and inferred  resources for the main zone deposit
totalling 61 million  tonnes grading 1.42 g/t  gold-equivalent.  All gold values
were capped at 4.0 g/t and silver values were capped at 220 g/t. A cut-off grade
of 0.5 g/t  gold-equivalent  was used.  The data provided to MRDI Canada for the
resource   study   included  238  drill  holes  (127   diamond   drill  and  111
reverse-circulation  drill  holes)  totalling  52,898  metres.  The drill  holes
extended over 2,800 metres of strike length and 1,000 metres across strike.

From  January  to March  2000,  a  program  of  infill  drilling  confirmed  the
continuity of high-grade gold and silver mineralization  occurring within feeder
structures  surrounded  by a broad  zone  of  disseminated  mineralization.  The
high-grade  feeder structures extend for over 4,000 metres along strike and have
been  drill-tested to depths of up to 300 metres.  Some of the best results from
the 2000 drill  program came from hole  D00-R140  drilled on section  2175.  The
drill hole  averaged  1.24g/t  gold and 61.7g/t  silver over 236 metres.  A 15.2
metre section within this zone averaged 11.52g/t gold and 707.7g/t silver.

In August of 2002,  Pincock Allen & Holt completed an  independent  audit of the
resource data-base (compiled through April 2002) and the measured, indicated and
inferred  resources  previously  reported  for the Dolores  deposit.  This audit
resulted in the  resource  table  reproduced  below  under the section  "Mineral
Resource and Mineral Reserve Estimates".

Since June of 2002, a drilling  program,  consisting of approximately  30,000 to
35,000 metres of infill and stepout  drilling has been  underway.  This drilling
program is designed to bring the main zone resource to a final  feasibility  and
to expand the mineralized  potential of the district.  Results from this program
will be  incorporated  into  revised  resource  models  and mine  planning,  and
incorporated into an independently engineered feasibility study. Through the end
of 2002 a total of 24,500 metres of new drilling has been completed,  consisting
of 18,300 metres of core in 59 holes and 6,200 metres of RC in 32 holes.

Mineralization

Gold and silver  mineralization  identified at surface occurs within a zone over
4,000 metres long and 1,000 metres in width at elevations  that range from 1,400
metres  to  1,700  metres  above  sea  level.   Mineralization   has  also  been
investigated  to the depth of drilling  at 1,250  metres  elevation  or over 450
metres of vertical extent.

Precious  metal  mineralization  has been  encountered  from the  surface to the
deepest drilling completed to date, exceeding 500 metres and over wide intervals
(30 to 100 metres). Within this broad zone of mineralization, relatively narrow,
2 to 20 metre wide intense  stockwork or mineralized  breccia zones,  that often
occur along, but not confined to, intrusive contacts contain bonanza grades that
may range from 10 to over 200 grams per tonne gold and 300 to over 13,000  grams
per tonne silver.

Precious metal values are contained within native gold, native silver, electrum,
silver sulfides and silver  sulfosalts.  Feeders also contain quartz,  sericite,
pyrite (locally oxidized to limonite), with lesser amounts of epidote, chlorite,
calcite, fluorite, galena, sphalerite, and occasional chalcopyrite.

                                      -10-

<PAGE>

At intermediate  levels in the system,  mineralized  feeders widen into breccias
containing  druzy cavities,  comb  structures,  crustifications  and symmetrical
banding in silica veins and veinlets.  Strong hydrothermal brecciation is common
and frequently  overprints areas of original  tectonic breccia and/or fractures.
Pervasive  silicification  of the country  rock and  multiphase  veining in both
breccias and stockwork  zones show strong  correlation  with high grade gold and
silver mineralization,  with lower grade material occurring between the feeders.
Mineralization  at this  level also  occurs  within  localized  zones of intense
propylitic  alteration that may occur adjacent to the most strongly  mineralized
areas within the deposit.

The upper extent of  widespread  mineralization  is generally  confined to a few
tens of metres  above the contact of the latitic  volcaniclastic  tuffs with the
underlying  intermediate andesitic volcanics.  It is likely that high porosities
and  permeabilities  resulted in dispersal and lateral migration of hydrothermal
fluids  at  the  volcaniclastic   contact  with  concomitant  cooling  generally
restricting  ascension of hydrothermal fluids.  Alteration extends laterally for
several  hundred  metres along and above the contact in a generally  silicified,
broken,  brecciated,  and variably argillized  subhorizontal layer. This altered
layer contains anomalous mercury,  arsenic,  and antimony throughout its extent.
Ore grades of  mineralization  locally  persist  beyond  tens of metres into the
overlying tuff units but are restricted to narrower zones of fracturing.  In the
highest exposures of the central dome area, low-grade  mineralization from 40 to
100 parts per billion  (ppb) gold is known to occur within  small  discontinuous
pods of chalcedonic to opalescent vein material.

The episodic nature and variable intensity of mineralizing activity has commonly
resulted in overprinting of several features,  including the formation of quartz
stockworks  along  intrusive  contacts,   flooding  of  tectonic  breccias  with
hydrothermal   silica,   silicification   and  dissemination  of  mineralization
peripheral to structures,  re-brecciation  and precipitation of stockwork quartz
in  several  phases,  and  hydrothermal  brecciation  that  overprints  original
tectonic  features.  A relatively large  breccia-pipe like body has been defined
over a 400 metre length  (20-60  metres wide) from the surface to depth  greater
than 500 metres,  which contains  consistent  higher-grades  of  mineralization,
indicating a primary mineralizing conduit.  Oxidation throughout the area of the
deposit  is  highly  variable.  Oxidation  has  been  observed  to the  depth of
drilling,  particularly  within the larger fracture zones, yet sulfides are also
known to occur at surface in various localities of the property. The majority of
the deposit can be classified as mixed oxide/sulfide with smaller percentages of
totally  oxidized  material  occurring along  structures and near surface,  with
progressively increased sulfide content found at depth.

Sampling and Analysis

Rock Chip Sampling and Soil Sampling

Since 1993,  in excess of 13,800 rock chip  samples have been taken across zones
of  mineralization  at the Dolores  Property.  Continuous rock chip samples were
collected  over five metre sample  lengths (84% of total  samples)  along sample
lines laid out perpendicular to the 330 degree strike of the altered, silicified
and mineralized rock exposures.

Each sample site was flagged and marked with an aluminum  tag. Soil samples were
taken along those portions of the lines covered by overburden.  A total of 1,800
soil samples were  collected  and analyzed.  A surveyed  baseline and grid lines
spaced at 50 metre  intervals were  established for control of the rock chip and
soil sampling.

The  area  covered  by  the  sampling  program  was   approximately  six  square
kilometres.

All samples  were  collected  from the Dolores  site by ALS Chemex  Laboratories
("Chemex"),  Bondar-Clegg  or  Inspectorate  personnel  and  taken  to a  sample
preparation  lab either at  Chihuahua,  Hemosillo or Durango.  Following  sample
preparation pulps are flown either to Vancouver, Canada or Reno Nevada for final
analysis.

The soil  samples  were dried and sieved to -80 mesh.  The -80 mesh  portion was
sent to the Chemex lab in Vancouver,  British Columbia.  A 30 gram subsample was
then  analyzed for gold by  fire-assay  with an atomic  absorption  (AA) finish.
Silver values were obtained by aqua-regia digestion followed by AA analysis.

For rock chip  samples,  a 30 gram  sub-sample  for gold  analyses  was used for
fire-assay  with an AA finish.  Silver  analyses were obtained by AA (background
corrected) assay following aqua-regia digestion. One kilogram pulps

                                      -11-

<PAGE>

were prepared,  instead of the normal 0.2 kg pulps,  after comparative  analyses
indicated the large sample size ensured greater sample assay consistency.

The  rock  chip and soil  sampling  programs  were  supervised  by  experienced,
professional  geologists.  The samples taken are  considered to be of acceptable
quality and  representative of the  mineralization  exposed at the sample sites.
The sample  results  are  considered  to be  reliable  since all  analyses  were
performed at well known reputable  laboratories with quality control  procedures
in place.

Core Sampling and Reverse-Circulation Sampling

All core was carefully logged in a thorough manner by experienced,  professional
geologists in keeping with  industry  standards  and  mineralized  sections were
photographed before sampling.  The mineralized sections were marked for sampling
according  to changes in rock type,  changes in  character  and  quantity of the
mineralization and at structural contacts.  As a result, core sample lengths are
variable.  Where  there  are  no  lithological  or  structural  changes,  sample
intervals  are  typically two metres in length.  All  mineralized  core was then
split by  core-splitter  with  one-half  of the core  placed in plastic or cloth
sample  bags along with a sample tag  number and  securely  fastened.  The other
one-half  was  replaced  in the  core  trays  and  stored  in core  racks on the
property.

Reverse circulation holes were sampled at 1.52 metre intervals.  One-half of the
samples,  weighing from 12 to 16 kg, were sent for assay and the other  one-half
was  placed in  storage  at the site for future  reference.  Core  samples  from
drilling  programs  carried out by the Company  were sent to the same Chemex lab
that was used to process  rock chip samples and the same  preparation,  assaying
and quality control procedures were applied.

Quality Control

Quality  control of assay data at the Dolores  Property  was  ensured  through a
monitoring program (set up by an independent geochemist, Dr. Lovestrom, hired by
Echo Bay) that included use of prepared  gold-silver  standards,  blank samples,
check  analyses,  duplicate  analyses by alternate  labs,  and  metallic  screen
analyses.  A total of more than one out of every ten samples  were a part of the
quality  assurance  database and all  geochemical  analyses are performed at ALS
Chemex Laboratories and Inspectorate,  well known, industry-standard geochemical
laboratories.  Quality  assurance  was  provided by check  assays  processed  at
Bondar-Clegg  labs,  Vancouver,  B.C.  and/or  between the two other labs listed
above.

2001 Dolores Silver Reanalysis Program

During the summer of 2001, the Company discovered that silver grades for certain
samples  from  the  Dolores  Property  were  underestimated  by  the  aqua-regia
digestion assay techniques which had been used. It is considered likely that the
under-reporting of grade is related to the presence of silver halide minerals in
Dolores ores, possibly as a result of secondary enrichment of silver.

Selection of Samples

After initial check assays showed a significant  increase in silver grades using
multi-acid  digestion  techniques,  an extensive silver  reanalysis  program was
undertaken  by the Company.  Approximately  8,880 samples were  reanalyzed.  The
samples  selected for reanalysis were primarily  consistent runs of greater than
10 g/t  silver,  or  runs  which  had  greater  than  5 g/t  silver  along  with
significant amounts of gold.

Chain of Custody and Sampling issues

Splits were pulled from pulp material previously prepared by Chemex in Chihuahua
and  Hermosillo.  About 35% of the  material  was stored at  Chemex's  Chihuahua
facility,  with the remainder being stored at Minefinders'  Chihuahua warehouse.
All sample  retrieval  and  preparation  was  carried  out by Chemex  personnel.
Approximately  400 drill samples and 100  underground  samples were not found at
either location, and are not incorporated in the data set.

                                      -12-

<PAGE>

Samples which had  previously  been  fire-assayed  were included in segments for
rerun.  It was not expected  that there would be a  significant  change in these
results,  but they  serve as an  excellent  check  on the  multi-acid  digestion
technique.  Samples which  returned a below  detection  limit result (<1 g/t Ag)
with  multi-acid  digestion  are ignored,  because the  aqua-regia  technique is
considered more accurate at these grades.

Results

For  the  drill  samples  submitted,  there  is a  significant  increase  in the
contained silver results using multi-acid digestion for oxidized material,  with
a more moderate increase for material  categorized as mixed or sulfide. The most
dramatic  increases in silver grade were found in various  peripheral zones that
surround the main deposit,  but the improvement in silver grades  throughout the
resource will increase the overall resource.  The samples analyzed by fire-assay
show excellent agreement with the multi-acid results,  which provides confidence
in the multi-acid  technique for Dolores ores. See "Mineral Resource and Mineral
Reserve Estimates" below.

Mineral Resource and Mineral Reserve Estimates

On August  19,  2002,  PAH  presented  its  initial  report  entitled  "Audit of
Resources at the Dolores Gold-Silver Project,  Chihuahua,  Mexico". This initial
report was subsequently re-written to comply with the requirements of NI 43-101.
This AIF  incorporates by reference the PAH Report dated December 2, 2002. There
are no mineral  reserve  estimates at this stage.  The  measured,  indicated and
inferred resources for the Dolores Property, at cut-off grades of 0.3, 0.5, 0.6,
0.7,  1.0, 1.5, 2.0 and 3.0 gpt Au Eq are taken from the PAH Report and shown in
the following  table.  This  resource  estimation  is based on  construction  of
geological  and computer block models,  and  variographic  analysis.  The Metric
System is used in this analysis. Tonnes are stated as metric tonnes of 1,000 kg.
Gold and silver grades are reported in grams per tonne (gpt).  All resources are
calculated in accordance with NI 43-101.

                   Measured, Indicated and Inferred Resources

<TABLE>
<CAPTION>
<S> <C>          <C>          <C>          <C>           <C>         <C>              <C>          <C>
-----------------------------------------------------------------------------------------------------------------
Dolores Project, PAH Measured  Resource
-----------------------------------------------------------------------------------------------------------------
  Cutoff        TONNES         GOLD         GOLD         SILVER        SILVER      Aueq grade        Aueq
 gpt Aueq      (1000's)       gpt Au       Ounces        gpt Ag        Ounces       gpt Aueq        Ounces
-----------------------------------------------------------------------------------------------------------------
    3.0          2,960        3.743        356,300       183.5       17,467,200       6.802         647,400
    2.0          5,337        2.706        464,400       135.6       23,269,600       4.966         852,200
    1.5          7,986        2.138        549,000       109.0       27,973,500       3.954       1,015,200
    1.0         12,147        1.649        643,900        85.0       33,191,400       3.066       1,197,100
    0.7         16,415        1.344        709,500        69.8       36,859,600       2.508       1,323,900
    0.6         18,614        1.230        736,100        64.0       38,298,300       2.297       1,374,500
    0.5         21,487        1.107        764,500        57.8       39,960,100       2.071       1,430,500
    0.3         29,980        0.857        826,300        45.0       43,384,100       1.607       1,549,400
-----------------------------------------------------------------------------------------------------------------
</TABLE>

                                      -13-

<PAGE>
<TABLE>
<CAPTION>
<S> <C>          <C>          <C>          <C>           <C>         <C>              <C>          <C>
-----------------------------------------------------------------------------------------------------------------
Dolores Project, PAH Indicated  Resource
-----------------------------------------------------------------------------------------------------------------
  Cutoff        TONNES         GOLD         GOLD         SILVER        SILVER      Aueq grade        Aueq
 gpt Aueq      (1000's)       gpt Au       Ounces        gpt Ag        Ounces       gpt Aueq        Ounces
-----------------------------------------------------------------------------------------------------------------
    3.0          3,897        3.202        401,200       196.9       24,669,300       6.484         812,300
    2.0          7,512        2.277        549,800       144.3       34,838,100       4.681       1,130,400
    1.5         11,043        1.853        657,800       116.8       41,455,500       3.799       1,348,700
    1.0         15,994        1.481        761,300        94.1       48,405,500       3.050       1,568,100
    0.7         21,189        1.227        835,600        78.2       53,303,100       2.531       1,723,900
    0.6         24,363        1.113        872,000        70.9       55,509,000       2.294       1,797,100
    0.5         28,598        0.993        912,700        63.1       58,041,100       2.045       1,880,100
    0.3         41,524        0.750      1,001,900        47.7       63,645,700       1.545       2,062,700
-----------------------------------------------------------------------------------------------------------------
-----------------------------------------------------------------------------------------------------------------
 Dolores Project,  PAH Measured + Indicated Resource
-----------------------------------------------------------------------------------------------------------------
  Cutoff        TONNES         GOLD         GOLD         SILVER        SILVER      Aueq grade        Aueq
 gpt Aueq      (1000's)       gpt Au       Ounces        gpt Ag        Ounces       gpt Aueq        Ounces
-----------------------------------------------------------------------------------------------------------------
    3.0          6,857        3.436         757,400      191.1       42,136,400       6.622       1,459,700
    2.0         12,849        2.455       1,014,200      140.7       58,107,600       4.799       1,982,600
    1.5         19,029        1.973       1,206,800      113.5       69,429,000       3.864       2,364,000
    1.0         28,141        1.553       1,405,200       90.2       81,596,900       3.056       2,765,200
    0.7         37,604        1.278       1,545,100       74.6       90,162,700       2.521       3,047,800
    0.6         42,977        1.164       1,608,100       67.9       93,807,200       2.296       3,171,600
    0.5         50,085        1.042       1,677,300       60.9       98,001,100       2.056       3,310,600
    0.3         71,504        0.795       1,828,200       46.6      107,029,800       1.571       3,612,000
-----------------------------------------------------------------------------------------------------------------
 Dolores Project, Inferred Resource
-----------------------------------------------------------------------------------------------------------------
  Cutoff        TONNES         GOLD         GOLD         SILVER        SILVER      Aueq grade        Aueq
 gpt Aueq      (1000's)       gpt Au       Ounces        gpt Ag        Ounces       gpt Aueq        Ounces
-----------------------------------------------------------------------------------------------------------------
    3.0          2,986        3.546        340,400       185.9       17,845,400       6.644         637,800
    2.0          5,939        2.421        462,200       136.2       26,004,100       4.691         895,600
    1.5          9,114        1.934        566,700       107.5       31,505,600       3.726       1,091,800
    1.0         12,707        1.581        646,000        88.8       36,288,200       3.062       1,250,800
    0.7         18,416        1.225        725,400        70.4       41,695,900       2.399       1,420,400
    0.6         22,457        1.070        772,300        61.6       44,464,600       2.096       1,513,400
    0.5         28,051        0.919        828,400        52.8       47,661,100       1.799       1,622,800
    0.3         44,017        0.668        945,800        38.1       53,980,700       1.304       1,845,500
-----------------------------------------------------------------------------------------------------------------
</TABLE>

* Note:  this  geological  resource has been  estimated in  accordance  with the
Canadian Institute of Mining and Metallurgy guidelines, which are different from
the  guidelines  set  forth in Guide 7 under  Item 802 of  Regulation  S-K.  See
"Glossary."

The  resources in the preceding  table do not account for the material  mined in
the past.  Historic production from the project area is reported as 371,771 tons
(337,233  tonnes) at an average  grade of 0.286 opt (9.8 gpt) gold and 16.26 opt
(563 gpt) silver. Of this total, the Company estimates that about 80 % is within
the area where resources have been estimated.  PAH, in the PAH Report, concludes
that 270,000  tonnes  should be  subtracted  from the  resource  estimate at the
average grade of the current resource estimate.

                                      -14-

<PAGE>

A revised resource model will be completed,  incorporating all the drill results
from the on going  drilling  program,  commenced  in June 2002,  when all infill
holes are completed and assays are final.

                            NORTHERN SONORA PROPERTY

The information provided hereunder has been prepared by or under the supervision
of Mark H.  Bailey,  M.Sc.,  P.Geo.,  President  of the Company and a "qualified
person"  as  defined  in NI  43-101.  The  properties  described  below  are not
considered  material  to the  Company  due  to the  current  book  value  of the
properties. The Company does, however, consider these properties to be worthy of
future  exploration  expenditures and has been conducting,  and will continue to
conduct, exploration work on each of the following properties.

Description and Location

The Northern  Sonora  Property is located in the northern  part of Sonora State,
Mexico.   The  Northern  Sonora  Property   consists  of  the  nine  exploration
concessions  described  below,   comprising  a  total  of  approximately  16,591
hectares.

                      Northern Sonora Property Concessions

--------------------------------------------------------------------------------
     Concession Name         Title No.    Area (hectares)      Expiry Date
--------------------------------------------------------------------------------
     Abe                     216305            996           April 29, 2052
     Oro Fino                215622            649           March 3, 2052
     La Pistola              213748          1,698           June 13, 2002*
     La Gloria               214344          1,087           September 26, 2002*
     Los Adobes              218455          6,173           November 3, 2052
     El Ruido                218448          3,788           November 3, 2052
     El Callejon             211609             14           June 15, 2006
     El Callejon 2           211623             20           June 22, 2006
     El Manzanal             213593            220           May 16, 2007
--------------------------------------------------------------------------------
     Total Area                             14,645

*Filed for conversion to exploitation, awaiting new title

Approximately  three areas of mineralization in separate  geographic zones occur
within the Northern Sonora Property:  1) the La Bolsa Property, in the northwest
corner of the  Northern  Sonora  concession  block;  2) the El Malacate  Caldera
related gold mineralized  area, in the central part of the concession block; and
3) base metal mineralization related to porphyry systems, in the eastern portion
of the concession block,  including the El Fierro and La Recompensa  mineralized
systems.

The Company has obtained all required permits to conduct exploration drilling on
the La Bolsa and El  Malacate  projects  through  the next  several  exploration
programs.  The  Northern  Sonora  Property is not  subject to any  environmental
liabilities.

Climate, Accessibility, Local Resource Infrastructure and Physiography

The  climate  in  the  area  is  high  desert,  semi-arid  with  average  annual
precipitation of approximately 20 cm. Most of the precipitation falls during the
wet season lasting from July to mid September. Temperatures range from 5 degrees
Celsius in winter to 48 degrees Celsius in summer. Exploration can be undertaken
throughout the year.

The local economy is supported mainly by cattle  ranching,  with the nearby city
of Nogales,  Mexico  (population  exceeding 1  million),  providing  most of the
economy for the region. Skilled and unskilled labour is abundantly

                                      -15-

<PAGE>

available  from  nearby  Nogales.  Water for  drilling is  available  from local
sources   including  ponds  and  water  wells.   Surface  rights  to  all  known
mineralization,  areas suitable for potential waste disposal, tailings, storage,
heap leach pads and plant sites are held under agreements by the Company.

Site  topography  is  characterized  by low to  moderately  rugged  terrain with
elevations ranging from 1,000 to 1,800 metres above sea level.

                                [OBJECT OMITTED]
                      Figure 4: Northern Sonora Properties

Nature of Transport

The project  area is serviced by narrow,  winding,  dirt roads from  Nogales.  A
network of roads to provide access for drilling has been  established on several
of the more advanced  prospects located on the Northern Sonora Property.  Modern
services  are  available  at  Nogales,  within  30  kilometres  of  most  of the
prospects.

Sampling and Integrity of Samples

We have taken more than 5,000 surface  samples over the project area since 1994,
drilled  72 holes  at La Bolsa  and nine  holes at El  Malacate,  and  completed
extensive  geological mapping and airborne  geophysical  surveys over the entire
claim block.  All assays were completed by either  Bonder-Clegg  or Chemex under
the same quality assurance as those for the Dolores Property.

                                      -16-

<PAGE>

La Bolsa Property: Location and Access

The La Bolsa  Property is located on the Abe  concession in the northern part of
Sonora State,  Mexico,  approximately  30 kilometres west of the Mexican city of
Nogales, and 97 kilometres SSW of Tucson, Arizona. The property is best accessed
from  Tucson,  by taking  Highway I-19  approximately  110  kilometres  south to
Nogales. Access to the property from Nogales is by four wheel drive vehicle by a
combination of paved and dirt roads.

History of Property

There is no  known  written  information  pertaining  to the La  Bolsa  Property
although historic pits, shafts,  adits and exploratory trenches occur within the
property.  The greatest  concentration  of these are found on top of, and on the
east flank of the main mineralized hill where an access tunnel,  several shafts,
and over half a dozen  surface  pits were dug to exploit high grade (to 0.48 opt
gold and 8.3 opt silver) carbonate-rich breccias and veining.

Ownership

The La Bolsa  Property  was staked on behalf of Minera by a  registered  mineral
surveyor and Minera is the registered owner of all the exploration  concessions.
Other than as imposed under  Mexican  mining law, the property is not subject to
any underlying royalties or title encumbrances.

Although  the Company is the  registered  owner of the mineral  rights to the La
Bolsa  Property,  the surface  rights to much of the Abe Concession are owned by
Roberto Pierson Suarez  ("Pierson").  Terms for an exploration and  exploitation
surface rights  agreement with Pierson (the "Pierson  Agreement")  were accepted
during the third quarter of 1997,  and a final  agreement was executed and filed
with the appropriate Mexican authorities on October 13, 1997.

The Pierson  Agreement has a term of 20 years and is renewable for an additional
20 years.  Under the  agreement,  the Company is to pay  Pierson  annual rent of
US$20,000,  increasing by 10% per year,  and an additional  annual fee of US$200
for each  Pierson-owned  hectare that the Company actually  encumbers as part of
its mining operations for activities such as building roads.

The Pierson  Agreement  required the Company to pay a lump sum of US$94,400 upon
execution of the agreement.  This amount has been paid.  This amount  represents
the sum of:  1) rent for  activities  prior to  August  1996 of  US$22,400  (the
Company did not conduct  activities  on this  property  between  August 1996 and
October  1997);  2) rent for the first year of the lease term  (October 13, 1997
through October 12, 1998) of US$38,000,  which included a one-time signing bonus
of  US$10,000;  and 3) rent for the second year of the lease term of  US$34,000.
These annual rental fees are calculated based on the assumption that the Company
will encumber 40 hectares of Pierson-owned property during the first year of the
lease term, and 60 hectares  during the second year. The Company paid the annual
rent and  disturbance  fee during the period from 1999 to 2002. The Company will
continue to hold this property and advance it to a  feasibility  study as market
conditions allow. In addition,  the Pierson Agreement  provides that the Company
is to pay Pierson a one-time  fee of  US$500,000  for each mine that the Company
puts into production on a Pierson-owned property.

Geology and Mineralization

The geological  setting of the La Bolsa Property  consists of Tertiary  volcanic
and  sedimentary  units  shown to  overlie or intrude  Cretaceous  and  Jurassic
sedimentary and volcanic rocks consisting of interbedded  siltstone,  sandstone,
conglomerate, limestone, and rhyolite flows and tuffs.

Several Tertiary volcanic and volcaniclastic  rock types have been identified on
the property. Volcaniclastic and tuff beds are correlated to the lowermost units
of the Tertiary  Montana Peak  Formation  in the Oro Blanco  Mining  District of
Arizona, located to the immediate north.

The La Bolsa Property  contains an inferred resource of 8.3 million tons grading
0.025  oz/t  gold  and  0.254  opt  silver.  Mineralization  and  alteration  is
characterized by intense  silicification,  sericitization  and quartz-calcite or
quartz-adularia  stockwork  veining  and  brecciation  hosted by  volcaniclastic
sediments and  intermediate  volcanic  flows intruded by felsic dikes and plugs.
Quartz-calcite veins up to 4.56 metres in width have been noted at the surface

                                      -17-

<PAGE>

although  most of the  quartz-veining  occurs as  stockworks.  Pink  replacement
textures  have been  described as potassic  alteration or  adularization  but no
pattern has been  defined.  The presence of pyrite is  suggested  by  iron-oxide
pseudomorphs  and hematite and limonite  along  fractures.  Carbonate  veins and
breccia zones are found throughout the mineralized La Bolsa Property.

Exploration Activity

The La Bolsa  mineralized  system was  discovered  and staked in 1994 by Company
personnel  while  exploring  the Hill of Gold  prospect in the Oro Blanco Mining
District (Arizona) adjacent to the international boundary.  Further prospecting,
mapping and rock  geochemical  sampling  (1,200  samples)  outlined a coincident
gold-silver  anomaly which  extends for about 800 metres and averages  about 120
metres in width. Approximately 994 metres of surface trench rock sampling by the
Company  produced  significant  values,  including 125 metres averaging 1.10 g/t
gold in Trench  95-1 and 152 metres  averaging  1.10 g/t gold along  sample line
1000S.  During  late 1995 and early  1996,  42 reverse  circulation  drill holes
totalling  4,835 metres and 7 HQ/NQ diamond drill holes  totalling  614.5 metres
were completed.

In  mid-1996,  the  Company  retained  Mine  Development  Associates  ("MDA") to
undertake  an  independent  preliminary  resource  estimate  for  the  La  Bolsa
Property,  and Hazen Research Inc. ("Hazen") to conduct preliminary  bottle-roll
cyanide  leach  metallurgical  test  work on  mineralized  drill  cuttings.  MDA
reported gold mineralized  material of 122,600  equivalent  ounces of gold (i.e.
4,087,000 tons at .030 opt using .01 cut-off)  including  modest silver credits.
Hazen  reported that the results from eight samples  leached over a period of 72
hours had recoveries  ranging from 57% to 95%,  while four samples  (including a
split of the 57%/72 hr. sample) leached for 96 hours had extraction rates in the
80.6% to 86.0% range.  Silver  recoveries  were reported to be relatively  high,
with low  reagent  consumption,  suggesting  amenability  of the samples to heap
leach extraction techniques.

The Company  completed the first phase  exploration  drilling  program on the La
Bolsa Property in 1996 with the resultant discovery and independent  mineralized
deposit  estimation of up to 122,000 ounces gold equivalent.  Mineralization  is
open down dip to the east and along  strike both north and south with  excellent
potential to expand this resource. The Company received ecological permitting to
drill an additional  150 holes on this  property.  Access road  preparation  and
drill pad  construction  commenced  upon approval of the permit.  A second phase
drilling  program  began in May 1998 and was  completed in August 1998.  Results
from this drilling  included 26  mineralized  holes from the 28 holes drilled to
extend the La Bolsa Property.  A revised resource estimate  utilizing  polygonal
methods  tabulated 8.3 million tons,  grading .025 opt gold and .254 opt silver,
containing  208,000  ounces gold and 2.1  million  ounces  silver,  at a .01 opt
cut-off grade.  Mineralization remains open to the south and east and additional
drilling will be required to advance the present deposit to a reserve.

Work Program

The work proposal for the La Bolsa Property calls for detailed ground geophysics
in the deposit area to continue  tracing the known  mineralization  along strike
and to depth.  Continued surface sampling,  a 50 hole drilling program including
diamond and reverse  circulation  drilling,  bulk density  tests,  metallurgical
testwork,  engineering  studies,  and economic studies were all proposed for the
property.  Allowance was made for geological  mapping of the property as well as
for prospecting and geochemical sampling of potential target areas.

Detailed  exploration  is required at the La Bolsa Property to bring the project
to the  pre-feasibility  stage.  This will  entail  infill,  diamond and reverse
circulation  drilling,  and  surface  channel  sampling to enable  upgrading  of
resources  to the measured or indicated  category of  pre-feasibility  purposes.
Systematic check assays,  bulk density testing,  geostatistical  analysis of the
assay database,  preliminary mining studies, ongoing metallurgical testwork, and
economic  evaluations  will  be  required  and  have  been  provided  for in the
proposal.

Additional  work on the resource area was suspended  over the last several years
pending an increase in gold prices or a substantial cash influx.  As a result in
the recent increase in gold prices and the Company's  financing  activities,  an
exploration  program is planned for 2003 to advance  the La Bolsa  property to a
feasibility study. The drilling program budgeted for 2003 includes 25 core holes
for 4000 metres, 45 RC holes for 5000 metres and a total budget of US$1,265,000.
Exploration continues on other portions of the Northern Sonora Property and work
completed in

                                      -18-

<PAGE>

2002  included  initial  drilling  (nine RC holes) on the El Malacate  prospect.
Exploration  budgets are proposed for the El Malacate , La Dura and  Alcaparroso
properties for 2003.

Estimated Costs - La Bolsa Property

        --------------------------------------------------------------------
        Item                                                       Amount
        --------------------------------------------------------------------
        Personnel costs                                        US$155,000
        Support costs                                           US$25,000
        Contract costs (Met & Eng. Studies)                    US$150,000
        Reverse circulation drilling (7,000 m)                 US$280,000
        Diamond Core holes  (4,000 m)                          US$360,000
        Trenching/drill roads                                   US$20,000
               Assays                                          US$100,000
               Property holding costs                           US$75,000
                                                        --------------------
        Subtotal                                             US$1,165,000
        Additional cost contingency factor                     US$100,000
        --------------------------------------------------------------------
        Total                                                US$1,265,000

El Malacate Recon: Description and Location

Following  the initial  success on the La Bolsa  discovery,  the Company  staked
eight  additional  concessions  expanding  the Northern  Sonora  Property to its
present size. Work on these additional  concessions  during the period from 1996
through  2001  included  regional  and  detailed  geologic  mapping,   extensive
geochemical  sampling  programs,   and  an  airborne  geophysical  survey.  This
comprehensive  exploration  effort resulted in the discovery of eight additional
gold-silver  mineralized  systems and two  porphyry  copper  related  base metal
systems.

The El  Malacate  Property  is located in the  central  portion of the  Northern
Sonora Property,  Sonora State, Mexico,  approximately 20 kilometres west of the
Mexican city of Nogales and 97 kilometres SSW of Tucson,  Arizona.  The property
is  best  accessed  from  Tucson,  by  taking  Highway  I-19  approximately  110
kilometres   south  to  the  border   crossing  in  Nogales.   The  property  is
approximately  10 to 20  kilometres  west of Nogales,  Mexico and is accessed by
four wheel drive vehicle by a combination of paved and dirt roads.

History of Property

Portions  of the  Los  Adobes  and  El  Ruido  concessions  have  been  outlined
(approximately 35 square  kilometres) and were incorporated into a joint venture
agreement with Placer Exploration Mexico Ltd. ("Placer"), a subsidiary of Placer
Dome,  dated December 21, 2001.  This area,  which comprises six separate target
areas, is referred to as the El Malacate Property. No evidence of any historical
activity  is  apparent  and the six  target  areas  were  discovered  by Company
geologists  over the past  several  years.  Under the Placer  option  agreement,
Placer  had the  right  to  earn a 51%  interest  in the  property  by  spending
US$4,500,000 over a four year period and paying the Company  US$500,000 prior to
the third  anniversary  of the  agreement.  Placer  could  have  acquired  a 70%
interest in the property upon completion of a bankable  feasibility  study prior
to the sixth  anniversary  of the  agreement and  construction  of a mine on the
property.  During 2002,  Placer Dome  reimbursed  $521,043  (US$327,714)  to the
Company for exploration  activities in 2002, including completion of nine widely
spaced RC drill holes.  Subsequent to completing the initial  drilling  program,
Placer  notified  the  Company  that it was  terminating  the option  agreement.
Consequently, the property has reverted to the Company.

Ownership

The  concessions  were staked on behalf of, and are 100%  controlled  by Minera.
Surface rights to the area belong to various ranchers. An agreement (the "Milner
Agreement") was signed in May 2000 with Fred Milner ("Milner"),

                                      -19-

<PAGE>

covering the area of his Los Adobes Ranch that  encompasses  7,492  hectares and
includes the El Malacate,  La Matanza,  La Dura, La Verde, El Tapon, and Picacho
Alto  prospects.  The  agreement  provides for surface  rights for  exploration,
development,  and mining within his property, in return for an annual payment of
US$10,000,  compensation  of US$350,000 for the first mine to go into production
on his property and  US$250,000  for any other mines that go into  production on
his property.  A second surface rights agreement was completed for the remaining
area encompassing the El Malacate Property.  This agreement,  referred to as the
Maldanado  property  agreement,  is similar to the  Milner  Agreement,  with the
initial  annual rental  payment of $5,000 having been made in 2001, but with the
exception that there is no lump sum payment for the construction of a mine.

Geology and Mineralization

The  geologic  setting of the  Northern  Sonora  Property  consists  of Tertiary
intermediate   to  felsic  flows  and  tuffs  overlying  a  diverse  package  of
conglomerate,   sandstone,   siltstone,   and  thinly  layered  limestones  with
interspersed  intermediate volcanic flows and tuffs. The entire area is believed
underlain by Mesozoic  metavolcanic  and  metasedimentary  units. The structural
regime is dominated by an older series of northeast trending structures cut by a
later series of northwest  trending horsts and grabens.  Gold  mineralization is
localized at the edges of several  circular  features,  which are interpreted as
related to Tertiary volcanism. There is an earlier mineralizing event, primarily
containing  silver with accessory base metals and gold,  which is emplaced along
the older set of northeast trending structures.

The most  advanced  prospect  is El  Malacate,  where  three  separate  zones of
epithermal gold mineralization are encountered at surface over an area in excess
of 10 square  kilometres  (see Figure 5).  Mineralization  is  localized  within
volcaniclastics  and  sediments  adjacent  to a series  of  circular  structures
related to  volcanism  and  subsequent  hydrothermal  activity.  Northeast of El
Malacate  are the  Matanza  and Cerro  Palomino  systems,  which  have a similar
geologic  setting in another  set of  circular  structures.  The Cerro  Palomino
system includes strong areas of  mineralization  in association  with hot-spring
terraces  across a  strikelength  that exceeds two  kilometres and 200 metres of
width. These zones were discovered in December 2000 and early 2001, and work has
been ongoing.

Other mineralized systems nearby include the La Dura, Real Viejo, Santa Juliana,
La  Verde,   El  Tapon,   and  Picacho  Alto  prospects   which  are  dominantly
silver-lead-zinc  +/-gold systems. These are confined to ENE trending structural
zones occurring within Jurassic to Cretaceous  felsic  volcanics.  These systems
vary in size  from 500 to 2,000  metres  strike  length  and veins  within  them
contain silver grades up to 1,865.2 grams per tonne (54.4 opt).

The El Fiero and La Recompensa  targets are large  porphyry  related  base-metal
(Cu-Mo-Zn-Pb)  targets  located  in the  eastern  portion  of the  claim  block.
Alteration covers four square kilometres and is comprised of strong iron oxides,
sericitic and argillic alteration, and scattered quartz tourmaline stockworks in
Jurassic to Cretaceous felsic volcanics. Intruding the project area are a series
of  rhyolite,  granodiorite,  and  diorite  dikes and plugs.  Approximately  190
samples have been collected yielding values up to 38,000 ppm Cu, 370 ppm Mo, 400
ppm Pb, and 500 ppm Zn.

                                      -20-

<PAGE>

                                [OBJECT OMITTED]
            Figure 5: El Malacate Property Geology and Mineralization

Exploration Activity

Between  April and October  1996,  the Company  contracted  Altar  Resources (an
independent   consulting   firm  located  in  Tucson,   Arizona)  to  produce  a
reconnaissance  geological  map of the  Northern  Sonora  Property and to sample
possible  mineralized areas. The area examined covered  approximately 110 square
kilometres,  and 126 rock samples were collected.  Six of the samples  contained
between 1.0 and 7.0 g/t gold,  while 76 samples (60% of total) were anomalous in
one or more elements.

Additional  geological mapping and geochemical  sampling has been completed over
an area  exceeding 150 square  kilometres to the east of the La Bolsa  Property.
Eight major areas of anomalous gold mineralization were identified and are being
evaluated  through  comprehensive  exploration  programs.  Exploration  is being
expanded to include  completion of  additional  drilling  programs  leading to a
pre-feasibility decision.

Results  from  a  helicopter-borne  magnetic,  radiometric  and  electromagnetic
survey, including colour aerial photography,  covering more than 90,000 hectares
of the combined La Reserva/El Correo, Northern Sonora and Oro Blanco Properties,
were  evaluated  during  1998.  The  purpose of this  survey was to assist  with
mapping lithology,  structure,  alteration and potential  mineralized zones. The
Company  also  evaluated  the  results of a detailed  ground  geophysics  study,
including magnetic and VLF electromagnetic  surveys, and an induced polarization
/ resistivity survey for the combined purposes of drill target definition and as
an orientation survey for the La Bolsa and La Reserva/El Correo Properties.

Work in 2001  focused on  additional  geologic  mapping  and  sampling of the El
Malacate  Property.  Sixteen square kilometres of surface mapping was completed,
and  approximately  eight zones of potentially  significant gold  mineralization
were  delineated.  Over 3,500  surface  rock chip samples  were  collected,  the
majority of which are gold mineralized.

                                      -21-

<PAGE>

Nearby historic mining activity, with the most extensive workings found in areas
of previous  silver  mining  including  those at La Dura Mine,  Real Viejo Mine,
Santa Juliana Mine, and La Recompensa  Mine.  Hundreds of smaller  workings have
also been encountered throughout the property.  There are no historic records in
regard to these  workings and only the La  Recompensa  Mine has been recorded on
existing  maps.  These areas lie outside of the El Malacate  joint  venture with
Placer, and the Company will continue to advance these on its own.

Work Program

The  information in the following  table is a summary of the estimated costs for
the proposed work program for the El Malacate  Property,  for the period January
through December 31, 2003: During the period from December 2001 through December
2002, Placer Dome reimbursed the Company $521,043  (US$327,714) for exploration,
including drilling of nine reverse-circulation  holes, assays, property payments
and all field work  undertaken  as part of the option  agreement.  Subsequent to
completing the initial drilling  program,  Placer Dome notified the Company that
it was  terminating  the  option  agreement  and  would  not  fund  any  further
exploration work on the El Malacate Property.

                     Estimated Costs - El Malacate Property

        --------------------------------------------------------------------
        Item                                                       Amount
        --------------------------------------------------------------------
        Personnel costs                                         US$95,000
        Support costs                                           US$25,000
        Contract costs
               Reverse circulation drilling (3,200 m)          US$150,000
               Trenching/drill roads                            US$20,000
               Assays                                           US$40,000
               Property holding costs                           US$75,000
                                                        --------------------
        Subtotal                                               US$405,000
        Additional cost contingency factor                      US$40,000
        --------------------------------------------------------------------
        Total                                                  US$445,000

                                OTHER PROPERTIES

The Company has  interests in other mineral  properties in Mexico  covering more
than 24,000  hectares.  The  following  summaries  briefly  describe  two of the
Company's  Mexican  properties  in  which  the  Company  has  an  interest.  The
properties  described  below  have  not  been  advanced  sufficiently  to have a
material impact on the Company's portfolio of properties.

La Reserva/El Correo Property

The La  Reserva/El  Correo  Property  forms a  contiguous  block of  claims  and
comprises  the  southern  half of the Northern  Sonora  Property in the state of
Sonora, Mexico. The claims are centred at approximate coordinates 30 degrees, 50
minutes  north  latitude,  111  degrees,  10  minutes  west  longitude,  located
immediately  south of the United States border.  The centre of the property lies
about 25 kilometres  southwest of the border city of Nogales and 120  kilometres
SSW of Tucson,  Arizona.  The property is accessible by four wheel drive vehicle
from Nogales by proceeding south on Highway 15 for 15 kilometres,  then west for
about 8  kilometres  along a partly paved two lane road and then by a network of
good to very rough gravel roads to various locations in the sector.  The city of
Nogales has all modern conveniences and a potential work force.  Exploration and
mining equipment and supplies can be imported to Nogales from nearby Tucson.

                                      -22-

<PAGE>

The La Reserva/El Correo Property  consists of the five exploration  concessions
(recently reduced in area) described below in the following table,  comprising a
total of approximately 23,561 hectares:

                    La Reserva/El Correo Property Concessions

--------------------------------------------------------------------------------
         Concession Name     Title No.    Area (hectares)       Expiry Date
--------------------------------------------------------------------------------
La Reserva Fraccion I        202980          16,105            April 2, 2002*
La Reserva Fraccion II       202981             .01            April 2, 2002*
El Correo                    202982           6,650            April 2, 2002*
Cadena de Oro                205198             366            July 7, 2003
El Durazno                   212967             440            February 19, 2007
--------------------------------------------------------------------------------
Total Area                                   23,561

* Filed for conversion to exploitation, awaiting new titles

San Antonio Property

The San Antonio  Property is located  some 120 km SSE of the city of  Zacatecas,
Mexico, in the municipality of Villa Hidalgo,  Zacatecas. The project lies close
(12 km northwest) to the historic  mining  district of Pinos,  that from 1894 to
1934  produced  approximately  200,000 oz gold and 5 M oz silver  from veins and
mantos within Cretaceous limestone sequences.

The San  Antonio  Property  consists  of eight  concessions  totalling  some 817
hectares.  The La Laguna  concession was bid on and awarded to Minera during the
course of the year 2000. The concessions are detailed in the following table:

                        San Antonio Property Concessions

--------------------------------------------------------------------------------
     Concession Name         Title No.    Area (hectares)      Expiry Date
--------------------------------------------------------------------------------
Gran Maria 1                 208071          251.36            August 25, 2004
Gran Maria 1 Fraccion I      208072           32.30            August 25, 2004
Gran Maria Fraccion III      208073           17.83            August 25, 2004
Gran Maria 2                 208181           44.35            August 31, 2004
Gran Maria 5                 207501           48.24            June 24, 2004
Gran Maria 6                 210695          108.00            November 17, 2005
La Laguna                    213046          314.79            March 1, 2007
La Laguna Fraccion A         213046            0.34            March 1, 2007
--------------------------------------------------------------------------------
Total Area                                   817.21

Other Interests In Properties

The  Company  also has  interests  in the  Gutsy/Buckskin  Mountain  Properties,
Nevada, U.S.A., the Clear Property, Nevada, U.S.A., the Dottie Property, Nevada,
U.S.A., the Oro Blanco Property, Arizona, U.S.A. and the Dubuisson Property, Val
d'Or,  Quebec. The Company's interest in the Dubuisson Property consists only of
a 2% net royalty interest.

                                      -23-

<PAGE>

Gutsy/Buckskin Mountain Properties, Nevada, U.S.A.

The  Gutsy/Buckskin   Mountain  Properties  consist  of  82  claims  located  29
kilometres  south of the town of Carlin in sections 8, 16, 18, 4, 20, T32N,  and
R53E of Elko  County,  Nevada,  approximately  9,000 feet  northwest  of Newmont
Mining  Corporation's Rain gold mine. Access to the property is by a combination
of paved and gravel roads. The Gutsy Property consists of 62 mining claims which
were optioned by the Company under the NMP/Hecla  Agreement described above. The
Buckskin  Mountain  Property consists of 20 mining claims which were the subject
of an option  agreement dated November 15, 1994 (the "Bailey  Associates  Option
Agreement") between the Company and Bailey and Associates,  a company controlled
by Mark Bailey, the President and Chief Executive Officer of the Company. Bailey
and Associates has transferred  title of the Buckskin  Mountain  Property to the
Company pursuant to the Bailey Associates  Option Agreement,  and the Company is
required  to pay the annual  claim  maintenance  fees to keep the claims in good
standing.

Under the Bailey Associates  Option Agreement,  the Company was required to make
staged annual payments to Bailey Associates totalling US $100,000.  The payments
were made on November  15 of each of the years 1994  through  2000,  as follows:
1994 - US $10,000;  1995 - US $7,500; 1996 - US $10,000; 1997 - US $15,000; 1998
- US $20,000; 1999 - US $20,000; and 2000 - US $17,500. As of December 31, 2000,
the  Company  has made all  required  payments  totalling  US $100,000 to Bailey
Associates pursuant to the terms of this agreement.

The   properties   lie  within  the  Carlin  gold  belt.   Exploration   on  the
Gutsy/Buckskin Mountain Properties has included geological mapping,  geochemical
sampling  and one reverse  circulation  drill hole by a previous  owner in 1985.
Exploration  by Santa Fe Pacific  Gold  Corporation  ("Santa  Fe") has  included
additional mapping, sampling, geophysical surveys and the drilling of three deep
reverse circulation holes.

Results from  geological  mapping and geochemical  sampling on these  properties
have defined and  prioritized  several drill targets.  The Company  continues to
seek a partner to advance  this  project,  and will drill test these  targets in
2003, with or without a partner.

Gold mineralization  within the Carlin trend is sediment hosted and structurally
controlled.  Mineralization  in the  nearby  Rain  mine  is  hosted  by  clastic
sedimentary  rocks of the  Mississippian  age  lower  Webb  Formation,  near the
unconformable contact with the underlying Devonian age Devils Gate Limestone.  A
major northwest-striking structural zone controls the location of mineralization
within these overlap assemblage rocks of the Antler Sequence. The Gutsy prospect
lies  along the trend  between  the Rain  deposit  and the other  main  deposits
defining the Carlin trend.

Clear Property, Nevada, U.S.A.

The Clear  Property  consists  of three  groups  of  unpatented  mining  claims,
totalling 94 claims located in Pershing County,  Nevada.  Access to the property
is by an  upgraded  paved  and  gravel  road  approximately  14  miles  south of
Winnemucca,  Nevada.  Of the claims,  17 are  optioned by the Company  under the
NMP/Hecla  Agreement,  40 were staked by the Company and 37 were acquired by the
Company  from  Cominco.  In addition,  in 1998 the Company  entered into a lease
agreement to acquire  mineral rights  situated near the Clear property by making
annual  advance  minimum  royalty  payments  over  15  years  and  by  incurring
exploration  expenditures  of US $150,000 by April 1, 2001.  As at December  31,
2002,  annual royalty  payments of US $80,000 had been paid. The Company has the
right to terminate  the lease  agreement  on thirty days  written  notice to the
owner.

Previous  exploration  work on the Clear Property has delineated a small reserve
of 20,000  tons with an  average  grade of .189 opt  gold.  Geological  mapping,
geochemical  sampling and drilling  programs were  completed  between the period
1986 through 1990.  During 1996 a mapping,  sampling and geophysical  survey was
completed by Cominco Ltd. of the claims previously held by it.

The claim block is underlain by Cambrian  Harmony  Formation,  Ordovician  Valmy
Formation in thrust contact and over limited exposures of Pennsylvanian Havallah
Formation and Cretaceous  diorite and felsic  intrusives.  The main mineralizing
controls on the  property  are a series of N30E  trending  thrust  sheets and NW
trending range front normal faults. Extensive jasperoid with gold mineralization
has been the focus of previous exploration efforts.

                                      -24-

<PAGE>

The Clear  Property  represents  a partially  explored  prospect  with  strongly
mineralized but narrow gold values.  Further geologic,  geochemical and drilling
is recommended to complete evaluation of this property.  Results from geological
mapping and geochemical sampling on this property, as well as from a geophysical
survey,  have  defined and  prioritized  drill  targets.  The Company  commenced
drilling on this property in November 1997. Results  identified  widespread gold
mineralization,  including 30 metres averaging .86g/t,  and 7.6 metres averaging
1.9g/t gold.  The Company  expended the required  $100,000 and received title to
the Clear Property from Hecla.

Dottie Property, Nevada, U.S.A.

The Dottie claim block is located at the south end of the Bull Run  Mountains of
Elko County.  Access from Elko is along State  Highway 225 for 28 miles to State
Highway 226, then approximately 30 miles to the Spanish (Ellison) Ranch turnoff.
A gravel road passes through the ranch compound and continues some four miles to
the claims.  The Property  consists of 24 mining  claims and was optioned by the
Company under the NMP/Hecla Agreement.

In 1998,  the  Company  entered  into an  agreement  to acquire  mineral  rights
adjacent to the Dottie property by making annual minimum advance  payments of US
$10,000  beginning  September 1, 2000.  The vendor  retains a 2% NSR on minerals
produced from the 25 claims covered by the agreement.  The Company has the right
to terminate the agreement at any time provided that if termination occurs after
July 15 of any year,  the Company is obliged to pay any State and  Federal  fees
due by August 31 of that year.

The Dottie  Property was  discovered in 1982 and  throughout  the 1980s mapping,
sampling and drilling work was undertaken on the property. The property covers a
series of  Oligocene to Miocene  lithic  tuffs,  volcaniclastics,  ash flows and
andesite  flows  capped  by  siliceous  sinter.   Previous  drill  results  have
discovered gold anomalous sinters and high angle silicified zones.

The initial  drilling  program on this property was  completed  during the first
quarter of 1998. Results from first phase drilling intercepted favorable geology
and structures with anomalous gold values.  The Company expended the required US
$100,000 and has applied for title from Hecla.  Results from geological  mapping
and  geochemical  sampling on this property have defined and  prioritized  drill
targets.

The Company has prepared an exploration budget for 2003 for the  Gutsy/Buckskin,
Clear and Dottie  properties in Nevada.  The following  table lists the expected
costs for the  proposed  drilling  programs  on these three  prospects  in 2003.
Drilling  will  include  2500  metres of RC and 500  metres of core on the Clear
property and 2500 metres of core on the Gutsy/Buckskin  property and 2000 metres
on the Dotie property.

     Estimated Costs - Nevada Properties (Gutsy/Buckskin, Clear and Dottie)

        --------------------------------------------------------------------
        Item                                                       Amount
        --------------------------------------------------------------------
        Personnel costs                                         US$95,000
        Support costs                                           US$20,000
        Contract costs
               Reverse circulation drilling (2,500 m)          US$100,000
               Diamond Core drilling (5000 m)                  US$450,000
               Trenching/drill roads                            US$20,000
               Assays (2,500)                                   US$50,000
               Property holding costs                           US$70,000
                                                        --------------------
               Subtotal                                        US$805,000
        Additional cost contingency factor                      US$70,000
        --------------------------------------------------------------------
        Total                                                  US$875,000

                                      -25-

<PAGE>

                               NUMBER OF EMPLOYEES

As at December 31, 2002, the Company had a total of 20 employees and consultants
working for the Company.  None of the Company's  employees  belong to a union or
are subject to a  collective  agreement.  The  Company  considers  its  employee
relations to be good.

              BANKRUPTCY, RECEIVERSHIP OR OTHER SIMILAR PROCEEDINGS

There have been no bankruptcy, receivership or other similar proceedings against
the Company or any of its subsidiaries  within the three most recently completed
financial years or the current financial year.

                                   COMPETITION

The Company  competes with other mining companies for the acquisition of mineral
claims,  permits,  concessions  and other  mineral  interests as well as for the
recruitment  and  retention  of  qualified   employees.   There  is  significant
competition for the limited number of gold acquisition  opportunities  and, as a
result,  the Company may be unable to acquire  attractive gold mining properties
on terms it considers acceptable.

                                  RISK FACTORS

The Company's  securities should be considered a highly  speculative  investment
and investors should carefully  consider the following  information  about these
risks, together with other information contained herein. If any of the following
risks  actually  occur,  our  business,  results  of  operations  and  financial
condition could suffer significantly.

Risks of Exploration and Development

All of the  properties in which the Company has an interest or the right to earn
an interest,  except for the Dubuisson  Property,  which has been disposed of by
the Company save for a 2% NSR on the property (see "Narrative Description of the
Business -  Overview"),  are in the  exploration  stages  only and are without a
known body of  commercial  ore.  As an  exploration  company,  the Company has a
history of losses.  The level of  profitability  of the Company in future  years
will depend to a great  degree on precious and base metal prices and whether any
of the Company's  exploration  stage  properties can be brought into production.
The  exploration for and development of mineral  deposits  involves  significant
risks, which even a combination of careful evaluation,  experience and knowledge
may not eliminate.

Development  of  the  Company's  properties  will  only  follow  upon  obtaining
satisfactory results. Mineral exploration and development involves a high degree
of risk and few  properties  which are explored are  ultimately  developed  into
producing  mines.  There is no  assurance  that the  Company's  exploration  and
development  activities will result in any  discoveries of commercial  bodies of
ore. The long-term  profitability  of the Company's  operations  will be in part
directly related to the cost and success of its exploration programs,  which may
be affected by a number of factors.

Substantial expenditures are required to establish reserves through drilling, to
develop  processes to extract the resources and, in the case of new  properties,
to develop the extraction and processing  facilities and  infrastructure  at any
site chosen for extraction.  Although  substantial  benefits may be derived from
the discovery of a major deposit,  no assurance can be given that resources will
be discovered in sufficient  quantities to justify commercial operations or that
the funds required for development can be obtained on a timely basis.

It is impossible to ensure that the current and future exploration  programs and
or  feasibility  studies  on the  Company's  existing  mineral  properties  will
establish  reserves.  Whether  an  ore  body  or  a  tailings  deposit  will  be
commercially  viable  depends on a number of  factors,  some of which  are:  the
particular  attributes  of the  deposit,  such as size,  grade and  proximity to
infrastructure;  metal  prices,  which cannot be  predicted  and which have been
highly  volatile  in the past;  mining,  processing  and  transportation  costs;
perceived  levels of political risk and the willingness of lenders and investors
to provide project financing; and governmental regulations,  including,  without
limitation,  regulations relating to prices, taxes, royalties, land tenure, land
use,  importing  and  exporting  materials,   foreign  exchange,   environmental
protection and reclamation and closure obligations.  The effect of these factors
cannot be accurately predicted, but the combination of these factors may cause a
mineral deposit that has been mined

                                      -26-

<PAGE>

profitably  in the past, to become  unprofitable.  The Company is subject to the
risks normally encountered in the mining industry, such as unusual or unexpected
geological  formations as well as political and economic risks  associated  with
developing  nations.  The Company may be subject to liability  for  pollution or
against  other  hazards  against  which it cannot insure or against which it may
elect not to insure.

The development of mineral properties is affected by many factors, some of which
are: the cost of  operations;  variations in the grade of ore;  fluctuations  in
metal  markets;  costs of extraction and  processing  equipment;  and government
regulations,  including without limitation,  regulations  relating to royalties,
allowable production,  importing and exporting of minerals, foreign exchange and
environmental  protection.  Depending on the price of minerals,  the Company may
determine  that  it is  impractical  to  commence  or,  if  commenced,  continue
commercial production.

Operating Hazards and Risks

Mineral exploration  involves many risks which even a combination of experience,
knowledge  and careful  evaluation  may not be able to overcome.  Operations  in
which the Company has a direct or indirect  interest  will be subject to all the
hazards and risks normally incidental to exploration, development and production
of resources,  any of which could result in work  stoppages,  damage to property
and possible environmental damage. The Company currently maintains the following
insurance  coverages against operating  hazards:  (a) foreign liability coverage
for   Minera,   and  Minera   Dolores  in  the   amount  of   US$2,000,000   per
occurrence/US$8,000,000 aggregate (deductible of $2,500 per occurrence); and (b)
commercial  package  insurance  including  US$2,000,000   comprehensive  general
liability  insurance for the Company's  Canadian and U.S.  operations  (US$2,500
deductible and subject to a health hazard exclusion and a pollution  exclusion),
and US$97,500 (US$1,000  deductible) insurance for the Company's office contents
located at its Reno, Nevada office.  The Company may become subject to liability
for  pollution,  cave-ins or hazards  against  which it cannot insure or against
which it may elect not to insure.  The  payment of such  liabilities  may have a
material, adverse effect on the Company's financial position.

Fluctuating Prices

The  Company's  revenues,  if any, are expected to be in large part derived from
the extraction and sale of precious and base metals such as gold and silver. The
price of those commodities has fluctuated widely,  particularly in recent years,
and is affected by  numerous  factors  beyond the  Company's  control  including
international,   economic  and  political  trends,  expectations  of  inflation,
currency exchange  fluctuations,  interest rates, global or regional consumptive
patterns,  speculative activities and increased production due to new extraction
developments and improved extraction and production methods. The effect of these
factors on the price of base and precious metals, and,  therefore,  the economic
viability of any of the Company's  exploration  projects,  cannot  accurately be
predicted.

Environmental Factors

All phases of the Company's  operations are subject to environmental  regulation
in the various jurisdictions in which it operates.  Environmental legislation is
evolving in a manner  which will require  stricter  standards  and  enforcement,
increased fines and penalties for non-compliance,  more stringent  environmental
assessments of proposed projects and a heightened  degree of responsibility  for
companies and their  officers,  directors and  employees.  There is no assurance
that changes in environmental  regulation, if any, will not adversely affect the
Company's operations.

Competition

The resource  industry is intensely  competitive  in all of its phases,  and the
Company competes with many companies  possessing greater financial resources and
technical  facilities  than  itself.  Competition  could  adversely  affect  the
Company's  ability to acquire  suitable  producing  properties  or prospects for
exploration in the future.

Inability to Meet Cost Contribution Requirements

The Company  may, in the future,  be unable to meet its share of costs  incurred
under  agreements  to which it is a party  and the  Company  may as a result  be
subject to loss of its rights to acquire interests in the properties  subject to
such agreements.

                                      -27-

<PAGE>

Potential Defects in Title to Properties

In those  jurisdictions  where the Company has property  interests,  the Company
makes a search of mining records in accordance with mining industry practices to
confirm that it has acquired  satisfactory  title to its properties but does not
obtain title insurance with respect to such properties.  The possibility  exists
that title to one or more of its properties,  particularly  title to undeveloped
properties,  might be  defective  because of errors or omissions in the chain of
title,  including  defects in conveyances and defects in locating or maintaining
such claims,  or  concessions.  The ownership and validity of unpatented  mining
claims and concessions are often uncertain and may be contested.  The Company is
not aware of challenges to the location or area of any of its mining concessions
and unpatented mining claims.  There is, however, no guarantee that title to the
Company's  claims and  concessions  will not be  challenged  or  impugned in the
future.

Political and Economic Instability

Most of the Company's  exploration  and development  activities  occur in Mexico
and, as such,  the Company  may be  affected by possible  political  or economic
instability  in this  country.  The  risks  include,  but are  not  limited  to,
terrorism, military repression,  extreme fluctuations in currency exchange rates
and high rates of  inflation.  Changes in  resource  development  or  investment
policies or shifts in political  attitude in Mexico,  or in the U.S.A. or Canada
(where the Company has secondary  property  interests) may adversely  affect the
Company's business.  Operations may be affected in varying degrees by government
regulations with respect to restrictions on production,  price controls,  export
controls,  income  taxes,  expropriation  of  property,  maintenance  of claims,
environmental legislation,  land use, land claims of local people, water use and
mine safety. The effect of these factors cannot be accurately predicted.

Financing Risks

The  Company's  current  operations,  other  than the  royalty  interest  in the
Dubuisson Property,  have not generated any cash flow. Any work on the Company's
principal  properties may require  additional equity  financing.  If the Company
seeks additional equity financing, the issuance of additional shares will dilute
the interests of the Company's  current  shareholders.  Although the Company has
successfully  raised funds in recent years through share and warrant  issuances,
there is no  assurance  that  additional  funding will be available to allow the
Company to fulfil its obligations on existing exploration properties. Failure to
obtain  such   additional   financing   could  result  in  delay  or  indefinite
postponement of further  exploration and the possible,  partial or total loss of
the Company's potential interest in certain properties.

No Known Reserves; Uncertainty of Mineral Resource Estimates

The Company has no mineral producing properties at this time. Only those mineral
deposits that the Company can economically and legally extract or produce, based
on a comprehensive  evaluation of cost, grade,  recovery and other factors,  are
considered  "resources" or "reserves." The Company has not defined or delineated
any  proven  or  probable  reserves  on  any  of its  properties.  Although  the
mineralized material and mineralized deposit estimates included herein have been
carefully  prepared by the Company,  or, in some  instances  have been prepared,
reviewed or verified by independent mining experts,  these amounts are estimates
only and no  assurance  can be given that any  particular  level of  recovery of
gold,  silver  or  other  minerals  from  mineralized  material  will in fact be
realized  or that an  identified  mineralized  deposit  will ever  qualify  as a
commercially mineable (or viable) reserve.

Although  the Company has  assessed  the mineral  resource  estimates  presented
herein and believes that the methods used to estimate such mineral resources are
appropriate, such figures are estimates. As well, estimates of mineral resources
are  inherently  imprecise and depend to some extent on  statistical  inferences
drawn  from  limited  drilling,  which may  prove  unreliable.  Furthermore,  no
assurances can be given that the indicated level of recovery of minerals will be
realized.  Fluctuations in the market prices of minerals may render reserves and
deposits  containing  relatively  lower  grades  of  mineralization  uneconomic.
Moreover,  short-term  operating factors relating to mineral resources,  such as
the need for orderly  development  of the deposits or the  processing  of new or
different  grades,  may  cause  mining  operations  to be  unprofitable  in  any
particular period. Material changes in mineralized material,  grades or recovery
rates may affect the economic viability of projects.

                                      -28-

<PAGE>

Conflicts of Interest

Certain  officers and directors of the Company may be or become  associated with
other natural resource  companies that acquire interests in mineral  properties.
Mark H.  Bailey,  President,  Chief  Executive  Officer  and a  director  of the
Company, is President of Mark H. Bailey & Associates LLC ("Bailey  Associates"),
Consulting  Geologists,  located  in Reno,  Nevada  and is a  director  of other
publicly listed natural resource  companies.  Bailey Associates'  clients do not
directly  compete  with the Company for  properties,  financing,  equipment,  or
personnel. Any conflicts which may arise will be dealt with as disclosed below.

Tench C. Page, Vice President,  Exploration,  of the Company,  is a principal of
Sierra  Timber and Gold  Corp.  ("Sierra  Timber"),  a  provider  of  geological
consulting  services,  located in Reno,  Nevada.  Sierra Timber's clients do not
directly  compete  with the Company for  properties,  financing,  equipment,  or
personnel. There are currently no conflicts of interest between Mr. Page serving
as Vice  President,  Exploration,  of the  Company  while  continuing  to act as
principal of Sierra Timber. Any conflicts which may arise, will be dealt with as
disclosed below.

Paul C.  MacNeill,  Corporate  Secretary  and a director  of the  Company,  is a
securities  lawyer,  with other  clients  involved  in mineral  exploration  and
development,  and is a director  and officer of other  publicly  listed  natural
resource companies.  None of Mr. MacNeill's  exploration and development clients
compete  directly  with the Company for  properties,  financing,  equipment,  or
personnel. Any conflicts which may arise, will be dealt with as disclosed below.

Such  associations may give rise to conflicts of interest from time to time. The
directors  of the Company are  required by law to act honestly and in good faith
with a view to the best  interest of the Company  and to disclose  any  interest
which they may have in any project or opportunity of the Company.  If a conflict
of interest  arises at a meeting of the board of  directors,  any  director in a
conflict will  disclose his interest and abstain from voting on such matter.  In
determining  whether  or not the  Company  will  participate  in any  project or
opportunity,  the director will  primarily  consider the degree of risk to which
the Company may be exposed and its financial position at that time.

Dependence on Key Management Employees

The nature of the Company's  business,  its ability to continue its  exploration
and  development  activities  and to thereby  develop a competitive  edge in its
marketplace  depends,  in large part,  on its  ability to attract  and  maintain
qualified key management  personnel.  Competition for such personnel is intense,
and there can be no  assurance  that the  Company  will be able to  attract  and
retain such personnel.  The Company's  development to date has depended,  and in
the future  will  continue  to  depend,  on the  efforts  of its key  management
figures,  such as Mark H.  Bailey.  Loss of Mark H. Bailey could have a material
adverse  effect on the  Company.  The Company  does not  maintain  key-man  life
insurance on any of its key management employees.

Dependence on Consultants and Engineers

The Company has relied and may continue to rely upon consultants,  engineers and
others  for  exploration  expertise  and  intends  to  rely on  consultants  for
development,  construction and operating expertise. Substantial expenditures are
required to construct  mines,  to establish ore reserves  through  drilling,  to
carry out environmental and social impact assessments,  to develop metallurgical
processes to extract the metal from the ore and, in the case of new  properties,
to develop the exploration infrastructure at any site chosen for exploration. No
assurance  can be  given  that  minerals  will be  extracted  or  discovered  in
sufficient  quantities to justify  commercial  operations or that funds required
for development can be obtained on a timely basis.

Compliance with Environmental and Government Regulation

Operations of the Company require permits from various foreign,  federal, state,
provincial and local  governmental  authorities  and may be governed by laws and
regulations  governing  prospecting,  development,  mining production,  exports,
taxes, labour standards,  occupational health, waste disposal, toxic substances,
land use,  environmental  protection,  mine safety and other matters.  Companies
engaged  in the  development  and  operation  of mines  and  related  facilities
generally  experience  increased  costs as a result of the need to  comply  with
applicable laws,  regulations and permits.  Permits and studies may be necessary
prior to operation of the exploration properties in

                                      -29-

<PAGE>

which the Company has interests  and there can be no guarantee  that the Company
will be able to obtain or maintain all necessary permits that may be required to
commence  construction or operation of mining  facilities at these properties on
terms which enable operations to be conducted at economically justifiable costs.
To the best of the Company's  knowledge,  the Company is in compliance  with all
material  current laws and regulations  which currently apply to its activities.
There can be no  assurance,  however,  that all  permits  which the  Company may
require for its future operations will be obtainable on reasonable terms or that
such laws and regulations would not have an adverse effect on any mining project
which the Company might undertake.

Failure to comply with applicable laws, regulations and permitting  requirements
may  result  in  enforcement  actions  thereunder,  including  orders  issued by
regulatory or judicial  authorities  causing operations to cease or be curtailed
and may include corrective measures requiring capital expenditures, installation
of  additional  equipment  or  remedial  actions.  Violators  may be required to
compensate  those suffering loss or damage by reason of their mining  activities
and may be fined if convicted of an offence under such legislation.

Amendments to current laws,  regulations,  and permits governing  operations and
activities of mining  companies or more stringent  implementation  thereof could
require increases in capital expenditures, production costs, reduction in levels
of production of future mining  operations,  or require delays in development or
abandonment of new mining properties.

The  Company's  mining  operations  may be subject to foreign,  federal,  state,
provincial  and local  laws and  regulations  governing  the  protection  of the
environment,  including laws and regulations  relating to air and water quality,
mine reclamation, waste disposal, and the protection of endangered or threatened
species.  The Company's  mining  activities may be subject to foreign,  federal,
state,  provincial and local laws and  regulations for protection of surface and
ground water.

If the Company  undertakes new mining  activities in other provinces,  states or
foreign countries, or significantly expands its existing mining operations,  the
Company may be required to obtain  pre-construction  environmental  and land use
review and to comply with permitting, control and mitigation requirements of the
jurisdiction  in which such  operations are to be located.  Compliance  with new
requirements could impose costs on the Company in the future, the materiality of
which cannot reasonably be predicted at this time.

Dilution

The  Company  has a number of  outstanding  share  purchase  warrants  and stock
options. If and when these are exercised,  the issued and outstanding capital of
the Company may be substantially increased,  thus diluting shareholder interests
in the Company.

                   SELECTED CONSOLIDATED FINANCIAL INFORMATION

The  following  table sets forth and  summarizes  certain of the Company and the
Company's  subsidiaries  financial  information on a consolidated  basis for the
last three fiscal years, prepared in accordance with Canadian generally accepted
accounting  principles  ("Canadian  GAAP").  Canadian  GAAP,  as  applied to the
Company,  materially  differs from United States generally  accepted  accounting
principles ("U.S. GAAP"), as set forth in Note 10 to the Consolidated  Financial
Statements of the Company. This financial information is derived from, should be
read in  conjunction  with and is  qualified in its entirety by reference to the
Company's  consolidated  financial statements,  including the notes thereto, and
Management's  Discussion  and Analysis of Results of  Operations  and  Financial
Condition.  The Company's  Consolidated Financial Statements for the years ended
December 31, 2002, 2001 and 2000 have been audited by BDO Dunwoody LLP.

                                      -30-

<PAGE>

                   Selected Consolidated Financial Information
<TABLE>
<CAPTION>
<S>                                                            <C>                   <C>                   <C>
-----------------------------------------------------------------------------------------------------------------
All in Canadian $ in thousands except Loss per       12 Months Ended       12 Months Ended       12 Months Ended
Share and Common Shares issued                         Dec. 31, 2002         Dec. 31, 2001         Dec. 31, 2000
-----------------------------------------------------------------------------------------------------------------
Operating Revenues                                                  -                     -                    -
Working Capital                                                 9,141                   534                  873
Interest Income                                                   182                    17                   27
Loss from Operations                                           (2,886)               (1,302)              (1,192)
Net Loss                                                       (2,754)               (1,282)              (1,132)
Loss per Share - Basic and Diluted                              (0.11)                (0.07)               (0.07)
Total Assets                                                   45,900                30,835               30,264
Net Assets                                                     45,004                30,720               30,039
Total Liabilities                                                 896                   115                  225
Share Capital                                                  56,793                42,013               38,930
Common Shares Issued                                       28,411,737            20,233,250           17,031,527
Dividends Declared                                                 -                     -                     -
-----------------------------------------------------------------------------------------------------------------
</TABLE>

The following table sets forth and summarizes  selected  consolidated  financial
information of the Company for the last eight  financial  quarters,  prepared in
accordance  with  Canadian  GAAP.  Canadian  GAAP,  as applied  to the  Company,
materially  differs from U.S. GAAP, as set forth in Note 10 to the  Consolidated
Financial Statements of the Company. This financial information is derived from,
should be read in conjunction with and is qualified in its entirety by reference
to the  respective  quarterly  and  annual  consolidated  financial  statements,
including the notes thereto, and Management's Discussion and Analysis of Results
of  Operations  and  Financial  Condition  pertaining  to  the  eight  financial
quarters.

                  Selected Consolidated Financial Information
<TABLE>
<CAPTION>
<S>                        <C>          <C>         <C>             <C>         <C>          <C>          <C>          <C>
---------------------------------------------------------------------------------------------------------------------------
 All in Canadian        December     September    June 30,     March 31,    December    September     June 30,    March 31,
 $ in 1,000's           31, 2002     30, 2002       2002         2002       31, 2001     30, 2001       2001         2001
 except Loss per
 Share and Common
 Shares Issued
---------------------------------------------------------------------------------------------------------------------------
Operating                     -            -            -            -            -            -            -            -
    Revenues
Working capital            9,141        9,411       10,694          976         $534         $953         $117         $659
Interest Income               46           89           46            1            4            3            3            7
Loss from                 (1,313)        (433)        (820)        (320)
    Operations                                                                  (570)        (194)        (339)        (199)
Net Loss                  (1,285)        (302)        (836)        (331)        (554)        (198)        (355)        (175)
Loss per Share -           (0.05)       (0.01)       (0.04)       (0.02)       (0.03)       (0.01)       (0.02)       (0.01)
    Basic and
    Diluted
Total Assets              45,900       43,780       42,723       31,670       30,835       31,204       29,933       30,255
Net Assets                45,004       42,874       42,317       31,410       30,720       31,115       29,810       30,165
Total Liabilities            896          906          406          260          115           89          123         (90)
Share Capital             56,793       54,710       53,851       43,034       42,013       41,855       40,352       40,352
Common Shares         28,411,737   26,985,149   26,299,740   20,931,305   20,233,250   20,083,250   18,681,170   18,681,170
    Issued
Dividends Declared             -            -            -            -            -            -            -            -
---------------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      -31-

<PAGE>

Dividend Record and Policy

We have not paid any dividends since incorporation. We intend to retain earnings
to finance the growth and  development  of our business and do not intend to pay
dividends on our common shares in the immediate future. The payment of dividends
in  future  will  depend,   among  other  factors,  on  our  earnings,   capital
requirements, and operating and financial condition.

                      MANAGEMENT'S DISCUSSION AND ANALYSIS

Reference is made to the section entitled "Management's  Discussion and Analysis
of  Operating  Results" set out at pages 11 to 12 of the  Company's  2002 Annual
Report,  which has been previously  SEDAR-filed and is incorporated by reference
in this AIF.

                              MARKET FOR SECURITIES

The  Company's  common shares are listed and posted for trading on the TSX under
the stock symbol "MFL", and on the AMEX under the symbol "MFN".

                             DIRECTORS AND OFFICERS

The following  table sets forth the name,  municipality  of residence,  position
held with the Company,  office,  principal occupation and number of shares owned
by each of the directors and executive officers of the Company. The statement as
to the Common Shares beneficially owned,  directly or indirectly,  or over which
control or  direction  is  exercised by the  directors  and  executive  officers
hereinafter  named is in each instance based upon  information  furnished by the
person  concerned  and is as at April 15, 2003.  Each director is elected by the
shareholders  at the annual  general  meeting and holds  office  until our first
annual general meeting  following the director's  election or appointment.  Each
officer holds office at the pleasure of our board of directors.

                             Directors and Officers
<TABLE>
<CAPTION>
<S>                             <C>                          <C>                                    <C>
----------------------------------------------------------------------------------------------------------------------
                                                                                            Number of Common Shares
                                                                                              Beneficially Owned,
                                                                                           Directly or Indirectly or
   Name and Municipality of          Position with the                                       Over Which Control or
          Residence                       Company               Principal Occupation        Direction is Exercised
----------------------------------------------------------------------------------------------------------------------
Mark H. Bailey                  President, Chief Executive   President and Chief                    235,700
Bellingham, Washington,         Officer and Director         Executive Officer of the
U.S.A.                                                       Company
----------------------------------------------------------------------------------------------------------------------
Paul C. MacNeill                Director and Corporate       Barrister and Solicitor                396,100
West Vancouver, British         Secretary
Columbia
----------------------------------------------------------------------------------------------------------------------
James M. Dawson(1)              Director                     President, Dawson                       5,000
Richmond, British Columbia                                   Geological Consulting
                                                             Ltd., a geological
                                                             consulting company
----------------------------------------------------------------------------------------------------------------------
H. Leo King(1)                  Director                     President, International               10,000
Vancouver, British Columbia                                  Barytex Resources Ltd., a
                                                             mining company
----------------------------------------------------------------------------------------------------------------------
</TABLE>

                                      -32-

<PAGE>
<TABLE>
<CAPTION>
<S>                             <C>                          <C>                                    <C>
----------------------------------------------------------------------------------------------------------------------
                                                                                            Number of Common Shares
                                                                                              Beneficially Owned,
                                                                                           Directly or Indirectly or
   Name and Municipality of          Position with the                                       Over Which Control or
          Residence                       Company               Principal Occupation        Direction is Exercised
----------------------------------------------------------------------------------------------------------------------
Robert Leclerc(1)               Director                     Business Consultant                    96,000
Laughlin, Nevada U.S.A.
----------------------------------------------------------------------------------------------------------------------
Tench C. Page                   Vice-President, Exploration  Vice-President,                        299,000
Reno, Nevada                                                 Exploration of the Company
U.S.A.
----------------------------------------------------------------------------------------------------------------------
Jon Morda                       Chief Financial Officer      Chief Financial Officer of              1,200
Toronto, Ontario                                             the Company
----------------------------------------------------------------------------------------------------------------------
</TABLE>

(1) Member of the Audit Committee.

Each of the foregoing  individuals has been engaged in the principal  occupation
set forth  opposite his or her name during the past five years except for:  Paul
C. MacNeill who,  prior to November  2002,  was a partner with the Vancouver law
firm of Campney & Murphy,  Barristers &  Solicitors;  H. Leo King who,  prior to
2001, was the General Manager for International Barytex Resources Ltd., a mining
company; Robert Leclerc who, prior to February 2003 was the President and CEO of
Echo Bay Mines Ltd.,  a mining  company;  and Jon N.  Morda,  who prior to April
2002,  was  the   Vice-President   and  Chief  Financial   Officer  of  Geomaque
Explorations Ltd., a mining company.

Shareholdings of Directors and Officers

To the best of our  knowledge as at April 15, 2003,  our directors and officers,
as a group,  beneficially  owned,  directly or indirectly,  or exercised control
over  1,043,000  common shares (not  including  common shares  issuable upon the
exercise of stock options)  representing  3.34% of our then  outstanding  common
shares.

Committees of the Board of Directors

The Company's  board of directors  has only one  committee - an Audit  Committee
(currently comprised of directors Robert Leclerc, James Martin Dawson and H. Leo
King).  The  members  of the Audit  Committee  do not have any  fixed  terms for
holding  their  positions  and are  appointed  and replaced from time to time by
resolution of the directors.  Their appointments are not subject to any specific
terms of reference.

The Audit Committee meets with the President and Chief Executive Officer and the
Chief Financial  Officer of the Company and the  independent  auditors to review
and inquire into matters affecting  financial  reporting matters,  the system of
internal  accounting  and  financial  controls  and  procedures  and  the  audit
procedures and audit plans.  The Audit Committee also recommends to the Board of
Directors the auditors to be appointed.  In addition, this Committee reviews and
recommends  to the Board for  approval  the  annual  financial  statements,  the
Management  Discussion  and Analysis,  and certain other  documents  required by
regulatory  authorities.  The Audit  Committee is mandated to meet,  and also to
consult the auditors, in the absence of management.

Corporate Cease Trade Orders or Bankruptcies

To the best of the Company's  knowledge,  no director or officer of the Company,
or  shareholder  holding a  sufficient  number of  securities  of the Company to
affect materially the control of the Company,  or within the 10 years before the
date of this AIF, has been a director or officer of any other issuer that, while
that  person was acting in that  capacity,  was the  subject of a cease trade or
similar order, or an order that denied the other issuer access to any exemptions
under Canadian securities legislation,  for a period of more than 30 consecutive
days, or became  bankrupt,  made a proposal  under any  legislation  relating to
bankruptcy or insolvency or was subject to or instituted

                                      -33-

<PAGE>

any  proceedings,  arrangement  or compromise  with creditors or had a receiver,
manager or trustee appointed to hold its assets.

Penalties or Sanctions

To the best  knowledge  of the Company,  no  penalties  or  sanctions  have been
imposed on a  director  or officer of the  issuer,  or a  shareholder  holding a
sufficient number of securities of the Company to affect control of the Company,
in relation  to  Canadian  securities  legislation  or by a Canadian  securities
regulatory  authority,  or by a court or  regulatory  body that would  likely be
considered important to a reasonable investor in making an investment decision.

Personal Bankruptcies

To the best knowledge of the Company,  no director or officer of the Company, or
a  shareholder  holding a  sufficient  number of  securities  of the  Company to
materially  affect the control of the Company,  or a personal holding company of
any such persons,  has,  within the 10 years before the date of this AIF, become
bankrupt,  made a proposal  under any  legislation  relating  to  bankruptcy  or
insolvency,  or was subject to or instituted  any  proceedings,  arrangement  or
compromise  with  creditors,  or had a  receiver,  receiver  manager  or trustee
appointed to hold the assets of the director or officer.

Conflicts of Interest

To the best knowledge of the Company,  no director or officer of the Company, or
a  shareholder  holding a  sufficient  number of  securities  of the  Company to
materially  affect the control of the Company,  or a personal holding company of
any such persons,  has,  within the 10 years before the date of this AIF, become
bankrupt,  made a proposal  under any  legislation  relating  to  bankruptcy  or
insolvency,  or was subject to or instituted  any  proceedings,  arrangement  or
compromise  with  creditors,  or had a  receiver,  receiver  manager  or trustee
appointed to hold the assets of the director or officer.

To the best of the  Company's  knowledge,  and other than as  disclosed  herein,
there  are no known  existing  or  potential  conflicts  of  interest  among the
Company, its directors,  officers or other members of management of the Company,
except that certain of the directors,  officers, and other members of management
serve as  directors,  officers,  promoters  and members of  management  of other
public  companies and therefore it is possible that a conflict may arise between
their duties as a director,  officer, or member of management of the Company and
their duties as a director,  officer,  promoter or member of  management of such
other companies.

The  directors  and  officers of the Company are aware of the  existence of laws
governing accountability of directors and officers for corporate opportunity and
requiring disclosures by directors of conflicts of interest and the Company will
rely upon such laws in respect of any  directors'  and  officers'  conflicts  of
interest  or in  respect  of any  breaches  of duty by any of its  directors  or
officers.  All such conflicts will be disclosed by such directors or officers in
accordance  with the Business  Corporations  Act  (Ontario) and they will govern
themselves in respect  thereof to the best of their  ability in accordance  with
the obligations imposed upon them by law.

                             ADDITIONAL INFORMATION

When the securities of the Company are in the course of a distribution  pursuant
to a preliminary  short form prospectus,  or a short form prospectus,  copies of
the  following  documents  may be  obtained  upon  request  from  our  Corporate
Secretary, Paul C. MacNeill:

(1)  the Company's AIF, together with one copy of any document, or the pertinent
     pages of any document, incorporated by reference in the AIF;

(2)  the comparative  financial  statements of the Company for our most recently
     completed  financial year for which  financial  statements  have been filed
     together with the  accompanying  auditor's  report and one copy of the most
     recent interim financial statements of the Company that have been filed, if
     any, for any period after the end of its most recently completed  financial
     year;

                                      -34-

<PAGE>

(3)  one copy of the Company's  Management Proxy Circular in respect of our most
     recent  annual  meeting of  shareholders  that  involved  the  election  of
     directors  or one  copy  of any  annual  filing  prepared  instead  of that
     information circular, as appropriate; and

(4)  one copy of any other documents that are incorporated by reference into the
     preliminary  short form prospectus or the short form prospectus and are not
     required to be provided under paragraphs (1), (2) or (3) above.

At any other time,  one copy of any documents  referred to at paragraphs  (1) to
(4) above,  provided  that the Company  may require the payment of a  reasonable
charge if the  request  is made by a person  or  company  who is not a  security
holder of the Company.

Additional  information  including  directors'  and officers'  remuneration  and
indebtedness,   principal  holders  of  our  securities,   options  to  purchase
securities and interests of insiders in material transactions, if applicable, is
contained in the  Company's  Management  Proxy  Circular for the annual  general
meeting  to be  held on June  10,  2003.  Additional  financial  information  is
provided in the Company's comparative financial statements and notes thereto for
the year ended December 31, 2002.

                                      -35-

<PAGE>

                          CRITICAL ACCOUNTING POLICIES

The  following  are  considered  to be the critical  accounting  policies of our
Company:

Mineral Properties and Deferred Exploration Costs

We are in the  exploration  stage in respect of its  mineral  properties.  Under
Canadian  generally  accepted  accounting   principles  ("GAAP"),   acquisition,
exploration  and development  costs relating to mineral  properties are deferred
until such time as mineral properties are brought into commercial production, at
which time they will be amortized  over the estimated  life of the property on a
unit of production basis using proven and probable reserves.  Revenue incidental
to exploration  and development  activities,  including the proceeds on sales of
partial properties, is credited against the cost of properties.  Aggregate costs
related to abandoned  properties  are charged to  operations  at the time of any
abandonment or when it has been determined that there is evidence of a permanent
impairment. During the year ended December 31, 2002, we wrote-off $766,055 (2001
- $502,535;  2000 - $208,824) of mineral  properties  and  deferred  exploration
costs related to inactive  properties and abandoned  claims in the United States
and Mexico.

Where we have entered into option  agreements for the acquisition of an interest
in mineral properties which provides for periodic payments,  such amounts unpaid
are not recorded as a liability since they are payable entirely at our option.

Canadian  GAAP  followed  in  the  preparation  of  our  consolidated  financial
statements  differs  from  United  States GAAP in regard to the  accounting  for
mineral  exploration  expenditures.   Under  US  GAAP  all  mineral  exploration
expenditures  incurred by our Company to date would be charged to our  Statement
of Loss and Deficit as incurred. The effect of such a GAAP difference is set out
in Note 10 to our 2002 consolidated financial statements.

Estimates and Assumptions

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

Stock Based Compensation

Effective  January  1, 2002,  the  Company  adopted  new  recommendations  under
Canadian  GAAP  relating  to  stock-based  compensation  and  other  stock-based
payments.   The  new  Canadian  standard  requires  either  the  recognition  of
compensation  expense  for  grants  of stock,  stock  options  and other  equity
instruments to employees, based on the fair value of the instrument at the grant
date, or  alternatively,  the  disclosure of pro forma net earnings and earnings
per share data, as if stock-based  compensation had been recognized in earnings.
We have  chosen not to use the fair  value  method to  account  for  stock-based
employee  compensation  plans,  but to  disclose  pro forma  information  in our
consolidated financial statements for options granted to employees after January
1, 2002 as outlined  in Note 9 to our 2002  consolidated  financial  statements.
Consequently,  we record no  compensation  expense  when  options are granted to
employees.

We adopted the fair value  method of  accounting  for  stock-based  compensation
awards granted to non-employees.  Accordingly,  compensation  expense calculated
using a  Black-Scholes  option  pricing  model is  charged  to the  Consolidated
Statements of Loss and Deficit or capitalized in Mineral Properties and Deferred
Exploration Costs, depending on the nature of the award.

<PAGE>

The adoption of new Canadian GAAP recommendations  effective January 1, 2002 for
stock  options  granted  after that date impacts the  comparability  of the 2002
consolidated financials against prior year comparative financial statements when
no recognition of stock option compensation under Canadian GAAP was done. As the
current  Canadian  GAAP  standard  is largely  the same as US  accounting  rules
previously  in  existence,  the  GAAP  difference  in  regard  to  stock  option
compensation  has been  eliminated in 2002. To assess the impact of stock option
compensation on the years ended December 31, 2001 and 2000, we refer you to Note
10 of our 2002 consolidated  financial statements which discusses and quantifies
the effect of this GAAP difference on our 2001 and 2000 fiscal years.

                             CONTROLS AND PROCEDURES

Within  the  90-day  period  prior  to the  filing  of  this  report  ("Date  of
Evaluation"),  an evaluation  was carried out under the  supervision of and with
the  participation  of the Company's  management,  including the Chief Executive
Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of our
disclosure  controls and procedures (as defined in Rule 13a - 15(c) and Rule 15d
- 15(c) of the  Securities  Exchange  Act of 1934,  as  amended).  Based on that
evaluation  the CEO and the CFO have  concluded  that the  Company's  disclosure
controls and procedures are effective to ensure that information  required to be
disclosed  by the  Company  in  reports  that it  files  or  submits  under  the
Securities Exchange Act of 1934, as amended, is recorded, processed,  summarized
and reported within the time periods  specified in U.S.  Securities and Exchange
Commission rules and forms.

There  have  been no  significant  changes  in our  internal  controls  or other
factors,  which could  significantly  affect internal controls subsequent to the
date of the evaluation. Therefore, no corrective actions were taken.

                               NON-AUDIT SERVICES

Since the enactment of the Sarbanes-Oxley  Act of 2002, all non-audit  services,
performed by the Company's auditor, for the fiscal year ended December 31, 2002,
have been approved by the Audit  Committee of the Company.  The  aggregate  fees
billed by the Company's  auditor for all non-audit  services rendered during the
year ended December 31, 2002 was Cdn$2,912,  10.8% of the total fees paid to the
auditor.  Professional services provided include miscellaneous  discussions with
management concerning implementation of new stock option compensation accounting
rules under Canadian generally accepted accounting principles,  the registration
of the Company's  common stock on the American  Stock Exchange and in connection
with the private placement completed by the Company in 2002.

                  UNDERTAKING AND CONSENT TO SERVICE OF PROCESS

Undertaking

The  Registrant  undertakes  to  make  available,  in  person  or by  telephone,
representatives  to respond to  inquiries  made by the  Securities  and Exchange
Commission  ("SEC") staff, and to furnish  promptly,  when requested to do so by
the SEC staff,  information  relating to: the securities  registered pursuant to
Form 40-F;  the securities in relation to which the obligation to file an annual
report on Form 40-F arises; or transactions in said securities.

Consent to Service of Process

Consent to Service of Process on Form F-X in  connection  with the Common Shares
has been previously filed with the SEC.

<PAGE>

                                    EXHIBITS

The following exhibits are filed as part of this report:

Exhibit No.         Description

1.                  The  audited   consolidated   financial  statements  of  the
                    Registrant,  are  exhibits to and form a part of this Annual
                    Report, and include the following:

                    Auditors' Report on Consolidated Financial Statements, dated
                    February 28, 2003

                    Consolidated  Balance  Sheets as at  December  31,  2002 and
                    2001;

                    Consolidated  Statements  of Loss and  Deficit for the years
                    ended December 31, 2002, 2001 and 2000;

                    Consolidated  Statements  of Cash Flows for the years  ended
                    December 31, 2002, 2001 and 2000;

                    Consolidated  Statements of Mineral  Properties and Deferred
                    Exploration  Costs for the years ended  December  31,  2002,
                    2001 and 2000;

                    Summary of Significant Accounting Policies

                    Notes to Consolidated  Financial Statements (which include a
                    reconciliation   with  United  States   generally   accepted
                    accounting principles).

2.                  Management  Discussion and Analysis of Financial  Conditions
                    and Results of Operations

3.                  Consent of BDO Dunwoody LLP. dated April 28, 2003

4.                  Consent of Mark H. Bailey dated May 5, 2003

5.                  Consent of Pincock Allen & Holt dated May 5, 2003

6.                  Consent of George A. Armbrust dated May 5, 2003

7.                  Consent of Robert L. Sandefur dated May 5, 2003

<PAGE>

Signatures

Pursuant to the requirements of the Exchange Act, the Registrant  certifies that
it meets all of the  requirements  for  filing on Form 40-F and has duly  caused
this annual report to be signed on its behalf by the  undersigned,  thereto duly
authorized.

MINEFINDERS CORPORATION LTD.
----------------------------
         Registrant

By /s/"Mark H. Bailey"
   --------------------------------
   Mark H. Bailey, CEO and Director

Date: May 6, 2003

<PAGE>

                                  CERTIFICATION

I, Mark H. Bailey, President, Chief Executive Officer and Director certify that:

1.   I have reviewed this annual report on Form 40-F of Minefinders  Corporation
     Ltd. (the "Registrant");

2.   Based on my  knowledge,  this  annual  report  does not  contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information included in this annual report,  fairly present in all material
     respects the financial  condition,  results of operations and cash flows of
     the Registrant as of, and for, the periods presented in this annual report;

4.   The  Registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and have:

     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  Registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is being prepared;

     (b)  evaluated the  effectiveness of the Registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     (c)  presented   in  this   annual   report  our   conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The Registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  Registrant's  auditors  and the audit
     committee of  Registrant's  board of directors (or persons  performing  the
     equivalent function):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  Registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  Registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  Registrant's  internal
          controls; and

6.   The  Registrant's  other  certifying  officers and I have indicated in this
     annual report whether there were significant  changes in internal  controls
     or in other  factors  that could  significantly  affect  internal  controls
     subsequent  to the  date  of our  most  recent  evaluation,  including  any
     corrective  actions with regard to  significant  deficiencies  and material
     weaknesses.

Date: May 6, 2003

                                 /s/"Mark H. Bailey"
                                 --------------------
                                 Mark H. Bailey
                                 President, Chief Executive Officer and Director

<PAGE>

                                  CERTIFICATION

I, Jon N. Morda, Chief Financial Officer certify that:

1.   I have reviewed this annual report on Form 40-F of Minefinders  Corporation
     Ltd. (the "Registrant");

2.   Based on my  knowledge,  this  annual  report  does not  contain any untrue
     statement of a material fact or omit to state a material fact  necessary to
     make the statements  made, in light of the  circumstances  under which such
     statements  were made, not misleading with respect to the period covered by
     this annual report;

3.   Based on my  knowledge,  the  financial  statements,  and  other  financial
     information included in this annual report,  fairly present in all material
     respects the financial  condition,  results of operations and cash flows of
     the Registrant as of, and for, the periods presented in this annual report;

4.   The  Registrant's  other  certifying  officers  and I are  responsible  for
     establishing and maintaining disclosure controls and procedures (as defined
     in Exchange Act Rules 13a-14 and 15d-14) for the Registrant and have:

     (a)  designed  such  disclosure  controls  and  procedures  to ensure  that
          material  information  relating  to  the  Registrant,   including  its
          consolidated subsidiaries,  is made known to us by others within those
          entities,  particularly  during the period in which this annual report
          is being prepared;

     (b)  evaluated the  effectiveness of the Registrant's  disclosure  controls
          and procedures as of a date within 90 days prior to the filing date of
          this annual report (the "Evaluation Date"); and

     (c)  presented   in  this   annual   report  our   conclusions   about  the
          effectiveness  of the disclosure  controls and procedures based on our
          evaluation as of the Evaluation Date;

5.   The Registrant's other certifying  officers and I have disclosed,  based on
     our most recent  evaluation,  to the  Registrant's  auditors  and the audit
     committee of  Registrant's  board of directors (or persons  performing  the
     equivalent function):

     (a)  all  significant  deficiencies  in the design or operation of internal
          controls  which could  adversely  affect the  Registrant's  ability to
          record,  process,   summarize  and  report  financial  data  and  have
          identified for the  Registrant's  auditors any material  weaknesses in
          internal controls; and

     (b)  any fraud, whether or not material,  that involves management or other
          employees who have a  significant  role in the  Registrant's  internal
          controls; and

6.   The  Registrant's  other  certifying  officers and I have indicated in this
     annual report whether there were significant  changes in internal  controls
     or in other  factors  that could  significantly  affect  internal  controls
     subsequent  to the  date  of our  most  recent  evaluation,  including  any
     corrective  actions with regard to  significant  deficiencies  and material
     weaknesses.

Date: May 6, 2003

                                                         /s/"Jon N. Morda"
                                                         -----------------
                                                         Jon N. Morda
                                                         Chief Financial Officer

<PAGE>

                                EXHIBIT 1

                                Minefinders Corporation Ltd.
                                (An Exploration Stage Company)
                                Consolidated Financial Statements
                                (Expressed in Canadian Dollars)
                                For the years ended December 31, 2002 and 2001

<PAGE>

                                Minefinders Corporation Ltd.
                                (An Exploration Stage Company)
                                Consolidated Financial Statements
                                (Expressed in Canadian Dollars)
                                For the years ended December 31, 2002 and 2001

                                                                        Contents
--------------------------------------------------------------------------------
Auditors' Report                                                              2

Consolidated Financial Statements

    Balance Sheets                                                            3

    Statements of Loss and Deficit                                            4

    Statements of Cash Flows                                                  5

    Statements of Mineral Properties and Deferred Exploration Costs           6

    Summary of Significant Accounting Policies                            7 - 9

    Notes to the Financial Statements                                   10 - 22

<PAGE>

[logo]                 BDO Dunwoody LLP            600 Park Place
                       Chartered Accountants       666 Burrard Street
                                                   Vancouver, BC, Canada V6C 2X8
                                                   Telephone:  (604) 688-5421
                                                   Telefax:  (604) 688-5132
                                                   E-mail:  vancouver@bdo.ca
                                                            www.bdo.ca

--------------------------------------------------------------------------------

                                                                Auditors' Report

--------------------------------------------------------------------------------

To the Shareholders of
Minefinders Corporation Ltd.

We have audited the Consolidated Balance Sheets of Minefinders  Corporation Ltd.
(an  Exploration  Stage  Company)  as at  December  31,  2002  and  2001 and the
Consolidated  Statements of Loss and Deficit,  Cash Flows and Mineral Properties
and Deferred  Exploration  Costs for each of the years in the three-year  period
ended December 31, 2002. These financial  statements are the  responsibility  of
the Company's  management.  Our responsibility is to express an opinion on these
financial statements based on our audits.

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

In our opinion,  these consolidated  financial statements present fairly, in all
material respects, the financial position of the Company as at December 31, 2002
and 2001 and the  results of its  operations  and its cash flows for each of the
years in the  three-year  period  ended  December  31, 2002 in  accordance  with
Canadian generally accepted accounting principles.

/s/ BDO Dunwoody LLP

Chartered Accountants

Vancouver, Canada
February 28, 2003
                                                                               2

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                                     Consolidated Balance Sheets
                                                 (Expressed in Canadian Dollars)
<TABLE>
<CAPTION>
<S>                                            <C>               <C>
December 31                                                2002            2001
--------------------------------------------------------------------------------

Assets

Current
    Cash                                       $      2,231,785  $      475,136
    Short-term investments (Note 2)                   7,140,489               -
    Receivables                                         535,752         133,651
    Prepaid expenses                                    128,749          40,838
                                               ---------------------------------
                                                     10,036,775         649,625

Mineral properties and deferred exploration
  costs (Note 3)                                     35,731,966      30,110,724
Capital assets (Note 4)                                 130,876          74,660
                                               ---------------------------------
                                               $     45,899,617  $   30,835,009
--------------------------------------------------------------------------------

Liabilities and Shareholders' Equity

Liabilities

Current
    Accounts payable and accrued liabilities    $       896,188    $    115,107
                                               ---------------------------------

Shareholders' equity
    Capital stock (Note 5)                           56,792,773      42,013,404
    Contributed surplus (Note 9)                      2,258,100               -
    Deficit                                         (14,047,444)    (11,293,502)
                                               ---------------------------------
                                                     45,003,429      30,719,902
                                               ---------------------------------
                                                $    45,899,617   $  30,835,009
--------------------------------------------------------------------------------

</TABLE>

Approved by the Board of Directors:


         /s/ James M Dawson      Director
         --------------------


         /s/ Paul C. MacNeill    Director
         --------------------

The  accompanying  summary of significant  accounting  policies and notes are an
integral part of these consolidated financial statements.
                                                                               3

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                     Consolidated Statements of Loss and Deficit
                                                 (Expressed in Canadian Dollars)
<TABLE>
<CAPTION>
<S>                                                    <C>                <C>               <C>
For the years ended December 31                                     2002              2001             2000
--------------------------------------------------------------------------------------------------------------


Administrative costs
    Accounting and auditing                            $         126,565  $         75,583  $        47,363
    Amortization                                                   5,202             1,482            1,844
    Consulting (Note 9)                                          815,449           178,392          178,048
    Corporate relations                                          409,256            60,703          181,916
    Legal                                                        310,189           179,732          189,705
    Office services and expenses                                 244,565           164,647          234,643
    Shareholder reports and filing fees                           92,790            88,621          127,068
    Travel                                                       116,031            49,841           22,655
                                                       -------------------------------------------------------
                                                               2,120,047           799,001          983,242

Other operating items
    Write-off of mineral properties and deferred
      exploration costs                                          766,055           502,535          208,824
                                                       -------------------------------------------------------

Loss from operations                                          (2,886,102)       (1,301,536)      (1,192,066)

Investment and other items
    Foreign exchange (loss) gain                                 (52,671)            2,217           48,182
    Gain (loss) on sale of assets                                  3,031                 -             (670)
    Interest income                                              181,800            16,855           26,605
    Loss on investment                                                 -                 -          (13,762)
                                                       -------------------------------------------------------

Net loss for the year                                         (2,753,942)       (1,282,464)      (1,131,711)

Deficit, beginning of year                                   (11,293,502)      (10,011,038)      (8,879,327)
                                                       -------------------------------------------------------

Deficit, end of year                                   $     (14,047,444)  $   (11,293,502)  $  (10,011,038)
--------------------------------------------------------------------------------------------------------------

Loss per share - basic and diluted                     $           (0.11)  $         (0.07)  $        (0.07)
--------------------------------------------------------------------------------------------------------------

Weighted average shares outstanding                           25,280,665        19,129,452       16,547,997
--------------------------------------------------------------------------------------------------------------
</TABLE>


The  accompanying  summary of significant  accounting  policies and notes are an
integral part of these consolidated financial statements.
                                                                               4

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                           Consolidated Statements of Cash Flows
                                                 (Expressed in Canadian Dollars)
<TABLE>
<CAPTION>
<S>                                                     <C>              <C>                  <C>
For the years ended December 31                                    2002              2001             2000
--------------------------------------------------------------------------------------------------------------

Cash flows from operating activities
    Net loss for the year                               $    (2,753,942) $     (1,282,464)    $ (1,131,711)
    Items not involving cash
        Amortization                                              5,202             1,482            1,844
        Loss (gain) on sale of asset                             (3,031)                -              670
        Write-off of mineral properties and
          deferred exploration costs                            766,055           502,535          208,824
        Loss on investment                                            -                 -           13,762
        Stock option compensation (Note 9)                      572,662                 -                -
        Common shares issued for expenses                             -                 -           50,000

    Net change in non-cash working
      capital balances
       Receivables                                             (402,101)           (3,047)         316,686
       Prepaid expenses                                         (87,911)          (37,400)          16,265
       Accounts payable and accrued liabilities                 126,081          (110,186)         114,359
                                                       -------------------------------------------------------
                                                             (1,776,985)         (929,080)        (409,301)
                                                       -------------------------------------------------------

  Cash flows from investing activities
    Mineral properties and exploration costs                 (4,006,210)       (1,522,696)      (1,989,194)
    Purchase of capital assets                                 (105,708)           (1,077)         (16,493)
    Proceeds from disposal of capital assets                      6,672                 -                -
    Purchase of short-term investments                       (7,140,489)                -                -
    Investment and advances                                           -                 -             (400)
                                                       -------------------------------------------------------
                                                            (11,245,735)       (1,523,773)      (2,006,087)
                                                       -------------------------------------------------------

  Cash flows from financing activities
     Net proceeds on issuance of common shares
       and subscriptions received                            14,779,369         1,963,798        1,824,607
                                                       -------------------------------------------------------

Increase (decrease) in cash                                   1,756,649          (489,055)        (590,781)

Cash, beginning of year                                         475,136           964,191        1,554,972
                                                       -------------------------------------------------------

Cash, end of year                                      $      2,231,785  $        475,136     $    964,191
--------------------------------------------------------------------------------------------------------------

Supplemental Information

     Interest and taxes paid                           $              -  $              -     $          -

     Non-cash investing and financing activities:
      Amortization of capital assets included in
        deferred exploration costs                     $         40,649  $         22,868     $     30,943
      Stock option compensation (Note 9)               $      2,258,100  $              -     $          -
      Issuance of common shares for expenses           $              -  $              -     $     50,000
      Issuance of common shares for share
        issuance costs                                 $              -  $         50,000     $          -
--------------------------------------------------------------------------------------------------------------
</TABLE>

The  accompanying  summary of significant  accounting  policies and notes are an
integral part of these consolidated financial statements.
                                                                               5

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                   Consolidated Statements of Mineral Properties
                                                  and Deferred Exploration Costs
                                                 (Expressed in Canadian Dollars)
<TABLE>
<CAPTION>
<S>                                                         <C>            <C>              <C>
For the years ended December 31                                      2002             2001             2000
--------------------------------------------------------------------------------------------------------------


Mineral properties                                          $     203,373  $       194,615  $       255,590
                                                       -------------------------------------------------------

Deferred exploration costs
    Assaying                                                      370,050           96,969          125,005
    Amortization                                                   40,649           22,868           30,943
    Communication and delivery                                     64,005           58,626           55,471
    Drilling and trenching                                      2,266,690                -          269,547
    Environmental                                                     985           13,053           13,151
    Geophysical surveying and mapping                              65,563           12,785              754
    Legal:  mineral properties                                     28,297            8,714            2,288
    Licenses and recording fees                                   612,517          453,390          363,743
    Metallurgical                                                   3,850                -           27,371
    Engineering/prefeasibility study                               20,958            4,057                -
    Road building                                                  55,405           12,197            7,595
    Supplies                                                      132,940           40,323           32,333
    Technical and professional services                         1,217,346          581,694          677,260
    Other non-cash professional services (Note 9)               1,685,438                -                -
    Travel                                                        140,274           46,273          159,086
                                                       -------------------------------------------------------
                                                                6,704,967        1,350,949        1,764,547
                                                       -------------------------------------------------------

Gross mineral properties and deferred exploration
  costs                                                         6,908,340        1,545,564        2,020,137
Less: costs paid by joint venturer                               (521,043)               -                -
                                                       -------------------------------------------------------

Mineral properties and deferred exploration
 costs during the year                                          6,387,297        1,545,564        2,020,137

Balance, beginning of year                                     30,110,724       29,067,695       27,256,382

Less:      Write-off of mineral properties
           and deferred exploration costs (Note 3)               (766,055)        (502,535)        (208,824)
                                                       -------------------------------------------------------

Balance, end of year (Note 3)                               $  35,731,966  $    30,110,724  $    29,067,695
--------------------------------------------------------------------------------------------------------------
</TABLE>

The  accompanying  summary of significant  accounting  policies and notes are an
integral part of these consolidated financial statements.
                                                                               6

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                      Summary of Significant Accounting Policies
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

Basis of Consolidation

These consolidated financial statements are prepared in accordance with Canadian
generally accepted accounting principles and include the accounts of the Company
and its wholly-owned subsidiaries,  Minera Minefinders S.A. de C.V. and Compania
Minera  Dolores S.A. de C.V. (in Mexico) and  Minefinders  (U.S.A.) Inc. (in the
United States).  All  intercompany  transactions  and balances are eliminated on
consolidation.

Short-term Investment

Short-term  investment is recorded at cost,  which  approximates its fair market
value, plus accrued interest earned in the period.

Mineral Properties

The Company is in the  exploration  stage in respect of its mineral  properties.
Acquisition,  exploration and development  costs relating to mineral  properties
are deferred until such time as mineral  properties are brought into  commercial
production,  at which time they will be amortized over the estimated life of the
property on a unit of  production  basis  using  proven and  probable  reserves.
Revenue  incidental to exploration  and  development  activities,  including the
proceeds  on  sales of  partial  properties,  is  credited  against  the cost of
properties.  Aggregate  costs  related to  abandoned  properties  are charged to
operations at the time of any  abandonment or when it has been  determined  that
there is evidence of a permanent impairment.  During the year ended December 31,
2002,  the Company  wrote-off  $766,055  (2001 - $502,535;  2000 - $208,824)  of
mineral properties and deferred exploration costs related to inactive properties
and abandoned claims in the United States and Mexico.

Where the Company has entered into option  agreements for the  acquisition of an
interest in mineral  properties  which  provides  for  periodic  payments,  such
amounts unpaid are not recorded as a liability  since they are payable  entirely
at the Company's option.

Capital Assets

Capital   assets  are   carried  at  cost.   Amortization   is   provided  on  a
declining-balance  basis at the rate of 30% per annum for  vehicles  and 20% per
annum for other capital assets.

Foreign Exchange Translation

The  Company  conducts  the  majority  of its  business in Mexico and the U.S.A.
through its subsidiaries in U.S.  dollars.  The Company uses the temporal method
of currency  translation for translating the Company's  foreign  operations into
Canadian dollars.  Under this method,  monetary assets and liabilities have been
converted at the exchange rate prevailing at the balance sheet date.  Income and
expenses are translated at historical rates.  Non-monetary  assets,  liabilities
and equity  are  translated  at  historical  rates.  Gains and losses on foreign
exchange are included in the Statements of Loss and Deficit for the year.
                                                                               7

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                      Summary of Significant Accounting Policies
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

Foreign Exchange Translation - Continued

Exchange rates between the U.S. dollar, the Mexican peso and the Canadian dollar
for the periods reported on in these financial statements are as follows:

                                        2002            2001              2000
                                    --------------------------------------------

            US Dollar
            Year end                   0.6370          0.6285            0.6669
            Average                    0.6343          0.6456            0.6569

            Mexican Peso
            Year end                    6.135           5.744             6.158
            Average                     6.596           6.018             6.127

Future Income Taxes

Income and resource taxes are accounted for by the liability method.  Under this
method,  income and resource  taxes reflect the deferral of such taxes to future
years.  The  deferral  is a result of  temporary  differences  which  arise when
certain costs,  principally  amortization and deferred exploration,  are claimed
for tax  purposes  in  different  time  periods  than the  related  amounts  are
amortized in the accounts.

Loss Per Share

During the year ended December 31, 2002, the Company adopted the "Treasury Stock
Method" to calculate  loss per common share.  Under this method,  the basic loss
per share is calculated based on the weighted average aggregate number of common
shares  outstanding  during each period. The diluted loss per share assumes that
the outstanding  stock options and share purchase warrants had been exercised at
the beginning of the period.  The adoption of this policy had no material effect
on prior year figures.

Common  equivalent  shares  (consisting of shares  issuable on exercise of stock
options and warrants) totalling  3,232,605 (2001 - 5,191,092;  2000 - 3,722,908)
were not included in the  computation of diluted  earnings per share because the
effect was anti-dilutive.

Financial Instruments

The  Company's  financial  assets and  liabilities  consist of cash,  short-term
investments, receivables and accounts payable and accrued liabilities. Except as
otherwise  noted, it is management's  opinion that the Company is not exposed to
significant  interest or credit risks arising from these financial  instruments.
The fair values of the financial  instruments  approximate their carrying values
due to the short-term maturities of these instruments.
                                                                               8

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                      Summary of Significant Accounting Policies
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

Financial Instruments - Continued

Financial  assets  and  liabilities  denominated  in  currencies  other than the
Canadian dollar are as follows:

                                      2002                        2001
                            Financial     Financial      Financial    Financial
                              Assets     Liabilities       Assets    Liabilities
                           -----------------------------------------------------

            US dollar      $ 1,428,044     $ 691,498     $  81,365     $  45,469
            Mexican peso       269,529        83,853       144,108        44,819
                           -----------------------------------------------------
                           $ 1,697,573     $ 775,351     $ 225,473     $  90,288
                           -----------------------------------------------------

Estimates and Assumptions

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

Segmented Information

The Company has determined that it has one business segment, the exploration and
development  of  mineral  properties.  Information  by  geographical  area is as
disclosed in Notes 3 and 4.

Stock Options

Effective  January 1, 2002,  the  Company  adopted the  recommendations  of CICA
Handbook Section 3870, Stock-based  compensation and other stock-based payments.
The standard requires either the recognition of compensation  expense for grants
of stock, stock options and other equity instruments to employees,  based on the
fair value of the instrument at the grant date, or alternatively, the disclosure
of pro  forma net  earnings  and  earnings  per share  data,  as if  stock-based
compensation had been recognized in earnings.  The Company has chosen not to use
the fair value method to account for stock-based  employee  compensation  plans,
but to disclose pro forma  information  for options  granted to employees  after
January 1, 2002 as outlined  in Note 9.  Consequently,  the  Company  records no
compensation expense when options are granted to employees.

The  Company  adopted  the fair  value  method  of  accounting  for  stock-based
compensation awards granted to non-employees.  Accordingly, compensation expense
calculated  using a  Black-Scholes  option  pricing  model  are  charged  to the
Consolidated Statements of Loss and Deficit or capitalized in Mineral Properties
and Deferred Exploration Costs, depending on the nature of the award.
                                                                               9

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

1.   Nature of Business

     The  Company  was  organized  on  February  4,  1975  under the laws of the
     Province  of Ontario  and is  engaged  in the  business  of  exploring  for
     precious and base metal properties in North America and Mexico. At December
     31, 2002 and 2001, the Company was considered an exploration stage company.

     The accompanying financial statements have been prepared on a going concern
     basis, which contemplates the realization of assets and the satisfaction of
     liabilities and  commitments in the normal course of business.  The Company
     has not yet determined whether its properties contain mineral reserves that
     are  economically  recoverable.  The  continuation  of the  Company and the
     recoverability  of the amount  shown for mineral  properties  and  deferred
     exploration  costs is dependent  upon the continuing  financial  support of
     shareholders  or other  investors  and  obtaining  long-term  financing  to
     complete  exploration  and  development,   the  existence  of  economically
     recoverable  reserves,  confirmation  of  the  Company's  interest  in  the
     underlying mineral claims and upon future profitable production. Subsequent
     to  year  end,  the  Company  received  proceeds  (net of  commissions)  of
     approximately  $17 million from a brokered  placement of common  shares for
     additional exploration work (Note 7).

--------------------------------------------------------------------------------

2.   Short-term Investments

     The balance  consists of the principal and accrued interest of a redeemable
     term deposit maturing on April 2, 2003.  Interest income is earned at prime
     less 1.65% per annum.

--------------------------------------------------------------------------------

3.   Mineral Properties and Deferred Exploration Costs

<TABLE>
<CAPTION>
<S>                                 <C>                <C>                  <C>             <C>
                                           Deferred
                                            Mineral           Exploration
                                         Properties                 Costs             2002             2001
                                    -----------------------------------------------------------------------
      Mexico
         Dolores Property           $    10,626,973    $       18,150,056   $   28,777,029  $    23,220,731
         Northern Sonora                    270,790             2,825,319        3,096,109        2,972,384
         La Reserva/El Correo                77,961             1,876,907        1,954,868        1,757,805
         Other                               76,967               713,895          790,862          591,648
                                    -----------------------------------------------------------------------

                                         11,052,691            23,566,177       34,618,868       28,542,568
                                    -----------------------------------------------------------------------

      United States
         Oro Blanco                               -                     -                -          594,854
         Nevada Properties                  288,682               824,416        1,113,098          973,302
                                    -----------------------------------------------------------------------

                                            288,682               824,416        1,113,098        1,568,156
                                    -----------------------------------------------------------------------

                                    $    11,341,373    $       24,390,593   $   35,731,966  $    30,110,724
                                    -----------------------------------------------------------------------
</TABLE>
                                                                              10

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

3.   Mineral Properties and Deferred Exploration Costs - Continued

     Mineral  properties and related deferred  exploration  costs consist of the
     following:

     Mexican Properties

     Dolores Property

     The Dolores  property  consists of nine claims  totaling 27,700 hectares in
     the Madera Mining  District,  in the state of Chihuahua.  The Company has a
     100% interest in two claims totaling 25,780 hectares and can acquire a 100%
     interest in the  remaining  seven  claims by  bringing  the  property  into
     production  or by  making  further  payments  of  approximately  US$550,000
     payable in quarterly instalments of US$25,000. The property is also subject
     to underlying net smelter return ("NSR")  royalties  totaling 3.25% on gold
     and 2% on silver.

     Northern Sonora Properties

     The Company  has a 100%  interest  in the  mineral  rights on the  Northern
     Sonora Properties, which consist of nine claims totaling 16,591 hectares in
     the State of Sonora.  The Company is required to make annual rent  payments
     to the  landowners  of  approximately  US$25,000,  which have been paid for
     2002, 2001 and 2000.  Should a mine be put in production on the properties,
     a one-time payment of US$500,000 is due to one landowner. Another landowner
     is to be paid  US$350,000  for the first  mine put into  production  on his
     property and  US$250,000  is to be paid for any  additional  mines put into
     production.

     On December 21, 2001,  the Company  entered into a letter of agreement with
     Placer Dome Exploration Inc.  ("Placer") to further explore and develop the
     El Malacate project in Northern Sonora. Under the agreement, Placer had the
     right to earn a 51%  beneficial  interest in the property  over a four-year
     period for cash  payments  and  exploration  expenditures.  Placer held the
     right to terminate the agreement at any time after the first  US$250,000 is
     spent.  Placer  reimbursed  costs in the amount of $521,043 in 2002 (2001 -
     $Nil) to the Company pursuant to the joint venture agreement. In June 2002,
     Placer terminated the agreement without earning an interest in the project.

     La Reserva/El Correo

     In 2001, the Company acquired mining rights on the property from the owner.
     As a result,  as of March 2001,  the Company holds the title to these three
     claims in the La Reserva/El  Correo  property and three  additional  claims
     staked  by the  Company,  for a total  of  23,561  hectares.  The  original
     agreement  signed  in 1996 for the La  Reserva/El  Correo  Concessions  was
     accordingly terminated.

     In 1998, the Company entered into surface rights agreements whereby it made
     annual  payments  to certain  landowners  for access to the  property  that
     formed part of the La Reserva/El  Correo Property,  to conduct  exploration
     and mining  activities.  The  agreements can be terminated at the option of
     the Company upon 30 days notice to the landowners. As of December 31, 2002,
     the Company is current with its surface rights payments.
                                                                              11

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

3.   Mineral Properties and Deferred Exploration Costs - Continued

     Other Properties

     The Company has title to eight additional claims in Zacatecas, Mexico.

     United States Properties

     Oro Blanco

     The Oro Blanco property consists of 108 mining claims in Santa Cruz County,
     Arizona.  In 1997,  the Company  completed  expenditures  of US$200,000 and
     acquired a 100% interest in 46 claims (subject to NSR royalties of 3%). The
     Company has a 100%  interest in the other 62 claims which do not have a NSR
     royalty.

     For the year ended  December 31, 2002,  the Company  wrote-off  100% of the
     cost of the mineral claims and deferred exploration costs of the Oro Blanco
     property in the amount of $608,182.

     Nevada Properties

     The Company holds a 100% interest in the Clear, Dottie and Gutsy properties
     (subject to NSR royalties of 3%).

     The Washiki  claim group and Cleo claims near the Clear  property  are 100%
     owned by the Company with no royalties attached.  In addition,  in 1998 the
     Company  entered into a lease  agreement to acquire mineral rights situated
     near the Clear property by making annual advance minimum  royalty  payments
     over 15 years and by incurring  exploration  expenditures  of US$150,000 by
     April 2001.  At December 31, 2002,  the Company is current with its advance
     royalty  payments.  The  Company  has the  right  to  terminate  the  lease
     agreement on thirty days written notice to the owner.

     The Company has also  acquired  the  Buckskin  Mountain  property by making
     certain payments  totaling  US$100,000 to a company  controlled by an arm's
     length consultant who,  subsequent to the agreement date, became a director
     of the  Company.  In 2000,  the Company paid the final  installment  to the
     director under the agreement.

     For the year ended December 31, 2002, there was no write-off of any mineral
     properties or deferred exploration costs of the Nevada properties.  For the
     year ended  December 31,  2001,  the Company  wrote-off  20% of the cost of
     mineral claims and 25% of deferred  exploration  costs totaling $332,583 in
     respect  of a  reduction  in the claim area on all US  projects  except the
     Clear property.
                                                                              12

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

4.   Capital Assets
<TABLE>
<CAPTION>
<S>                       <C>          <C>          <C>              <C>            <C>        <C>

                                                         2002                                         2001
                          ---------------------------------------------------------------------------------
                                        Accumulated     Net Book                  Accumulated      Net Book
                               Cost    Amortization       Value          Cost    Amortization         Value
                          ---------------------------------------------------------------------------------

        Exploration
          equipment       $   43,474   $     28,837 $     14,637     $ 42,809       $  25,177  $     17,632
        Office furniture
          and equipment      119,603         76,904       42,699       90,985          66,507        24,478
        Vehicles             279,528        205,988       73,540      218,506         185,956        32,550
                          ---------------------------------------------------------------------------------
                          $  442,605   $    311,729 $    130,876     $352,300       $ 277,640  $     74,660
                          ---------------------------------------------------------------------------------
</TABLE>

     Capital  assets  of the  Company  are  segmented  by  geographical  area as
     follows:

                                                  2002              2001
                                        ---------------------------------

     Mexico                             $        43,983  $        34,115
     United States                               54,546           28,739
     Canada                                      32,347           11,806
                                        ---------------------------------
                                         $      130,876  $        74,660
                                        ---------------------------------

                                                                              13

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

5.   Capital Stock

     Authorized
        Unlimited common shares, no par value
     Issued
        Common shares
                                               Issued                     Amount
                                      ------------------------------------------

     Balance, January 1, 2000              16,300,709        $        38,174,999

     Issued during the year:
     For cash
       Private placement (net of
         issue costs of $17,563)              405,818                    428,837
       Exercise of stock options              285,000                    276,250
     For expenses                              40,000                     50,000
                                      ------------------------------------------

     Balance, December 31, 2000            17,031,527                 38,930,086

     Issued during the year:
     For cash
       Private placement (net of
        issue costs of $178,754)            3,051,723                  2,910,818
       Exercise of warrants                   150,000                    172,500
                                      ------------------------------------------
     Balance, December 31, 2001            20,233,250                 42,013,404

     Issued during the year:
     For cash
       Private placement (net of
        issue costs of $745,593)            4,400,000                  9,374,407
       Exercise of stock options            1,778,000                  3,083,450
       Exercise of warrants                 2,000,487                  2,321,512
                                      ------------------------------------------
     Balance, December 31, 2002            28,411,737          $      56,792,773
                                      ------------------------------------------

     (a)  In  September  2000,  the  Company  issued  405,818  units by way of a
          private placement for gross proceeds of $446,400.  Each unit consisted
          of one common share and  one-half of a warrant with one whole  warrant
          entitling  the holder to purchase  one common share at $1.35 per share
          for a two-year period.

     (b)  In January 2001,  the Company  completed  private  placements to issue
          1,599,643  units  for  total  proceeds  of  $1,477,180  with each unit
          consisting of one common share and one warrant entitling the holder to
          purchase  one common  share at $1.00 and $1.15 for a two- year period.
          In connection with this private  placement,  50,000 common shares were
          issued and $56,269 was paid in cash as a finder's  fee.  These finders
          fees were recorded as a reduction to the gross proceeds on the private
          placement.  Net proceeds of $1,119,520 on 2001 private placements were
          received by the Company during 2000.
                                                                              14

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

5.   Capital Stock - Continued

          During the remainder of 2001, the Company completed private placements
          to issue a further  1,402,080  units for total  proceeds of $1,612,392
          with each unit  consisting  of one  common  share  and  one-half  of a
          warrant. Each whole warrant entitles the holder to purchase one common
          share at $1.40 per share for a period  of two  years.  Issuance  costs
          totaling  $122,485 relating to the private placement were charged as a
          reduction to the gross proceeds on the private placement.

     (c)  In December  2000, the Company issued 40,000 common shares in exchange
          for consulting services.  Total proceeds based on the trading price of
          the common shares on the issuance date was $50,000

     (d)  In April 2002, the Company  completed a brokered private  placement to
          issue  4,400,000  common  shares for total  proceeds  of  $10,120,000.
          Related  share issue costs of $745,593  were charged as a reduction to
          the gross proceeds on the brokered private placement.

     (e)  Stock Options

          In 2002,  the  shareholders  approved a stock option plan ("the Plan")
          for directors,  officers employees and certain consultants. The number
          of shares  available  for purchase  pursuant to options under the Plan
          cannot exceed  5,113,348.  The term of options  granted under the Plan
          cannot exceed 5 years. The exercise price of each option is determined
          by the Board of Directors at fair market value of the Company's shares
          at the date of grant.

          The following table summarizes the changes in stock options during the
          years:

<TABLE>
<CAPTION>
<S>                                                                    <C>                <C>
                                                             Number of Options      Weighted Average
                                                                                      Exercise Price
                                                           ------------------------------------------

           Outstanding at January 1, 2000                            2,412,500            $     1.54
             Granted                                                   485,000                  1.08
             Exercised                                               (285,000)                  0.97
             Cancelled                                               (205,000)                  1.32
                                                           ------------------------------------------

           Outstanding at December 31, 2000                          2,407,500                  1.54
             Granted                                                   430,000                  1.50
                                                           ------------------------------------------

           Outstanding at December 31, 2001                          2,837,500                  1.53
             Granted                                                 1,820,000                  5.10
             Exercised                                             (1,778,000)                  1.73
                                                           ------------------------------------------

           Outstanding at December 31, 2002                          2,879,500             $    3.66
                                                           ------------------------------------------
</TABLE>
                                                                              15

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

5.   Capital Stock - Continued

          All  options  granted  and  outstanding  during  the years  were fully
          exercisable on the various grant dates except 50,000  options  granted
          in 2001 with an  exercise  price of $1.50 per  share  which  vested on
          January 6, 2002, and 20,000  options  granted in 2002 with an exercise
          price of $6.15 which vest in 5,000 option  increments  over a one-year
          period.

          At December 31, 2002, the following stock options were outstanding:

                             Number             Exercise Price       Expiry Date
                         -------------------------------------------------------
                            210,000                 $1.40          July 16, 2003
                            302,500                 $1.25      December 22, 2003
                            285,000                 $1.10          June 19, 2005
                             45,000                 $1.05       December 7, 2005
                            270,000                 $1.50       November 7, 2006
                            727,000                 $3.30         April 17, 2007
                             20,000                 $6.15          July 15, 2007
                          1,020,000                 $6.45      December 23, 2007
                         -----------
                          2,879,500
                         -----------

          Subsequent  to  year-end   December  31,  2002,  79,500  options  were
          exercised  at a  weighted  average  exercise  price of $2.56 for gross
          proceeds  of $203,650  and 10,000  options  with an exercise  price of
          $6.15 were cancelled due to termination of agreement.

     (f)  The following table  summarizes  whole warrant  activities  during the
          years:
<TABLE>
<CAPTION>
<S>                                                           <C>                    <C>
                                                                               Weighted Average
                                                                 Number          Exercise Price
                                                    --------------------------------------------

           Outstanding at January 1, 2000                     1,112,499              $     1.50

           Issued                                               202,909                    1.35
                                                    --------------------------------------------

           Outstanding at December 31, 2000                   1,315,408                    1.48

           Issued                                             2,300,682                    1.18
           Exercised                                           (150,000)                   1.15
           Expired                                           (1,112,499)                   1.50
                                                    --------------------------------------------

           Outstanding at December 31, 2001                   2,353,591                    1.20

           Exercised                                         (2,000,487)                   1.16
                                                    --------------------------------------------

           Outstanding at December 31, 2002                     353,104              $     1.40
                                                    --------------------------------------------
</TABLE>
                                                                              16

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

5.   Capital Stock - Continued

          At December 31, 2002, the following  share  warrants were  outstanding
          and fully exercisable:

                     Number             Exercise Price               Expiry Date
                   -------------------------------------------------------------
                    133,895                   $1.40              August 30, 2003
                    219,209                   $1.40           September 26, 2003
                   ---------
                    353,104
                   ---------

          Subsequent to December 31, 2002,  108,695  warrants were exercised for
          gross proceeds of $152,173.

--------------------------------------------------------------------------------

6.   Related Party Transactions

     Related party  transactions not disclosed  elsewhere in these  consolidated
     financial statements are as follows:

     (a)  The Company was charged for administrative and geological  services by
          a director and an officer as follows:

                           Year                          Amount

                           2002                        $  378,490
                           2001                        $  323,387
                           2000                        $  342,041


     (b)  Legal  services  are  provided  by a law  firm  in  which  one  of the
          directors of the Company was a partner. The cost of these services was
          as follows:

                           Year                          Amount

                           2002                        $  350,211
                           2001                        $  139,985
                           2000                        $   84,503

     Transactions  with related  parties were in the normal course of operations
     and were  measured  at the  exchange  value  (the  amount of  consideration
     established and agreed to by the related parties).
                                                                              17

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

7.   Subsequent Event

     On February 10, 2003, the Company completed a brokered placement consisting
     of  2,587,500  common  shares at $7.00 per  share  for  gross  proceeds  of
     $18,112,500.  A  broker  commission  of  5.5%,  amounted  to  approximately
     $996,000, was payable on the gross proceeds.

--------------------------------------------------------------------------------

8.   Income Taxes

     The tax effects of temporary  differences  that give rise to the  Company's
     deferred tax assets are as follows: 2002 2001

<TABLE>
<CAPTION>
<S>                                                                <C>                 <C>
                                                                          2002               2001
                                                                   -----------------------------------
     Tax loss carryforwards                                        $     5,914,000     $    6,103,000
     Capital assets                                                          9,000              9,000
     Mineral properties and deferred exploration costs                  (1,956,000)        (1,383,000)
     Undeducted financing costs                                            293,000             91,000
     Valuation allowance                                                (4,260,000)        (4,820,000)
                                                                   -----------------------------------

                                                                    $             -     $           -
                                                                   -----------------------------------
</TABLE>

     The Company's  deferred tax asset includes the tax effect of  approximately
     $293,000  (2001 - $91,000)  related to deductions  for share issue costs in
     excess of amounts deducted for financial reporting purposes.  Additionally,
     the tax effect of tax loss carryforwards of approximately $632,000 has been
     recognized to offset a future tax liability arising from the capitalization
     of stock option compensation as deferred  exploration costs during 2002. If
     and when the valuation allowance related to these amounts is reversed,  the
     Company will recognize these amounts as adjustments to shareholders' equity
     as opposed to a deferred  income tax recovery in the Statements of Loss and
     Deficit.

     The provision for income taxes differs from the amount  estimated using the
     Canadian federal and provincial statutory income tax rates as follows:

<TABLE>
<CAPTION>
<S>                                                        <C>              <C>               <C>
                                                                     2002            2001             2000
                                                           ------------------------------------------------


     Benefit at Canadian statutory rates                   $   (1,033,000)  $     (572,000)   $   (521,000)
     Effect of difference in foreign tax rates                     32,000          67,000           43,000
     Non-deductible expenses                                      143,000         183,000           (4,000)
     Undeducted stock option compensation                         850,000               -                -
     Effect of tax rate changes on future income taxes            568,000               -                -
     (Decrease) increase in valuation allowance                  (560,000)        322,000          482,000
                                                            ------------------------------------------------

                                                           $            -   $           -     $          -
                                                           ------------------------------------------------
</TABLE>
                                                                              18

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

8.   Income Taxes - Continued

     The  Company  evaluates  its  valuation  allowance  requirements  based  on
     projected future operations.  When  circumstances  change and this causes a
     change in management's  judgment about the  recoverability  of deferred tax
     assets, the impact of the change on the valuation allowance is reflected in
     current income.

     The  Company  has   approximately   $18,800,000  (2001  -  $14,000,000)  of
     undeducted  exploration  and  development  costs  which are  available  for
     deduction against future income for tax purposes. In addition,  the Company
     has non-capital  losses of approximately  $16,100,000  (2001 - $14,680,000)
     expiring in various amounts from 2003 to 2022 and allowable  capital losses
     of approximately $216,000 (2001 - $216,000).

--------------------------------------------------------------------------------

9.   Stock-Based Compensation

     The Company  accounts for all stock-based  compensation  issued on or after
     January 1, 2002 to non-employees and attributes no compensation  expense to
     stock-based  awards  granted to  employees.  On April 17, 2002 and July 15,
     2002, the Company  granted  780,000 stock options with an exercise price of
     $3.30  and  20,000  stock   options  with  an  exercise   price  of  $6.15,
     respectively,  to directors for director services and certain  consultants.
     On December  23, 2002 the Company  granted  1,020,000  stock  options at an
     option  price of $6.45 to  directors  for  director  services  and  certain
     consultants.  Compensation expense to non-employees is determined using the
     Black-Scholes  option pricing model.  Weighted average  assumptions used in
     calculating   compensation   expense  in  respect  of  options  granted  to
     consultants are as follows:

                                                                            2002
                                                               -----------------

     Risk-free rate                                                           5%
     Dividend yield                                                          nil
     Volatility factor of the expected market price
      of the Company's common shares                                         60%
     Weighted average expected life of the options (months)                   30


     For the year ended  December 31,  2002,  the  compensation  costs for stock
     options  granted to  non-employees  which were  expensed  were $572,662 and
     $1,685,438 was capitalized to mineral  properties and deferred  exploration
     costs;  the  combined  amount of  $2,258,100  was  credited to  contributed
     surplus.
                                                                              19

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

9.   Stock-Based Compensation - Continued

     The  following is the pro-forma net loss of the Company with the fair value
     applied to options issued to employees during the year:

                                                                            2002
                                                             -------------------

     Net loss for the year                                          $(2,753,942)

     Compensation expense relating to
      the fair value of employee stock
      options                                                        (1,168,072)
                                                             -------------------
     Pro forma net loss for the year                                $(3,922,014)
                                                             -------------------

     Pro forma net loss per common  share
      - basic and diluted                                             $   (0.16)
                                                             -------------------

     Weighted average  assumptions used in calculating  compensation  expense in
     respect of  options  granted  to  employees  are the same as those used for
     consultants.

--------------------------------------------------------------------------------

10.  United States Generally Accepted Accounting Principles

     The consolidated  financial statements of the Company have been prepared in
     accordance  with  Canadian   generally   accepted   accounting   principles
     ("Canadian  GAAP").  These  principles  differ in some respects from United
     States generally accepted accounting  principles ("US GAAP"). The effect of
     such differences on the Company's  consolidated financial statements is set
     out below:

     (a)  Mineral Exploration Expenditures

          Under   Canadian  GAAP   expenditures   on  specific   properties  are
          capitalized  until  such  time as  either  economically  unrecoverable
          reserves are  established or the properties are sold or abandoned.  US
          GAAP requires that mineral exploration  expenditures be charged to the
          Statement of Loss and Deficit in the period incurred. Accordingly, for
          US GAAP, all mineral exploration  expenditures  incurred to date would
          be charged to the Statement of Loss and Deficit.

     (b)  Stock option compensation

          Under   Canadian   GAAP,   the  Company  has  elected  not  to  record
          compensation  costs for stock options  granted to  employees,  but the
          effect  would  be  required  to be  disclosed  in the  notes  relating
          thereto.  Compensation  expenses are  calculated  using the fair value
          method for stock-based  compensation  awards granted to  non-employees
          after  January  1,  2002.  The   compensation   costs  are  recognized
          prospectively in the financial statements.
                                                                              20

<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

10.  United States Generally Accepted Accounting Principles - Continued

          Under US GAAP, the Company applies Accounting Principles Board Opinion
          ("APB")  No.  25,  "Accounting  for Stock  Issued to  Employees",  and
          related  Interpretation  No. 44 in  accounting  for all stock  options
          granted to employees and directors. Under APB 25, compensation expense
          is only  recognized  for stock options  granted with  exercise  prices
          below the market price of the underlying  common shares on the date of
          grant.  Stock  options that have been  modified to reduce the exercise
          price are accounted for as variable.

          Statement  of  Financial   Accounting   Standard   ("SFAS")  No.  123,
          "Accounting  for  Stock-Based  Compensation",  requires the Company to
          record  compensation  to  "non-employees"  using the fair value  based
          method  prescribed  therein  similar to accounting  principles  now in
          effect  in  Canadian  GAAP.  Compensation  expense  under  US  GAAP to
          non-employees  is determined  using the  Black-Scholes  option pricing
          model.  For the year ended  December  31, 2002,  compensation  expense
          incurred  under SFAS No. 123 and not  recognized  in Canadian GAAP was
          $Nil (2001 - $133,796; 2000 - $179,000).  Weighted average assumptions
          used in calculating compensation expense in respect of options granted
          to consultants in 2001 and 2000 are as follows:

<TABLE>
<CAPTION>
<S>                                                                   <C>                      <C>
                                                                              2001              2000
                                                                     --------------------------------
          Risk-free interest rate                                     2.65% to 3.12%           5.95%
          Dividend yield                                                        Nil%            Nil%
          Volatility factor of the expected market price
            of the Company's common shares                                       80%            100%
          Weighted- average expected life of the options
            (months)                                                              29              31
</TABLE>

      The impact of the above on the financial statements is as follows:

<TABLE>
<CAPTION>
<S>                                                    <C>                <C>               <C>
                                                                  2002                2001             2000
                                                      ------------------------------------------------------
      Net loss per Canadian GAAP                       $    (2,753,942)   $     (1,282,464) $    (1,131,711)

      Adjustments related to:
         Mineral exploration expenses (a)                   (5,621,242)         (1,043,029)      (1,811,313)
         Stock option compensation (b)                               -            (133,796)        (179,000)
                                                      ------------------------------------------------------
       Net loss
         per US GAAP                                   $    (8,375,184)   $     (2,459,289) $    (3,122,024)
                                                      ------------------------------------------------------
      Loss per share per US GAAP
         Basic and diluted                             $         (0.33)   $         (0.13)  $         (0.19)
                                                      ------------------------------------------------------
</TABLE>

                                                                              21
<PAGE>
--------------------------------------------------------------------------------
                                                    Minefinders Corporation Ltd.
                                                  (An Exploration Stage Company)
                                  Notes to the Consolidated Financial Statements
                                                 (Expressed in Canadian Dollars)

December 31, 2002 and 2001
--------------------------------------------------------------------------------

10.  United States Generally Accepted Accounting Principles - Continued

<TABLE>
<CAPTION>
<S>                                                     <C>              <C>               <C>
                                                                  2002               2001              2000
                                                       -----------------------------------------------------
     Shareholders' equity per Canadian GAAP             $   45,003,429   $     30,719,902  $     30,038,568

     Adjustments related to:
        Mineral exploration expenses (a)                   (35,731,966)       (30,110,724)      (29,067,695)
                                                       -----------------------------------------------------
     Shareholders' equity per US GAAP                   $    9,271,463   $        609,178  $        970,873
                                                       -----------------------------------------------------
</TABLE>


     (c)  New Accounting Pronouncements

          Statement of Financial  Accounting  Standards No. 146, "Accounting for
          Costs  Associated  with  Exit or  Disposal  Activities"  ("SFAS  146")
          provides  guidance on the  recognition  and measurement of liabilities
          for costs associated with exit or disposal activities.  The provisions
          of this Statement are effective for exit or disposal  activities  that
          are initiated after December 31, 2002.

          FIN 46,  "Consolidation of Variable Interest Entities",  clarifies the
          application  of  Accounting  Research  Bulletin No. 51,  "Consolidated
          Financial  Statements",  to certain entities in which equity investors
          do not have the characteristics of a controlling financial interest or
          do not have  sufficient  equity at risk for the entity to finance  its
          activities  without  additional  subordinated  financial  support from
          other parties. FIN 46 is applicable  immediately for variable interest
          entities  created  after  January  31,  2003.  For  variable  interest
          entities  created prior to January 31, 2003,  the provisions of FIN 46
          are applicable no later than July 1, 2003.

          The  implementation  of these new  standards is not expected to have a
          material effect on the Company's financial statements.

                                                                              22

<PAGE>

                                   EXHIBIT 2

MANAGEMENT DISCUSSION AND ANALYSIS

For the year ended  December 31, 2002 compared with the year ended  December 31,
2001 and the year ended December 31, 2000.

Introduction

The following  discussion  and analysis of the  operating  results and financial
position  of  Minefinders  Corporation  Ltd (the  "Company")  should  be read in
conjunction with the attached  Consolidated  Financial Statements of the Company
and related Notes which have been prepared in accordance with Canadian generally
accepted  accounting  principles  (GAAP) (see Summary of Significant  Accounting
Polices and Note 1: Basis of  Presentation),  which  differ in certain  material
respects from accounting  principles generally accepted in the United States (US
GAAP).  Differences  between  GAAP and US GAAP  applicable  to the  Company  are
described in Note 10 to the  Consolidated  Financial  Statements.  The Company's
accounting  policies and estimates used in the  preparation  of these  financial
statements are considered  appropriate in the circumstances,  but are subject to
judgements and uncertainties  inherent in the financial reporting process.  This
analysis  may contain  forward-looking  statements  about the  Company's  future
prospects,  but the Company provides no assurances that actual results will meet
management's expectations.  For thorough analysis of the risks and uncertainties
of the Company we refer you to its Annual Information Form.

The Company is primarily engaged in the finding,  exploration and development of
mineral properties, primarily precious metals. The Company does not have revenue
except from interest earned on cash balances.  It relies on equity  financing to
fund exploration  programs on its properties in Mexico and the United States and
corporate expenses. The general market for this activity, which includes related
investor interest and opportunities to obtain funding, improved substantially in
2002 as gold prices  increased from $278 per ounce in January,  2002 to $347 per
ounce at the end of the year. The gold price had reached a low of $257 in March,
2001.  It is not possible to forecast  ongoing  gold price trends or  volatility
which may have an impact on the preparation of a feasibility  study on a mineral
deposit or future results from operations.

Operating Activities

The Company  recorded an overall net loss for 2002 of $2.8 million compared with
$1.3 million in 2001 and $1.1 million in 2000.  Overall  losses were affected by
higher  administration  costs and a write-off of mineral  properties and related
exploration  costs,  partly  offset by  higher  interest  income  earned on cash
balances.

Administration costs increased from $0.8 million in 2001 to $2.1 million in 2002
(2000 - $1.0  million) due to several  factors,  including  increased  corporate
relations  expenditures  to satisfy  demands  resulting from increased  investor
interest,  higher accounting and legal costs to assess and comply with increased
regulatory requirements,  as well as increased compensation expenses of $572,662
recorded as a consequence of the adoption of a new accounting policy relating to
stock-based  compensation.  New accounting  guidelines  require that the Company
record as compensation the determined fair value of stock options issued to non-

<PAGE>

employees  during the period of the grant,  with a  corresponding  credit to its
contributed surplus account. The value of the shareholders' equity account, on a
net basis will be unchanged.  No cash is exchanged at the time of the grant. The
Company  receives  the full option  price at such time,  if any,  that the stock
option is exercised.  Management  used a standard  option pricing  model,  which
required it to make certain  subjective  assumptions as to future interest rates
and stock price volatility (Note 9 to the  consolidated  financial  statements).
While  management has used its best efforts to assess these future  values,  the
determined fair value of these options is highly  subjective and meaningful only
if the input factors chosen are realized.

Interest income  increased to $181,800 in 2002 (2001 - $16,855;  2000 - $26,605)
due to a higher  treasury  balance  throughout  most of 2002  from that of 2001.
Interest income in 2001 was lower than in 2000 due to a lower treasury balance.

The Company's financial  instruments may include U.S. dollars and Mexican pesos.
Due to  fluctuating  exchange  rates to the  Canadian  dollar  for both of these
currencies,  a foreign exchange loss of $52,671 was recorded in 2002, a decrease
of $54,888 from the foreign  exchange gain of $2,217 recorded in 2001. A foreign
exchange gain of $48,182 was recorded in 2000 resulting from favorable  currency
exchange rate fluctuations in that year. The Company does not engage in currency
hedging  activities  as exposures to rate  adjustments  and  volatility  are not
considered to have a material impact on the Company at this time.

In the  course  of  reviewing  its  mineral  properties  accounts,  the  Company
determined  that its Oro  Blanco  property  in the  United  States  would not be
allocated  further funding,  as its other properties have greater  potential for
discovery of a significant  mineral  resource on a  cost-effective  basis.  As a
result,  the Company  wrote off the  balance of mineral  property  and  deferred
exploration  costs  relating  thereto,  which  significantly  contributed  to an
overall  write-down of $766,055,  compared with $502,535 in 2001 and $208,824 in
2000.

As the  Company  does not yet have any  resource  properties  that  qualify  for
capitalization   under  U.S.   GAAP,   the  primary  effect  of  the  U.S.  GAAP
reconciliation  is to increase the net loss and deficit for 2002,  2001 and 2000
by the amounts of the exploration  expenses  capitalized  less write-offs  under
Canadian  GAAP in each of  those  years,  and  adjustments  in 2001 and 2000 for
stock-based  compensation.  For the purposes of U.S.  GAAP,  these expenses have
been charged to the Statement of Loss and Deficit in the period  incurred  under
U.S. GAAP (Note 10 to the consolidated financial statements).

Capital Resources And Liquidity

The Company's financial condition improved significantly in 2002. As at December
31,  2002,  the Company had working  capital of $9.1 million an increase of $8.6
million  from  December  31,  2001,  when it  stood  at $0.5  million.  The most
significant  component of working  capital  changes was the increase in cash and
short-term  investments by $8.9 million over 2001. Receivables and payables both
increased from 2001 in response to increased exploration activities. Receivables
are mainly  composed of sales tax  refundables  relating to sales tax charges on
exploration expenditures in Mexico.

<PAGE>

Cash on hand at December 31, 2002 was $2.2 million,  an increase of $1.7 million
from  December 31, 2001 cash of $0.5  million.  The Company also had  short-term
investments  on hand in the amount of $7.1  million.  The  increase  in cash and
short-term  investments  resulted  primarily from funds received from a brokered
placement of 4.4 million  shares issued at $2.30 per share in April,  2002,  for
net proceeds of $9.4  million.  In addition,  the Company  received $3.1 million
upon the  exercise of 1.8  million  stock  options,  and $2.3  million  upon the
exercise of 2.0 million share purchase  warrants.  In 2001, the Company received
$3.1 million (2000 - $0.8 million) from private placements of 3.1 million shares
and the exercise of 150,000 share purchase warrants.

Expenditures  on the  Company's  mineral  properties,  particularly  the Dolores
property in Chihuahua,  Mexico, increased substantially in 2002, in an effort to
more fully delineate the extent of mineralization.  Total expenditures  incurred
were $6.9 million  (2001 - $1.5  million;  2000 - $2.0  million),  of which $0.5
million related to the El Malacate joint venture with Placer Dome and which were
recovered.  Included in the 2002  expenditures were $1.7 million relating to the
value of stock-based  compensation,  and  constituted a non-cash item (Note 9 to
the consolidated financial statements).

Outlook

In February, 2003 the Company completed a brokered placement of 2,587,500 common
shares  at  $7.00  per  share,  for  gross  proceeds  of $18.1  million.  A 5.5%
commission was paid.

The  Company  is  adequately  funded to carry out its  planned  exploration  and
development  programs for 2003. The Company has completed its current program of
delineation  drilling on the Dolores  deposit in  Chihuahua,  Mexico,  with some
assays pending,  and is continuing  step-out  drilling to seek out extensions to
known  mineralization.  The Company  now plans to proceed to final  feasibility,
which it  anticipates  will lead to  financing  and  development  of the Dolores
deposit.  The Company  will also  continue  exploration  on several of its other
projects in 2003.

Risk And Uncertainties

Except for  historical  information  contained in this  discussion and analysis,
disclosure  statements contained herein are  forward-looking,  as defined in the
United States Private Securities  Litigation Reform Act of 1995. Forward looking
statements  are subject to risks and  uncertainties,  which  could cause  actual
results to differ materially from those in such forward-looking  statements. The
Company  assumes no  obligation  to update  its  forward-looking  statements  to
reflect  actual  results,  changes in  assumptions  or changes in other  factors
affecting such statements.

The  Company is a mineral  exploration  and  development  company and as such is
exposed  to a number  of  risks  and  uncertainties  that  are  common  to other
companies in the same business.  The Company's  financial success is subject to,
among other things,  fluctuations  in metal prices and foreign  exchange  rates,
which may  affect  current  or future  operating  results,  and may  affect  the
economic  value of its mineral  resources.  Its ability to obtain  financing  to
explore for mineral  deposits and to continue and  complete the  development  of
those properties it has

<PAGE>

classified as assets is not assured, nor is there assurance that the expenditure
of funds will  result in the  discovery  of an  economic  mineral  deposit.  The
Company has not prepared a feasibility study on any of its deposits to determine
if it hosts a mineral resource that can be economically developed and profitably
mined.

(Signed: Mark H. Bailey)

Mark H. Bailey
President and Chief Executive Officer

<PAGE>

                                    EXHIBIT 3

                                   CONSENT OF
                        INDEPENDENT CHARTERED ACCOUNTANT

Minefinders Corporation Ltd.

Vancouver, Canada

We consent to the  inclusion  in this Annual  Report on Form 40-F of our reports
dated February 28, 2003,  relating to the consolidated  financial  statements of
Minefinders Corporation Ltd. for the year ended December 31, 2002.

We also consent to the incorporation by reference in the previously filed (March
18, 2003) open  registration  statement on Form S-8 of  Minefinders  Corporation
Ltd.  of our reports  dated  February  28,  2003,  relating to the  consolidated
financial statements of Minefinders  Corporation Ltd. appearing in the Company's
Annual Report on Form 40-F for the year ended December 31, 2002.

BDO Dunwoody LLP

BDO DUNWOODY LLP
Chartered Accountants

Vancouver, Canada
April 28, 2003

<PAGE>

                                    EXHIBIT 4

                            CONSENT OF MARK H. BAILEY

I hereby consent to the references to my name in the Company's  Annual Report on
Form 40-F to be filed with the United States Securities and Exchange  Commission
pursuant to the Securities Exchange Act of 1934, as amended.

/s/"Mark H. Bailey"
-------------------
Mark H. Bailey

Vancouver, British Columbia, Canada

May 5, 2003

<PAGE>

                                    EXHIBIT 5

                         CONSENT OF PINCOCK ALLEN & HOLT

We refer to our report auditing the resources at the Dolores Gold-Silver Project
Chihuahua, Mexico, dated December 2, 2002, (the "Report").

We hereby  consent to the filing,  use, and  incorporation  by reference of, the
Report and the references to our name in the Minefinders Corporation Ltd. Annual
Report on Form 40-F to be filed with the United States  Securities  and Exchange
Commission pursuant to the Securities Exchange Act of 1934, as amended.

Sincerely,

Pincock Allen & Holt


/s/"Mark G. Stevens"
--------------------
Mark G. Stevens

Lakewood, Colorado, USA

May 5, 2003

<PAGE>

                                    EXHIBIT 6

                          CONSENT OF GEORGE A. ARMBRUST


I refer to the report  prepared by Pincock Allen & Holt which was prepared under
my direct  supervision,  regarding  the audit of the  resources  at the  Dolores
Gold-Silver Project Chihuahua, Mexico, dated December 2, 2002, (the "Report").

I consent to the filing,  use and  incorporation by reference of, the Report and
the references to my name in the Minefinders  Corporation  Ltd. Annual Report on
Form 40-F under the heading "Mineral Resource and Mineral Reserve  Estimates" in
the  Minefinders  Corporation  Ltd. Annual  Information  Form for the year ended
December  31, 2002,  which is included as an exhibit in the Annual  Report to be
filed with the United States Securities and Exchange  Commission pursuant to the
Securities Exchange Act of 1934, as amended.

/s/"George A. Armbrust"
-----------------------
George A. Armbrust

Lakewood, Colorado, USA

May 5, 2003

<PAGE>

                                    EXHIBIT 7

                          CONSENT OF ROBERT L. SANDEFUR


I refer to the report  prepared by Pincock Allen & Holt which was prepared under
my direct  supervision,  regarding  the audit of the  resources  at the  Dolores
Gold-Silver Project Chihuahua, Mexico, dated December 2, 2002, (the "Report").

I consent to the filing,  use and  incorporation by reference of, the Report and
the references to my name in the Minefinders  Corporation  Ltd. Annual Report on
Form 40-F under the heading "Mineral Resource and Mineral Reserve  Estimates" in
the  Minefinders  Corporation  Ltd. Annual  Information  Form for the year ended
December  31, 2002,  which is included as an exhibit in the Annual  Report to be
filed with the United States Securities and Exchange  Commission pursuant to the
Securities Exchange Act of 1934, as amended.

/s/"Robert L. Sandefur"
-----------------------
Robert L. Sandefur

Lakewood, Colorado, USA

May 5, 2003