ANDERSON CREEK MINE Introduction and Summary The Anderson Creek property consists of 39 mineral claims in the Mayo Mining division. Aurora Mines Inc. (“Aurora”), a Yukon Territory company is the legal and beneficial owner of the Anderson Creek property. Placer gold exploration has been conducted on the lower area of Anderson Creek (largely on the discovery claim/lease) since 2000. Preliminary studies on placer concentrate samples by Ray Brosseuk (President of Aurora) in 2001 prompted the staking by Aurora of an additional 19 mineral claims in the upper portions of the creek. During the 2002 mining season a sampling program in the upper portions of the creek bed was completed. The gold identified on the upper portions of the creek is coarser, indicating recovery of as high as US$50.00 per cubic yard. The complete exploration program has involved significant bulk sampling and limited production from test pits, and a detailed seismic refraction survey. Test pits in the seismic grid area returned a total of 728 troy ounces of crude gold from 36,557 cubic yards of alluvial material, averaging $US6.86 per cubic yard (at US$400/Oz.) for just over 800 hours of washing during the 3-year test period. Pure exploration expenditures (excluding equipment costs) on the property since 2000 are in excess of US$300,000. From the seismic work done on the property the geological reserves appear to be greater than 20 million cubic yards. At a gold price of US$400/Oz. this corresponds to a reserve value of approximately US$160 million. A unique aspect of the Anderson Creek mine is it’s gold extraction technology. The system in use has been proven to offer extraction yields and operating efficiencies superior to any other available technology. Anderson Creek has achieved a Canadian Environmental Inspection "A" rating during every operating year that this technology has been in place at Anderson Creek. The sole reason for the sale of the Anderson Creek mine is to enable Aurora and its parent company to focus on the international commercialization of this mineral extraction technology (see www.ie-tec.com/hpc ). The mine is a “turnkey” operation with total operating costs (including expenses and depreciation) of US$1.40 per cubic yard of material processed. Based on a gold price of $400/Oz. and sampled average of 86% gold purity, this corresponds to a conservative average profit after expenses and depreciation of US$5.46 per cubic yard processed or US$645,000 per month for a 6-day operation at 75% utilization with reserves of approximately 20 million cubic yards of material. Ultra-conservative / “worst case” financial projections yield a profit of US$390,000 per month (see Financial Information section). Our proposed capacity increase would result in a profitability of US$1.8 million per month ! During 2003, limited mining took place whilst Aurora completed the following development initiatives of Anderson Creek as a full-scale commercial property:

• Equipment refurbishment, including reconditioning of one gold extraction machine and total rebuilding of caterpillars for the 2004 season.

• Access to the upper claim areas and site of future processing areas to minimise materials handling costs.

• Roads and access ways broadened or re-routed in full compliance with anticipated environmental regulations.

In 2004 the mine was to be sold. The contracted buyer was unable to secure funding, the sale fell through and the mine was not operated. Email IE-TEC Marketing Limited for additional information: info@ie-tec.com

BACKGROUND Location and Access The Anderson Creek property is located 50 kilometres South east of Mayo, Yukon in an area known as Mayo lake District. The property is located on the west side of Mayo Lake. The property covers the Anderson Creek drainage basin. Placer operations are near the mouth of Anderson Creek on NTS topographic map sheet 105M/10. All of the placer claims lie within Mayo Mining Division. Access to the property is possible by road from Mayo and a short boat trip across Mayo Lake.

Topography, Vegetation, Climate Anderson Creek is located in an area of the Yukon where the temperatures reach 30 degrees Celsius in the summer and a low of -40 degrees Celsius in the winter months. As a result the mining season generally commences in the first week of May and continues through to the last week in October. The location of the mine is such that the daylight hours are almost continuous during the summer months and allow for 24 hour operations. Anderson Creek is a north east flowing tributary, draining into Mayo Lake. Mayo Lake drains to the north and into the Mayo river which flows into the Stewart river then into the Yukon river. The property is sparsely forested with Yukon spruce. Brush, willow and alpine vegetation exist at higher elevations.

Local Geology There has been some geological work and mapping at Anderson Creek. This is documented in a Canadian Government book entitled "Mayo Lake and Area, Placer Gold Geology." Historic Placer Mining Recorded placer gold production for Anderson Creek between 1898 and 1935 is unknown. Upstream from the delta, early placer miners would have experienced major difficulties with large boulders (up to 4 tons). These areas would have been largely avoided during that era. The testing programs in 2002 found unmined gravels in these areas. Almost all of the gold from Anderson Creek between 1898 and 1935 was produced using conventional placer mining techniques. There was no dredging or deep placer mining other than small underground workings. The delta appears to have been largely untouched. Previous placer mining along the creek was relatively inefficient and left a significant amount of the gold in the tailings and probably in place (boulder areas). PROPERTY Mineral Claims The Anderson Creek property consists of the following 39 Placer claims:

• Claim Name 1 Below #P5911 to Claim Name 3 Below #P5913 • Claim Name Discovery / Steven # YB28728 • Claim Name Sunshine 1 #P5297 to Claim Name Sunshine 6 #P5302 • Claim Name Angie 1 #P15507 to Claim Name Angie 10 #P15516 • Claim Name Cassie 1 #P47768 to Claim Name Cassie 10 #P47777 • Claim Name Kyle 1 #P47778 to Claim Name Kyle 9 #P47786

The discovery claim (Steven) was staked many years ago by the original owner along with the lower 19 claims.(expiry October, 2021) The upper claims were staked recently and are now grouped with the lower claims for a total of 895.31 acres under claim.

Recent exploration on the property Aurora began placer exploration in the Anderson Creek area in 2000. This exploration consisted of excavating shallow test pits and bulk sampling. The alluvial material recovered from the bulk sampling was processed using a portable trommel-sluice system (Model-200 HPC / Gold Machine). A placer testing program on the Discovery claim began in July 2000 following regulatory permit approval. The testing program involved heavy equipment excavators, loaders, and dozers and one Model-200 HPC / Gold Machine. A series of test pits were excavated. Much of the surface material, down to approximately 2 meters in depth was found to be old tailings. The gold reserves identified during the sampling in this portion of the program resulted in $2 to $3 of gold per cubic yard. In August 2000 a series of test runs in the same area involving 800 or more cubic yards a day returned values in the $3 to $5 per cubic yard range. A similar program of test pits and bulk sampling was conducted in 2001 and 2002 reaching much greater depths where higher gold reserves were identified. The average depths to bedrock, were found to be 20 to 25 meters, which was consistent with the seismic testing done on the property. Removal of overburden prior to washing is either unnecessary or minimal. In September 2002, further exploration upstream indicated depths to bedrock at about 12 meters. The results of bulk sampling in the upper stream area for more than 200 cubic yards per sample yielded a low of US$30 to a high of US$38 per cubic yard (typical quality is 87% gold with 13% silver) The results from the 3 year bulk sampling program clearly indicates that gold occurs in the delta area and upstream and can be efficiently extracted using the HPC / Gold Machine system. From 2000 to 2002 a total of 36,557 cubic yards were processed in 819 wash hours and 728 Troy Ounces of crude gold were extracted, yielding an average of US$5.14 per cubic yard (assuming a US$300/Oz. gold spot-price).

Anderson Creek: 2000 - 2002 Test Program Summary

Cubic Yards Processed

Fine Gold (g)

Coarse Gold (g)

Total Gold (g)

Total Gold(Troy Oz.)

Value US$(at $400/Oz. x 86%)

US$ per Cubic Yard

2000 14,118 3714.5 4974.6 8689.1 279.4 $96,111 $6.812001 12,991 4702.6 3108.5 7811.1 251.2 $86,399 $6.652002 9,448 3078 3085 6163 198.2 $68,170 $7.22Total 36,557 11495.1 11168.1 22663.2 728.7 $250,680 $6.86

$2.00 Minimum US$ yield per cubic yard during 3-year test program$50.84 Maximum US$ yield per cubic yard during 3-year test program

$6.86 Average US$ yield per cubic yard during 3-year test program(Based on a gold spot price of $400/Oz. and purity of 86%)

Exploration History

Seismic In the spring of, 2001 Frontier Geosciences Inc. conducted a detailed seismic refraction survey of the property. The seismic grid consisted of roughly perpendicular sets of lines along the creek valley floor. The seismic survey results indicated significant volumes of untested placer material and potential placer gold 'traps' (bedrock irregularities) Ray Brosseuk has found that the geological information obtained during pit excavation by Aurora supports the conclusions reached from the seismic tests. Depths to bedrock were correct to the meter. The bedrock dips steeply to the Northeast or lake area. A bedrock fault along the mine site road is of great interest as it lies along the current gold bearing channel. It is suggested by Mr. Brosseuk that this fault line be tested more carefully in the future as it could lead to much greater gold reserves as the depths in the fault area are 5 to 8 meters deeper than the current channel. Old mining shafts and tunnels were uncovered during the testing. These would have been from the late 1800 to the 1930s, Tailings 1 to 2 meters in depth were encountered in most places. The tailings commonly covered a 20 to 25 meters of mixed sand, gravel and boulders above bedrock. Placer Exploration and Reserves The method of placer gold exploration conducted at the Anderson Creek is an integrated approach using

1. seismic refraction surveys and 2. bulk sampling of deep test pits plus 3. extraction using the HPC / Gold Machine technology

This is known to be the best approach for exploring and testing placer deposits. Major advantages of this approach are:

• a fairly accurate definition of depth to bedrock, layers and topography (for volume calculations and bedrock traps);

• direct observation of placer material in pit walls; • minimal site damage, immediate reclamation; and • the sampling system using the HPC / Gold Machine – technology used in full scale

production Using this exploration approach, the number of surprises encountered during mining operations is minimized. Aurora recently made volume calculations for the seismic grid area to determine the amount of alluvial material available for placer mining. A contoured isopach 3D map was produced using all available data (the seismic data and results of pit samples). The isopach map produced indicated on average a 150 meter wide channel, 20 meters deep (some depths 35 meters). The total length of the property is 6500 meters. This translates (conservatively) into approximately 20,000,000 cubic yards available for processing.

Proposed Exploration and Development Aurora has had a work and reclamation program filed for placer mining on the placer claims with the Ministry of Energy, Mines and Petroleum Resources of the Yukon. The work and reclamation plan has been approved and will allow for all of the Anderson Creek area to be mined. This license is fully transferable to the purchaser. Further testing and placer exploration is proposed. A seismic refraction survey similar to the survey conducted in 2001 will aid in this ongoing exploration process. Geological Reserves for Development Areas It is not possible to give any certainty to gold reserves for the upper area of Anderson Creek, except to extrapolate from the limited testing done in the area. However, well over 15,000,000 cubic yards of alluvial material is probable in the area. Assuming the volume and gold grade reserves for the seismic grid areas already completed are representative of the development blocks, geological reserves would translate as follows:

Claims Cubic Yards Yield (US$ / cubic yard) Reserve Value US$ Reserve in Pure

Ounces of GoldLower Area 4 5,000,000 $6.86 $34,300,000 114,333 Upper-1 16 7,000,000 $8.50 $59,500,000 198,333 Upper-2 19 8,000,000 $8.50 $68,000,000 226,667 TOTAL 39 20,000,000 $8.09 $161,800,000 539,333

Lower Area Discovery Claim + P5911 - P5913. Seismic survey completedUpper-1 P5297 - P5302 + P15507 - P15516. Seismic survey completedUpper-2 P47768 - P47786. Conservative volume estimate

Conservative Reserve Estimate

Should the gold yield in the Upper areas average out at $20/yard (approximately 50% of the yield value found during some of the tests), the total reserve would be US$325 million !

HEAVY PARTICLE CONCENTRATION (HPC) TECHNOLOGY A totally unique aspect of the Anderson Creek mine is it’s HPC gold extraction technology. This system has been proven to offer extraction yields and efficiencies superior to any other available technology. Key benefits of this technology include: • A broad material-size processing spectrum with 95%-97% extraction yield • Mobile, self-contained equipment which is complete and easy to set up and use • A continuous process with a simple, secure and highly efficient final recovery stage • An environmentally friendly process with no chemicals and minimal water use. The “bottom line” is high yield, cost effective and reliable equipment requiring minimal operator skills. This means that the mine is essentially an “earth moving operation” – the HPC system reliably extracts and concentrates the gold allowing the operator to focus on efficient supply and processing of high tonnages of material. The results of the 2000 - 2002 tests using the HPC system at Anderson Creek clearly demonstrate the operating advantage gained through the use of this technology. Please see the separate document “IE-TEC HPC Technology” and visit www.extrac-tec.com for more detailed information.

INFRASTRUCTURE & OPERATIONS Infrastructure The Anderson Creek placer deposits were originally mined in the 1930s. There are numerous references to the difficult access into the area and generally poor logistics during the period of active placer mining between 1898 and 1935. At the present time there is excellent road access to the lake and an easy boat ride across to the property. These major improvements in access along with freight, fuel and other facilities in Mayo are very important to the economics of the proposed operation and potential to develop new areas up Anderson Creek. From 2000 to date an extensive infrastructure investment / development program has been implemented at the mine. This includes:

• Roads, access ways and clearings for equipment and operations • Water supply dams and waste-water settling pond systems • Establishment of accommodation / living and office areas • Setup and equipping of stores for parts inventories and workshops • Installation of satellite phone and broadband internet / network communication systems

Placer Mining Operations The operation is split into two sections: (1) Supply

Placer material from each pit is collected and fed into rock trucks using a cat and excavator. Each strip of placer material being worked is excavated to bedrock and loaded into rock trucks which transport this material to the extraction stockpile.

(2) Gold Extraction There are two HPC-200 gold extraction machines on site (total capacity 252 cubic yards per hour). These machines are arranged into a single machine group or wash plant and are fed by one excavator from the material stockpile / staging area. A loader then moves tailings to tailings piles and waste water flows into the settling pond system. No water or sediment enters the creek.

After processing, all material is fed back to the pits for backfill. Fine silt size material from the settling ponds is eventually placed back on top of the coarse tailings to assist re-vegetation. With this system, material is excavated, processed and backfilled on a semi-continuous basis. The method of placer gold mining on Anderson Creek is efficient with minimal environmental impact. Excavation and continual backfill using heavy machinery does not result in any large pits remaining open for any period. The area occupied by the machines and settling ponds is small, being approximately one to 1.5 hectares. This area has adequate protection against fuel leakage (pad lining, berms, etc.) and material spilling into the creek, and can be operated within regulatory requirements, such as the Mine Act. Production involves two twelve hour shifts per day. Power is generated on site.

Proposed Operation & Capacity Increase We have carefully studied the overall operating and financial performance of Anderson Creek and concluded that it would be optimal to increase the processing capacity of the mine through the addition of a single HPC-400 machine (latest generation of our HPC equipment) and implement a production scenario including 2 “machine groups”

• Machine Group-1 – Tandem configuration of two HPC-200s (currently on mine). These machines would be moved approximately 2 miles up to the fork in the Creek. Auxiliary equipment: Feed excavator, D41 supply bulldozer pushing to excavator, and 988B loader on tailings

o 3 people required per shift (supply, feed and tailings) o Capacity 250 cubic yards / hour. o Ground preparation work of 6-8 weeks would be required to build a road of about

2 miles to the fork in the Creek and prep the area / move the wash plants.

• Machine Group-2 - HPC-400 situated just above “Narrows” section of mine. Auxiliary equipment: D10 bulldozer (or similar) feeding (via 50-ton push-hopper), D10 or 988B loader on tailings

o Only 2 people per shift (supply/feed and tailings) o Capacity 400-500 cubic yards per hour (possible this unit could produce up to

600yards/hour)

The advantage of this approach is that additional capacity would be 400-500 tons/hour ie. capacity of the mine would almost triple to a total of almost 750 cubic yards/hour with minimal additional capital, labor and expense increase. This would yield an increase in profitability from US$645,000 per month to US$1.8 million per month

FINANCIAL INFORMATION Equipment at Anderson Creek Value CD$ New HPC-200 wash plant, complete with sluices 389,000 Reconditioned HPC-200 wash plant with sluices 350,000 Fiat Allis Bulldozer D41 115,000 8x10 - 471 Detroit Diesel water pump 12,000 1.5 inch water pump 500 1.5 inch fuel transfer pump 500 3 inch Kubota water pump 4,000 1.5 inch water pump 500 1.5 inch water pump 500 8x10 - 671 Detroit Diesel water pump 15,000 35 kw Hatz genset 9,000 100kw Cummins diesel generator 18,000 40 kw John Deere genset 8,000 40 kw John Deere genset 8,000 Diesel Light Plant 6,000 400 Amp Diesel Welder 4,000 250 Amp Diesel Welder 2,000 Ford F600 2000 gal. fuel transfer truck (used for storage) 500 3000 gallon Western Star Fuel Truck 12,000 Zodiac with outboard engine 2,000 6 Atco camp Trailers (value adjusted to reflect rec. room roof damage) 80,000 Workshop 500 20 Ft Shop trailer 1,000 Older 14'x70' mobile home 1,000 8x8x40' Storage Container 3,000 Honda ATV 3,000 Honda ATV 4,000 Misc Parts for Equipment incl. Misc Steel 0 Radios Satellite Phone and Broadband Internet Systems 11,000 Tools 60,000 TOTAL VALUE CD$ 1,120,000 TOTAL VALUE US$ 970,000

ATTACHMENTS Anderson Creek Mine: 2000 - 2002 Test Program Results

2000 Gold Testing Program - One HPC-200 in operationCubic Yards Processed

Fine Gold (g)

Coarse Gold (g)

Total Gold (g)

Total Gold(Troy Oz.)

Value US$(at $400/Oz. x 86%)

US$ per Cubic Yard

20-Aug-00 452 84 52 137 4.4 $1,512 $3.35189 64 37 102 3.3 $1,124 $5.95

21-Aug-00 420 116 56 172 5.5 $1,903 $4.53210 56 29 85 2.7 $939 $4.47

22-Aug-00 420 136 68 204 6.5 $2,252 $5.3670 60 29 89 2.9 $983 $14.05

23-Aug-00 350 64 37 101 3.2 $1,115 $3.19448 112 167 279 9.0 $3,086 $6.89

24-Aug-00 455 124 89 213 6.8 $2,353 $5.17614 58 101 159 5.1 $1,754 $2.86

25-Aug-00 378 39 140 180 5.8 $1,988 $5.26435 129 168 297 9.5 $3,281 $7.53

27-Aug-00 270 65 39 105 3.4 $1,156 $4.29445 88 97 185 5.9 $2,046 $4.60

28-Aug-00 368 81 116 198 6.4 $2,188 $5.95294 110 176 286 9.2 $3,165 $10.76

29-Aug-00 147 45 32 77 2.5 $854 $5.81550 148 653 801 25.7 $8,858 $16.12

30-Aug-00 490 118 332 450 14.5 $4,980 $10.16559 96 345 441 14.2 $4,872 $8.72

31-Aug-00 532 84 73 157 5.1 $1,739 $3.27420 116 66 181 5.8 $2,003 $4.77

1-Sep-00 360 135 90 225 7.2 $2,483 $6.90420 146 87 233 7.5 $2,579 $6.14

3-Sep-00 476 133 77 210 6.7 $2,317 $4.87385 123 52 175 5.6 $1,936 $5.03

4-Sep-00 392 119 52 170 5.5 $1,885 $4.81532 83 169 252 8.1 $2,783 $5.23

5-Sep-00 539 122 143 264 8.5 $2,925 $5.43493 197 81 278 8.9 $3,071 $6.23

6-Sep-00 538 169 385 554 17.8 $6,122 $11.39462 157 353 510 16.4 $5,638 $12.20

7-Sep-00 455 177 257 434 13.9 $4,798 $10.55553 162 329 490 15.8 $5,424 $9.81

TOTAL / AVERAGE 14,118 3,715 4,975 8,689 279.4 $96,111 $6.81

2001 Gold Testing Program - One HPC-200 in operationCubic Yards Processed

Fine Gold (g)

Coarse Gold (g)

Total Gold (g)

Total Gold(Troy Oz.)

Value US$(at $400/Oz. x 86%)

US$ per Cubic Yard

15-Aug-01 77 140 38 178 5.7 $1,970 $25.5884 115 31 146 4.7 $1,610 $19.17

16-Aug-01 70 65 30 95 3.1 $1,050 $15.00210 105 107 212 6.8 $2,346 $11.17

17-Aug-01 193 89 65 154 4.9 $1,698 $8.79403 68 30 98 3.2 $1,086 $2.70

19-Aug-01 292 87 67 154 5.0 $1,703 $5.84357 74 69 143 4.6 $1,580 $4.42

20-Aug-01 410 108 19 127 4.1 $1,409 $3.44302 133 88 221 7.1 $2,439 $8.08

21-Aug-01 392 111 32 144 4.6 $1,588 $4.05350 121 43 164 5.3 $1,812 $5.18

22-Aug-01 308 134 76 210 6.8 $2,323 $7.54469 136 46 182 5.8 $2,012 $4.29

23-Aug-01 455 155 59 214 6.9 $2,362 $5.19350 174 68 242 7.8 $2,677 $7.65

24-Aug-01 315 121 48 169 5.4 $1,864 $5.92350 190 76 266 8.6 $2,943 $8.41

26-Aug-01 385 168 56 224 7.2 $2,472 $6.42420 186 73 259 8.3 $2,864 $6.82

27-Aug-01 368 193 144 337 10.8 $3,723 $10.13420 177 87 265 8.5 $2,929 $6.97

28-Aug-01 434 169 77 246 7.9 $2,717 $6.26403 188 98 286 9.2 $3,162 $7.86

29-Aug-01 420 167 50 218 7.0 $2,409 $5.74455 145 68 213 6.8 $2,356 $5.18

30-Aug-01 441 148 52 200 6.4 $2,214 $5.02469 122 85 207 6.7 $2,292 $4.89

31-Aug-01 420 113 90 203 6.5 $2,244 $5.34455 98 84 181 5.8 $2,006 $4.41

2-Sep-01 473 199 77 277 8.9 $3,062 $6.48490 102 81 183 5.9 $2,020 $4.12

3-Sep-01 490 128 385 513 16.5 $5,670 $11.57560 99 353 451 14.5 $4,989 $8.91

4-Sep-01 504 177 257 434 13.9 $4,798 $9.52TOTAL / AVERAGE 12,991 4,703 3,109 7,811 251.2 $86,399 $6.65

2002 Gold Testing Program - ** Two HPC-200 Machines in operationCubic Yards Processed

Fine Gold (g)

Coarse Gold (g)

Total Gold (g)

Total Gold(Troy Oz.)

Value US$(at $400/Oz. x 86%)

US$ per Cubic Yard

11-Aug-02 140 37 17 54 1.7 $597 $4.2712-Aug-02 245 60 49 109 3.5 $1,206 $4.9213-Aug-02 280 80 24 104 3.3 $1,150 $4.1114-Aug-02 210 60 29 89 2.9 $984 $4.6915-Aug-02 315 65 42 107 3.4 $1,184 $3.7616-Aug-02 280 101 97 198 6.4 $2,190 $7.8218-Aug-02 210 22 16 38 1.2 $420 $2.0019-Aug-02 280 59 50 109 3.5 $1,206 $4.3120-Aug-02 70 30 28 58 1.9 $642 $9.1621-Aug-02 245 47 67 114 3.7 $1,261 $5.1522-Aug-02 315 97 35 132 4.2 $1,460 $4.6423-Aug-02 140 78 13 91 2.9 $1,007 $7.1925-Aug-02 70 42 25 67 2.2 $741 $10.5926-Aug-02 140 49 16 65 2.1 $719 $5.1428-Aug-02 1,190 450 234 684 22.0 $7,566 $6.36 **2-Sep-02 1,120 310 172 482 15.5 $5,331 $4.76 **

205 167 594 761 24.5 $8,417 $41.06 ** Narrows material3-Sep-02 980 200 202 402 12.9 $4,447 $4.54 **

213 272 707 979 31.5 $10,829 $50.84 ** Narrows material4-Sep-02 910 201 212 413 13.3 $4,568 $5.02 **5-Sep-02 1,050 300 223 523 16.8 $5,785 $5.51 **6-Sep-02 840 351 233 584 18.8 $6,460 $7.69 **

TOTAL / AVERAGE 9,448 3,078 3,085 6,163 198.2 $68,170 $7.22

** 2 HPC-200 Machines in operation

Anderson Creek Mine - Images

View of Mayo Lake from the mine

Anderson Creek Mine

Living facilities

Material Supply

Stockpiling

Extraction / Washing operation using HPC-200 Gold Machines

Re-vegetation of settling ponds

Powder-fine gold extracted by HPC-200 Gold Machines (water surface tension causes flotation)

Fine and coarse gold extracted using HPC technology

Nuggets including 2.6 Oz. 1.75” nugget found in Narrows area in July 2003

Aerial photographs of Anderson Creek