Form51-102F  MANAGEMENT’S DISCUSSION & ANALYSIS  For the period ended June 30, 2010  None.  1.8  Off Balance Sheet Arrangements  1.9  Transactions with Related Parties  1.10  Fourth Quarter  Refer to note 14 of the audited annual consolidated financial statements.  For the quarter ended June 30, 2010, the Company reported a net loss of $601,678, or $0.00 per share, compared to a net loss  of $990,066, or $0.01 per share, reported for the corresponding period in fiscal 2009. The operations expenses of $549,816 for fourth quarter of fiscal 2010 (2009 - $738,607) are comprised of salaries, office and  administration, legal and accounting, shareholder communications, conference and travel, regulatory compliance, amortization  and stock-based compensation. Excluding stock-based compensation expenses of $120,818 (2009 - $244,930), the Company  incurred operating expenses of $428,998 compared to operation expenses of $493,677 for fiscal 2009. General and administration expenses, which decreased by 20% to $294,157 in the fourth quarter of fiscal 2010 from $368,992  in the same period for fiscal 2009, was comprised of salary expenses of $240,868 (2009 - $173,366) and office rent, office  services and others of $53,289 (2009 - $195,626). The increase in salaries compared to the same period last year reflected  increased corporate activities, which was offset by decreased financial management consulting.  Shareholder communications, conference and travel expenses totaled $56,468 in the fourth quarter of 2010, decreased by  $33,497 from $89,965 in the same period of fiscal 2009, reflecting budget cuts implemented as a result of the global recession. The regulatory and filing expense was $2,307 compared to $3,353 in the fourth quarter of fiscal 2009. Legal, accounting and  audit expenses were $71,626 compared to $27,961 an increase by $43,665 reflected the additional legal costs related to a  number of construction service contracts awarded to suppliers and legal action against Sim Tze Chui AKA Jyn Tze Baker et el.  (“the Defendants”) for defamation.  During the fourth quarter of fiscal 2010, a total $152,338 (2009 - $327,389) stock-based compensation expenses were credited  to contributed surplus, of which $120,818 (2009 – $244,930) was debited to operations and $31,520 (2009 - $82,459) was  debited to exploration, mine development and construction of the plant. The amortization expense was $4,440 compared to  $3,406 in the fourth quarter of fiscal 2009.  During the fourth quarter of fiscal 2010, the Company received $1,452 (2009 - $35,633) of interest income generated from a  cash balance. The Company incurred a foreign exchange loss of $52,634 compared to $286,058 in the same period last year. None.  Refer to note 2(b) of the audited consolidated financial statements as at June 30, 2010.  Refer to note 3 of the audited consolidated financial statements as at June 30, 2010.  13 | P a g e 1.13  Changes in Accounting Policies including Initial Adoption  1.12  Critical Accounting Estimates  1.11  Proposed Transactions 