The Company is an active junior mineral resource exploration company focused on the acquisition, exploration and development of precious metals, base metals and diamond projects.  Properties which the Company currently owns or which it is currently evaluating for acquisition are located in the traditional mining areas of Ontario, Canada. 

The recoverability of the amounts comprising mineral properties and deferred exploration costs is dependent upon the confirmation of economically recoverable reserves, the ability of the Company to obtain the necessary financing to successfully complete its exploration and development and upon future profitable production and royalties. 

Risks: 

The success of the Company’s business is subject to a number of factors including but not limited to those risks normally encountered in the mining industry such as exploration uncertainty, lack of operating cash flow, increasing environmental regulation, continued industry and public acceptance, regulatory compliance, potential liability claims, general markets and economic conditions, competition with Companies having greater resources, and further capital requirements and the uncertainty of obtaining required financing.

REVIEW OF OPERATIONS - MINERAL PROPERTIES

Mann Platinum/Palladium Project, Ontario, Canada 

A 998 metre diamond drill program, in six holes, was carried out on the Mann property, comprising 19 contiguous claim units (304 hectares) covering part of a large mafic/ultramafic complex located approximately 47 kilometres northeast of Timmins, Ontario. The property is situated within the Mann complex, a mafic/ultramafic layered intrusion which hosts Platinum Group Elements (PGE) and copper-nickel sulphide mineralization.  Broadlands Resources Ltd. is earning up to 50% interest in the property as per an Agreement executed on November 9, 2000. 

Phase I exploration included geological studies and the re-logging and sampling of approximately 1,155 metres of historic drill core.  One hundred-four (104) samples were taken. Thirty-one (31) samples were taken in clinopyroxenite of which twenty-four (24) are anomalous in PGE’s, up to 942 ppb PGE’s plus gold.  Phase I geophysical surveys include 21 kilometres of Total Field Magnetics and 7.5 kilometres of Induced Polarization (IP) surveys.

Whole rock analyses, thin section and microprobe studies indicate that platinum group metals (PGM) and native gold occur in discrete grains, approximately one to five microns in size.  The PGM are typically anhedral, and occur in clusters of two to ten grains and comprise a complex suite of Pt, Pd, Te, Sb, Cu, Mn bearing minerals.  The PGM are generally enclosed in chlorite close to contacts with secondary clinopyroxene or within secondary clinopyroxene and occur in proximity to sulphides but rarely in contact with sulphides.  The sulphides consists of bornite, chalcopyrite, digenite and cobaltian pentlandite.

The target of the most recent drill program was a clinopyroxenite horizon in the layered Mann ultramafic complex which hosts highly anomalous platinum and palladium values. On the claims, immediately north of the west end of the Frederick House River bridge, three continuous chip samples taken by the Ontario Gological Survey returned values of PGE + Au of 645 ppb over 12.20 metres, 574 ppb over 14.00 metres and 594 ppb over 22.00 metres.  This unit was intersected in three of six holes drilled.  It is a reasonably consistent unit ranging from 13 to 15 meter in true thickness and dipping moderately to the east.  No anomalous PGM’s were returned from the clinopyroxenite where it was intersected, but anomalous PGM values to 79 ppb were encountered in a coarse, chaotic gabbro stratigraphically above the clinopyroxenite horizon.  In addition, six samples taken from drill hole M-01-3 returned highly anomalous values in nickel.  Six samples totaling 7.4 meters, were taken over a core length of 92.5 meters and averaged 0.19% nickel.  Further work including geological mapping, detailed structural mapping, sampling and diamond drilling is recommended.

Temagami Diamond Claim Project, Ontario, Canada 

On July 18, 2001, the Company acquired 100% undivided interest in 837 mining claim units (the “Temagami Diamond Claims) in Hartle, Askin, Burnaby, Eldridge, Flett, Gladman, Hebert and Kenny Townships, located east of Marten River at the southern end of the Lake Timiskaming Structural Zone near Sudbury, Ontario.  The purchase price for the claims  is a cash payment of $195,000 ($120,000 paid to September 30, 2001) and the issuance of 180,000 common shares of the Company (120,000 issued). 

On September 20, 2001, the Company completed a Letter of Intent executed in July 2001 to purchase 100% interest in  111 claim units in Hartle and Flett Township, adjoining the Company’s existing 2,100 contiguous Temagami Diamond claims which cover approximately 34,000 hectares.  The purchase price for the claims payable by the Company to the Vendors is a cash payment of $25,000 (paid) and the issuance of 150,000 shares common shares of the Company (issued). The claims are considered prospective for diamonds.

The Company’s Temagami Diamond Claim properties are located west of the Timiskaming Structural Zone and straddle the Grenville Front, a deep rooted structure that separates the thick Precambrian Superior craton from the Grenville Province, a cratonized accreted mobile belt.  These deep-seated fault structures may have tapped into the diamond bearing portions of the earth’s mantle.   The area exhibits many major north to northwest trending faults and lineaments (associated with the Timiskaming Structural Zone) that intersect major east to northeast trending structures.  The intersection of these deep-rooted structures may have provided an excellent conduit or “plumbing system” for kimberlite or lamproite emplacement.

Dr. Harrison Cookenboo, Ph.D., P.Geo. of Meridian Geoscience Ltd. was engaged in  May 2001 to compile an independent evaluation report and to provide recommendations for future exploration activities.  Dr. Cookenboo is interpreting proprietary data possessed by, or collected by the Company in conjunction with recently released KIM data published by the Ontario Geological Survey (OGS).  To date, numerous kimberlite indicator minerals (KIM) have been collected both on and immediately down-ice of the Company’s claims.  Included among these indicator minerals are sub-calcic G10 Cr-pyrope garnets, eclogitic garnets and Cr- and Mg-rich chromites that are compositionally similar to most such minerals included in diamonds.  Dr. Harrison Cookenboo believes that, “the Tres-Or property has the potential to host significantly diamondiferous kimberlites due to its location over Archean basement.  The property is near known kimberlites, in a direction of increasingly encouraging indicator chemistry.  The Tres-Or property hosts indicator mineral suites suggestive of multiple kimberlite sources including pipes that have sampled the diamond stability field in the mantle and are likely to be diamondiferous.”  

During a recent site investigation, rock, till and beach samples were collected to test selected high- priority target areas on the Tres-Or property, as well as to establish rigorous protocols for subsequent regional sampling programs.  The high-priority target areas were selected based on favourable indicator chemistry and geological structures derived from both the OGS reports and Tres-Or’s proprietary data.  The favourable indicator minerals include very sub-calcic G10 pyrope garnets comparable to the best indicator minerals from producing diamondiferous kimberlites worldwide, including the Ekati  Mine in the Northwest Territories.  All of the samples collected have been submitted for analyses, and the results will be included in an independent evaluation report.

The Company is reviewing additional property opportunities and is actively pursuing financing and discussing joint venture participation in the Temagami Diamond Claim project with a number of interested parties.

Shallow River, Shallow River East and Botany Base Metal Project, Ontario, Canada

The Company has completed the Option Agreement to earn its 100% interest in the Shallow River East and Northeast mineral claims consisting of 52 units totaling 832 hectares.  The titles to the claims were transferred to the Company on July 27, 2001.  Treasury shares will be issued as the final property payment subject to filing with the Exchange an acceptable geological report on the exploration work completed.

The Company completed 300 metres of exploration drilling on the Botany  project to test a 1.6 kilometre long geobotanical anomaly identified in earlier work programs by John Mansville.  Drilling intersected massive to intermediate volcanics and gabbro and no significant base metal mineralization was identified.  Site visits and prospecting and additional geochemical surveys were carried out during the period.  The Botany Option Agreement is complete subject to the issuance of 100,000 shares of the Company on approval of the Exchange of an acceptable geological report on the exploration work completed.  The Company received confirmation of title transfer on October 5, 2001 of 26 mining claim units covering 416 hectares in Warden Township.  In addition, the Company staked 28 claim units contiguous and adjoining the Botany claims.  Earlier exploration programs carried out by the Company on the Shallow River Project identified a rhyolite porphyry unit which may be indicative of a semi-conformable alteration zone related to a volcanogenic massive sulphide (VMS) alteration system.  The prospective zinc-bearing felsic volcanic horizon has been identified over eight kilometres of property length and remains open along strike.The properties are located approximately 65 kilometres northwest of Kirkland Lake, Ontario, and cover largely under-explored southeast trending package of felsic volcanic, mafic volcanic and sedimentary rocks. 

In August 2001, Mobile Metal Ion geochemical surveys were carried out over two areas on the property to verify and better locate previously identified anomalies.  One hundred eighty-two samples approximately 50 grams in weight were taken at 20 to 40 centimeters depth, placed in zip-lock freezer bags and taken to Xral Laboratories in Rouyn-Noranda for analysis using the MMI technique for Cu, Pb, Zn and Cd.

Analyses of samples from the eastern grid were less clear. No significant anomalies are apparent from this work. The success of the sampling on the western grid indicate the MMI system works in this terrain. There is a good possibility the eastern grid might not have extended far enough to the north to cover the biogeochemical anomaly outlined in 1972. The survey should be extended at least 200 metres further north and all lines sampled.  Further work including mapping, prospecting and sampling is recommended to evaluate the base metal potential of the Shallow River, Shallow River East and Botany properties. The Company is pursuing joint venture participation in the project.

CORPORATE, FINANCE AND INVESTOR RELATIONS ACTIVITIES

The Company has working capital of approximately $33,247 and is pursuing a modest financing that will include a non-brokered private placement of both equity and flow-through investments.

Subsequent to the period, the Company received Acknowledgement of Payment of $18,000 in full satisfaction of a judgment in the Supreme Court of British Columbia on September 4, 1998 between R.A. Jones and Associates Inc. and Sterling  Pacific Resources Inc.

The Company has recovered expenses related to the acquisition and exploration of the Mann Project by optioning 50% interest in the property to Broadlands Resources Ltd. in a Letter Agreement approved by the Exchange February 8, 2001.  As at August 31, 2001, Broadlands has made cash payments to the Company totaling $13,000 and issued 150,000 common shares.

The Company continues with sampling and scientific investigations on the Temagami Diamond Claims.  The most recent information and proprietary data is being presented to several companies active or interested in acquiring diamond exploration projects.  The goal is to secure an Option/Joint Venture agreement or obtain additional funding for continued advancement of its properties.

During the period, the Company completed a non-brokered private placement of 723,500 units (323,500 being flow-through units) of the Company at $0.25 per unit.  Each unit consists of one common share and one non-transferable share purchase warrant.  Each share purchase warrant can be exercised to acquire one common share of the Company for a period of one year at an exercise price of $0.50 per share.  Proceeds from the financing will be used for general working capital, and for the acquisition and exploration of the Temagami Diamond Claims, located in the Sudbury Mining Division of Ontario.

During the period, the directors of the Company  exercised 394,576 stock options at $0.15 for net proceeds to the Company of $59,186.  The proceeds are to be used for general working capital and for the acquisition and exploration of the Temagami Diamond Claim project.  Subsequently, on July 23, 2001 the Company granted stock options to the directors and officers of the Company to purchase an aggregate of 670,000 shares at an exercise price of $0.14 per share for a three (3) year term.

Warrants exercised during the period and up to the date of this report include a total of 125,000 warrants exercised at $0.10 for net proceeds of $12,500.

The Company does not have any investor relations contracts.  Investor relations is managed by the Directors and includes daily contact with shareholders and attendance at industry conferences and trade shows.  Other investor relations activities include maintaining the Company’s web site, preparation and dissemination of documentation packages.

Liquidity and solvency:

The financial statements presented in Schedule A, have been prepared on a going concern basis which assumes that the Company will be able to realize its assets and discharge its liabilities in the normal course of business for the foreseeable future.  The continuing operations of the company are dependent upon its ability to raise adequate financing, secure substantial option or joint venture partnerships and to advance project opportunities to viable operations in the future.