Annual report for EL 10351, year ended 6 February 2008

Abstract

No on ground exploration was conducted on EL 10351 in the year under review. This licence forms part of a strategic land package adjacent to RRMF'L's Rustler's Roost Mine on MLN 1083. Further exploration on EL 10351 in the short term is dependent on reestablishment of operations on ML 1083 following the feasibility study which was undertaken by RRMPL in 2005-2006 in respect of the Rustler's Roost deposit. The complete results of this study, which cost in excess of $800,000 were made available to your Department in mid-2006. During the past year RRMPL's parent company, Valencia Ventures Inc., has investigated several avenues to act upon the fmdings of the Feasibility Study and re-establish operations at Rustler's Roost especially in light of the currently enhanced gold price. This has culminated in a recent announcement by WI to the Toronto Ventures Exchange (TSX-V: WI 19/02/08) that WI's interest in the Rustler's Roost project at Mount Bundey is being transferred to Valere Mining Limited (VLM) in which VVI will hold a 50% interest. A copy of this announcement was forwarded to officers in your Department on 25 February and a copy is also attached to this letter. As part of the transfer, VLM has covenanted with VVI to undertake minimum expenditure of CDN$2 million in respect of the development of the Rustler's Roost deposit within two years of the date of effect of the transfer which is subject to receipt of all necessary regulatory approvals. Formal notice of the change in ownership will be lodged with the NTG for Ministerial approval in due course. VLM has immediately appointed Mr Andrew Bradfield to take charge of investigation aimed at putting Rustler's Roost back into production. Mr Bradfield was General Manager at Rustler's Roost during the final years of oxide operations in the mid-1990's and is therefore well placed to understand the logistical requirements of the task in hand. We expect that Mr Bradfield will visit the NT in due course to outline VLM's intentions more fully once he has familiarised himself with the current legislative regime and with investigations which were undertaken on the Rustler's Roost deposit over the past five years. Expenditure on EL 10351 during the reporting period totalled approximately $500 for tenement management and reporting. This does not satisfy the expenditure covenant and we therefore request a variation of covenant be approved by the Minster or whether the prescribed fee is attached.