Canaccord Mar 4 09

SURVIVOR
4 March 2009

Wendell Zerb • Stock exchange notices to companies defaulting on list requirements, have
wendell.zerb@canaccordadams.com been on the rise. Precious metal equities have largely avoided the issue;
1.604.643.7485 however, many others are not so fortunate. We’ve outlined a cross section of
companies trying to survive, but which are currently facing delisting. We’ve
Eric Zaunscherb also added a list of junior exploration companies that have hit new 52-week
eric.zaunscherb@canaccordadams.com lows.
1.604.699.0829
• The Prospectors and Developers convention in Toronto is on this week. For
Nicholas Campbell those of us attending, it will likely be the typical four days of survival:
nicholas.campbell@canaccordadams.com battling crowds, hospitality suites, promoters, and negative metals price
1.604.643.7027 forecasters…

•
Adam Melnyk (Research Associate)
Exploration updates:
adam.melnyk@canaccordadams.com
Brilliant Mining Corp. (BMC : TSX-V : C$0.10 | Not rated)
1.604.643.1655 Diamonds North Resources Ltd. (DDN : TSX-V : C$0.12 | Not rated)
Exeter Resource Corp. (XRC : TSX-V : C$2.70 | Speculative Buy)
Iris Varga (Research Assistant) Mega Uranium Ltd. MGA : TSX : C$0.71 | Not rated)
iris.varga@canaccordadams.com UEX Corporation (UEX : TSX : C$0.76 | Not rated)
1.604.643.7412 Uracan Resources Ltd (URC : TSX-V : C$0.22 | Not rated)
• Site visit notes:
In this issue:
Extract Resources Ltd. (XRC : TSX : C$1.75 | Not rated)
Market/Commodities Snapshot 2
Foreword 3
Figure 1: Gold price versus average value US$/oz in situ
Other News 4
Exploration Updates 120

Current value: US$40.06/oz ↓
Brilliant Mining Corp. 6 1000
110

Diamonds North Resources Ltd. 7
Exeter Resource Corp. 8
100
900

Mega Uranium Ltd. 10 90

UEX Corporation 11 800
80

Uracan Resources Ltd. 13
Average Value US$/oz in si tu

Gol d Price (US$)

Site Visit Notes
70

700

Extract Resources Ltd. 14 60

600
50

Drill Bitz 20
Uranium In Situ 21
40

500

Gold In Situ 23 30

Research Universe 24 20 400

Ink Spots 25
19-Jul-07
2-Aug-07
16-Aug-07
30-Aug-07
13-Sep-07
27-Sep-07
11-Oct-07
25-Oct-07
8-Nov-07
22-Nov-07
6-Dec-07
20-Dec-07
3-Jan-08
17-Jan-08
31-Jan-08
14-Feb-08
28-Feb-08
13-Mar-08
27-Mar-08
10-Apr-08
24-Apr-08
8-May-08
22-May-08
5-Jun-08
19-Jun-08
3-Jul-08
17-Jul-08
31-Jul-08
14-Aug-08
28-Aug-08
11-Sep-08
25-Sep-08
9-Oct-08
23-Oct-08
6-Nov-08
20-Nov-08
4-Dec-08
18-Dec-08
9-Jan-09
23-Jan-09
5-Feb-09
20-Feb-09

Index 27
Disclosures 28
Average Value US$/oz in situ Gold Price

C$:US$ 0.78
Ag:Au ratio 72:1
Source: Capital IQ, Thomson ONE, Canaccord Adams

Canaccord Adams is the global capital markets group of Canaccord Capital Inc. (CCI : TSX|AIM)
The recommendations and opinions expressed in this Investment Research accurately reflect the Investment Analyst’s personal,
independent and objective views about any and all the Designated Investments and Relevant Issuers discussed herein. For important
information, please see the Important Disclosures section in the appendix of this document or visit or visit
http://www.canaccordadams.com/research/Disclosure.htm.

Junior Mining Weekly | 2
4 March 2009

Figure 2: Junior market/commodities snapshot
In Situ Value % Change TSX Venture Daily Volume for the week
EV/attrib. lb eq. or Mkt. cap/oz or lb eq. Feb 27/09 YTD WoW of Feb 23-27/09 Date Volume
CA GOLD In Situ (US$/oz) 40.06 25.2% -2.0% Monday 23-Feb-09 139,486,704
CA SILVER In Situ (US$/oz) 0.80 9.6% -12.1% Tuesday 24-Feb-09 153,504,084
CA URANIUM In Situ (US$/lb) 1.64 -14.6% 5.8% Wednesday 25-Feb-09 133,300,937
Feb 27/09 YTD WoW Thursday 26-Feb-09 126,332,368
CA COPPER In Situ (cents Cdn/lb) 1.29 26.5% -4.4% Friday 27-Feb-09 131,476,468
CA NICKEL In Situ (cents Cdn/lb) 4.40 -19.0% -15.5%
CA ZINC In Situ (cents Cdn/lb) 1.24 86.2% -6.1% Total 544,613,857
CA MOLY In Situ (cents Cdn/lb) 3.45 -27.7% -5.5% Average. Daily Volume 108,922,771
Value % Change S&P/TSX Venture Composite Index Volume and Value
Index Feb 27/09 YTD WoW Jan/07-Feb 27/09
S&P/TSX Venture Composite Index 862 8.1% -3.5%
S&P/TSX Composite Index 8,123 -9.6% 2.2%
S&P/TSX Global Gold Index 309 -1.1% -9.6% 370
3,200

S&P/TSX Diversified Metals & Mining 276 14.7% 5.3%
(SPDR) Streettracks Gold Trust 75 0.0% 0.0% 2,800

IShares Comex Gold Trust 93 6.9% -5.3%
AMEX Gold Bugs 289 -4.5% -6.9%
295
2,400

TSX Ve nture Vo lu m e (M )
S& P/TSX Ve n ture In de x
S&P/TSX Venture Composite Index 2,000

Selected companies Price Av Day Val 220

Highly active by value (Feb 23-27/09) Symbol Feb 27/09 C$ 000 1,600

Goldsource Mines Inc. GXS $2.16 1,280
Ongoing drilling; new coal intercept. 1,200

Andina Minerals Inc. ADM $1.70 630
145

Positive media exposure. 800

Fortuna Silver Mines Inc. FVI $1.04 430
Consolidation in the silver space. Acquiring Continuum Resources Ltd. 400 70

(CNU : TSX-V).
Jan -07

F e b-07

M a r-07

Ap r-07

M ay-07

Jun -07

A ug-07

Se p-07

O ct-07

N o v-07

D e c-07

F e b-08

M a r-08

Ap r-08

M ay-08

Jun -08

A ug-08

Se p-08

O ct-08

N o v-08

D e c-08

F e b-09
Canplats Resources Corp. CPQ $1.98 410 TSX-Venture Daily Trading Volume S&P/TSX Venture Index

Positive media coverage.

CA commodity price and currency forecasts Value % Change
2008E 2009E 2010E Long Term Feb 27/09 YTD WoW
Aluminum US$/lb 1.17 0.70 0.80 1.00 0.59 -13.2% 1.7%
Copper US$/lb 3.16 1.50 2.00 2.00 1.55 12.3% 9.9%
Nickel US$/lb 9.59 5.00 6.00 7.75 4.50 -14.4% 5.4%
Zinc US$/lb 0.86 0.63 0.70 0.80 0.50 -7.4% 2.0%
Lead US$/lb 0.95 0.50 0.50 0.50 0.47 2.2% 2.2%
Uranium US$/lb 63.55 60.00 65.00 70.00 45.00 -15.1% -4.3%
Molybdenum US$/lb 30.28 13.50 15.00 12.50 9.25 -25.3% -5.1%
Cobalt US$/lb 38.84 15.00 15.00 12.50 12.00 -31.4% -10.6%
Gold US$/oz 873.00 975.00 900.00 750.00 952.00 10.6% -3.7%
Silver US$/oz 14.99 13.50 13.75 14.00 13.11 16.1% -9.5%
Platinum US$/oz 1578.46 1050.00 1200.00 1200.00 1073.50 14.9% -0.8%
Palladium US$/oz 351.95 250.00 300.00 300.00 196.00 4.8% -8.8%

C$/US$ 0.94 0.85 0.90 0.90 0.78 -4.0% -1.8%
A$/US$ 0.85 0.70 0.75 0.80 0.64 -8.6% -1.0%
US$/Euro 1.47 1.40 1.34 1.30 1.27 -9.5% -1.2%
Rand/US$ 8.27 9.50 9.00 8.00 10.10 8.2% 0.0%

WoW (week over week)
The CA commodity price (base metals) and currency forecasts – updated values published January 12, 2009.
In Situs: The basket of companies might vary quarterly. Silver In Situ first published on September 22, 2008.
CA - Canaccord Adams.
Past performance is not indicative of future results.
Source: Thomson ONE, Bloomberg, TSX Venture Exchange, Canaccord Adams estimates

4 March 2009

SURVIVOR
According to the Globe and Mail (February 25, 2009), the New York Stock Exchange is
considering relaxing a rule that requires shares to trade above a dollar. Currently, a
NYSE-listed company’s shares cannot remain below US$1.00 for over 30 consecutive
days. If that happens, the company gets six months to prove to the NYSE it can boost its
stock price. Already, on January 23, 2009, the exchange temporarily decreased its
required market capitalization threshold to US$15 million from US$25 million. The
minimum market cap was raised to US$25 million from US$15 million in 2004. Roughly
65 companies, or 3% of the NYSE’s 1,950 listed companies, are currently listed on the
NYSE website as “non-compliant with NYSE quantitative continued listing standards.”
Included on this list are mining companies Lundin Mining (LMC : NYSE) and Coeur
d’Alene Mines (CDE : NYSE). In Figures 3 and 4 we list the mining and exploration
companies on the TSX and TSX Venture exchanges that have been similarly delisted or
suspended.

Figure 3: Delistings on S&P/TSX and S&P/TSX Venture Exchange between December 1,
2008 and January 28, 2009
Company Name Symbol Delist Date
1 Delta Exploration Inc. DEV 4-Feb-09
2 Golden Oasis Exploration Corp GOT 2-Feb-09
3 Aranka Gold Inc. ARK 29-Jan-09
4 Pinewood Resources Ltd. PNW 13-Jan-09
5 Winchester Minerals And Gold Exploration Ltd WMG 13-Jan-09
6 Patricia Mining Corp. PAT 17-Dec-08
7 Oromin Explorations Ltd. OLE 16-Dec-08
8 Fusion Resources Limited FNS 19-Feb-09
9 GLR Resources Inc. GRS 7-Jan-09
10 Gateway Gold Corp. GTQ 23-Dec-08
11 Campbell Resources Inc. CCH 19-Dec-08
Source: www.tsx.com, Canaccord Adams

Figure 4: Suspensions on S&P/TSX and S&P/TSX Venture Exchange between December 1,
2008 and January 28, 2009
Company Name Symbol
1 Pine Valley Mining Corporation PVM
2 Tahera Diamond Corporation TAH
3 Big Bar Resources Corporation BBK
4 Emerald Isle Resources Inc. EIR
5 Great Gold Mines N.L. GGM
6 Gulfside Minerals Ltd. GMG
7 Kansai Mining Corporation KAN
8 Majestic Gold Corp. MJS
9 Neo Alliance Minerals Inc. NAM
10 Pacific Imperial Mines Inc. PPM
11 Superior Canadian Resources Inc. CAD
12 Vega Gold Ltd. VGG
13 Vostok Minerals Inc. VOS
14 West Hawk Development Corp. WHD
Source: www.tsx.com, Canaccord Adams

4 March 2009

Other news
• As expected, HudBay and Lundin agreed to officially terminate their proposed
merger last week. As a result, Lundin disclosed last week that it was not in
compliance with its tangible net worth covenant at year-end on its existing five-year
credit facility. However, Lundin has received a temporary covenant waiver valid
until June 2009 as the parties negotiate the restructuring of the facility. The
company has US$267 million drawn on this credit line and had only US$170 million
of cash at year-end. In exchange for the temporary covenant waiver from the banks,
Lundin has agreed to make no further drawdowns on the facility, an increase in the
rate to 4.5% + libor (from 1.5%), restrictions on cash distributions and asset sales,
and the inclusion of its interest in Tenke as collateral. If the facility cannot be
restructured, the US$267 million drawn line becomes callable by the lenders.

HudBay is also currently not without its issues, as a proxy battle is underway for
control of the company between current management and SRM Global, a Monaco
based hedge fund. Current HudBay management claims that SRM and its nominated
slate of directors has no strategy for long-term value creation and its nominees for
HudBay's board do not have the requisite mining industry experience to maximize
shareholder value. The current management views this as a hostile takeover with
SRM paying no premium to HudBay's current share price. HudBay's current
management, should it win the proxy battle, would continue to focus on long term
growth, both organically and through acquisitions and would retain HudBay's strong
balance sheet, with cash of US$686 million, or $4.48/share. The current
management has also proposed new corporate governance requirements,
including requiring a shareholder vote before any equity issue resulting in more than
25% dilution to shareholders and minimum share ownership requirements for
management. According to SRM, HudBay's board of directors decided to insist on a
shareholder vote, that HudBay CEO Allen Palmiere acted on his own and the board
did not rein him in. Also, according to SRM, GMP (HudBay's financial advisor for the
proposed merger) advised HudBay the day before the deal was announced that using
current metals prices and exchange rates, HudBay's NAV was 70-95% more than
that of Lundin (range based on valuing Lundin with and without its interest
in Tenke) and, as such, not equal as per the share exchange ratio. Also, SRM asserts
that HudBay did not disclose to GMP material facts known to HudBay about the
financial position of Lundin. At this point, SRM has not indicated how its
proposed slate of directors would act, but the consensus view is that this new
management would distribute a significant portion of HudBay’s cash balance to
shareholders. SRM has stated that it expects to have no control over the
management, other than its interest as an 11% shareholder. A vote on the matter is
scheduled for March 25, 2009.

• Last week, Canaccord Adams precious metals analyst Steven Butler revised his
outlook on gold prices, As gold passed through our previous $950/oz peak target
price (for equity target price setting), we remained confident in the bullish view on
gold. As such, we raised our peak gold price by a further $150/oz to $1,100/oz gold.
Given the leverage to gold, our equity target prices increased by approximately 20%.
Our official 2009 earnings and cash flow estimates also reflect a bump in gold price
to $975/oz from $900. Although gold may be in a bubble, the bubble is still being
blown up. Overall global financial market conditions remain weak and we believe

4 March 2009

the safe haven flight to gold can continue. Credit risk, while lower than most recent
highs, is as high as the first peak last March which coincided with the collapse of
Bear Stearns; but, gold is still lower than the US$1,003/oz peak set one year ago.
While inflation has not yet registered in near-term expectations, we ultimately
believe that inflation and general devaluation of paper currencies will be the result of
the concerted monetary and fiscal policies to reflate the global economy. Investment
demand as demonstrated by the abrupt rise in SPDR gold trust holdings. Already
year-to-date, this trust has added over 228 tonnes of gold for an annualized increase
of over 1,700 tonnes in this trust alone. The record-setting level of investment
demand is more than offsetting the slackening levels of fabrication demand, lower
de-hedging demand and potentially higher scrap supply at these high prices.

• The International Convention, Trade Show & Investors Exchange – PDAC – is
Figure 5: PDAC 2009 ongoing in Toronto at the Metro Toronto Convention Centre, between March 1-4,
2009. In 2008, there were just over 20,000 convention registrants as well as 587
companies exhibiting.

• At the Prospectors and Developers Association of Canada Conference, held in
Source: www.pdac.ca
Toronto this week, Dr. Jose Serrano Delgado, Ecuador's Sub-Secretary of
Mines, announced that the suspension on mining activities in Ecuador that has been
in place since April, 2008 has been lifted. According to Dr. Delgado, concession
holders will soon receive letters formally allowing the resumption of work from the
Ministry of Mines and Petroleum. Companies with projects in Ecuador include
Kinross (K : TSX), IAMGold (IMG : TSX), Corriente Resources (CTQ : TSX), Dynasty
Metals and Mining (DMM : TSX), International Minerals (IMZ : TSX), and
Cornerstone Capital Resources (CGP : TSX-V).

4 March 2009

EXPLORATION UPDATE
BRILLIANT MINING CORP. (BMC : TSX-V : C$0.10 | NOT RATED)

Figure 6: BMC : TSX-V Figure 7: BMC : TSX-V

Shares o/s (M): 73.0 Past 12-months – purchased: $96,683
Shares fd (M): 79.9 Past 12-months – sold: 300,000
Working Cap. (M): $0.1
Market Cap. (M): C$7.3 Since Dec. 24, 2008 - acquisitions or dispositions: NIL
Co. Website: www.brilliantmining.com
Source: Company reports, StockCharts.com Source: INK Research
Brilliant Mining is a Vancouver-based company focused on the exploration for and production of nickel. The company owns
a 25% interest in the producing Lanfranchi nickel mine in Western Australia and wholly owns the Michikamau Ni-Cu-Co-
PGE exploration property in central Labrador. The company melds strong Canadian management in the form of Chairman
John Robins, President Mike Sieb, and CEO John Williamson with exceptional Australian engineering in the form of hands-
on directors Leigh Junk and Ian Junk. The company recently announced plans to sell its interest in the Lanfranchi mine:

• Brilliant has entered into an agreement to sell its indirect interest in the producing Lanfranchi nickel mine in Western
Australia to majority owner Panoramic Resources (PAN : ASX : A$0.81 | Not rated). In consideration, Brilliant would
retain C$6 million in working capital, receive 12 million shares in Panoramic and receive 3 million share purchase
warrants exercisable in Panoramic common shares at A$1.50 to December 31, 2012. Brilliant shareholders will
receive their proportional share of Panoramic securities, thus maintaining exposure to the Lanfranchi mine subject to a
six-month hold period. Brilliant management was motivated to strike this deal with Panoramic in order to avoid
dilution in this difficult equity market stemming from operational funding obligations.

• Brilliant recently reported record nickel production for the three months ended December 31, 2008. The mine had
produced 115,064 tonnes of ore at 2.45% nickel for 6.2 million pounds of nickel in concentrate. These figures
represented year-over-year increases of 84% and 74% in ore mined and metal in concentrate, respectively. Unit
payable cash costs, net of copper credits, amounted to US$3.65 per pound in the quarter. The Lanfranchi mine hosts
measured and indicated resources of 3.7 million tonnes grading 2.57% nickel plus 1.6 million tonnes inferred grading
1.84% nickel for a global resource of 276.3 million pounds of nickel.

• It is unfortunate the conditions have backed Brilliant into this particular corner. The project offers excellent exploration
potential in down-plunge extensions of the producing channels. In addition, the Northern Tramways Dome area boasts
significant evidence in support of the discovery of an overturned portion of the critical ultramafic/basalt target contact
on the northern margin of the area. Two high-priority nickel channels in the projected overturned position of the
Winner-Schmitz and Helmut-Deacon channels had been identified.

An analyst has not visited the properties held by Brilliant Mining Corp.

Investment risks
The Lanfranchi Mine is located in Western Australia in an area of extensive historical production, thus sovereign-related
risks are minimal. The primary risks associated with investment in Brilliant Mining Corp. are those of metal prices and
exchange rates. The commercialization risks associated with new mineral exploration and development are high, thus,
investment in the shares of Brilliant Mining Corp. is for risk accounts only.

4 March 2009

DIAMONDS NORTH RESOURCES LTD. (DDN : TSX-V : C$0.12 | NOT RATED)

Figure 8: DDN : TSX-V Figure 9: DDN : TSX-V

Past 12-months – purchased: $153,629
Shares o/s (M): 75.2
Past 12-months – sold: $84,950
Shares fd (M): 86.3
Since Jan. 20, 2009 - acquisitions: 3,000 shares @ $0.28
Market Cap. (M): $9.0
Since Jan. 20, 2009 - dispositions: NIL
Co. Website: www.diamondsnorthresources.com

Diamonds North Resources is a mineral exploration company targeting diamonds in Canada’s far north. The company is led
by Mark Kolebaba (President and CEO), a former exploration head for the BHP and Dia Met joint venture at Ekati. Its principal
asset is its 100%-owned Amaruk diamond project (Tuktu target) in the Pelly Bay region of Nunavut. The main area of the
Amaruk project spans more than 80 kilometres east to west and is within approximately 30 kilometres of tidewater.

• Last week the company released disappointing mini-bulk sample results from its Amaruk property in northern Canada.
An estimated 21.63 tonnes of kimberlite was collected from the Tuktu-1, 2 and 3 kimberlite and an additional
estimated 14.49 tonnes of kimberlite was collected from Qavvik-4, 5 and 6 kimberlites last summer. Results of Dense
Media Separation (DMS), and final diamond-picking suggest these kimberlite bodies are not likely to host a material
population of macro stones, considerably reducing the economic potential of these particular pipes. The largest stones
recovered from the mini-bulk samples that remained on the 1.18 mm sieve weighed in at 0.04 carats. The company
has estimated the grades of the Tuktu and Qavvik kimberlite samples are inferred to be less than 0.1 ct per tonne. No
further work is planned on these kimberlite bodies.

• The company has identified over 500 airborne magnetic anomalies defined by abundant, high-quality indicator
minerals and kimberlite float at the Amaruk property. Sampling indicates a significant population of high-
chromium/low-calcium pyrope garnets (G-10s). In our opinion, the chemistry of these garnets is closely comparable to
some of the best garnet chemistry associated with the Ekati and Diavik diamond mines in NWT. In fact, several of the
sub-calcic garnets display as high as 13 wt% Cr2O3 and <2.5 wt% CaO. This chemistry is a strong indication that any
kimberlites that sourced these garnets have tapped the diamond stability field and have a high potential to contain a
significant population of diamonds. The company has indicated that the area hosts favourable chromite chemistry and
there is additional work outstanding on the chemistry of the population of eclogitic garnets. According to Diamonds
North, hundreds of targets on the property remain untested and it will continue to work towards outlining high
potential diamond bearing kimberlites in the area.

An analyst has not visited the properties held by Diamonds North Resources Inc.

Investment risks
The commercialization risks associated with mineral exploration and development are high, thus, investment in the shares
of Diamonds North Resources Inc. is for risk accounts only.

4 March 2009

EXETER RESOURCE CORPORATION (XRC : TSX-V : C$2.70 | SPECULATIVE BUY)
Figure 10: XRC : TSX-V Figure 11: XRC : TSX-V

Shares fd (M): 71.7
Since Sep. 30, 2008 - acquisitions: NIL
Since Sep. 30, 2008 - dispositions: NIL
Co. Website: www.exeterresource.com

Exeter Resource is a Vancouver-based gold-silver exploration company under the management of Yale Simpson, Chairman,
and Bryce Roxburgh, President and CEO. Exeter is advancing the Caspiche copper-gold porphyry project (earning 100%) in
northern Chile and the Cerro Moro high-grade gold-silver vein project (95%) in Santa Cruz province in southern Argentina.
• Last week, Exeter released more results from more exploration drilling at Caspiche, including assay results from the
last 284 metres of drill hole #32, which previously (Feb. 2, 2009) returned 930 metres grading 0.89 g/t Au and 0.31%
Cu including a 488-metre section that returned 1.30 g/t Au and 0.44% Cu. This drill hole was designed to test the SW
extension of the mineralized system at Caspiche. The complete intercept in hole #32 is 1,214 metres of 0.90 g/t Au
and 0.33% Cu, including an interval of 716 metres grading 1.22 g/t Au and 0.42% Cu. Also hole #32, a 200-metre
south-east step out hole (from hole 32), returned 130 metres of 0.47 g/t Au in the oxide zone and 786 metres of 0.33
g/t Au and 0.13% Cu in sulphide. The company has more drilling planned to test the continuation of the system to the
southwest, following what appears to be the trend of high grade mineralization. Currently, assays are pending from
the depth extensions to drill holes #16 and #23. The company indicates that in general recent drilling shows potassic
alteration increasing to depth, potentially suggesting that the strongest part of the system is still open at depth.
• An initial NI 43-101 compliant resource estimate for Caspiche is expected to be released in March or April of this year,
based on drill holes to December 31, 2008. An update to this resource estimate is expected in September, based on
2009 drilling results. Based on recent drilling results and a recently closed C$29 million private placement, Exeter
now plans to expand its 2009 drilling program from 9,300 metres to 12,000 metres, with drills turning until May.
Exeter also plans to test the Caspiche III target at the property, a former Newcrest epithermal target.
• On a comparative basis, Caspiche’s Au-Cu grade, geology and infrastructure are all similar to Barrick/Kinross’s Cerro
Casale deposit. In October 2007, Barrick acquired a 51% interest in Cerro Casale for US$805 million. Based on our
conceptual preliminary estimates, we believe Exeter is on track to outline an NI 43-101 resource at Caspiche (down to
400 metres vertical) of six to seven million ounces gold equivalent and in excess of five million ounces of AuEq at
vertical depths below 400 metres. We rate Exeter a SPECULATIVE BUY; our 12-month target price is C$4.05.
An analyst has visited the properties held by Exeter Resource Corp. Partial payment or reimbursement was received
from the issuer for the related travel costs.

4 March 2009

Valuation
Given the early stage of exploration and development of XRC’s projects (no defined NI 43-101 resources), we have applied
our in-situ valuation metrics to Caspiche and Cerro Moro. We apply a value of US$25/oz AuEq to estimated oxide and
primary sulphide resources above 400 m vertical, and US$15/oz AuEq to estimated sulphide resources below 400 m vertical.
Based on continuing positive results, we are reducing our applied execution risk discounts in our valuation for Caspiche. We
are maintaining our SPECULATIVE BUY rating on XRC, while raising our 12-month target price to C$4.05 (was C$3.10).

Investment risks
of Exeter Resource Corp. is for risk accounts only.

Figure 12: Caspiche drill plan

Source: Exeter Resource Corp.

4 March 2009

MEGA URANIUM LTD. (MGA : TSX : C$0.71 | NOT RATED)

Figure 13: MGA : TSX Figure 14: MGA : TSX

Past 12-months – purchased: $2,854,131
Past 12-months – sold: $6,639,139
Shares fd (M): 214.9
Working Cap. (M): C$38.9
Since Dec. 31, 2008 – acquisitions or dispositions: NIL
Market Cap. (M): C$166.4
Co. Website: www.megauranium.com

Mega Uranium Ltd. is a uranium exploration and development company under the stewardship of Sheldon Inwentash,
Chairman and CEO, based in Toronto, and Stewart Taylor, President, based in Brisbane, Australia. Mega has a diverse
global portfolio of projects in sites including Australia, Canada, Mongolia, Argentina, and Cameroon. Mega Uranium’s most
advanced projects with defined resources are in Australia. Mega’s largest uranium deposit is the Lake Maitland deposit in
Western Australia with 23.7 million pounds U3O8 in Inferred Resource. The company has agreed to sell a 35% interest in
the Lake Maitland project as follows:

• Last week Mega agreed to sell a 35% interest in the Lake Maitland uranium project in Western Australia to a
consortium of Japanese utilities and ITOCHU Corporation, the world’s second largest uranium trading house. The
Japanese utility group is comprised of the Kansai, Kyushu, and Shikoku electric power companies. The utilities will
access uranium for their own use while ITOCHU will be able to participate in incremental uranium offtake. The 35%
interest may be earned through staged payments amounting to US$49 million, or US$5.91/lb, beginning with the
funding for a feasibility study. The memorandum of understanding is expected to lead to definitive farm-in and joint
venture agreements, subject to completion of due diligence and the required regulatory and board approvals.

• In October 2008, Mega announced the results of a scoping study for the Lake Maitland deposit. Based on annual
throughput of 1.67 million tonnes, annual production is estimated at 1.65 million pounds U3O8 per year. The recovery
rate is expected to average 90% over a 10-year mine life using alkaline leach. Total capital cost is estimated at US$85.1
million with an average operating cost estimated at US$16.60/lb U3O8. The study was completed using the current
long-term price of US$75.00/lb U3O8, giving the project a NPV (10%) of US$181.4 million and IRR of 43.4%. The study
was completed using an A$ exchange rate of US$0.80. The Lake Maitland deposit is amenable to low-cost, open-pit
mining as the orebody occurs as a flat lying calcrete layer at a depth of approximately 2.0 metres below the surface.
The average thickness varies between one and three metres. Lake Maitland is in the Eastern Goldfields of Western
Australia near operating mines, with good access to infrastructure, including roads, airstrips, and a gas pipeline.

An analyst has not visited the Lake Maitland property held by Mega Uranium Ltd.

Investment risks
of Mega Uranium Ltd. are for risk accounts only.

4 March 2009

UEX CORPORATION (UEX : TSX : C$0.76 | NOT RATED)

Figure 15: UEX : TSX Figure 16: UEX : TSX

Past 12-months – sold: NIL
Since Oct. 9, 2008 - acquisitions or dispositions:: NIL
Co. Website: www.uex-corporation.com

UEX is a Vancouver-based exploration and development company advancing an extensive portfolio of uranium projects in
the Athabasca Basin, Saskatchewan. The Athabasca Basin supplied an estimated 23% of global mine supply in 2007. This
past week, the company provided updates as follows:

• Exploration has commenced on the 49%-owned (51% AREVA Resources Canada Inc.) Shea Creek uranium project,
western Athabasca Basin, Saskatchewan. The project hosts the Kianna, Anne and Colette deposits. The partners will
spend, funded on a pro rata basis, C$8.25 million on exploration and C$2 million for development. Drilling has begun
with three rigs seeking to infill on Kianna and Anne at 20-metre centres, expand the two deposits and confirm a
potential connection between the two deposits at depth. Environmental baseline and engineering studies have begun in
support of future development. A 950-metre shaft is planned for access for underground exploration and testing of
ground conditions.

• To date, 53 holes amounting to 16,500 metres have been drilled on the wholly owned Hidden Bay property (Figure 17).
One drill rig is testing the definition drilling of the Horseshoe Northeast zone while two rigs are testing southwestern
extensions of the Raven deposit. Additional drilling will test eastern extensions of the Raven deposit, the area between
the Raven and Horseshoe deposits and regional coincident alteration and geophysical anomalies. In January UEX
reported a resource estimate for the Raven deposit of 3.97 million tonnes indicated grading 0.105% U3O8 containing
9.15 million pounds of U3O8, and 0.49 million tonnes inferred grading 0.104% U3O8 containing 1.13 million pounds of
U3O8 at a cut-off grade of 0.05%. Last fall, UEX reported a resource estimate for the Horseshoe deposit amounting to
18.69 million pounds indicated at a grade of 0.24% U3O8 and 0.31 million 1.43 million pounds inferred at a grade of
0.21% U3O8. Management have increased their target for the Hidden Bay project to 40 million pounds U3O8 and are
evaluating processing options for eventual development including toll milling with one of the two active facilities in the
region, namely the Rabbit Lake mill (less than five kilometres to the northeast) and the McClean Lake facilities (12
kilometres to the northwest), or potentially a stand-alone facility.

An analyst has not visited the properties held by UEX Corporation.

Investment risks
The commercialization risks associated with mineral exploration and development are high; thus, investment in the shares
of UEX Corporation is for risk accounts only.

4 March 2009

Figure 17: Raven-Horseshoe area within the Hidden Bay Property, Athabasca Basin, Saskatchewan

Source: UEX Corporation

4 March 2009

URACAN RESOURCES LTD. (URC : TSX-V : C$0.22 | NOT RATED)

Figure 18: URC : TSX-V Figure 19: URC : TSX-V

Since Dec. 13, 2008 - acquisitions or dispositions: NIL
Co. Website: www.uracanresources.com

Uracan Resources is a Canadian uranium exploration company that has been exploring in Québec and Saskatchewan since
mid-2006. Uracan is under the management of Gregg Sedun, President and CEO, with Marc Simpson as Exploration
Manager. Uracan is exploring for near-surface, large-tonnage, low-grade, granite-hosted uranium mineralization. The two
main assets are the North Shore project in the Johan Beetz area of southern Québec and the Pipewrench Lake project
targeting basement-hosted mineralization in the Wollaston Domain southeast of the Athabasca Basin. In November 2008,
Uracan completed a private placement led by Canaccord Capital for $5.7 million. The company recently updated the
resource estimate for the North Shore project:

• The wholly owned North Shore property covers approximately 1,000 square kilometres, 285 kilometres east of Sept-
Iles, Québec. Infrastructure is excellent with paved highways, power lines, and deep water potential within the project
area. The project hosts a number of uraniferous zones. Uracan recently announced NI 43-101 complaint inferred
resource estimates for the TJ and Middle zones based on 13,863 metres in 66 diamond drill holes drilled in 2008. The
TJ zone amounts to 28.7 million tonnes grading 110 ppm U3O8, or 7.0 million pounds, while the Middle zone amounts
to 52.0 million tonnes grading 120 ppm U3O8 containing 13.7 million pounds, both using a 90 ppm cut off grade.

• The TJ and Middle zones are part of the Double S trend, a radiometric anomaly of six kilometres in length. The TJ zone
is located approximately three kilometres northwest of the previously discovered Double S zone while the Middle zone
is situated 1.3 kilometres west of the Double S zone. In July 2008, Uracan had announced an NI 43-101 compliant
inferred resource for Double S amounting to 74.2 million tonnes averaging 120 ppm U3O8, or 20.0 million pounds.
Combining the three zones using a 90 ppm cut-off grade amounts to an inferred resource of 40.7 million pounds U3O8.
The grade and potential project scale indicated by untested radiometric anomalies, detailed mapping and sampling
suggests a strong analogue to the granite-hosted uranium deposits found in Namiba, but with the advantage of
superior infrastructure. Uracan has recommenced exploration with a 3,000-metre drill program targeting further
definition and expansion of the Double S zone which remains open along strike and to depth.

An analyst has not visited the properties held by Uracan Resources Ltd.
Investment risks
The commercialization risks associated with mineral exploration and development are high; thus investment in the shares
of Uracan Resources Ltd. is for risk accounts only.

4 March 2009

SITE VISIT NOTES

EXTRACT RESOURCES LIMITED
(EXT : TSX : C$1.75 | EXT : ASX : A$2.45 | NOT RATED)
Namibia, February 16, 2009
Extract Resources Limited (Extract) is a Perth-based uranium exploration company
primarily focused on advancing its wholly owned Husab uranium project in Namibia.
The company is in the more-than-capable hands of Managing Director Peter McIntyre
but the sharks have been circling: Kalahari Minerals (KAH : LSE : £0.76 | Not rated)
holds a 40.6% equity position in Extract and has been challenging Extract’s Board of
Directors. Rio Tinto (RIO : LSE : £17.16 | BUY), 69%-owner of the adjacent world-class
Rössing uranium mine, has taken a 14.4% interest in Extract, as well as a 15.8% stake in
Kalahari. We recently had the opportunity to visit Extract’s Husab project in Namibia.

In Africa, uranium explorers have focused to a large extent on the Damara Orogenic Belt in
west central Namibia. Approximately 900 million years ago, the continent in this area was
pulling apart (rifting) along a roughly east-northeast trend. The rift became filled by up to
17,000 metres of volcanic flows, fluvial (river borne) sediments and, ultimately, marine
sediments. Tectonic movements reversed approximately 600 million years ago such that
the package of sedimentary and volcanic rocks was subjected to tremendous pressure
resulting in metamorphism, folding, and faulting. The peak of metamorphism (heat and
pressure) is dated at 535 million years ago. The intrusion of granitic bodies occurred
during and after this phase of compression and much of the region’s primary uranium
mineralization is associated with the emplacement of these bodies. The combination of
compression and granitic intrusion created the northeast trending domes one sees today.
The granitic layers within these domes are prime targets for uranium mineralization. The
target granites are more specifically leucogranites (i.e., white granites), some of which are
referred to in the field as alaskites.

Uranium mineralization was discovered in the vicinity of Rössing Mountain in the 1900s.
Mineralization at Rössing is hosted in alaskite layers which have intruded into surrounding
gneiss and schist units of the Khan and Rössing formations. The Rössing mine is the
archetype of Rössing-style granite-hosted mineralization now sought in Africa. In 1966 Rio
Tinto began exploration there and identified the large, low-grade deposit. The Rössing
mine, which became operational in 1976, is indirectly owned by Rio Tinto (69%), the
Government of Iran (15%), the Industrial Development Corporation of South Africa (10%),
the Namibian Government (3%), and a private party (3%). The main SJ pit is currently
2,800 metres long by up to 800 metres wide and 330 metres deep. In 2008, the mine
produced 6.1 million pounds U3O8 versus 4.6 million pounds in 2007 as higher grades
were encountered. An expansion is in progress to take the mine to 12.1 million pounds
U3O8 per annum capacity by 2012, potentially including heap leaching of lower-grade ore.

Extract’s core asset is the Husab uranium project in Namibia, located approximately 50
kilometres east of Swakopmund, Namibia and immediately south of the Rössing mine
(Figure 20). The project was acquired in May 2005 on a 51/49 basis by Extract and
Kalahari, respectively. Extract subsequently acquired Kalahari’s interest in the Husab
project in return for 66.7 million Extract shares in March 2007. Husab consists of two
contiguous Exclusive Prospecting Licenses (EPL 3138 and 3439) covering an area of 637

4 March 2009

square kilometres. EPLs can cover an area of up to 1,000 square kilometres, are
commodity-specific, are valid for an initial term of three years with two renewals of two
years each, and allow the holder to engage in prospecting and mineral sample removal.

Figure 20: Husab project location map, Namibia

Source: Extract Resources Limited

4 March 2009

Access to Husab is excellent via paved and well-maintained unpaved roads directly to the
property. The communities of Walvis Bay and Swakopmund provide the plethora of goods
and services needed in exploration, as well as international sea and air connections. The
national power grid is situated nearby, although power availability is a challenge
NamPower is actively addressing. Water is not locally available and will have to be piped in
from a desalination plant currently under construction on the coast north of Swakopmund.

The Husab project consists of three main target areas – Ida Dome (Ida Central, Garnet
Valley, Ida East, Holland’s Dome, New Camp and other zones), Hildenhof, and Rössing
South (Figure 21). Extract initially focused on the Garnet Valley and the Holland’s Dome
zones within the Ida Dome area where previous drilling by Anglo American identified
extensive stacked alaskite-hosted uranium mineralization similar to that seen at the
Rössing mine. At a 100 ppm U3O8 cut-off grade, Ida Dome now hosts 52.7 million tonnes
inferred grading 213 ppm for 24.8 million pounds U3O8 contained, plus an additional
310,000 pounds at 246 ppm U3O8 in the indicated category. Extract’s exploration focus,
however, is now firmly on the recently discovered Rössing South target.

Figure 21: Husab exploration targets, Namibia

Source: Extract Resources Limited

4 March 2009

Rössing South

The Rössing South target is situated at the north end of the Husab project. In an excellent
example of best exploration practices, Extract traced the key stratigraphy (geological
horizons) southward from the nearby Rössing mine (Figure 22) using regional magnetic
data and began to drill test the stratigraphy through overlying unconsolidated sand. The
subsequent blind discovery of bulk uranium mineralization of the Rössing type is one of the
most significant of the cycle. A prospective trend of 15 kilometres has been identified at
Rössing South, of which only six kilometres has been tested.

Figure 22: Drill rig on Rössing South with Rössing mine facilities on the horizon

Source: Canaccord Adams

4 March 2009

In January, Extract announced an initial NI 43-101 compliant inferred resource for
Rössing South Zone 1, prepared independently by Coffey Mining of Australia, of 115.0
million tonnes grading 430 ppm U3O8 at a 100 ppm U3O8 cut-off grade and containing
108.3 million pounds U3O8. Three things are immediately noteworthy:

• Extract successfully outlined this resource in a short period of time (12 months),

• The grade is approximately 50% higher than at the nearby Rössing mine, and

• The contained uranium is relatively insensitive to cut-off grade.

Figure 23: Rössing South drill plan

Source: Extract Resources Limited news release

The higher grade seen at Rössing South appears to be related to elevated supergene
enrichment, a late-stage hydrothermal event, which increased the component of secondary
uranium. Empirically, this suggests that Rössing and especially Rössing South may be
closer to the thermal centre on the north-south Welwitchia lineament or fault zone along
which the uraniferous alaskites are situated. These deposits are located at dilationary,

4 March 2009

high-stress zones along this lineament. Supergene enrichment at Rössing South is evident
from top to bottom in section and the high proportion of supergene enrichment may
explain the resource’s relative insensitivity to cut-off grade.

The Rössing South trend does not outcrop to the north as the sand cover thins and the
surface falls off into the river valley. Mineralization consequently is closed off as
stratigraphy sweeps to the west; mineralization also appears to finger out approaching this
closure. To the south, however, mineralization remains wide open. There are currently
three reverse circulation and two diamond drill rigs operating. Drill spacing is being
tightened on Zone 1 to upgrade from the inferred to the indicated category. The strike
length of Zone 1 is currently 2.4 kilometres, but we see no reason why the gap between
zones 1 and 2 should not be closed with additional drilling. The strike length of Zone 2 is
now 2.0 kilometres but the zone remains open along strike, as well as to depth. Drilling on
Zone 2 is progressing on a 100 by 100 metre grid. The zone is much more flat-lying than
Zone 1 and may represent the top of an antiform. Extract is targeting August 2009 for an
initial resource for Zone 2, but their published target of 69 to 106 million pounds at 260 to
300 ppm may be overly conservative given the previous experience with Zone 1.

The Rössing South trend appears to extend a further nine kilometres south of Zone 2. We
visited an excellent new exploration target at Salem (Figure 21), approximately six to eight
kilometres south of Rössing South Zone 2. The site is unusual in that alaskites appear to be
intruding Salem granite as opposed to Khan or Rössing metamorphic rocks. A radiometric
anomaly, confirmed on the ground as being uraniferous alaskite, covers approximately 100
metres by 300 metres. This may, however, be the “tip of the iceberg” requiring further
drilling. We are also intrigued by the jog in stratigraphy north of Salem, which then may
line up with Rössing South.

Looking forward, feasibility studies are expected to begin this month looking at both
conventional agitated leach and heap leach options for an operation at Rössing South. The
configuration for Zone 1 is good, but Zone 2 is even better appearing almost flat-lying
implying a low strip ratio. At present we see fewer calc-silicate (marble) horizons present
at Rössing South, which suggests lower acid consumption. Although betafite (a refractory
uranium mineral) has not been directly observed, up to 5% betafite is common at Rössing;
more metallurgical testing is required and samples from current metallurgical holes are
being sent to the Australian Nuclear Science and Technology Organisation for extraction,
communition and mineralogy studies.

On the corporate front, the board room shenanigans are detracting from what is truly a
world-class discovery. Clearly, with a project of this scale the pace of exploration can
safely be accelerated. In fact, an accelerated exploration program is the best defence
against a potential predator (the neighbour to the north, for example), especially if one is
confident in the exploration model and the ability to build resources. Extract had A$20.5
million in its treasury at the end of December, but additional funds would surely be
available from the market to accommodate an accelerated program.

An analyst has visited the properties held by Extract Resources Limited. Partial payment
or reimbursement was received from the issuer for the related travel costs.

Investment risks
The commercialization risks associated with mineral exploration and development are
high; thus, investment in the shares of Extract Resources Limited is for risk accounts only.

4 March 2009

DRILL BITZ
The Drill Bitz section is designed to provide the reader with a very quick overview of
juniors that have announced drill programs in the past week. The intent of this data is to
identify those juniors that may provide news in the near future and also to allow us to
track turnaround time from the initiation of drilling to first results. The old adage that
good news travels fast will be under the microscope. The layout of Drill Bitz will remain
constant. We will provide a short one- to two-line description of the program planned, as
well as the company ticker, shares issued, market capitalization and the name and
Source: www.Forsur-tools.com
location of the project.

Figure 24: Drill Bitz for February 23 to March 3, 2009

Sh o/s Price $ Mkt. Cap.
Co name Ticker Exch. M Mar 2/09 $M Project Description
Alix Resources Corp. AIX TSX-V 41.3 0.14 5.8 Manitoba Coal Set to commenced drilling. 12 drill
Geo Minerals Ltd. GM TSX-V 28.4 0.12 3.4 Property/Manitoba holes planned.
Bell Copper Corp. BCU TSX-V 75.4 0.06 4.5 Brown Cu-Mo Commenced drilling with three drill
Project/Mohave County, holes planned.
Arizona
CanAlaska Uranium Ltd. CVV TSX-V 137.7 0.14 19.3 Fond du Lac Uranium Ongoing infill drilling, six holes
Property/Athabasca completed to date.
basin, Saskatchewan
Cartier Resources Inc. ECR TSX-V 19.4 0.20 3.9 Dieppe-Collet; La Pause Initiating a 5,000 metre diamond
& Kinojevis Au drill program.
Properties/Québec
Cornerstone Capital Resources Inc. CGP TSX-V 74.8 0.06 4.5 Little Deer Cu Commencing drilling. Budget set at
Property/north-central C$900,000 for the exploration
Thundermin Resources inc. THR TSX-V 68.8 0.10 6.5
Newfoundland program.
Exeter Resource Corp. XRC TSX-V 50.3 2.70 135.8 Capische Au-Cu Ongoing drilling. Recently raised
Property/Chile funds will increase the drilling
program from 9,300 metres to
12,000 metres.
Merrex Gold Inc. MXI TSX-V 62 0.21 13.0 Siribaya Gold 2009 Exploration Program set to
Project/West Mali commence with 5,000 metres of
diamond drilling. Budget: C$3.0
million.
Nevada Copper Corp. NCU TSX 41 0.26 10.5 Pumpkin Hollow Cu Ongoing drilling.
Property/Nevada, US
Pitchstone Exploration Ltd. PXP TSX-V 33.4 0.21 6.8 Gomboot, Darby-Candle Drilling continuing. Six holes in over
Uranium 4,000 metres completed to date.
Property/Athabasca
Basin, Saskatchewan
Planet Exploration Inc. PXI TSX-V 25.3 0.22 5.6 Sidace Lake Au Ongoing drilling. 14 holes
Property/Red Lake, completed to date.
Goldcorp Inc. (Red Lake Gold Mines) PXI TSX-V 729.6 0.22 160.5
Ontario
Polar Star Mining Corp. PSR TSX-V 59.3 0.30 17.8 Montezuma Cu Commenced RC drilling. 4,000-
Project/Sierra Limon 5,000 metres of drilling in 16-20
Verde District, Chile holes.
Ventana Gold Corp. VEN TSX 68.8 1.05 72.2 La Bodega Au Set to commence a 3,400 metre
Property/NE Colombia drill program.
Westar Resources Corp. WER TSX-V 34.9 0.23 8.0 Tobin Lake Coal Commenced drilling. Currently
Property/Hudson bay, drilling on the first hole.

Source: Thomson ONE, Stockwatch, Canaccord Adams

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