On May 7, 2007, the Company entered into a Property Financing and Operating Agreement (the "Agreement"), dated for reference April 30, 2007, with Allied Minerals ("Allied"), a company incorporated under the laws of the Federal Republic of Nigeria. Pursuant to the Agreement, which is attached to this Current Report as an Exhibit, Allied granted the Company the exclusive right and option (the "Option"), to acquire an initial and undivided 65% beneficial and economic interest in and to certain mineral licenses, claims, concessions or reservations situated in Nigeria (collectively, the "Property"), as more fully described in the Agreement.

Under the terms of the Agreement, the Company has a forty-five (45) day due diligence period (the "Due Diligence Period") starting on the effective date of the Agreement (April 30, 2007), during which Due Diligence Period the Company will have access to Allied's books, records and properties to make such investigation as the Company considers advisable to enable the Company to determine whether to proceed with the Option. On or before the last day of the Due Diligence Period, the Company may elect in writing to proceed with the Option (such written notice, the "Notice to Proceed"). If the Company does not provide Allied with such Notice to Proceed, the Agreement shall be treated as being at an end and of no further force and effect.

If the Company provides Allied with the Notice to Proceed, under the terms of the Agreement, the Company will be deemed to have exercised the Option (the "Exercise"), and shall be entitled to an undivided initial 65% beneficial and economic interest in and to the Property, provided that the Company:

Under the terms of the Agreement, the Company and Allied have agreed that, among other things, after Exercise, each of them will use their respective reasonable commercial efforts to ensure that (i) Stacey Kivel (one of the Company's current directors and its current Head of Development) becomes the Company's full-time President and Chief Executive Officer and (ii) each of the Company and Allied will have the right to appoint one representative to the Board of Directors of the other party.

Also under the terms of the Agreement, after Exercise: (a) the Company will be the operator of the Property and (b) the Company and Allied will establish a Management Committee to determine overall policies, objectives, procedures, methods and actions under the Agreement with a view to bringing the Property into commercial production as a mine. With effect from Exercise until the commencement of commercial production of the Property, if any, the Company will be required to contribute 100% of all costs with respect to the Property. Following commencement of commercial production, if any, the net profit interests will be 35% for Allied and 65% for the Company until such time as the Company has recouped 175% of its preproduction and production costs, after which the Company shall be entitled to receive 52% of all cash flow from the Property and Allied shall be entitled to receive 48% of all cash flow from the Property. In addition, if and when the Company has recouped 175% of its costs as set forth in the previous sentence and commercial production reaches 250 tons of mineral product per day, the Company will issue to the order and direction of Allied 250,000 fully paid and non-assessable shares from the Company's treasury.