A N N U A L R E P O R T responsible. growth

Transcription

1 A N N U A L R E P O R T responsible growth

2 Contents milestones 2 PRESIDENT S MESSAGE PHILIPPINE COPPER-GOLD SYSTEMS 6 BATANGAS PROJECTS 8 Resources and Multiple Targets in a well-mineralized Copper-Gold Belt 10 Archangel Project and Kay Tanda 11 Archangel Project 20 Calo Prospect 22 El Paso Prospect 24 Talahib Prospect 24 SW Breccia Mineral Resource 24 PAN DE AZUCAR PROJECT 26 SURIGAO PROJECTS 28 Mindoro In The Surigao District 29 Agata Nickel-Iron Laterite Project 32 Agata Project 34 Tapian San Francisco Project 36 Tapian Main Project 37 Mat-I Project 37 Bolobolo Prospect 37 COMMUNITY RELATIONS AND SOCIAL RESPONSIBILITY 38 ENVIRONMENTAL RESPONSIBILITY 40 IN MEMORIAM JOE DE GUZMAN 42 corporate directory 43

3 responsible growth Annual Report 2006 p.

4 MILESTONES APRIL 2006 $2,724,844 raised from non-brokered private placement. MAY 2006 Mindoro joint ventures Apical Gold Project with Medusa Mining Limited of Australia. Mindoro acquires right to 15 percent interest in Apical Project subject to Medusa meeting its earn-in requirements. Kay Tanda drilling intersects 9.31 g/t gold over ten meters, including a bonanza-grade intercept of g/t gold over one meter. Strong porphyry copper-gold related alteration is encountered in all holes immediately below the gold-silver zone. JUNE 2006 Kay Tanda and Pulang Lupa drilling intersects 3.73 g/t gold over six meters and 1.22 g/t gold over 36 meters. JULY 2006 Gold mineralization extended 50 meters beyond previously known limits at Kay Tanda as drilling returns 0.52 g/t gold over 32 meters and 0.66 g/t gold over 34 meters. SR Metals signs confidentiality agreement on Agata nickel laterite prospect. AUGUST 2006 Doug Frondall, CA, and Robert Sarcher, MBA, are appointed to the board of directors. A diamond drill rig is mobilized to Kay Tanda to collect larger diameter core samples for metallurgical testing. Reverse circulation drilling expands Kay Tanda-Pulang Lupa gold zones and encounters high-grade mineralization with 6.96 g/t gold over six meters, and 1.47 g/t gold over 28 meters. Mindoro receives $100,013 from the exercise of purchase warrants. Mindoro retains Argentuminvest GmbH to provide marketing and investor relations services in Europe. SEPTEMBER 2006 First metallurgical drill hole at Kay Tanda encounters porphyry copper-gold related alteration and mineralization near bottom of the hole. Kay Tanda gold mineralization extended another 50 meters beyond previously known limits as reverse circulation drilling encounters 1.19 g/t gold over 76 meters, including 5.79 g/t gold over six meters and 4.46 g/t gold over six meters. OCTOBER 2006 Calo exploration permits received; Secretary Reyes, of the Philippines Department of Environment and Natural Resources states: The issuance of these new permits sends a clear signal to investors that the government s revitalization program for mining is on track and we want serious investors with corporate social and environmental responsibility. Third metallurgical core hole at Kay Tanda ends in porphyry related alteration. High-grade gold of 3.45 g/t gold over 64 meters intersected at Kay Tanda, including 9.76 g/t gold over 20 meters. Data reinterpretation indicates the Kay Tanda target area is much larger than previously recognized, with an associated induced polarization chargeability anomaly of 1.5 kilometers by 1.4 kilometers in extent. Greater than 99.9 percent of purchase warrants due to expire on October 15 are exercised, with the Company receiving a total of $2,931,052, plus $230,000 from purchase warrants expiring on October 12. NOVEMBER 2006 Diamond drill hole four at Kay Tanda passes through high-grade gold feeder zone into base metal mineralization and ends in porphyry-related alteration mineralization. Major program of geophysical surveying is completed over the Calo porphyry copper-gold prospect defining an unusually large and intense induced polarization chargeability anomaly of at least three by six kilometers, within a very favourable geological setting. Mindoro receives a total of $226,506 from the exercise of purchase warrants due to expire on November 22. p.2 MINDORO RESOURCES LTD.

5 responsible growth DECEMBER 2006 Drilling extends gold mineralization at Kay Tanda another 100 meters to the north-east and 50 meters to the north-west beyond previously known limits, intersecting 0.47 g/t gold over 62 meters and 0.86 g/t gold over 14 meters, respectively. Asian Lion fund invests $2,299,500 in Mindoro; President of Asian Lion, Mr. Howard Walker, states, Mindoro has outstanding exploration potential for the discovery of major epithermal gold and porphyry copper gold systems in the Philippines. JANUARY 2007 Mindoro closes the final tranche of its private placement with $1,050,000 received from an institutional investor. Preliminary drill program of 3,500 meters in six drill holes commences on Calo porphyry copper-gold prospect with the objective of vectoring into mineralization centers. Infill drill holes establish internal continuity of mineralization at Kay Tanda with 1.61 g/t gold over 64 meters, including 2.35 g/t gold over 36 meters, and 0.69 g/t gold over 92 meters including 2.13 g/t gold over 12 meters. FEBRUARY 2007 Further promising drill results from Kay Tanda with 1.53 g/t gold over 58 meters, including 3.05 g/t gold over 24 meters; 3.43 g/t gold over 28 meters, g/t gold over eight meters; and 0.72 g/t gold over 124 meters, including 2.58 g/t gold over 12.3 meters. MARCH 2007 Mindoro signs agreement to purchase joint venture partner s forty percent interest in the Surigao Projects in Northern Mindanao, bringing Mindoro s total interest to 75 percent. Five coring rigs commence drilling the Agata nickel laterite prospect with the objective of defining a NI compliant resource and advancing the deposit towards a production goal of Metallurgical tests report very high gold and silver recoveries from both the oxide and mixed oxide and sulphide mineralized material from Kay Tanda, with 93.4 percent of the contained gold leached in 48 hours from the oxide material and 88.6 percent of the gold leached from the mixed material. EXPLORATION ON MINDORO S PROPERTIES IS CARRIED OUT UNDER THE SUPERVISION OF TONY CLIMIE, P.GEOL., WHO IS A QUALIFIED PERSON AS DEFINED BY NATIONAL INSTRUMENT , AND PRESIDENT OF MINDORO. ANNUAL REPORT 2006 p.3

6 PRESIDENT S MESSAGE 2006 OVERVIEW The past year has been an exciting and exceptionally busy one for us, as we have been fast-tracking both the Kay Tanda gold-silver and Agata nickel laterite prospects towards economic evaluation and potential near-term development. At the same time, important advances were made in the evaluation of our large portfolio of porphyry copper-gold prospects. Metal prices and markets remain very strong, with no sign of any let-up as China, India and other Asian countries continue their frenetic pace of development, making the nearby resource-rich Philippines an especially attractive country for metals exploration and development. On the corporate front, over six million dollars was raised from two financings which included investments by the prestigious mining investment fund Asian Lion of Australia and a large U.S. based investment fund. KAY TANDA- APPROACHING FEASIBILITY STAGE During the past year we carried out a major resource delineation program on the Kay Tanda epithermal gold silver prospect, drilling over 21,000 meters in 162 drill holes. We have outlined a large area of near-surface, low-grade gold-silver mineralization, extending over at least 700 meters by one kilometer in extent, and which is still open in several directions. Kay Tanda is actually just part of a six kilometer trend of strong geophysical anomalies, gold and copper showings and hydrothermal alteration, with high potential for additional discoveries of epithermal gold silver and related porphyry copper-gold deposits at depth. At the time of writing, Golder Associates had been commissioned to carry out a preliminary geostatistical resource estimate for Kay Tanda which will form the basis of a full NI resource estimate, leading to an economic evaluation of the project s openpit, heap-each potential. Metallurgical testing has given positive results for both oxide and mixed oxide and sulphide material with high recovery rates and short leach times. Environmental studies have commenced and suitable locations for heap-leach pads are being evaluated. AGATA NICKEL LATERITE- FAST TRACK TO PRODUCTION Prices and demand for nickel are at an all time high, and this situation shows no signs of abating in the foreseeable future. Not only is the Philippines richly endowed with nickel laterite deposits, but it is in an ideal location to supply the near-by markets in China, Japan and Korea. This proximity translates into low shipping costs and other competitive advantages. As a consequence, the nickel-iron laterite prospect on our Agata project has been catapulted into the limelight for us and has become an important component in our future, and strategic planning. PHOTO: President Tony Climie (left) with Chairman Dr. Gerhard Kirchner. Section p.4 MINDORO Title p.4 RESOURCES LTD.

7 responsible growth More than ten organizations have approached Mindoro with expressions of interest to either joint venture development of the Agata nickel laterite, or to take product from it. Mindoro has taken the strategic decision to advance the project itself. Drilling commenced in March, 2007, with five coring drill rigs. Initial objective is to block out sufficient resources for three to five years production of direct shipping grade material*. It is expected that drilling will be completed, and a NI compliant resource estimate commenced by late April, Work on an Environmental Compliance Certificate has commenced. The project is just one kilometer from tidewater and investigations of the potential mine road access to the coast have also commenced. Preliminary marketing studies and environmental permitting have commenced. Target production date is the first half of The initial drill program and Exploration Target covers less than 20% of the area of nickel laterite mineralization mapped to date at Agata and the longer term objective is to expand this resource, and mine life, once production has commenced. This is an important step in our Company s growth. The very high demand for ferro-nickel feedstock for stainless steel production in our region, and high nickel prices, presents a great opportunity to get our Agata Project into production fast, and to generate early cash flow. Uniquely, direct shipping-grade nickel laterite deposits offer a low-capital cost and rapid route to production and cash-flow. RE-ACQUISITION OF 40 PER CENT INTEREST IN SURIGAO PROJECTS Through a purchase agreement, we recently re-acquired the 40 per cent interest in the entire Surigao land package earned by Canadian company Panoro Minerals Ltd. This makes excellent sense for us. Prior to this purchase, Mindoro had already negotiated the right to acquire an additional 22.5 per cent interest from our Philippine partner, effectively giving Mindoro control of the entire Surigao joint venture package. Because of the increasing importance of the Agata nickel laterite prospect due to booming nickel demand and prices, the potential cash flow from this project has become increasingly attractive to Mindoro. In addition to the huge technical potential of the Surigao District, an additional important factor in our strategic decision was the recent deal reached between Anglo American and Manila Mining Corporation to explore and advance the Kalayaan [Bayugo] porphyry copper-gold prospect next to the Anglo American-Philex Boyongan copper-gold deposit. This will likely open the road for the Surigao District to become a major copper-gold camp. Mindoro now has a direct 75% interest in the Surigao Projects and the right to increase this to 100% at feasibility. With its large land position, Mindoro is extremely well-placed to become a major participant in the development of nickel laterite and porphyry copper-gold deposits in the emerging Surigao District. PORPHYRY COPPER-GOLD TARGETS While the Kay Tanda gold-silver and Agata nickel laterite prospects offer high potential to generate cash flow in the short term, we have over twenty high potential porphyry copper-gold targets in our three project packages; Batangas, Pan de Azucar and Surigao; porphyry copper-gold deposits are the elephants we seek in the Philippines. At Batangas, Mindoro has already drill-intersected porphyry copper-gold mineralization at the Pica Prospect, on the margins of the giant Calo target, where early stage drilling has given positive indications. Drilling at Kay Tanda has also given encouraging indications of porphyry mineralization below. In Surigao, during 2006 porphyry-related mineralization was drill intersected at Tapian San Francisco, and is believed to have a source a short distance to the east. This will be followed-up by further drilling. At Agata, where porphyry copper-gold mineralization had been intersected by Mindoro in 1999, and not yet followed up, operational difficulties due to bad ground prevented two other porphyry targets from being drill tested. We will overcome the technical problems and drill-test the promising cluster of porphyry targets at Agata. * The potential quantity and grade of the Exploration Target described is conceptual in nature, that there has been insufficient exploration to define a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource. Until a feasibility study has been completed there is no certainty that the Company s projections will be economically viable. INSTITUTIONAL INVESTMENT As part of over six million dollars raised through private placements in the past year, Mindoro was pleased to secure investment from the newly created Asian Lion fund. A strong record of environmentally and socially responsible programs is a pre-requisite for Asian Lion investments; as the first investment completed by the Asian Lion Fund, we were pleased with the confidence expressed in both Mindoro and the Philippines. Following the Asian Lion investment, a large U.S. based institutional investor became the second significant fund to back Mindoro. These investments will allow Mindoro to continue to advance an aggressive strategy of drilling multiple projects, while further strengthening our social and environmental commitments. A WORD OF THANKS It is with sincere gratitude that I acknowledge our loyal employees in both Canada and the Philippines. We have achieved our many successes as a result of their hard work and dedication. My thanks also to the board of directors for their guidance and to our shareholders who have continued to support the company and believe in our goals. Tony Climie, President and CEO ANNUAL REPORT 2006 p.5

8 PHILIPPINE COPPER-GOLD SYSTEMS PHILIPPINE COPPER-GOLD SYSTEMS: A TELESCOPING OF EPITHERMAL INTO PORPHYRY MINERALIZATION The Model The Philippines is located in the Pacific Ring of Fire, the circum- Pacific belt of volcanic activity which contains much of the world s copper-gold resources. Philippine gold-copper systems are especially attractive targets because they are characterized by the telescoping of high-level epithermal gold deposits into the top of porphyry copper-gold systems. The model on the opposite page illustrates a typical Philippine copper-gold system. Epithermal gold-silver mineralization, with varying amounts of base metals such as copper, lead and zinc, occurs at shallow levels in the earth s crust. As shown in our model, epithermal deposits may occur as flat-lying bodies in volcanics, such as Mindoro s Kay Tanda prospect, or as more steeply-dipping tabular zones, similar to Mindoro s SW Breccia gold resource, and the abundant gold occurrences on many of Mindoro s projects. High grades of more than five grams per tonne (g/t) gold are common, making epithermal deposits particularly attractive targets for a junior company. Some of the larger Philippine epithermal gold deposits have produced several million ounces of gold (e.g., Antamok Mine, Baguio, produced ten million ounces). Epithermal deposits are usually derived from, and related to, intrusive rocks 2-3 kilometers below which may be associated with porphyry copper-gold mineralization. High-sulphidation epithermal mineralization and associated advanced argillic alteration are especially good indicators of a nearby porphyry copper-gold system. Porphyry copper-gold deposits are generally low-grade, but largetonnage, often over 100 million tonnes and to a billion tonnes or more, and contain very large amounts of copper and gold which are potentially bulk mineable. They provide over 50 percent of the world s copper production. Porphyry systems have zoned alteration systems which are an important exploration guide to the best copper-gold mineralization within them (see model). Worldwide, productive porphyry systems average about 0.5 percent copper and 0.30 g/t gold. In the case of the Philippines, gold content can be much higher, as much as one g/t or more, which makes Philippine porphyry deposits especially attractive exploration targets. Porphyry deposits often occur in clusters, such as the Anglo-Philex Boyongan and Bayugo porphyry deposits, situated just a few hundred meters away from each other in the Surigao Gold District of the Philippines. PHOTO: Geologist Sheila Redoblado logging Kay Tanda drill core. p.6 MINDORO RESOURCES LTD.

9 responsible growth In the Philippines, uniquely, the shallower level epithermal deposits often relate to a younger epithermal event telescoped into the upper parts of the porphyry system. The original epithermal mineralization of the copper-gold system has been long since eroded away, and the deeper porphyry has been eroded down to levels that bring the economically interesting parts of the porphyry system to shallower levels. The younger epithermal mineralization is either formed very late in the development of the copper-gold system, or it relates to a younger copper-gold system that has occupied the same structural (fault) conduits. The significance of this is that we may be exploring epithermal gold prospects, Mindoro s original exploration target, yet know we have a good chance of having a porphyry copper-gold system not far below, and in many cases on our projects, within just a few hundred meters. In fact, most of the gold prospects being explored by Mindoro have evidence of nearby porphyry systems, including porphyry-related hydrothermal alteration. Frequently, phyllic or SCC (sericite-clay-chlorite) alteration, is identified very close to our epithermal showings (see model below). This realization explains the rapid transition we have made from exploring early-stage epithermal gold prospects to an extraordinarily large portfolio of porphyry copper-gold targets, at, or very near the drill stage. High-grade epithermal deposits are attractive exploration targets, but the porphyry copper-gold deposits below are the real elephants we seek. Recognising and Defi ning Porphyry Copper-Gold Targets Since porphyry copper-gold systems are primarily concentrations of metal sulphides; iron sulphides (pyrite) and copper-iron sulphides (chalcopyrite and bornite), often with accompanying magnetite and silica (quartz) alteration, they are highly amenable to geophysical exploration. The metal sulphides and silica are detected by electrical methods; i.e., induced polarization (IP) surveys, with high chargeability readings defining sulphides, and high resistivity readings, areas of silica alteration. Magnetic surveys can be used to define hydrothermal magnetite associated with porphyry systems. IP is a powerful tool in defining porphyry targets. In the past few years, Mindoro has carried out over 500 line kilometers of IP surveys, and defined many promising anomalies to be drill tested. As shown in the model, porphyry systems are accompanied by zoned hydrothermal alteration systems which can be mapped and allow the system to be defined, and help vector drilling into the best-mineralized parts of the system (which are normally in the potassic zone, and in over-printing SCC alteration). Stream sediment and soil geochemical surveys may be useful in defining the location and extent of copper-gold systems. As noted above, epithermal mineral showings are an important exploration guide and, especially, high-sulphidation epithermal copper-goldsilver mineralization and associated advanced argillic alteration, which often indicate proximity to a porphyry copper-gold system. The porphyry copper-gold targets referred to in this report have been defined by IP surveys, and porphyry-related alteration, as well as associated epithermal mineral showings. PHILIPPINE COPPER-GOLD SYSTEM ANNUAL REPORT 2006 p.7

10 p BATANGAS PROJECTS 32,292 HECTARES

11 p.9

12 BATANGAS PROJECTS RESOURCES AND MULTIPLE TARGETS IN A WELL-MINERALIZED COPPER- GOLD BELT ARCHANGEL PROJECT AND KAY TANDA RESOURCES AND MULTIPLE TARGETS IN A WELL- MINERALIZED COPPER-GOLD BELT Mindoro acquired the Lobo and Archangel Projects in the Batangas District of Luzon Island in December 2000, under an agreement with Egerton Gold Philippines Inc., a private Philippines company. Mindoro may earn a 75 percent interest in the Batangas Projects through phased exploration expenditures, issues of shares, and by taking one of the projects (either Lobo or Archangel) to the feasibility stage. Lobo and Archangel are each held under a Mineral Production Sharing Agreement (MPSA), which is a legally binding contract with the Philippine Government allowing for mineral exploration and development. Early work in the Batangas District was so encouraging that Mindoro has since increased its tenements and tenement applications (under Exploration Permits) to over 32,000 hectares. These cover favorable geology and abundant epithermal gold-copper-silver showings, and several clusters of porphyry copper-gold prospects. The Batangas Projects, which include the original Lobo and Archangel Projects, are located within a well mineralized copper-gold belt. This belt includes the Taysan porphyry copper-gold deposit of Freeport McMo- Ran, adjacent to the Mindoro projects, as well as the Dizon, Tapian, San Antonio and Mogpog porphyry copper-gold deposits, several of which have been mined. The summary map of the Batangas Projects, on pages 8 and 9, shows the tenement situation and main prospects defined to date. Of particular note are the areas of high chargeability (reflecting metal sulphides) defined to date which are shown in yellow and red. These cover a remarkable area within Mindoro s tenements, indicating the widespread and strong alteration and mineralizing processes which have operated in the Batangas District. Many mineral showings are as yet un-surveyed by geophysical surveys (induced polarization) and it is expected that even more chargeability anomalies will be discovered as work progresses. The main focus of Mindoro is advancing the Kay Tanda gold-silver project towards production and evaluating the high potential Calo porphyry copper-gold target. However, several other Batangas prospects also offer great promise, especially porphyry copper-gold targets at Archangel, El Paso and Talahib. PHOTO: Chief Geologist Bail Lab-oyen examining gold-mineralized hydrothermal breccia at Kay Tanda. p.10 MINDORO RESOURCES LTD.

13 responsible growth ARCHANGEL PROJECT AND KAY TANDA The Archangel Project: Gold-silver Resource Delineation in Progress The Kay Tanda epithermal gold-silver prospect occurs on the Archangel Project, a granted Mineral Production Sharing Agreement. Geology of Archangel consists of pervasively altered volcanics intruded by andesitic, dioritic and dacitic intrusives, and overlain by younger cover volcanics to the northwest. A cluster of gold-silver and porphyry copper-gold prospects has been outlined along a strong northeast structural trend of at least six kilometers, which is open to the northeast. Extensive phyllic, SCC (sericite-clay-chlorite) alteration, characteristic of porphyry copper-gold-related mineralization, along with abundant copper showings, occur along the six kilometer trend. Superimposed on this at higher elevations are areas of advanced argillic and argillic alteration which are interpreted as being upflow zones and which may indicate proximity to porphyry centers below. Near-surface zones of low-sulphidation epithermal gold-silver mineralization, including Kay Tanda, have been telescoped into the advanced argillic alteration and are interpreted to reflect especially fertile and metalliferous porphyry systems below. The main features are shown on the Archangel Compilation on page 13 and in the 3-Dimensional Model on page 12. These illustrate the extent of the chargeability anomaly (indicating metal sulphides), plus epithermal gold silver zones as mapped at surface, and zones of advanced argillic alteration. The latter can be especially important guides to porphyry copper-gold systems nearby. Kay Tanda: Geology and Mineralization As drill-defined to date Kay Tanda, and contiguous Pulang Lupa sub-zone, are extensive near-surface lobes of epithermal goldsilver mineralization near the southern end of the Archangel trend. Recent drilling has indicated that Kay Tanda and Pulang Lupa are actually connected at depth and form part of a very large area of low-grade, near-surface gold-silver mineralization which extends over at least one kilometer and up to 800 meters wide. Kay Tanda is still open in several directions. Low sulphidation epithermal gold-silver mineralization at Kay Tanda is associated with extensive and intense quartz stockworks, hydrothermal breccias, with accompanying base metal sulphides, emplaced into permeable flat-lying andesitic and dacitic flows and tuffs and volcanic breccias, and intruded by high-level andesitic porphyry, diorite, quartz dirorite and dacite stocks, dykes and sills. The gold and silver mineralization is associated with quartz veins, stockworks, open space fills and swarms of hydrothermal breccias. The mineralization includes disseminated and veinlet pyrite, chalcopyrite, galena, sphalerite and some molybdenite mineralization. The latter may indicate proximity to underlying porphyry coppergold mineralization. Total sulphide content is generally less than five percent. The Kay Tanda epithermal mineralization was telescoped into an area of intense, high- temperature advanced argillic alteration, itself telescoped into intermediate argillic, phyllic, and SCC (sericite-clay-chlorite) alteration types, which are believed to be related to a porphyry copper-gold system below. This appears to conform closely to the copper-gold model illustrated on page 7. Kay Tanda is reflected by an induced polarization chargeability anomaly that is about 1.5 kilometers by 1.4 kilometers in extent, and which forms part of the much larger Archangel chargeability anomalies extending over at least six kilometers along strike. Less than 25 percent of the chargeability anomaly at Kay Tanda has been drill-tested to date. ANNUAL REPORT 2006 p.11

14 BATANGAS PROJECTS Kay Tanda: Drill Resource Evaluation Mindoro has completed 150 reverse circulation and twelve core holes, for a total of over 21,000 meters, at Kay Tanda. Almost all holes have encountered near-surface, generally flat-lying to gently-dipping blanket-like low-grade mineralization, which is partially to strongly oxidized to depths of 40 to 60 meters, passing through a mixed (transitional) oxide and sulphide zone, into a sulphide-only zone below. Drilling, especially at deeper levels, has encountered at least four steeper-dipping and much higher-grade zones, with bonanza grades to 100 g/t gold and over 1,000 g/t silver in places, which are interpreted as structurally controlled upflow, or feeder zones. Further drilling and structural studies are in progress to determine the nature and controls of the high-grade zones. The shallower mineralization is thought to be related to swarms of hydrothermal breccias, and prospect-scale quartz stockworking, with the high-grade material occurring preferentially at elevations below 150 meters (ASL) and within a boiling zone. Few holes have penetrated to this depth to date. Such upflow zones can be associated with bonanza mineralization and constitute some of the world s best epithermal gold-silver deposits. In the meantime, the economic potential of the extensive near-surface, low-grade mineralization is being evaluated for its open-pit, heap leach potential. Location of all drill holes to date is shown on the map on page 16 ( Kay Tanda Prospect Drilling Results Gold g/t X meters ). This shows distribution of gold values in grams per tonne (g/t) times intercept length in meters for each hole. Using a cut-off of 0.3 g/t gold, mineralization intercepts for each drill hole are summed and plotted in contour form. Mindoro considers the contoured areas defined by numbers greater than 15 (g/t gold x length of intercept) to be of particular interest. This map format illustrates the distribution of mineralization and provides information on mineralization centers, structural controls, as well as mineralization trends. Two cross sections are shown on page 17; one of Line 9,350N through the Pulang Lupa sub-zone (section line A to A ), and section line 9,750N through Kay Tanda (section line B to B ). The accompanying table summarizes the most significant drill results to date. The 3-Dimensional Model shown below illustrates the near-surface nature of the Pulang Lupa sub-zone (left) and Kay Tanda and relationship to topography. : A 3-Dimensional model of Kay Tanda showing drillholes and topography. p.12 MINDORO RESOURCES LTD.

15 responsible growth PHOTO: Batangas Projects technical team. ARCHANGEL COMPILATION ANNUAL REPORT 2006 p.13

16 BATANGAS PROJECTS ARCHANGEL PROJECT AND KAY TANDA Kay Tanda: Metallurgy The metallurgical characteristics of the ore are critical to the success of a mining operation. A comprehensive program of metallurgical testing has been embarked on at Kay Tanda. Preliminary bottle roll metallurgical test work carried out on historic reverse circulation samples, and reported on January 14, 2004, was largely positive. A second round of more extensive testing was carried out on a small bulk sample of oxidized material from a pit at Pulang Lupa. Results, which were reported in December 2005, were excellent, with high and rapid recovery of gold. This led to more detailed testing of large diameter drill core with the objective of evaluating heap leach characteristics of both near-surface oxide, and deeper mixed oxide / sulphide containing material. Samples were collected by large diameter (PQ) core drilling and submitted to Metcon Laboratories in Australia. The program was designed and supervised by an independent metallurgical consultant, Peter J. Lewis and Associates of Australia. Two series of testwork were completed on the two composites. The first test was a bottle roll test on composites at 80 percent passing a sieve at 75um. This test is required to indicate the maximum gold and silver recoveries obtainable and to compare with the recoveries obtained by the later heap leach testing. Very high gold and silver recoveries were obtained from both types of mineralized material. From the oxide material, 93.4 percent of the contained gold and 83.7 percent of the contained silver were leached and recovered in 48 hours. From the transition material (mixed oxide and sulphides) 88.6 percent of the gold and 87 percent of the contained silver were leached. These are unusually high recoveries, especially for the sulphide-containing material. Results to date suggest that the gold and silver occur in cracks and fissures, and not bound with sulphides, and, hence, very accessible to cyanide solutions. For the second round of testing, column tests (heap leach tests) were performed on a crush size of minus 12.7mm, i.e. 1/2 inch, which is close to the lower size limit normally used for heap leaching. Gold recovery from the oxide material after 17 days of leaching was 81.9 percent. Gold recovery from the transition material after 11 days was 90.8 percent. Silver recoveries were 32 per cent and 42 per cent respectively, which is good for silver. Both composites are, therefore, highly amenable to heap leaching. Because of the very encouraging results, a second test was commenced at a very coarse crush size of 50mm (two inch), since the coarser the crush, the lower the plant costs. This work was in progress at time of writing, and results will be reported on completion. Since the transition sample contained a high proportion of sulphide-related mineralization, and leached very well, a test will also be carried out on deeper, entirely sulphide-related gold and silver mineralization as well. p.14 MINDORO RESOURCES LTD.

17 responsible growth Mindoro management is most encouraged by the metallurgical results from Kay Tanda to date and considers these a strong basis for further evaluation of the project s economic potential. TOP PHOTO: KTDH-01 at 37 meters; Oxide facies mineralization at Kay Tanda. Quartz-iron oxide stockworks. From intersection grading 0.91 g/t gold over 79 meters. Kay Tanda: Plans Mindoro has commenced a detailed evaluation of the open-pit, heapleach potential of Kay Tanda. In March, Mindoro commissioned the highly regarded mining consulting group Golder Associates to carry out a geostatistical (indicator kriging) resource estimate for the near-surface zone at Kay Tanda. This is to give a first pass estimate of gold-silver content defined by drilling to date. This will be followed in the near future by a National Instrument resource estimate. In conjunction with this, environmental base line work is in progress and detailed metallurgical studies are well advanced. This work will lead to a scoping study and economic evaluation of the project later in MIDDLE PHOTO: KTDH-01 at 82 meters; Sulphide facies mineralization at Kay Tanda. Mineralized hydrothermal breccia cut by quartz-chalcopyrite-galena sphalerite mineralized vein breccias. From intersection grading 0.91 g/t gold over 79 meters. BOTTOM PHOTO: KTDH-04 at meters; Massive galena-chalcopyrite-sphalerite mineralization below gold-silver zone at Kay Tanda. From intercept of 14 meters grading 0.99 percent copper, 2.13 percent lead and 2.29 percent zinc. ANNUAL REPORT 2006 p.15

18 PHOTO: Chief Geologist Bail Lab-oyan at Kay Tanda KAY TANDA PROSPECT DRILLING RESULTS Gold g/t X meters p.16 MINDORO RESOURCES LTD.

19 KAY TANDA ASSAY RESULTS Cross Section Line 9,350N (0.3 g/t Au Cutoff) KAY TANDA ASSAY RESULTS Cross Section Line 9,750N (0.3 g/t Au Cutoff) ANNUAL REPORT 2006 p.17

20 BATANGAS PROJECTS TABLE OF SIGNIFICANT DRILL INTERSECTIONS - KAY TANDA From DIAMOND DRILLHOLES To Sample Length (m) Au g/t Ag g/t KTDH N : 9943E Direction: 140 Incl: Including KTDH N : 9895E Vertical Including KTDH N: 10000E Direction: 140 Incl: Including PLDH N : 9550E Direction: 140 Incl: Including REVERSE CIRCULATION (RC) DRILLHOLES KTRC N : 9900E Vertical Including KTRC N : 9805E Vertical Including Including KTRC N : 10092E Direction: 140 Incl: From To Sample Length (m) Au g/t Ag g/t KTRC N : 9852E Direction: 320 Incl: Including KTRC N : 9953E Direction: 140 Incl: Including KTRC N :9701E Vertical Including KTRC N : 9651E Vertical Including Including Including KTRC N : 9695E Vertical Including KTRC N : 9954E Direction: 140 Incl: Including KTRC N : 9600E Vertical Including KTRC N : 9600E Vertical Including p.18 MINDORO RESOURCES LTD.

21 responsible growth From To Sample Length (m) Au g/t Ag g/t KTRC N : 9938E Vertical Including KTRC N :10100E Direction: 320 Incl: Including KTRC N : 9950E Direction: 140 Inc Including KTRC N : 9855E Vertical N/R N/R N/R Including N/R N/R Including N/R KTRC N : 9650E Direction: 320 Incl: N/R N/R Including N/R N/R PLRC N : 9630E Direction: 140 Incl: < Including PLRC N : 9580E Direction: 140 Incl: Including PLRC N : 9530E Direction: 140 Incl: Including From To Sample Length (m) Au g/t Ag g/t PLRC N : 9486E Direction: 140 Incl: Including PLRC N : 9550E Vertical Including Including PLRC N : 9600E Direction: 140 Incl: Including PLRC N : 9575E Direction: 140 Incl: Including PLRC N : 9625E Direction: 320 Incl: Including PLRC N : 9575E Vertical Including <0.5 PLRC N : 9500E Direction: 140 Incl: Including PLRC N : 9500E Direction: 140 Incl: Including PLRC N : 9410E Direction: 140 Incl: Including ANNUAL REPORT 2006 p.19

22 BATANGAS PROJECTS ARCHANGEL PROJECT ARCHANGEL PROJECT: MULTIPLE PORPHYRY COPPER-GOLD TARGETS Strong chargeability and resisitivity anomalies have been defined semi-continuously along a northeast trend for over six kilometers. The anomalies are over one kilometer wide in places and are consistent with the reflection of multiple porphyry copper-gold cells at depth. The IP appears to define four separate porphyry centers at Kay Tanda, Ahit / Balibago, Marita and Bootin (see Archangel Compilation map on page 13). Detailed geological mapping along the Archangel copper-gold trend, as well as detailed independent petrological studies and PIMA clay analyses, confirm alteration types. Geological, geophysical and geochemical data have been integrated to define the following principal porphyry copper-gold drill targets along the six kilometer trend: Kay Tanda The extent and intensity of alteration and mineralization noted at Kay Tanda itself, strongly suggest porphyry copper-gold mineralization below, or nearby. Widespread phyllic, SCC alteration is overprinted by advanced argillic and argillic alteration with high temperature clays. Recent deeper drilling has intersected anhydrite and gypsum veining, characteristic of zoning close to porphyry mineralization, and in some places with chalcopyrite mineralization plus molybdenite. Grey quartz veinlets with chalcopyrite and some bornite mineralization have also been encountered in places at depth. Information from the current shallow resource delineation drilling of Kay Tanda is being compiled and interpreted and will lead to deeper drill testing of porphyry copper-gold targets at a later date. Ahit-Balibago At the southwestern end of Archangel, Ahit-Balibago is an 800 meter by 600 meter, high-chargeability anomaly with a coincident resistivity anomaly. Ahit Hill exhibits intense argillic and advanced argillic alteration, probably telescoped into the top of a porphyry system. PIMA clay analyses revealed prominent high-temperature potassic white mica (high-temperature illite). Extensive and strong copper-in-soil anomalies are associated with the alteration. In 2006, two reconnaissance diamond drill holes, 500 meters apart, were drilled to test the strong chargeability anomaly coincident with copper-oxide showings and quartz veining. The holes intersected dacite porphyry, diorite, and quartz diorite stocks intruding andesite and dacite volcanics. Porphyry-related alteration was intersected and varies from SCC (sericite-chlorite-clay) to phyllic (quartz-pyriteclay) overprinting propylitic alteration. Weak to moderate sulphides were intersected, including pyrite and minor chalcopyrite, covellite and bornite associated with galena and sphalerite. The holes PHOTO: Core drilling on Kay Tanda. p.20 MINDORO RESOURCES LTD.

23 responsible growth bottomed at 500 meters depth in the anhydrite-gypsum zone of the porphyry system, which is normally adjacent to the potassic mineralized core. The information will be used to target later drilling with a larger drill rig to vector into the mineralized porphyry center. Marita The Marita prospect is located northeast of Kay Tanda, and is a one kilometer by 700 meter, high-chargeability zone with a coincident high-resistivity anomaly. The area is underlain by volcanics intruded by dioritic to dacitic intrusives, capped and masked by young volcanic cover to the northwest. Alteration is phyllic, overprinted by intense argillic alteration. Detailed mapping, including analysis of fracture pattern, and trenching activities revealed strongly oxidized quartz-sulphide stockworks, in places with associated copper mineralization. A highly silicified and stockworked boulder contains disseminated chalcopyrite and assayed 9.92 g/t gold (surface-enriched). Independent consultant, Dr. Bruce Rohrlach, using PIMA data, summarized his findings, The Marita area is associated with a very distinctive circular zone of sericite alteration that is approximately one kilometer in diameter. Within this illite alteration lies an arcuate zone where illite occurs in association with jarosite. Jarosite is a common weathering product of pyrite and is seen in a number of porphyry systems that have extensive jarosite development in their leached caps. The arcuate jarosite zone defined by PIMA is broadly similar in shape and position to the arcuate core of the IP anomaly (>40 msec at n=3). Hence it is reasonable to suspect that the sulfides that define the core of the IP anomaly are also responsible for the jarosite development where they are oxidized at surface. Drilling is planned for later in 2007 or early Bootin Bootin is located about 1.5 kilometers north of Marita and is associated with high-chargeability and high-resistivity anomalies. The area is largely covered by young, cover volcanics with windows of phyllic-altered andesite, andesite porphyry and diorite. A hydrothermal breccia pipe with a matrix of fine pyrite and clay occurs on the northwest side of the prospect. Zones of argillic to advanced argillic alteration have been mapped and localized copper showings found. A grab sample from a north-northeast trending gougy fault assayed g/t gold. Drilling is planned for ARCHANGEL PROJECT Showing location of chargeability anomalies, epithermal gold-silver zones and advanced argillic alteration ANNUAL REPORT 2006 p.21

24 BATANGAS PROJECTS CALO PROSPECT CALO PROSPECT: AN UNUSUALLY LARGE AND INTENSE IP GEOPHYSICAL ANOMALY Calo is one of Mindoro s highest priority porphyry copper-gold targets. It covers an unusually large and intense IP chargeability anomaly, seven kilometers south of Freeport McMoRan s Taysan porphyry copper-gold deposit, and has abundant copper-gold and gold showings along its margins, as well as extensive porphyry-related alteration within a very favorable geological setting, and is bounded in the southeast by the Pica porphyry copper-gold system. Main features are shown on the Calo-Pica Compilation map on page 23. Porphyry copper-gold mineralization was discovered by Mindoro on the Pica Prospect in Pica occurs in a high range of hills on the Lobo Project and is associated with intense advanced argillic (silica cap) and intermediate argillic alteration at surface. A geophysical survey in late 2004 had defined chargeability anomalies extending over an area of approximately 1.5 kilometers by 2.5 kilometers, which was tested by four drill holes. The second drill hole intersected 213 meters at a grade of 0.18 percent copper, 0.30 g/t gold and 1.91 g/t silver from 22 to 235 meters, associated with phyllic alteration. It now seems apparent that Pica is just the southeastern edge of a much larger system. In the meantime, a cluster of low- and high-sulphidation epithermal copper-gold and gold showings were located in the far northwest of the Calo Prospect. This led to a major induced polarization (IP) and ground magnetic survey of 141 line kilometers, performed on 200 meter-spaced lines by Elliott Geophysics International Pty. Ltd of Australia. Background chargeability values are in the range of five to eight msecs. An area of at least seven kilometers by four kilometers of greater than 20 msecs has been defined, which encompasses zones of greater than 50 msecs, and includes values to as much as 100 msecs, and more. The Calo anomaly links with the Pica chargeability anomaly in the far southeast. The chargeability anomalies, which occur at the intersection of strong regional northwest to southeast, and northeast to southwest structural features, suggest large concentrations of metal sulphides below the younger cover volcanics, and which geological evidence suggests are related to a cluster of porphyry copper-gold centers. The area is extensively covered by young Quaternary volcanics and tuff which obscure large parts of the prospective underlying geology. However, in the northwest of the Calo prospect, erosion has exposed windows of altered andesite volcanics and small diorite intrusive stocks with areas of advanced argillic alteration covering several copper showings, and areas of phyllic and SCC (sericite-clay-chlorite) alteration. High-sulphidation epithermal copper-gold-silver mineralization associated with quartz veins and stockworks, and skarn-related mineralization have been located in these altered rocks, and are interpreted to indicate proximity to a porphyry system. PHOTO: Exotic copper showing, Calo Prospect. Secondary copper carbonates (green color) in volcanic breccia. Copper believed to have been transported in by ground waters from source associated with chargeability anomaly below. 30 meters at 2.61% copper. p.22 MINDORO RESOURCES LTD.

25 responsible growth Evidence that the sulphides defined by the IP survey relate to porphyry copper-gold mineralization include: the Pica porphyry copper-gold mineralization already drill-intersected by Mindoro on the far southeastern margin, the erosional windows of advanced argillic, phyllic and SCC (sericite-clay-chlorite), copper-stained, massive silica boulders, interpreted as porphyry system lithocap located in the southern part of Calo; abundant epithermal copper and gold showings occur along the western and eastern margins of Calo, and include high-sulphidation epithermal copper-gold-silver veins and skarn mineralization; the occurrence of a diatreme breccia. All are features characteristic of Philippine porphyry copper-gold systems. In addition, in the southwest part of Calo, outcrops of young volcanic agglomerate cover, with clasts cemented by supergene copper minerals and silica have been mapped over an area of 100 meters by 300 meters. Two trench channel samples gave 2.62 percent copper over 30 meters, and 2.17 percent copper over 20 meters. This exotic copper occurrence, typical of those associated with South American porphyry copper deposits, also implies a significant copper source in the underlying rocks. Drill-testing with a large diamond drill rig commenced in late Given the very large size of the target area, initial planning is for six drill holes in 3,500 meters as a preliminary test of the anomaly cluster. These will be widely-spaced holes, up to two kilometers apart, with the objective of vectoring into mineralization centers, and will likely be the start of a major ongoing program. As an illustration of the large target size to be evaluated at Calo, the Anglo American / Philex Gold Boyongan porphyry copper-gold deposit is shown on the Calo-Pica Compilation map to scale. CALO PICA COMPILATION ANNUAL REPORT 2006 p.23

26 BATANGAS PROJECTS EL PASO PROSPECT: ABUNDANT COPPER SHOWINGS AND TWO LARGE IP ANOMALIES The El Paso Prospect is located seven kilometers north of the Lobo Project, and twelve kilometers from the Taysan porphyry copper-gold deposit (see the 2006 Batangas Projects map on pages 8 and 9). Main features of El Paso are shown on the El Paso Compilation on page 25. El Paso is immediately north of the major west-northwest-trending structural boundary that separates older northeastern batholithic terrain (San Juan Diorite), and the younger southern volcanic terrain. This major boundary is an especially favorable structural setting which served to localize mineralizing intrusions, including Taysan. The area is underlain largely by San Juan Diorite with islands of metavolcanics, intruded by younger quartz diorite porphyry and andesite porphyry intrusions, and overlain in places by younger Quaternary volcanic tuff. Extensive porphyry-related phyllic and intermediate argillic alteration has been mapped, as well as potassic alteration in places. Widespread copper-gold mineralization occurs associated with the younger andesite porphyry intrusions, as well as the older, more-eroded San Juan Diorite. The mineralization associated with the former is the principal target. In the southwest part of the El Paso prospect, copper mineralization had been known historically and was tested with shallow drill holes by a previous operator in the mid-nineties. Results are unknown. However, the area tested by drilling is not associated with significant IP anomalies and is considered to represent copper mineralization on the periphery of the porphyry copper-gold system. Subsequent reconnaissance IP surveys by Mindoro defined two large and strong chargeability anomalies, known as Calantas and Mulawin, approximately two kilometers east of the copper showings. Each is about two kilometers by one kilometer in extent with chargeability values ranging from 20 to over 50 msec, against a background of four to eight msec. A thin cover of volcanic ash obscures much of the area, but scattered outcrops indicate geology consists of stocks of younger fine-grained, quartz diorite and andesite porphyry intruding metavolcanics. Independent petrology confirms that alteration consists of quartz-sericite-chlorite and sericite-clay-chlorite. These alteration assemblages are common to Philippine porphyry systems and are usually transitional to the core potassic zone at depth. The petrology also confirms the presence of quartz veining with magnetite and the copper minerals chalcopyrite and bornite. A channel sample from the metavolcanics yielded 0.24 percent copper over 15 meters. This suggests the strong chargeability anomaly below is of considerable potential. High molybdenum values of 806 parts per million (ppm) over a ten meter trench are associated with an andesite porphyry stock at Calantas, and also suggest a porphyry source. Drill testing is planned later in 2007 or 2008, once ground work has been completed and priority drill targets defined, subject to receipt of an exploration permit, which is in the final stages of approval. TALAHIB PROSPECT: A PROMISING PORPHYRY PROSPECT BEING BROUGHT TO THE DRILL STAGE The Talahib prospect is located about eight kilometers west of Lobo Project and eleven kilometers southwest of the Taysan porphyry deposit. Reconnaissance work has located significant copper and gold mineralization at Talahib. The prospect area is underlain by andesitic volcanics intruded by a series of phyllic and SCC-altered diorite and microdiorite intrusions, and capped in places with younger Quaternary tuff. Stream sediment sampling yielded strong anomalies to 650 ppm copper, 468 parts per billion (ppb) gold, 100 ppm lead and 327 ppm zinc. Reconnaissance rock channel sampling of heavily mineralized hydrothermal breccia assayed 3.33 percent copper and 0.10 g/t gold over 20 meters, which included 6.55 percent copper and 0.16 g/t gold over ten meters. About 200 meters south of this an outcrop of SCC-phyllic altered diorite gave 0.74 percent copper and 0.15 g/t gold over 30 meters. Another channel sample from phyllic-altered diorite outcrop 500 meters north of the hydrothermal breccia, assayed 1.04 percent copper and 0.09 g/t gold over 20 meters. Detailed ground geological and induced polarization surveys are planned for 2008, followed by drilling, subject to receipt of an exploration permit. SW BRECCIA MINERAL RESOURCE: A SMALL GOLD RESOURCE WITH GROWTH POTENTIAL Past work by Mindoro outlined from five to seven kilometers of northeasttrending epithermal vein/breccia trends on the Lobo Project. Mineralization along these epithermal trends occurs as both low-sulphidation gold and high-sulphidation copper-silver, with lesser gold, mineralization shoots. Two such mineralization shoots are SW Breccia, where Mindoro has drill-defined a near-surface gold resource, and the old Lobo Mine, where copper was mined during the 1960 s. High gold-copper-silver values occur at surface in a number of areas along these trends. There are likely other mineralization-shoots not exposed at surface that will require drilling to discover. At SW Breccia on the Camo Trend, a National Instrument compliant resource estimate was prepared during 2004, based on 25 shallow drill holes completed by Mindoro using a man-portable diamond drill rig. Indicated resources, to a depth of 130 meters, are 270,000 tonnes at a grade of 6.49 grams per tonne gold, containing 56,380 ounces of gold. Additional inferred resources are 61,000 tonnes at a grade of 5.35 g/t gold, containing 10,540 ounces of gold. The mineralization is believed to be open to depth and to the south-west along strike. At a later date, Mindoro plans to utilize a larger drill rig to extend the resource. p.24 MINDORO RESOURCES LTD.

27 responsible growth EL PASO COMPILATION TRENCH / CHANNEL RESULTS Trench No. Length (m) Cu (%) Au (g/t) Ag (g/t) Mo ( ppm) TRN < TRN TRN TRS TRS TRS TRS TRS TRS TRS <0.50 TRS TRS TRS TRS < TRS TAL CAL TR TR TR TR ANNUAL REPORT 2006 p.25

28 PAN DE AZUCAR PROJECT PORPHYRY MINERALIZATION YET TO BE DRILL-EVALUATED p.26 MINDORO RESOURCES LTD.

29 responsible growth PAN DE AZUCAR PROJECT: PORPHYRY MINERALIZATION YET TO BE DRILL-EVALUATED The Pan de Azucar MPSA covers 535 ha on Pan de Azucar Island and adjacent Panay Island. Under a 1997 agreement with a private Philippines company, Minimax Mineral Exploration Corporation, Mindoro may earn a 75 percent interest in the Pan de Azucar Project through phased exploration expenditures and issues of shares. Mindoro has earned a 40 percent interest to date and is negotiating an extension to its final Phase Three earn-in period. Geology and Mineralization The Pan de Azucar Prospect is located within a collapsed caldera structure, where the dacitic-andesitic caldera-fill package hosts pervasive replacement and structurally-controlled alteration and mineralization. Dacitic units are preferred hosts to mineralization. An epithermal, massive pyritic-sulphide deposit, the Valderama Zone, with low to moderate grade copper-gold-zinc-silver values was drill-intersected by Mindoro in 2001 and a porphyry coppergold target located at Asparin Hill in Valderama Zone: Massive Sulphide Mineralization A 2001 scout drill program, consisting of 1,041 meters, encountered promising copper, gold, silver and zinc values at shallow depths, for example, 37.1 meters of 0.8 percent copper, 1.87 g/t gold, and meters of 0.69 percent copper, 1.21 g/t gold, 4.34 g/t silver, and 0.63 percent zinc (true thicknesses). A second drill program in 2002, consisting of 431 meters, encountered lower, more irregular grades. The zone is open to the north for a further meters, to the property boundary, where gossanous outcrops are present. The Valderama epithermal replacement mineralization is believed to be related to an adjacent porphyry copper-gold system. Based on drilling to date, the Valderama Zone averages between 36 percent and 40 percent sulphur. Mineralization is near-surface, and a few hundred meters from tide water. It may, therefore, have potential for a low-cost sulphur source for sulphuric acid production for treatment of the numerous lateritic nickel deposits going into production in the Philippines and elsewhere in the region and for fertilizer production. Mindoro s main priorities, however, are the remaining Pan de Azucar copper-gold targets and Mindoro s projects elsewhere. Asperin Hill: Porphyry Copper-Gold Prospect A 45 meter drill hole was completed on the Asparin Hill target, approximately 700 meters west of the Valderama Zone, to test an area of gossanous quartz-alunite boulders, also site of the strongest geochemical anomalies on the project, a coincident circular topographic depression some 300 meters in diameter, and a broad magnetic anomaly. This intersected dacitic rocks with intense porphyryrelated alteration, including biotite alteration, plus disseminated and veinlet chalcopyrite mineralization. Both are characteristic of porphyry copper systems. Future work at Pan de Azucar will focus on the Asparin Hill porphyry copper-gold target and a partner will be sought to fund this work. ANNUAL REPORT 2006 p.27

30 SURIGAO PROJECTS MINDORO IN THE SURIGAO DISTRICT p.28 MINDORO RESOURCES LTD.

31 responsible growth MINDORO IN THE SURIGAO DISTRICT: A NICKEL PRODUCING DISTRICT AND EMERGING WORLD-CLASS PORPHYRY COPPER-GOLD CAMP The Surigao Gold District is an historic gold mining camp, where there are literally thousands of epithermal gold showings, prospects and small scale artisanal mines. Based on the recognized Philippine copper-gold model, porphyry copper-gold systems would be anticipated as well, and this was confirmed with the discovery in 2000 of the Philex Gold/Anglo American Boyongan Prospect. Subsequent drilling outlined a major porphyry copper-gold deposit with a disclosed resource estimate of 219 million tonnes at a grade of 0.51 percent copper and 0.74 g/t gold. Philex has announced that a second porphyry system has been discovered to the northwest of Boyongan, known as Bayugo, and possibly, a third porphyry system to the southwest. Australian junior Red 5 subsequently announced the discovery of a new porphyry copper-gold system just a few hundred meters along trend from Mindoro ground (see Mindoro in the Surigao District on pages 30 and 31). Two other porphyry copper-gold prospects also occur just to the north of Mindoro s Tapian San Francisco Project. The Surigao Gold District is attracting considerable international attention and is just beginning to undergo extensive exploration for new porphyry copper-gold deposits, as well as for epithermal gold deposits. Mindoro believes the Surigao Gold District will become a major copper-gold camp within the decade. The Surigao District also hosts abundant nickel laterite occurrences and has at least three producing nickel laterite mines. Mindoro commenced exploration in the Surigao District in 1997 under an agreement with Minimax Mineral Exploration Corporation, a private Philippine company. Under the agreement, Mindoro may earn a 75 percent interest in the Agata, Tapian San Francisco, Tapian Main and Mat-I Projects through phased exploration expenditures and issues of shares. To date, Mindoro has earned a 75 percent interest in the Agata, Tapian San Francisco, and Tapian Main Projects, and a ten percent interest in the Mat-I Project. Mindoro s total project area in Surigao is over 26,000 hectares. The granted tenements consist of an MPSA on Agata and Exploration Permits on Tapian San Francisco and Tapian Main, as well as MPSA and Exploration Permit applications that are undergoing normal processing on the remaining ground. This is believed to be the second largest land holding after the Philex-Anglo American joint venture. Between 2004 and 2006 Panoro Minerals Ltd. earned a 40 per cent interest in the Surigao Projects. For strategic reasons, Mindoro recently re-acquired that interest. Upon closing, as consideration for the purchase of the interest, Mindoro paid Panoro $750,000 cash plus 500,000 Mindoro Common shares; Mindoro will make a second payment of $500,000 cash plus 500,000 Common shares on the first anniversary of the closing. Furthermore, in the event that the nickel laterite prospect located on the Agata project should proceed to production and upon shipment of an aggregate one million tonnes of nickel laterite, Mindoro will pay Panoro $500,000 cash plus an additional $500,000 cash payment on the first anniversary of the shipment. Mindoro thus has a 75 percent interest in the Surigao Projects, and has the option to acquire a further 25 percent from its Philippine partner at feasibility stage, bringing its total interest to 100 percent if all options are exercised. Mindoro has a significant nickel-iron laterite prospect on the Agata Project, which has the potential to be advanced to production as early as 2008, and has defined multiple porphyry copper-gold and epithermal gold prospects on the Surigao Projects. LEFT PHOTO, OPPOSITE PAGE: Resource delineation drilling on Agata nickel laterite prospect. PHOTO, OPPOSITE PAGE: Mindoro camp on Agata Project. ANNUAL REPORT 2006 p.29

32 MINDORO IN THE SURIGAO DISTRICT p.30 MINDORO RESOURCES LTD.

33 ANNUAL REPORT 2006 p.31

34 SURIGAO PROJECTS AGATA NICKEL-IRON LATERITE PROJECT AGATA NICKEL-IRON LATERITE PROJECT: WELL POSITIONED FOR NEAR-TERM PRODUCTION Prices and demand for nickel are at an all time high, and this situation shows no signs of slackening in the foreseeable future. Not only is the Philippines richly endowed with nickel laterite deposits, but it is in an ideal location to supply the near-by markets in China, Japan and Korea. This proximity translates into low shipping costs and other competitive advantages. As a consequence, the nickel-iron laterite prospect on our Agata project has been catapulted into the limelight for us and has become an important component in our future, and strategic planning. Nickle laterite mines are in production at Hinatuan and Taganito, and the SMRI Mine recently went into production immediately adjacent to Agata, and on the same nickel laterite trend. These mines are providing direct shipping-grade ore to markets and processing plants in China, Japan, Korea and Australia. Just to the north of Surigao City, on Nonoc Island there are plans to put the large Nonoc nickel laterite deposit back into production and also to construct a new processing plant. The map Agata Nickel-Iron Laterite on page 35 shows the distribution of nickel laterite mineralization mapped to date on the Agata Project, as well as the SMRI Mine immediately to the south of Agata. In 2006, thirty-five wide-spaced drill holes at Agata produced encouraging results, with nickel and iron grades in the range of material in high demand for the rapidly expanding ferro-nickel market for stainless steel production in China and SE Asia. Results were reported in a release dated July 6, A cross section (A-A ) appears on page 35. More than ten organizations have approached Mindoro with expressions of interest to either joint venture development of the Agata nickel laterite, or to take product from it. Mindoro has taken the strategic decision to advance the project itself. As a consequence of these encouraging results and high demand for nickel-iron product, drilling at the Agata nickel laterite prospect commenced in February with five coring drill rigs in operation. With five drill rigs working, it is expected that drilling will be completed and the resource estimate commenced by late April. Work on acquiring an Environmental Compliance Certificate has commenced. Based on the 2006 drilling, Agata is considered an excellent Exploration Target* with an initial target resource of two million to 3.5 million tonnes at a grade of 0.9 percent to 1.2 percent nickel and 40 percent to 45 percent iron, sufficient initially for three to five years production at a rate of 500,000 to 700,000 wet metric tonnes per annum of direct shippinggrade material for the very high demand ferro-nickel markets of China and SE Asia. Immediate objective is to establish this as a NI compliant resource within the first half of The initial drill program and PHOTO: Agata nickel-iron laterite prospect trench showing part of laterite profi le. p.32 MINDORO RESOURCES LTD.

35 responsible footprints responsible growth Exploration Target covers less then 20 percent of the area of nickel laterite mineralization mapped to date at Agata. The longer term objective is to expand this resource, and mine life, once production has commenced. The project is just one kilometer from tidewater and investigations of the potential mine road access to the coast have also commenced. Preliminary marketing studies and environmental permitting have commenced. Target production date is the first half of This is an important step in our Company s growth. The very high demand for ferro-nickel feedstock for stainless steel production in our region, and high nickel prices, presents a great opportunity to get our Agata Project into production fast, and to generate early cash flow. Uniquely, direct shipping-grade nickel laterite deposits offer a low-capital cost and rapid route to production and cash-flow. *The reader is cautioned that the potential quantity and grade of the Exploration Target described is conceptual in nature, that there has been insuffi cient exploration to defi ne a mineral resource and that it is uncertain if further exploration will result in the target being delineated as a mineral resource. Until a feasibility study has been completed there is no certainty that the Company s projections will be economically viable. PHOTO: Close up view of photo on opposite page: garnierite (nickel) mineralization in trench. PHOTO: View of Agata nickel-iron laterite prospect looking south. SRMI nickel-iron laterite mine is approximately 3 km further south. ANNUAL REPORT 2006 p.33

36 SURIGAO PROJECTS AGATA PROJECT: EPITHERMAL GOLD AND PORPHYRY COPPER-GOLD PROSPECTS In addition to the nickel laterite mineralization, remarkably, Agata has a cluster of porphyry copper-gold prospects and two epithermal gold prospects which are also being advanced by Mindoro. The two unrelated mineralization types are in totally different geological settings. Assmicor Prospect During the 1980s, thousands of artisanal miners mined a saprolite (soil) horizon at Assmicor to shallow depths. In 1999, seven of eight drill holes completed by Mindoro intersected better than 0.5 g/t gold near surface in oxidized intrusives and dykes. The two best holes were 1.1 g/t gold over 19 meters and 1.4 g/t gold over 24 meters. The mineralization is open to the north and east. Limestone Prospect At the Limestone Prospect, geology consists of silty limestone with strong gold-in-soil anomalies occurring in an area of approximately 600 meters by 500 meters. Artisanal miners previously panned gold from the soils and mined gold from shallow workings in the limestone. Two 1999 holes drilled by Mindoro at the eastern edge of the soil anomalies encountered 2.7 g/t gold and 2.2 g/t gold over seven and eight meters respectively, at shallow depths. Deeper sections of mineralization were also encountered in both holes. Mineralization at the Limestone Prospect resembles important limestone-hosted gold deposits in Nevada, US. Assmicor Porphyry Copper-Gold Prospect Alteration, accompanied by grey quartz-magnetite veins with copper and gold mineralization, characteristic of the margins of a porphyry copper-gold system, are associated with east-dipping dykes and intrusions intersected in 1999 drill-hole 11. The prospect has not yet been covered by IP, but the eastern edge of the IP survey indicates a resistivity anomaly is emerging, suggesting a porphyry copper-gold system is being approached to the east. North Target The North Target occurs at the intersection of northeast-southwest faults with a splay of the north-trending Philippine Fault, which is the structural setting of porphyry copper-gold deposits in the Surigao District. The North Target is a very large and strong chargeability anomaly of greater than 28 m/secs covering about 1.2 kilometers by 500 meters. It is coincident with soil copper and gold anomalies, and unusually intense alteration of ultra-mafic rocks (pyrite and magnetite disseminations and silica veining). Several copper showings and intrusive dykes have been found in the area. Late in 2005, drilling commenced at the North Target. Considerable operational difficulties were experienced in the intensely fractured broken and gougy ultra-mafic cap rock and three holes were lost at shallow depths. This degree of structural preparation is consistent with that seen associated with a porphyry copper-gold system. At a future date, it is planned to pre-collar drill holes with a reverse circulation rig and then continue with diamond drilling below. South Target South Target is also a large, 1.5 kilometer by 500 meters, and strong chargeability anomaly of greater than 28 m/secs. It has a large, flanking high resistivity anomaly. Geology consists of limestone, greenschist and ultra-mafics. Small dykes or stocks of altered intrusive, likely the top of a much larger intrusive complex, have been mapped. Zones of structurally controlled phyliic alteration have also been defined. There are historical and ongoing artisanal gold mining operations in this area. Soil geochemical surveys carried out by Mindoro in 1997 partially covered the South Target and defined gold, zinc and copper anomalies. The South Target geological, geochemical and geophysical results strongly point to a porphyry copper-gold system at depth. In 2006, a single hole was drilled on the South Target. This also encountered operational difficulties and was terminated before target depth. However, in this case it is believed that the target can be drilled from the western side and the difficult ultra-mafic cap rock circumvented. It is planned to renew drilling in late 2007 or early p.34 MINDORO RESOURCES LTD.

37 responsible footprints responsible growth AGATA NICKEL-IRON LATERITE AGATA NICKEL-IRON LATERITE Cross Section A-A ANNUAL REPORT 2006 p.35

38 SURIGAO PROJECTS TAPIAN SAN FRANCISCO TAPIAN MAIN MAT-I PROJECT BOLOBOLO TAPIAN SAN FRANCISCO: PORPHYRY MINERAL- IZATION DRILL-INTERSECTED Geology of the Tapian San Francisco (TSF) Project consists of ultra-mafics, volcanics and limestones intruded by diorite and monzonite dykes and intrusions. Several major northeast-trending lineaments extend from TSF through the Boyongan district hosting the Boyongan and Bayugo copper-gold porphyry deposits. The northern portion of the TSF property overlaps the southern edge of a large intrusive complex of approximately six kilometers in diameter that hosts the Masgad porphyry system on its western margin and the Mayag porphyry system on its eastern margin. A cluster of seven IP chargeability anomalies was defined at TSF. Geological work has focused on two northeast structural / chargeability trends: the C4/C6 trend and the C5/C9 trend. The two trends are coincident with porphyry-related rock alteration and copper, gold and zinc in-soil geochemical anomalies and extremely abundant gold and copper showings. Alteration at TSF is widespread, pervasive, and typical of porphyry systems. This includes widespread propylitic and argillic alteration, minor calc-silicate alteration, structurally-controlled phyllic alteration and occurrences of potassic alteration. These alteration assemblages span an area that exceeds 3.5 kilometers by two kilometers, typical of large magmatic hydrothermal copper-gold ore-forming systems. A group of seven IP chargeability anomalies was defined at TSF. Geological work has identified a cluster of porphyry copper-gold targets, as well as multiple epithermal gold prospects (see Surigao Gold District map on pages 30 and 31). Further work has focused on two northeast structural / chargeability trends: the C6 trend and the C9 trend. The two trends are coincident with porphyry-related rock alteration and copper, gold and zinc in-soil geochemical anomalies and extremely abundant gold and copper showings. During 2006, a reconnaissance drilling program was carried out at C6 and C9 and three drill holes for a total of 1,176 meters were completed. The drilling intersected a series of narrow monzonite, monzonite porphyry, diorite porphyry, porphyritic dacite, and porphyritic andesite intrusive sills/dikes. They dip gently to moderately eastwards and intrude a thick sequence of volcanic, sedimentary and ultramafic rocks. The intrusives are affected by porphyry-related alteration (propylitic, phyllic, remnant potassic and associated skarn-type alteration). Multiple narrow zones of copper and gold mineralization were intersected (for example, 1.9 meters of 0.21 percent copper and 0.14 g/t gold). The mineralization and alteration is typical of mineralization in the distal to intermediate parts of a porphyry copper-gold system and suggest that the core of the porphyry system is further to the east within the project. Additional drilling is proposed to vector into the center of the system at a later date. p.36 MINDORO RESOURCES LTD.

39 responsible growth TAPIAN MAIN: GOLD PROSPECTS WITH A PORPHYRY TARGET BELOW BOLOBOLO: A PROMISING EARLY STAGE PORPHYRY PROSPECT Geology consists of greenschist overthrust by ultramafics, unconformably overlain by limestone and intruded by multiple intermediate porphyry intrusions. High-level epithermal gold mineralization occurs as veins, stockworks and breccias at contacts between greenschist, ultramafic, limestone and intrusives. The Rosario Zone is about 500 meters by 200 meters and open to the north. It includes extensive pre-world War Two underground development of a vein system, which reportedly had a 100 ton per day mill. The workings are inaccessible and production is unknown. Very incomplete records suggest the average grade was 8.3 g/t gold. The adjacent Samson Zone is about 600 meters by 200 meters. Encouraging gold values from rock sampling were obtained over widespread areas in this zone. Copper soil anomalies greater than 150 ppm and up to 1,192 ppm are associated with both the Rosario and Samson zones. A strong chargeability anomaly, coincident with intrusives, soil geochemical anomalies and alteration, extending over an area of 1.4 kilometers by 600 meters, covers the Rosario and Sampson Zones, and is open to the south. Planned work includes further evaluation of the epithermal gold potential by trenching, extension of the geophysical survey to fully define the anomalies, and drilling, if warranted. MAT-I PROJECT: GOLD PROSPECTS Porphyry deposits in the Surigao District are controlled by the intersection of northeast to southwest-trending faults with northnorthwest trending splays of the major Philippine Fault system. Due diligence work by Mindoro defined, amongst many other structural targets, one such structural intersection set in the Bolobolo area. A small ground reconnaissance program was carried out in 2005 to determine its potential significance. Altered and mineralized float boulders and outcrop were located over a wide area at Bolobolo. Widespread propylitic alteration, characteristically the outer halo of a porphyry system, was defined in volcanics. Within this propylitic halo, outcrops and boulders of intense argillic, phyllic and calc-silicate alteration were located. Phyllic alteration (quartz-sericite-pyrite), which is characteristically proximal to the main mineralized core of porphyry systems, is intense, structurally controlled, and can be traced over three kilometers and observed up to 200 meters wide. A mineralized float boulder of calc-silicate located in a stream, contains abundant disseminations of chalcopyrite and bornite, as well as high-density quartz-bornite-magnetite veinlets. A representative grab sample assayed 1.34 percent copper, 17.1 g/t silver. A float boulder of similar alteration and mineralization found in a stream, approximately 1.6 kilometers to the south, assayed 0.96 percent copper and 4.9 g/t silver. In a third stream, approximately three kilometers to the northeast, a boulder of silicified limestone assaying 1.92 percent copper was also found. Calc-silicate mineralization characteristically occurs in limestone near Philippine porphyry copper-gold deposits. Follow-up geological work is planned in the second half of Geology consists of ultramafics, sediments and volcanic tuffs intruded by intermediate porphyry intrusives. The Mat-I area was an important artisanal gold mining area and thousands of miners won gold from alluvials as well as shallow, hard-rock workings. There are spectacular examples of high-grade epithermal veins. However, most of the highest potential ground was lost in land disputes to other parties. Systematic geochemical surveys by Mindoro defined four moderate-order copper in soil anomalies of greater than 100 ppm and up to 268 ppm. Maximum dimension is approximately 2,000 meters by 200 to 300 meters. Minor associated gold anomalies are present, as well as very strong arsenic anomalies of up to 1,520 ppm. The copper anomalies may reflect intrusive-related mineralization of potential interest. Further geological investigations are planned. PHOTO, OPPOSITE PAGE: Agata nickel laterite project technical team. PHOTO: Surigao offi ce staff. Back; Ferland Tagura, Mary Jean Gonzales, Arnulfo Joyno. Front; Arlene Jovita, Mary Grace Cassion, Jeasalyn Abonates and Joan Rejuso. ANNUAL REPORT 2006 p.37

40 COMMUNITY RELATIONS AND SOCIAL RESPONSIBILTY p.38 MINDORO RESOURCES LTD.

41 responsible growth WORKING HAND-IN-HAND WITH LOCAL COMMUNITIES Mindoro recognizes that any successful exploration venture must have the support of those local inhabitants whose daily lives are most affected by our activities. Accordingly, Mindoro strives to involve communities in its exploration activities through training and employment programs and to keep them fully informed about our activities to the maximum possible extent. Community engagement policies are directed at establishing a solid, long-term relationship with local communities founded on fairness, trust, and transparency; and encouraging communities to become active partners in the development of the mineral resources found in their areas. Over the past year, Mindoro has further strengthened its Community Relations and Development Department (ComRel) and its Information Communication and Education (ICE) campaigns, especially in areas showing good potential to advance to production. Additionally, Mindoro has integrated Safety, Health and Environment (SHE) programs into these basic community programs. From the start of its exploration programs in the Philippines in 1997, and before being mandated by the government, Mindoro introduced and utilized ICE campaigns as one of the basic tools in linking with the local communities and various stakeholders. These campaigns are the venue to explain our exploration activities, any accompanying environmental impacts and mitigating measures. Open and frank discussions have become part of the ICE process, and these are increasingly necessary, not just in the Philippines, but in most parts of the world, to counter the active and cynical misinformation campaigns spread by various anti-mining groups; none of whom, it is observed, seem quite ready to give up the fruits and benefits of mining products. Mindoro also assists in carefully chosen local infrastructure and livelihood projects; especially in the field of education. Grants have been made to assist in building of day care and health centers and school rooms; a relatively small amount of money can often go a long way and make a big difference in a small community. Whereever possible, drill access roads are built to farm-to-market standards to leave a permanent legacy for the community. LEFT PHOTO, OPPOSITE PAGE: Mamanwa Tribe performs dance ceremony prior to start of drill program on the Agata nickel laterite prospect. In the Surigao District, with the assistance of the local Mines and Geosciences Bureau, the Community Technical Working Group (CTWG) was formed some years ago. This is a multi-sectoral group which monitors the Company s exploration activities and is involved in planning and implementing the Company s community development programs. This has become a very effective arrangement whereby the community, the local government, and the Company are active partners in the preparation of community development plans. The CTWG s intellectual and technical capabilities are enhanced through continuous training programs and seminars sponsored by the Company and concerned government agencies. One of our best ComRel achievements in 2006, was the Company s contribution to the empowerment of women and the Indigenous Peoples (IPs- the original inhabitants of the Philippines believed to be of Melanesian extraction). Involving women in our activities has strengthened their self-esteem and they have become active participants in our community development planning process. Some of these women are now the Company s local lead in the ICE campaigns. In acknowledgment of the important role played by local community women in attaining sustainable development, a Gender and Development program will soon be integrated into our various projects. Mindoro s assistance to the IP extends to offering employment preferences. In November 2006, seven IP leaders from four communities, and three personnel from the National Commission on Indigenous Peoples (NCIP), were sponsored by the Company to participate in the IP Capability Building Training-Workshop initiated by the Canadian Embassy in the Philippines. Our indigenous peoples interacted with the representatives of First Nations from Canada who shared their success stories in attaining sustainable development through improved capability of the IP community and close collaboration with exploration and mining companies operating in Canada. Various support programs for our indigenous peoples were launched this year, including children literacy, health and nutrition initiatives and cultural development. Mindoro also partners with the office of the NCIP in providing livelihood to our tribal communities. PHOTO: Mindoro sponsored tour of Taganito mine for Agata residents. ANNUAL REPORT 2006 p.39

42 ENVIRONMENTAL RESPONSIBILITY p.40 MINDORO RESOURCES LTD.

43 responsible growth PRO-ACTIVE PROGRAMS The environmental policy of Mindoro is to uphold environmental protection and safety while exploring potential mineral deposits in an environmentally responsible manner and remaining committed to the concept of sustainable development in its pursuit to improve our affected communities well being and welfare as our partners, in compliance with the Philippine Environmental Laws and Regulations. Mindoro has developed an Environmental Management System (EMS) for the Surigao and Batangas projects under the leadership of environmental scientists Ms. Jesalyn L. Abonates (Surigao) and Ms. Seigrid C. Macas (Batangas). Mindoro has strengthened its ComRel teams in both its Surigao and Batangas Projects. The Surigao ComRel team consists of nine professionals, including an environmental scientist and a mining engineer, while the Batangas ComRel team consists of eight employees, including an environmental scientist and three foresters. Most of the ComRel personnel have undergone training in occupational health and safety, environmental management, community engagement, social entrepreneurship and development management and will continue to acquire and learn new skills necessary for the successful implementation of development, environmental and safety programs. Even though the impact of our current exploration activities is relatively small, environmental management is strictly implemented. Good housekeeping and proper waste disposal and segregation are practiced in the exploration areas. The non-biodegradable wastes are given to the locals to reuse or recycle, while the remaining wastes are kept for disposal to Environmental Management Bureau-accredited buyers. SHE Philippine protocols Copper-Gold are strictly observed System preparatory to high-impact activities, such as drilling. All personnel, including locally-hired workers, undergo SHE induction and orientation. Close coordination with the drilling contractors, for example, is undertaken to ensure implementation of the contractors and Mindoro s environmental and safety policies. Protection of water systems and prevention of soil contamination are major objectives in environmental management. Mitigating measures are carefully planned and implemented. Hence, containments made of laminated sacks and tarpaulins for used oils, fuels and drilling additives are built. Fluid and water waste discharge from drilling are contained in catchment sumps to prevent ground water contamination. Excavated lands, such as sumps, compost pits, test pits and trenches, are fenced and stabilized. Disturbed areas are rehabilitated, excavated lands backfilled and planted, and drill collars cemented, capped and labeled. The Company also has its own nurseries and grows thousands of various trees and fruit species for its reforestation/rehabilitation programs. Continuous maintenance and protection of the rehabilitated site is carried out to ensure successful rehabilitation. Our commitment to environmental management is supported by the communities full participation in the implementation of our environmental policies. Mindoro s commitment to responsible exploration is demonstrated in its pro-people, pro-environment and pro-sustainable development. Mindoro continues to enjoy the strong acceptance and support from its host communities. Since some of Mindoro s exploration activities are in areas that are prone to landslides and erosion, the environment management team employs slope stabilization measures such as establishment of riprap and contour planting using local nitrogen fixing plants to prevent soil erosion and river siltation. Accurate pre-assessment of drill sites is conducted to avoid unnecessary damage to crops and ground disturbance. Post-drilling mitigation measures are strictly implemented. PHOTO: Environmental Offi cer Seigrid Macas supervising drill road slope stabilization. PHOTO, OPPOSITE PAGE: Archangel Nursery. LEFT PHOTO, OPPOSITE PAGE: Offi cials of Brgy. Colorado assist in Mindoro rehabilitation program. ANNUAL REPORT 2006 p.41

44 IN MEMORIAM JOE DE GUZMAN It is with a great sense of loss and sadness that we record the passing of our joint venture partner and friend, Joe de Guzman on June 11, 2006, in his home city of Quezon, Philippines. Joe was one of those rare individuals who had mining in his blood and was totally consumed by his desire to discover and develop mines in the Philippines. Joe was a graduate in Chemical Engineering from the University of Santo Tomas, Manila, in He became involved in mining at an early stage; exploring for and mining feldspar deposits in Luzon Island in the 1960 s and 1970 s. He established Philchrome Mining Corporation in 1977, and in partnership with Amax Inc. of USA and Kawasaki Steel of Japan, discovered and operated the J.E. Thompson Chromite Mine in Palawan Island. During the late 1980s he established Minimax Mineral Exploration Corporation and accumulated a number of promising early stage projects in the Philippines. I first met Joe in 1996, when his projects were attracting a great deal of interest from foreign mining exploration companies. As a result of previous difficult experiences with off-shore companies, Joe was cautious about with whom he dealt and declined many acquisition and joint venture offers. Mindoro was able to convince Joe that we were a bona fide and serious explorer and we were fortunate to conclude agreements on a number of his properties. It is these projects that formed the core of Mindoro s promising portfolio in the Philippines. With time, I established a close rapport and friendship with Joe based on mutual trust. We would meet frequently and, while sharing a few San Miguels, immerse ourselves in discussing the projects progress and in general mining talk. Joe is survived by his five daughters and wife, now Mindoro s partners in the Philippines. Joe would be very pleased to see how his projects are now responding and excited that several are advancing towards development. Tony Climie April 5, 2007 p.42 MINDORO RESOURCES LTD.