Mineral property development costs incurred to expand ore reserves are deferred and depleted on a units-ofproduction

basis over proven and probably reserves. Revenue derived from mineral properties before full production

during commissioning of a property is accounted for as a reduction of the cost of the property. For the three months

and six months ended June 30

, 2008 - $nil) from 5,502 ounces of gold

(June 30

, 2008 – nil) was recorded as a reduction of the Hinge mineral property..........

Related party transactions

Wynne Mining Ltd., Wynne Drilling Ltd., Wynne's Place Ltd., Hotel San Antonio, and Hugh Wynne

$ 8,618 $ 284,482 $ 8,618 $ 284,482

Prepaid expenses

$ 200,000 $ 200,000 $ 200,000 $ 200,000

Three Month Period Ended Six Month Period Ended

, 2008 -

$902,458) and for the six month period ended June 30

, 2009, the Company purchased goods and services for the

sum of $3,605,459 (June 30

, 2008 - $2,375,710) from Hugh Wynne, Wynne Mining Ltd., Wynne’s Place Ltd., Hotel

San Antonio, and Wynne Drilling Ltd., (corporations controlled by Hugh Wynne who is a director and Chairman of the

CoMpany).....HM, my point being, under Canadian Tax look at how the financials can play into you favour. San did say back in 2006 that they were a producing Company, but yet they play this exploration side and write off production in favour of flow through development. I don"t have a problem with the Tax payer suporting Sans production, but let keep Winkin, Blinkin and Nod out of Hugh Bar. I see this 1.5 million increase at the San Antonio as alot of free beer. Long On The Greens Traps7