Three years ago, what Dave Webb was thinking about the future of the Yellowknife Gold Project (YGP) might be gleaned from this letter to Bill Murphy at GATA.

Especially interesting are his references to four million ounces or more and additional one ounce per tonne grades under the Discovery Mine!

Cheers,

Baires

Mr. Bill Murphy
GATA
Wednesday, June 14, 2006

Dear Bill,

It was a pleasure meeting you on Tuesday. It is a pleasure meeting someone with such enthusiasm for what they do. I was beginning to think that we were a non-existent breed.

As you were made aware, both Roger and my introduction to mining started early. We both followed our fathers and lived the mining life from day one. Roger started work in his teens, as did I, only I had my experience during summer vacations starting in 1974. I continued in school with an engineering degree from the University of Toronto, an M.Sc. in geology from Queen’s University in Kingston (thesis “The Relationship of Ore to Structural Features of the Campbell Shear Zone and Hanging Wall Stratigraphy in the Con Mine, Yellowknife, Northwest Territories”), and a Ph.D. in geology from the University of Western Ontario in London (thesis “Controls of Auriferous Shear Zones at Yellowknife, N.W.T.”).

I discovered a number of interesting gold deposits while completing my studies in Yellowknife. I staked and optioned the Nicholas Lake deposit to Chevron Minerals Ltd., which was later sold to Athabaska Gold Resources Ltd., and then Royal Oak Mines Inc. I purchased the Mon Gold Property (30 km north of Yellowknife) from Cominco Ltd., and after a number of joint ventures brought this into production with partners between 1992 and 1998, operating a 100 tpd mill on site of the underground gold mine. In December of 1992 I staked the Discovery Mine site with a partner, and optioned the claim to GMD Resource Corp. GMD invested nearly $20 million and was developing the property rapidly when the president of the company withdrew $3 million from the treasury without board knowledge. The outcome of the trading halt and reorganization devastated the company, and in the late 1990’s they were in desperate straights.

Royal Oak Mines was developing the adjacent Nicholas Lake Mine for production to provide supplemental feed to their Yellowknife operations when the confluence of many factors led to their bankruptcy. The Ontario Superior Court was hearing the recommendations of the receiver in bankruptcy, and approved the return of the Nicholas Lake Property to Dave Webb free and clear of all liens and encumbrances in late 2000, at which time we approached GMD with a proposition.

In January 2001 Tyhee purchased the Discovery Claim from GMD for $1 per ounce resource, and a variable rate net smelter royalty. Simultaneously with that transaction, tyhee purchased the Nicholas Lake claims and leases from Dave Webb for $1 per ounce plus a net smelter royalty identical to GMD. In 2003, tyhee purchased GMD’s royalty for $70,000.

Since acquiring the two contiguous properties, tyhee has invested $18 million completing diamond drill programs, underground exploration and development work, collecting a bulk sample, engineering and permitting studies. We currently report the resource shown on the table below:

Table 1. Gold Resource Estimate for Yellowknife Gold Project, 2006.

1 Bullis, Pratico, and Kirkham, 2006. A 1.5 gpt cut-off, 60 gpt cut and 39 gpt reduced area of influence on 5 x 5 x 5 metre blocks using ID2 estimation. NI 43-101 Resource details below.

2 Dupre and Giroux, 2003. A 2.5 gpt cut-off, 96 gpt cut, 1.5 metre minimum width using ordinary kriging estimation. NI 43-101 Resource details below.

The key feature of this resource is that it is open for expansion, within an area that we believe could host 4 million ounces of gold or more. We currently have two diamond drills on the property, and are proceeding to test this potential, in order to add as many ounces to the resource We hope to bring about 200,000 to 400,000 ounces in all categories (measured indicated and inferred), the majority of which will be in the more weakly defined category, inferred. However, it is hoped that this will demonstrate the potential of the property, where gold can be added to the better defined resource categories at around $30 per ounce.

I’ve attached three figures, more of which can be found on our website,

www.tyhee.com

The first figure is a general location of Yellowknife, north of the Con Mine and Giant Mine (cumulative production 13 million ounces of gold at 0.5 ounces of gold per ton).

The second figure shows the overall geology of the property, and the location of a number of the known gold deposits and showings.

The third figure shows the detail of the Discovery mining lease, and the distribution of the mineralization. It includes a plan and section view of this part of the property. We have the Ormsby Zone well drilled off, and a fairly well established resource there on the southern, or left hand side. The old discovery mine is shown to the north, on the right-hand side and the shaft can be seen to a depth of 4,000’ or 1,200 metres. We are currently drilling the Discovery volcanic block, filling in the blank areas where there are no drillholes, and hence no resource shown. The main features to be gathered from this figure are the red boxes, each outlining exploration potential of 1 million ounces of gold. There is also depth potential not shown, such as beneath the old Discovery Mine workings where the previous operators had already drilled off resources similar to what they had produced (1 opt) in the past!

Please feel free to call any time, on my cell phone, 604 xxx-xxxx , or at the office 604 xxx-xxxx if you have questions. Again, it was a pleasure meeting you, and we’ll continue following your activities.

Sincerely

Tyhee Development Corp.

Signed

Dave Webb, President and CEO.