20-F

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 20-F

[  ]

REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) OR (g) OF THE SECURITIES EXCHANGE ACT OF 1934

OR

[X]

ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the fiscal year ended February 28, 2007              

OR

[  ]

TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ____________ to __________

OR

[  ]

SHELL COMPANY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

Date of event requiring this shell company report ………………………………

Alpha Gold Corporation

(Exact name of Registrant as specified in its charter)

__________ British Columbia, Canada_____________

(Jurisdiction of incorporation or organization)

410 Donald Street, Coquitlam, British Columbia,V3K 3Z8

(Address of principal executive offices)

Securities to be registered pursuant to Section 12(b) of the Act:

None

Securities to be registered pursuant to Section 12(g) of the Act:

Common Shares, without par value

(Title of Class)

Securities for which there is a reporting obligation pursuant to Section 15(d) of the Act: None

Indicate the number of outstanding shares of each of the Company’s classes of capital or common stock as of the close of the period covered by the annual report.                                           29,036,919

Indicate by check mark if the registrant is a well-known seasoned issuer, as defined in Rule 405 of the Securities Act.   Yes ___     No   xxx

Indicate by check mark whether the registrant (1) has filed all reports required to be filed by Section 12 or 15(d) of the Securities Exchange Act of 1934 during the preceding 12 months (or for such shorter period that the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past ninety days.            Yes XXX   No ___

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer or a non-accelerated filer.  See definition of “accelerated filer and large accelerated filer” in Rule 12b-2 of the Exchange Act.

Large accelerated filer   Accelerated filer   Non-accelerated filer  xxx

Indicate by check mark which financial statement item the registrant has elected to follow: Item 17 xxx   Item 18 ___

If this is an annual report, indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act).

Yes    No XXX N/A  ___

Page 2 of 74

Index to Exhibits on Page 49

#

ALPHA GOLD CORPORATION

FORM 20-F Annual Report

TABLE OF CONTENTS

	PART I
Item 1	Identity of Directors, Senior Management and Advisers	5
Item 2	Offer Statistics and Expected Timetable	5
Item 3	Key Information	5
Item 4	Information on the Company	11
Item 5	Operating and Financial Review and Prospects	22
Item 6	Directors, Senior Management and Employees	28
Item 7	Major Shareholders and Related Party Transactions	33
Item 8	Financial Information	34
Item 9	The Offer and Listing	34
Item 10	Additional Information	37
Item 11	Quantitative and Qualitative Disclosures About Market Risk	47
Item 12	Description of Securities Other than Equity Securities	47
	PART II
Item 13	Defaults, Dividend Arrearages and Delinquencies	47
Item 14	Material Modifications to the Rights of Security Holders and Use of Proceeds	47
Item 15	Controls and Procedures	47
Item 16	Reserved	48
Item 16A	Audit Committee Financial Expert	48
Item 16B	Code of Ethics	48
Item 16C	Principal Accountant Fees and Services	48
Item 16D	Exemptions from Listing Standards for Audit    Committees	48
Item 16E	Purchase of Equity Securities by the Issuer and    Affiliated Purchasers	48
	PART III
Item 17	Financial Statements	48
Item 18	Financial Statements	49
Item 19	Exhibits	49
Signature Page

#

INTRODUCTION

Alpha Gold Corp. is organized under the laws of British Columbia, Canada.  In this Annual Report, the “Company”, "we", "our", and "us", refer to Alpha Gold Corp. (unless the context otherwise requires).  Summary discussions of documents referred to in this Annual Report may not be complete, and we refer you to the actual documents for more complete information.  Our principal corporate offices are located at 410 Donald Street, Coquitlam, British Columbia, Canada V3K 3Z8; our telephone number is 604-939-4083.

BUSINESS OF ALPHA GOLD CORP.

Alpha Gold Corp. (the “Company") is a mineral company engaged directly and indirectly through subsidiaries, in the acquisition and exploration of mineral properties.  The Company's primary property is the Lustdust Property (exploration) located in north-central British Columbia.  The Company will not know that a commercially viable mineral deposit, a reserve, exists in the Lustdust Property until sufficient and appropriate exploration work is done and a comprehensive evaluation of such work concludes economic and legal feasibility.

FINANCIAL AND OTHER INFORMATION

In this Annual Report, unless otherwise specified, all dollar amounts are expressed in Canadian Dollars (“CDN$” or “$”).  The Government of Canada permits a floating exchange rate to determine the value of the Canadian Dollar against the U.S. Dollar (US$).

FORWARD-LOOKING STATEMENTS

Certain statements in this document constitute “forward-looking statements”. Some, but not all, forward-looking statements can be identified by the use of words such as “anticipate,” “believe,” “plan,” “estimate,” “expect,” and “intend,” statements that an action or event “may,” “might,” “could,” or “should” be taken or occur, or other similar expressions. Although the Company has attempted to identify important factors that could cause actual results to differ materially from expected results, such forward-looking statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Registrant, or other future events, to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements. Such factors include, among o thers, the following risks: the risks associated with outstanding litigation, if any, risks associated with project development; the need for additional financing; operational risks associated with mining and mineral processing; fluctuations in metal prices; title matters; uncertainties and risks related to carrying on business in foreign countries; environmental liability claims and insurance; reliance on key personnel; the potential for conflicts of interest among certain officer, directors or promoters of the Registrant with certain other projects; the absence of dividends; currency fluctuations; competition; dilution; the volatility of the Registrant’s common share price and volume; and tax consequences to U.S. Shareholders. We are obligated to keep our information current and revise any forward-looking statements because of new information, future events or otherwise.

#

PART I

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

Not Applicable

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE.

Not Applicable

ITEM 3.  KEY INFORMATION.

3.A.1.  Selected Financial Data

3.A.2.  Selected Financial Data

The selected financial data of the Company for the Fiscal Year ended February 28, 2007 were derived the financial statements of the Company that have been audited by De Visser Gray LLP, Chartered Accountants. The selected financial data of the Company for the fiscal years ended February 28, 2006 and February 29, 2005 were derived from the financial statements of the Company that have been audited by MacKay LLP, independent chartered accountants, as indicated in their audit report, which are included elsewhere in this annual report. The selected financial data for the Company for the Fiscal Years ended February 28, 2004 and February 28, 2005 were derived from the financial statements of the Company that have been audited by Bailey & Associates, independent Chartered Accountants; these financial statements are not included herein.  

The selected financial data should be read in conjunction with the financial statements and other financial information included elsewhere in the Annual Report.

The Company has not declared any dividends since incorporation and does not anticipate that it will do so in the foreseeable future.  The present policy of the Company is to retain all available funds for use in its operations and the expansion of its business.

Table No. 1 is derived from the financial statements of the Company, which have been prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP) and Canadian/USA Generally Accepted Auditing Standards (GAAS).  All material numerical differences between Canadian GAAP and US GAAP, as applicable to the Company, are described in footnotes to the financial statements.

Table No. 1

Selected Financial Data

(CDN$ in 000, except per share data)

	Year	Year	Year	Year	Year
	Ended	Ended	Ended	Ended	Ended
	2/28/07	2/28/06	2/28/05	2/29/04	2/28/03
Revenue	Nil	Nil	Nil	Nil	Nil
Net Income (Loss)	($298)	($416)	($230)	($166)	($130)
Earnings (Loss) Per Share	($0.01)	($0.02)	($0.01)	($0.01)	($0.01)
Net Income (Loss) US GAAP	($1,639)	($858)	($869)	($1,071)	($615)
EPS (Loss) US GAAP	($0.06)	($0.03)	($0.04)	($0.05)	($0.03)
Wtg. Avg. No. Shares US GAAP	27,453	25,010	23,818	22,249	18,147
Dividends Per Share	0	0	0	0	0
Dividends Per Share (US GAAP)	0	0	0	0	0
Wtg. Avg. No.Shares Cdn GAAP	27,453	25,010	23,818	22,249	18,147
Working Capital	$1,364	$1,426	$1,777	$2,225	$2,276
Mineral Properties (Cdn GAAP)	$6,549	$5,319	$5,015	$4,353	$2,397
Mineral Properties (US GAAP)	$0	$0	$0	$0	$0
Long Term Debt	$0	$0	$0	$0	$0
Long Term Debt (US GAAP)	$0	$0	$0	$0	$0
Shareholder’s Equity (Cdn GAAP)	$7,280	$5998	$5,933	$5,741	$5,112
Shareholder’s Equity (US GAAP)	$1,434	$1,493	$1,871	$2,263	$2,323
Total Assets	$8,009	$6,824	$6,900	$6,623	$5,731
Total Assets (US GAAP)	$1,460	$1,505	$1,885	$2,270	$2,334

______________________________________________________________________________

3.A.3.  Exchange Rates

In this Annual Report, unless otherwise specified, all dollar amounts are expressed in Canadian Dollars (CDN$).  The Government of Canada permits a floating exchange rate to determine the value of the Canadian Dollar against the U.S. Dollar (US$).

Table No. 2 sets forth the exchange rates for the Canadian Dollar at the end of five most recent fiscal years ended the last day of February, the average rates for the period, and the range of high and low rates for the period.

For purposes of this table, the rate of exchange means the noon buying rate in New York City for cable transfers in foreign currencies as certified for customs purposes by the Federal Reserve Bank of New York.  The table sets forth the number of Canadian Dollars required under that formula to buy one U.S. Dollar.  The average rate means the average of the exchange rates on the last day of each month during the period.

Table No. 2

U.S. Dollar/Canadian Dollar

_____________________________________________________________________________

_____________________________________________________________________________

	Average	High	Low	Close
Fiscal Year Ended 2/28/07	$1.14	$1.19	$1.10	$1.17
Fiscal Year Ended 2/28/06	$1.19	$1.27	$1.14	$1.14
Fiscal Year Ended 2/28/05	$1.29	$1.39	$1.18	$1.23
Fiscal Year Ended 2/29/04	$1.37	$1.49	$1.27	$1.34
Fiscal Year Ended 2/28/03	$1.56	$1.60	$1.49	$1.53

_____________________________________________________________________________

_____________________________________________________________________________

#

3.B.  Capitalization and Indebtedness

Not Applicable

3.C.  Reasons For The Offer And Use Of Proceeds

Not Applicable

3.D.  Risk Factors

Dependence Upon Key Management Employees

While engaged in the business of exploring mineral properties, the nature of Alpha Gold Corp.’s business, its ability to continue its exploration of potential exploration projects, and to develop a competitive edge in the marketplace, depends, in large part, on its ability to attract and maintain qualified key management personnel.  Competition for such personnel is intense and the Company may not be able to attract and retain such personnel.  The Company’s growth will depend, on the efforts of its Senior Management, including its President and Chief Executive Officer George Whatley and its Secretary Richard Whatley.  Loss of these individuals could have a material adverse effect on the Company.  Alpha Gold Corp. has no key-man life insurance and no written consulting agreements with Senior Management.

Control by Principal Stockholders, Officers and Directors Could Adversely Affect Alpha Gold Corp’s Stockholders.

Alpha Gold Corp.’s Senior Management and Directors, acting together, have the ability to control substantially all matters submitted to the Company’s stockholders for approval (including the election and removal of directors and any merger, consolidation or sale of all or substantially all of the Company’s assets) and to control Alpha Gold Corp.’s management and affairs.  Accordingly, this concentration of ownership may have the effect of delaying, deferring or preventing a change in control of the Company, impeding a merger, consolidation, takeover or other business combination involving the Company or discouraging a potential acquirer from making a tender offer or otherwise attempting to obtain control of Alpha Gold Corp., which in turn could materially adversely affect the market price of the Company’s stock.

Dilution Through Employee/Director/Consultant Options.

Because the success of Alpha Gold Corp. is highly dependent upon its respective employees, the Company may in the future grant to some or all of its key employees, Directors and consultants options to purchase common shares as non-cash incentives.  To the extent that significant numbers of such options may be granted and exercised, the interests of the other stockholders of the Company may be diluted.

Need for Additional Financing.

Alpha Gold Corp. is engaged in the business of exploring mineral properties, and press releases regarding the Company’s business, show changes in estimates and evaluations by securities analysts or other events or factors.  In recent years, the securities markets in the United States and Canada have experienced a high level of price and volume volatility, and the market price of securities of many companies, particularly small-capitalization companies such as Alpha Gold Corp., has experienced wide fluctuations that have not necessarily been related to the operations, performances, underlying asset values, or prospects of such companies.  For these reasons, the Company’s common shares can also be expected to be subject to volatility resulting from purely market forces over which the Company will have no control.    If these exploration programs are successful, additional financing will be required to continue exploration and/or to develop the mineral properties identified and to place them into commercial production.  The exploitation of the Company’s mineral properties is, therefore, dependent upon Alpha Gold Corp.’s ability to obtain financing through the joint venturing of projects, debt financing, equity financing or other means.  Failure to obtain such financing may result in delay or indefinite postponement of work on the Company’s mineral properties, as well as the possible loss of such properties.

Broker-Dealers May Be Discouraged From Effecting Transactions In Our Common Shares Because They Are Considered Penny Stocks And Are Subject To The Penny Stock Rules.

Rules 15g-1 through 15g-9 promulgated under the Securities Exchange Act of 1934, as amended, impose sales practice and disclosure requirements on NASD broker-dealers who make a market in "a penny stock".  A penny stock generally includes any non-NASDAQ equity security that has a market price of less than US$5.00 per share.  Our shares are quoted on the TSX Venture Exchange, and the price of our common shares ranged from CDN$0.30 (low) to CDN$1.18 (high) during the period from 2/28/2006 to 2/28/2007.  The closing price of our shares on 7/31/2007 was CDN$0.62.  The additional sales practice and disclosure requirements imposed upon broker-dealers may discourage broker-dealers from effecting transactions in our shares, which could severely limit the market liquidity of the shares and impede the sale of our shares in the secondary market.

Under the penny stock regulations, a broker-dealer selling penny stock to anyone other than an established customer or "accredited investor" (generally, an individual with net worth in excess of US$1,000,000 or an annual income exceeding US$200,000, or US$300,000 together with his or her spouse) must make a special suitability determination for the purchaser and must receive the purchaser's written consent to the transaction prior to sale, unless the broker-dealer or the transaction is otherwise exempt.

In addition, the penny stock regulations require the broker-dealer to deliver, prior to any transaction involving a penny stock, a disclosure schedule prepared by the US Securities and Exchange Commission relating to the penny stock market, unless the broker-dealer or the transaction is otherwise exempt.  A broker-dealer is also required to disclose commissions payable to the broker-dealer and the registered representative and current quotations for the securities.  Finally, a broker-dealer is required to send monthly statements disclosing recent price information with respect to the penny stock held in a customer's account and information with respect to the limited market in penny stocks.

U.S. Investors May Not Be Able to Enforce Their Civil Liabilities Against the Company or Our Directors, Controlling Persons and Officers.

It may be difficult to bring and enforce suits against Alpha Gold Corp.  The Company is a corporation incorporated in the province of British Columbia under the British Columbia Securities Act.  A majority of the Company's directors must be residents of Canada, and all or substantial portions of their assets are located outside of the United States, predominately in Canada.  As a result, it may be difficult for U.S. holders of our common shares to effect service of process on these persons within the United States or to realize in the United States upon judgments rendered against them.  In addition, a shareholder should not assume that the courts of Canada (i) would enforce judgments of U.S. courts obtained in actions against us or such persons predicated upon the civil liability provisions of the U.S. federal securities laws or other laws of the United States, or (ii) would enforce, in original actions, liabilities against us or such persons pre dicated upon the U.S. federal securities laws or other laws of the United States.

However, U.S. laws would generally be enforced by a Canadian court provided that those laws are not contrary to Canadian public policy, are not foreign penal laws or laws that deal with taxation or the taking of property by a foreign government and provided that they are in compliance with applicable Canadian legislation regarding the limitation of actions.  Also, a Canadian court would generally recognize a judgment obtained in a U.S. Court except, for example:

a)

where the U.S. court where the judgment was rendered had no jurisdiction according to applicable Canadian law;

b)

the judgment was subject to ordinary remedy (appeal, judicial review and any other judicial proceeding which renders the judgment not final, conclusive or enforceable under the laws of the applicable state) or not final, conclusive or enforceable under the laws of the applicable states

c)

the judgment was obtained by fraud or in any manner contrary to natural justice or rendered in contravention of fundamental principles of procedure;

d)

a dispute between the same parties, based on the same subject matter has given rise to a judgment rendered in a Canadian court or has been decided in a third country and the judgment meets the necessary conditions for recognition in a Canadian court;

e) the outcome of the judgment of the U.S. court was inconsistent with Canadian public policy;

f) the judgment enforces obligations arising from foreign penal laws or laws that deal with taxation or the taking of property by a foreign government; or

g)

there has not been compliance with applicable Canadian law dealing with the limitation of actions.

As a "foreign private issuer”, Alpha Gold Corp. is exempt from the Section 14 proxy rules and Section 16 of the 1934 Securities Act:

The submission of proxy and annual meeting of shareholder information (prepared to Canadian standards) on Form 6-K may result is shareholders having less complete and timely data.  The exemption from Section 16 rules regarding sales of common shares by insiders may result in shareholders having less data.

The Lack of Trading Volume Associated with Alpha Gold Corp.’s Stock Reduced the Liquidity of the Stock for Investors

The lack of trading volume of the Company’s shares reduces the liquidity of an investment in the Company’s shares. The limited daily trading activity in the Company’s stock can make it difficult for investors to readily sell their shares in the open market.

Possible Dilution to Present and Prospective Shareholders:

The Company’s plan of operation, in part, contemplates the accomplishment of business negotiations by the issuance of cash, securities of the Company, or a combination of the two, and possibly, incurring debt.  Any transaction involving the issuance of previously authorized but un-issued shares of common stock, or securities convertible into common stock, would result in dilution, possibly substantial, to present and prospective holders of common stock.

Federal, Territorial and Local Governmental Regulations:

The current operations of the Company, involves exploration activities on its properties. These activities currently do not require permits from federal, territorial and local governmental authorities.  There can be no assurance, however, that any future permits which the Company may require will be obtainable on reasonable terms or that such laws and regulations, or that new legislation or modifications to existing legislation, would not have an adverse effect on any exploration project which the Company might undertake.

Failure to comply with applicable laws, regulations and permitting requirements may result in enforcement actions there under, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment or remedial actions. Parties engaged in exploration operations may be required to compensate those suffering loss or damage by reason of the exploration activities and may have civil or criminal fines or penalties imposed for violation of applicable laws or regulations.

Amendments to current laws, regulations and permits governing operations and activities of exploration companies, or more stringent implementation thereof, could have a material adverse impact on the Company and cause increases in capital expenditures or require abandonment or delays in the exploration of new properties.

There is No Guarantee of Clear Title to Any of Alpha Gold Corp.’s Mineral Properties:

Unregistered agreements or unregistered transfers of title could cause the Company to forfeit its interests in one or more of its property interests.

Alpha Gold Corp. has No Proven Reserves on the Properties in which it has an interest:

The properties in which the Company has an interest or the concessions in which the Company has the right to earn an interest are in the exploratory stage only and are without a known body of ore. Properties on which mineral reserves are not found will have to be discarded causing the Company to write each respective property off thus sustaining a loss.

Alpha Gold Corp. has no Positive Cash Flow and No History of Earnings and is Dependent Upon Public and Private Distributions of Equity to Obtain Capital in Order to Sustain Operations:

None of the Company’s properties have advanced to the commercial production stage and the Company has no history of earnings or cash flow from operations.  The Company does not know if it will ever generate material revenue from mining operations or if it will ever achieve self-sustaining commercial mining operations. Historically, the only source of funds available to the company has been through the sale of its common shares. Any future additional equity financing would cause dilution to current shareholders.

Unsuccessful Exploration Efforts By Alpha Gold Corp. Personnel Could Result in a Significant Negative Effect:

The expenditures to be made by the Company in the exploration of its properties as described herein may not result in discoveries of mineralized material in commercial quantities.  Most exploration projects do not result in the discovery of commercially mineable ore deposits.

#

ITEM 4.  INFORMATION ON THE COMPANY

4.A. History and Development of the Company

Introduction

Alpha Gold Corp. and its subsidiaries hereinafter also are referred to as the "Company".  The Company was incorporated in the province of British Columbia on February 25, 1985 under the name Info-Stop Communications Inc.  On September 25, 1990 the name was changed to Alpha Gold Corp.  The Company has been in the natural resource exploration business since 1990. The principal business events since then are (most important and recent matters first):

  (a)

the 1989 and 1992 acquisition of a 100% interest in the Lustdust Property, a gold-copper prospect located in North Central British Columbia;

  (b)

the 1994 and 1995 acquisition of the option to acquire a 100% interest in the Goldbanks Property, 25 lode claims located in Nevada.

The Company does not have any operating revenue although historically it has had annual interest revenue as a consequence of investing surplus funds pending the completion of exploration programs. The resource extraction business has historically been cyclical and the prices received for copper and gold have been volatile and, in the case of gold affected by factors and sentiments outside of the cost of production. The mining business operates in a worldwide market and prices are derived from relatively pure market forces so competition to sell any metals or concentrates produced is not an issue if metals prices warrant production.

The Company’s executive office is located at:

  410 Donald Street

  Coquitlam, B.C. Columbia, CANADA  V3K 3Z8

  Telephone: (604) 939-7943

  Facsimile: (604) 939-4981

  E-Mail: alpha-gold@shaw.ca

  Website: http://www.alphagold.bc.ca

The Company’s registered office is located at:

  Lang Michener

  Barristers & Solicitors

  1055 West Georgia St., Suite 1500

  Vancouver, B.C. Canada V6E 4N7

The contact person is:

   Mr. George Whatley, President.

The Company's fiscal year ends the last day of February.

The Company's common shares have traded on the TSX Venture Exchange under the symbol "ALQ" since 9/20/1990.

The Company has 100,000,000 common shares, with no par value, authorized. At February 28, 2007, the end of the Company's most recent year, there were 29,036,919 common shares issued and outstanding.  

In this Annual Report, unless otherwise specified, all dollar amounts are expressed in Canadian Dollars (CDN$).

#

Incorporation and Name Changes

The Company was incorporated in the province of British Columbia on February 25, 1985 under the name Info-Stop Communications Inc.  On September 25, 1990 the name was changed to Alpha Gold Corp. and changed from an advertising company to a natural exploration company just prior to that time.

The Company's initial public offering was pursuant to a prospectus effective only in Canada under the auspices of the Vancouver Stock Exchange and pursuant to a registration statement filed with the British Columbia Securities Commission, under the former name “Info-Stop Communications Inc.”.  The common shares were called for trading on the Vancouver Stock Exchange in 1986 and since the merger of the Vancouver Stock Exchange and the Alberta Stock Exchange, which resulted in the formation of the TSX Venture Exchange in November of 1999; it has traded on the TSX Venture Exchange.

Financings

The Company has financed its operations through funds raised from public/private placements of common shares, shares issued for property, shares issued in debt settlements, and shares issued upon exercise of stock options and share purchase warrants.

____________________________________________________________________________________________________________________________________________________________

Fiscal Year	Nature of Share Issuance	Number of Shares	Capital Raised
2004	Private Placement (1)	1,500,000	$525,000
	Exercise of Stock Options	175,000	$57,750
	Exercise of Share Purchase Warrants (2)	685,714	$315,429
	Exercise of Share Purchase Warrants (3)	250,000	$125,000
	Exercise of Share Purchase Warrants (3)	100,000	$50,000
	Exercise of Share Purchase Warrants (4)	50,000	$21,500
	Private Placement (5)	999,999	$599,999
2005	Private Placement (6)	575,000	$230,000
	Exercise of share purchase warrants (7)	78,100	$39,050
	Exercise of share purchase warrants (8)	396,400	$170,452
2006	Private Placement (9)	957,260	$478,630
2007	Private Placement (10)	3,499,225	$1,399,690
	Exercise of Share Purchase Warrants (11)	128,750	$77,250

(1)

1,500,000 common shares were issued for $0.35 per share (of which 663,900 were “flow-through common shares”) that provided purchasers with warrants to purchase one additional common share at a price of $0.43 per share expiring February 18, 2005.

(2)

These share purchase warrants were associated with a private placement financing which closed on April 16, 2001. 571,428 units were sold pursuant to this private placement at a price of $0.35 per share. Each unit consisted of one common share and one common share purchase warrant. Each common share purchase warrant entitled the holder to purchase one additional common share at a price of $0.46 until April 16, 2003.

(3)

These share purchase warrants were associated with a private placement financing which closed on April 23, 2001. 300,000 units were sold pursuant to this private placement at a price of $0.40 per unit. Each unit consisted of one common share and one common share purchase warrant. Each warrant entitled the holder to purchase one additional common share at a price of $0.50 until April 22, 2003.

(4)

These share purchase warrants were associated with a private placement financing which closed on May 22, 2002. 3,135,620 units were sold at a price of $0.40 per unit. Each unit consisted of one common share and one share purchase warrant. Each warrant entitled the holder to purchase an additional share at a price of $0.50 until May 27, 2004.

(5)

This private placement consisted of the sale of 999,999 units. Each unit consisted of one flow-through share and one non-flow through share purchase warrant. Each non-flow-through share purchase warrant entitled the holder to purchase one additional common share at a price of $1.15 until December 19, 2004.

(6)

This private placement consisted of the sale of 575,000 units at a price of $0.40 per unit. Each unit consisted of one flow-through share and one non-flow through share purchase warrant. Each share purchase warrant entitled the holder to purchase one additional non-flow-through common share at a price of $0.46 until July 15, 2006.

(7)

These share purchase warrants were related to the financing described in (4) above.

(8)

These share purchase warrants were related to the financing described in (1) above.

(9)

This private placement consisted of the sale of 957,260 units.  A total of 285,000 of the Units were flow-through units. The warrants comprised in the Units and flow-through Units are exercisable to purchase an additional non-flow-through common share at a price of $0.50 until July 25, 2007.  All shares issued, including any shares issued on exercise of the warrants, bore a legend restricting transfer until November 26, 2005.  Alpha paid 7% cash commission on 210,000 Units and issued 14,700 brokers warrants to Canaccord Capital Corporation.  Each broker warrant is exercisable to purchase a common share of Alpha at a price of $0.50 until July 25, 2007.

(10)

This private placement consisted of the sale of 3,499,225 units. A total of 2,781,500 were flow-through units. Each unit consisted of one common share and one-half of one share purchase warrants. Each whole share purchase warrant is exercisable to purchase one additional non flow-through common share for $0.60 until July 28, 2007.

(11)

These share purchase warrants were related to the financing described in (10) above.

_____________________________________________________________________________

_____________________________________________________________________________

Capital Expenditures

2004:

During the Fiscal Year ended February 29, 2004, the Company spent $956,652 on exploration work on its Lust Dust Property. The Company also spent an additional $5,300 on plant, property and equipment. The plant, property and equipment consisted of miscellaneous office equipment.

2005: During the Fiscal Year ended February 28, 2005, the Company spent $661,264 on exploration work on its Lust Dust Property.  The Company also spent an additional $82,743 on plant, property and equipment. The plant, property and equipment consisted of two new vehicles.

2006: During the Fiscal Year ended February 28, 2006; the Company spent $720,510 on exploration work on its Lust Dust Property. (These expenses are all disclosed in the Schedule of Deferred Expenditures, which are a part of the audited financial statements for the Fiscal Year ended February 28, 2006 and included with this document.) The Company also spent an additional $1,988 on computer equipment.

2007: During the Fiscal Year ended February 28, 2007; the Company spent $1,147,466 on exploration work on its Lust Dust Property. (These expenses are all disclosed in the Schedule of Deferred Expenditures, which are a part of the audited financial statements for the Fiscal Year ended February 28, 2006 and included with this document.)The Company also spent an additional $22,003 on equipment.

4.B.  BUSINESS OVERVIEW

Historical Corporate Development

Alpha Gold Corp. is a natural resource property exploration company in the exploration stage with no history of cash flows from operations. There is no assurance that a commercially viable mineral deposit exists on any of the Company’s properties and further exploration will be necessary before a final evaluation based upon such work concludes economic and legal feasibility.  

Currently the only specific governmental rules and regulations, which the Company must adhere, is that it must obtain a work permit from the British Columbia Department of Mines each year.

The Company’s primary focus is on its Lustdust Property, which is located in British Columbia. The Company also held an option to acquire a 100% interest in the Goldbanks Property, which is located in Pershing County, Nevada. During Fiscal 2006, ended February 28^th, the Company abandoned its interest in the Goldbanks Property so that it could concentrate all of its efforts on the Lust Dust Property.

Exploration activity on the Lust Dust Property can only be undertaken during the spring and summer seasons because of adverse weather conditions, which occur during the fall and winter months.

Plan Of Operations

Source of Funds for the Fiscal Year ended February 29, 2006

The Company’s primary source of funds since incorporation has been through the issuance of common shares and Special Warrants.  Currently the Company does not have operating revenues, and the Company does not anticipate generating any operating revenue until the Lustdust project begins production.  For the Fiscal Year ended February 28, 2007, the Company raised $1,476,940 from the issuance of 3,627,975 common shares.  

The Company had a working capital balance of $1,358,808 at 2/28/2007 and $1,425,879 at 2/28/2006.  The Company had $1,253,430 in cash and cash equivalents at 2/28/2007 and $1,257,178 at 2/28/2006.  

Use of Funds for the Fiscal Year ended February 28, 2007

During the Fiscal Year ending February 28, 2007, the Company estimates that it might expend $900,000 on exploration work and general administrative expenses.

Anticipated Changes to Facilities/Employees

The Company will continue to focus its efforts on the exploration of the Lustdust property.  The Company has no plans to add any additional personnel.  Management anticipates that any property exploration efforts will be carried out by outside contractors.

United States vs. Foreign Sales/Assets

The Company generated no sales revenue during the last three years.

At 2/28/2007, 2/28/2006, 2/28/2005: $8,008,679, $6,823,815 and $6,900,048, of the assets were located in Canada, primarily in the Lustdust property.

Material Effects of Government Regulations

The current and anticipated future operations of the Company, including further exploration and/or production activities require permits from various Canadian Federal and Provincial governmental authorities.  Such operations are subject to various laws governing land use, the protection of the environment, production, exports, taxes, labor standards, occupational health, waste disposal, toxic substances, well safety and other matters.  Unfavorable amendments to current laws, regulations and permits governing operations and activities of resource exploration companies, or more stringent implementation thereof, could have a materially adverse impact on the Company and cause increases in capital expenditures which could result in a cessation of operations by the Company.  The Company has had no material costs related to compliance and/or permits in recent years, and anticipates no material costs in the next year.

Seasonality

Dependency upon Patents/Licenses/Contracts/Processes

Sources/Availability of Raw Materials

--- No Disclosure Necessary ---

4.C. Organization Structure

Alpha Gold Corp. was incorporated by registration of its Memorandum and Articles under the Company Act (British Columbia) on 2/25/1985 under the name “Info-Stop Communications Inc.”  On 9/25/1990, the Company changed its name to Alpha Gold Corp., and changed from an advertising company to a natural resources exploration company just prior to that time.  The common shares of Alpha Gold have traded on the TSX Venture Exchange since 9/20/1990.

Alpha Gold has one non-material subsidiary.

Alpha and its subsidiaries own their mining Projects outright (subject to underlying royalty obligations).  

4.D.  Property, Plant and Equipment

The Company’s executive offices are located 410 Donald Street, Coquitlam, British Columbia, Canada V3K 3Z8.

Lustdust Property

The Lustdust Property does not represent a producing property and the Company’s current operations are an exploratory search for mineable deposits of minerals.

The Company has had no revenue from mining operations on The Lustdust Property to date.

Acquisition Details

On July 15, 1989, the Company acquired its initial interest in what is now called the Lustdust Property by acquiring a 100% interest in a group of mineral claims in the Omineca Mining Division of British Columbia for cash consideration of $170,000 and allowing the vendor to retain a 3% net smelter return on any future sale of minerals.

On February 21, 1992, the Company purchased a 100% interest in its second and final major portion of land comprising what is now called the Lustdust Property. Consideration paid was $100,000 in cash and 200,000 common shares of the Company at a deemed price of $0.60 per share. The purchase was subject to a 5% net profit interest to a maximum of $100,000 and the vendor retained a 2% net smelter return royalty. (The Company retained the right to repurchase one-half of the net smelter return royalty for $500,000 cash.)

At the end of 2000 the Company filed claim to twenty additional units located on the west and north edges of the claim block.

The Company’s current land holdings consist of 238 claim units and covers seventeen square miles.

Property Description

The Lustdust Property occurs at the eastern edge of a belt of Permian age, Cache Creek group, sediments and lesser volcanics. This belt, up to 30 kilometers wide, extends northwesterly and southeasterly for several hundred kilometers parallel to the Stuart-Trembleur-Takla Lake system. This package of rock units has an apparent minimum thickness of three kilometers and consists of thick, massive, but discontinuous limestone strata, overlain by a mixed assemblage of chert and agrillite with subordinate andesitic volcanics.  Tight folding along northwest-southeast axes has affected all formations and is most evident as extreme crumpling of the chert/argillite units. The sedimentary package is bounded on the east by upper Jurassic, granitoid, intrusive rocks of the Hogem batholith north of Techentlo Lake and by Upper Jurassic Takla Group marfic volcanics and sediments further south.

The dominant structural feature of the region is the Pinchi Fault Zone.  This is a major regional feature which is evident throughout much of the British Columbia interior and which, in the Lustdust Property area, forms the eastern contact of the Cache Creek belt.

Limestone and intercalcated chert/phyllite of the Cache Creek group are the most extensive rock units on the Lustdust Property.  Cache Creek rocks generally strike northwestward and dip vertically to steeply westward.  The sediments contain minor amounts of intermediate to basic tuffaceous volcanics.  Satellite stocks and dikes of the Early Jurassic Hogem Batholith crop out on the property. The intrusions are coarsely crystalline and range in composition from granodiorite to quartz monzonite.  Most of the intrusions occur north of Canyon Creek. The last intrusive event was a series of feldspar-porphyry dikes.  These dikes might be Tertiary in age and are spatially related to the Lustdust replacement and vein deposits suggesting a genetic relationship.

To date, vein and replacement mineralization on the Lustdust Property has been located in four main en echelon zones representing a discontinuous strike length of some 1200 meters. Strike direction of these zones is north to northwesterly.

Of the four economically inferred zones recognized to date management believes that there are two distinct styles of mineralization.  Zones 1 and 2 are described as structurally controlled veins while zones 3 and 4b appear as massive replacements within the sedimentary sequence.  Previous work on the property has suggested that the 3 and 4b zones may represent manto, replacement-type mineralization.  The mineralized setting and metal zoning at Lustdust is similar to large-scale hydrothermal cells associated with “porphyry type” environments of the North American cordillera.  These systems are commonly zoned from a central copper/molybdenum/gold core, within the intrusive, moving outward to base metal skarn replacements, gold and silver rich base metal veins and replacements, and distal epithermal gold, silver, and mercury deposits.

Location and Access

The Lustdust Property is located in the Omineca Mining Division of north-central British Columbia, NTS 93N/11W at latitude 55 34’ North and 125 25” West.  The property is located approximately 210 kilometers northwest of the town of Prince George, BC and 36 km east of Takla Landing (where there is a BC rail line.)

Access to the property is gained by traveling approximately 45 kilometers of paved road from Fort St. James towards Tachie Lake and then 68 kilometers along the Leo Creek Road, 56 kilometers along the Driftwood Road, approximately 20 kilometers along the Fall-Tsayta Road and 3 kilometers along the Silver Creek Road.  This comprises a total of 147 kilometers along forest service roads.

The terrain is moderate, ranging in elevation from 1000 meters to 1525 meters on the property.  Lower elevations are covered by widely spaced lodge-pole pine trees; while at elevations above 1200 meters, forest cover consists of over-mature spruce and balsam trees.  Summers are short and rainy while moderate snowfall in winters persists from late September through April/May at the higher elevations.

Previous Work

During the Year 2000, the Company spent $345,817 on exploration work on the Lustdust Property.

The Year 2000 Work Program consisted of exploratory drilling involving twenty-nine drill holes encompassing 4680 meters.

Overall, management feels that the 2000 Lustdust drilling was successful in that it encountered copper-gold mineralization. The 2000 program also indicated that copper; gold and zinc mineralization occurs within at least a 475-meter long segment of the CCSZ Zone. The drilling also showed that width and grade increases downwards and to the west and further indicates that the source of the system lies in that direction.

Virtually all of the drill holes encountered gold, silver, copper, lead and zinc mineralization as indicated in the Company’s press release dated October 2, 2000.

The Company’s Year 2001 Exploration Program focused on: 1) Drilling magnetic anomalies detailed in the Year 2000 Exploration Program; 2) Continued drilling of the Canyon Creek Skarn particularly in the area of the inferred Canyon Creek Fault and to depth.

The Year 2001 Exploration Program included 18 diamond drill holes totaling 5609 meters; approximately six kilometers of new roads and drill stations; detailed structural mapping and interpretations; reconnaissance mapping of areas west of the explored zone; and, detailed igneous petrography and geochemical analyses and fluid inclusion study of several intrusive and mineralization phases.

The costs associated with the Year 2001 Exploration Program were $559,064. All of these costs were associated with the work described in the preceding two paragraphs.

During its 2002 exploration program, the Company engaged in a drill program involving testing and defining a series of gold-copper and gold targets on its Lustdust Property.

Drill results from diamond drill hole 2-01 and diamond drill hole 2-02 are as follows:

Diamond drill hole 2-01 was collared at UTM coordinates 6161800 N, 0346591 E, collar azimuth 050 degrees and collar dip 56 degrees.   The borehole cuts a thick, ninety-seven meter wide, andradite-chlorite skarn body containing several mineralized zones.  Highest grade Mineralization in diamond drill hole 2-01 is associated with a strongly mineralized chalcopyrite-magnetic-chlorite (retrograde) skarn.  Over a drill indicated width of 18.75 meters (531.25 to 550.0 meters) 0.95 g/T Au, 17.1 g/T Ag and 1.62% Cu were cored.

Diamond drill hole 2-02 was collared at UTM coordinates 6161985 N, 346745 E. collar azimuth 050 degrees and collar dip 57 degrees.  The borehole cuts a thick, 114 meter wide, skarn body containing both copper and gold mineralized zones.  Highest grade gold Mineralization in diamond drill hole 2-02 is associated with a 1.0-meter (drill indicated width, 510.5 – 511.5 meter) massive sulphides replacement zone developed at the contact between a retrograde skarn zone and limestone.  This high sulfide replacement body assayed 61.3 g/T Au, 181 g/T Ag and 0.87% Cu.

The costs associated with the 2002 drill program were $572,000.

The 2003 drill program consisted of the following work:

1.

Systemic drilling to follow the best mineralized 2002 intercepts in the Canyon Creek Skarn Zone to depth;

2.

Systematic drilling under mineralized skarn that has not been drilled at comparable depths: and,

3.

Continued field-based exploration to further unravel the structural details of the property and find additional mineralized zones on the property.

The drilling program was designed to expand the focus of exploration beyond the Canyon Skarn area of the Lustdust Property. This program targeted gold mineralized zones in three areas, including the Number 1 Zone, the Number 3 Zone and the Canyon Skarn. The Company completed 7,908 meters of drilling in 42 boreholes. Drill results are presented on the table below with intersection widths indicated.  

2003 NUMBER ONE ZONE DIAMOND DRILL ASSAYS

DDH From/To Length Gold Silver Lead Zinc Copper

2003 NUMBER 3 ZONE DIAMOND DRILL ASSAYS

DDH	From/To	Length	Gold	Silver	Lead	Zinc	Copper
	(meters)	(meters)	(grams/ton)	(grams/ton)	(percent)	(percent)	(percent)

2003 CANYON SKARN DIAMOND DRILL ASSAYS

DDH	From/To	Length	Gold	Silver	Lead	Zinc	Copper
	(meters)	(meters)	(grams/ton)	(grams/ton)	(percent)	(percent)	(percent)

The 2004 drilling program occurred between March 1, 2004 and February 28, 2005. During this time the Company completed a 21 hole, 6,010 meter diamond drilling, and soil geochemistry program.

Highlights of the this program include:

1.

The Canyon Creek Skarn Zone was extended approximately 400 meters to the north.  This extension consists of prograde and retrograde exoskarn with high pyrrhotite:pyrite ratios, high pyroxene:garnet ratios, and high-grade precious metal values.

•

Drill-hole LD04-01 returned 176.0 g/t Ag and 4.02% Pb over 1.0m from 61.2-62.2 meters.

•

Drill-hole LD04-02 returned 50.7 g/t Au over 0.6m from 244.4 to 245.0 meters

•

Drill-hole LD04-08 returned 15.35 g/t Au over 1.2m from 148.6 to 149.8 meters

•

Drill-hole LD04-13 returned 12.70 g/t Au over 1.6m from 236.1 to 237.7 meters

•

Drill-hole LD04-14 returned 378 g/t Ag over 1.3m from 245.3 to 246.6 meters

2.

The Number 3 oxide zone was extended 50 meters north of drill-hole LD03-27.

•

Drill-hole LD04-18 returned 2.23 g/t Au, 14.4 g/t Ag, and 2.75% Zn over 9.1m from 115.5 to 124.6 meters.

3.

A 450 meter long, gold-arsenic soil geochemistry anomaly was identified 300 meters east of and parallel to the Canyon Creek Skarn Zone.

Drill-hole results are summarized below.

DDH ID	AZ.	DIP	FROM	TO	Width	Au	Ag	Zn	Pb	Cu
			(m)	(m)	(m)	(g/t)	(g/t)	(%)	(%)	(%)
Canyon Creek Skarn Extension
LD04-01	085°	-56°	61.2	62.2	1.0	0.31	176.0	0.87	4.02	0.11
LD04-01	085°	-56°	119.6	125.1	5.5	0.88	6.0
LD04-02	086°	-55°	171.6	175.8	4.2	0.26	8.8	0.10		0.16
LD04-02	086°	-55°	244.4	245.0	0.6	50.70	3.7
LD04-02	086°	-55°	255.5	256.3	0.8	0.72	3.0			0.12
LD04-08	076°	-55°	148.6	149.8	1.2	15.35				0.08
LD04-08	076°	-55°	195.3	197.5	2.2	0.61				0.17
LD04-09	086°	-55°	151.2	158.7	7.5	1.07
LD04-09	086°	-55°	214.8	216.1	1.3	1.54	80.3
LD04-09	086°	-55°	244.7	246.1	1.4	3.38	15.0
LD04-09	086°	-55°	262.1	263.5	1.4	1.17	5.4
LD04-10	080°	-55°	29.6	35.7	6.1	0.58	9.9
LD04-11	090°	-55°	43.4	44.0	0.6	2.12	17.8	1.29
LD04-11	090°	-55°	86.5	89.3	2.8	1.27	34.8	0.33
LD04-11	090°	-55°	96.7	99.6	2.9	0.72	23.8
LD04-11	090°	-55°	107.7	109.4	1.7	4.64	16.9	0.21		0.10
LD04-11	090°	-55°	112.7	122.8	10.1	0.82	14.7			0.11
	including		115.4	118.6	3.2	1.43	28.4			0.18
LD04-12	089°	-55°	136.2	139.3	3.1	0.60	13.1	0.19
LD04-13	087°	-70°	105.9	107.7	1.8	0.36	20.9	0.53
LD04-13	087°	-70°	236.1	237.7	1.6	12.70
LD04-13	087°	-70°	298.9	302.2	3.3	0.88
LD04-14	089°	-55°	243.7	247.9	4.2	1.08	137.1			0.24
LD04-15	092°	-55°	88.0	89.5	1.5	0.33	59.7			1.4
Canyon Creek Skarn
LD04-04	050°	-45°	109.0	110.1	1.1	0.36	15.0			0.84
LD04-04	050°	-45°	110.7	120.9	10.2	0.62	31.5			1.57
LD04-04	050°	-45°	133.6	142.3	8.7	0.21	7.5			0.45
LD04-04	050°	-45°	156.6	158.2	1.6	0.39	8.0			0.56
LD04-04	050°	-45°	184.6	188.6	4.0	0.40	18.2			0.95
LD04-04	050°	-45°	219.9	221.6	1.7	0.53	30.5			1.71
LD04-05	053°	-65°	185.6	191.5	5.9	1.37	18.0			1.28
LD04-06	045°	-45°	76.3	77.4	1.1	0.42	7.9			0.33
LD04-06	045°	-45°	159.0	160.1	1.1	2.54				0.07
LD04-06	045°	-45°	179.9	181.2	1.3	0.39	10.2			0.47
LD04-07	045°	-65°	69.5	78.0	8.5	0.23				0.14
Number 3 Manto
LD04-18	064°	-55°	115.5	124.6	9.1	2.23	14.4	2.75

On June 9, 2006 Alpha Gold mobilized a diamond drill rig to test 3 areas of anomalous soil geochemistry on its 100%-owned Lustdust Property in central British Columbia. The planned diamond-drilling program of 5,000 meters in 24 holes will last approximately 6 to 8 weeks and will be followed by a reverse-circulation drilling program designed to test the potential for sediment-hosted gold mineralization elsewhere on the property.

On August 3, 2006, the Company announced that it had completed fifteen diamond drill holes on the property and that drilling would continue into the fall and winter months.

On September 26, 2006, the Company announced that, resulting from a trenching program that occurred during the summer months, a new mineralized zone was discovered on the Lustdust property. This zone contains gold, silver, lead and zinc values.

On January 18, 2007, the Company announced that another mineralized zone, called the Valley Zone, had been identified on the property as a result of the diamond drilling that occurred during the fall and winter months. This zone is located about three kilometers south/southeast of the Canyon Creek Skarn and Skarn Extension Zones. Access to this area is available year-around.

The company began a new exploration program in June 2007. This program consists of 10,000 meters of diamond drilling and line-cutting for the 44-kilometer Induced Polarization survey extending to the property’s boundaries to the east and south.

It is expected that the current exploration program will continue into December 2007 at a cost of $2.5 million.

The Company believes that there are no major obstacles that it will have to overcome to continue its exploration program on this property.

Goldbanks Property

During the fiscal year ended February 28, 2006, Alpha Gold abandoned its interest in this property and wrote off all expenditures to operations. Alpha Gold wrote off this property because management decided to concentrate all of the Company’s efforts and capital on the Lust Dust Property.

ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion for the Fiscal Years Ended February 28, 2007, and February 28, 2006 should be read in conjunction with the financial statements of the Company and the notes thereto.

Overview

During the Fiscal Year ended February 28, 2003 the Company raised $1,342,498 through the sale of 3,360,620 shares.

During the Fiscal Year ended February 29, 2004 the Company raised $1,619,458 through the sale of 3,669,804 shares.

During the Fiscal Year ended February 28, 2005 the Company raised $439,502 through the sale of 1,049,500 shares.

During the Fiscal Year ended February 28, 2006 the Company raised $478,630 through the sale of 957,260 shares.

During the Fiscal Year ended February 28, 2007 the Company raised $1,476,940 through the sale of 3,627,975 shares.

During the Fiscal Year ended February 28, 2007 and for the preceding five fiscal years, Alpha Gold has been involved in the exploration for mineral deposits in British Columbia.

Results of Operations

The Fiscal Year Ended February 28, 2007 vs. the Fiscal Year Ended February 28, 2006

The loss for the fiscal year ended February 28, 2007 was ($298,178) or ($0.01) per share compared to ($415,746) or ($0.02) per share for the fiscal year February 29, 2006. The lower net loss for the fiscal year ended February 28, 2007 as compared to the fiscal year ended February 29, 2006 was due primarily to the fact that Alpha Gold wrote off no properties, as had occurred in the prior fiscal year.

Regarding the expenses, with the exception of the categories of Loss (gain) on disposal of equipment, shareholder relations, stock based compensation and property write-off the expense figures were similar to those of the last fiscal year.

The Company disposed of some equipment through a sale to an unrelated third party and recorded a gain in the amount of $30,115.

The category of shareholder relations increased by $85,856 as compared to the prior fiscal year. This was due to the fact that the Company retained the services of CHF Investor Relations. The terms of the agreement call for Alpha Gold to pay CHF Investor Relations $7,500 per month plus reimbursement for pre-approved expenses. CHF Investor Relations also received 250,000 share purchase options at a price of $0.40 subject to the normal vesting requirements of the TSX Venture Exchange.

The increase that occurred during the fiscal period in the category of “stock based compensation” resulted from the issuance of a greater number of share purchase options during Fiscal 2007 as compared to Fiscal 2006. For the fiscal year ended 2/28/2007 the amount was $195,500 as compared to $9,300 for the fiscal year ended 2/28/2006.  During the fiscal year ended 2/28/2007, the Company granted 1,200,000 stock options. Based on the fair values for the options granted, compensation expense of $195,500 was recorded in operations for the year.

During the fiscal year ended February 28, 2006, the Company wrote off its Goldbanks Property in the amount of $323,636 as discussed earlier. During Fiscal 2007, no properties were written-off.

Exploration costs increased during Fiscal 2007 to $1,232,929 compared to $720,510 during Fiscal 2006. Exploration expenditures during Fiscal 2007 were: assaying: $90,124; camp expenses: $90,198; drilling: $804,520; filing fees & claim assessment: $17,446; fuel: $601; geological/geochemical work and reports: $128,978; on-site management: $20,000; roadwork/reclamation $59,636; and, travel expenses of $21,426.

The Fiscal Year Ended February 28, 2006 vs. the Fiscal Year Ended February 28, 2005

The loss for the fiscal year ended February 28, 2007 was ($415,746) or ($0.02) per share compared to ($230,372) or ($0.01) per share for the fiscal year February 29, 2005. The higher net loss for the fiscal year ended February 28, 2007 as compared to the fiscal year ended February 29, 2005 was due primarily to the fact that Alpha Gold wrote off its Goldbanks Property, in the amount of $323,636, during Fiscal 2006. As disclosed earlier, management decided to abandon this property because of the decision to concentrate all of the Company’s efforts and capital on its Lustdust Property.

Regarding the expenses, the most significant increase was in the category of “Write-off of cost of and expenditures on exploration properties abandoned” as disclosed above. A significant decrease also occurred during the fiscal period in the category of “stock based compensation”. For the fiscal year ended 2/28/2006 the amount was $9,300 as compared to $83,000 for the fiscal year ended 2/28/2005.  During the fiscal year ended 2/28/2006, the Company granted 100,000 stock options. Based on the fair values for the options granted, compensation expense of $9,300 was recorded in operations for the year.

Expenses during Fiscal 2006 increased to $587,325, as compared to $288,592 during Fiscal 2005. However, when the write-off of the Goldbanks property is factored out overall expenses were about the same.

Exploration costs decreased during Fiscal 2006 to $627,978 compared to $661,264 during Fiscal 2005. Exploration expenditures during Fiscal 2006 were: assaying: $31,645; camp expenses: $22,739; drilling: $496,140; filing fees & claim assessment: $5,006; fuel: $242; geological/geochemical work and reports: $125,682; on-site management: $9,000; roadwork/reclamation $18,714; and, travel expenses of $11,342.

During the year, the company abandoned its interest in the Goldbanks property and wrote off all expenditures totaling $323,636 to operations.

The Fiscal Year Ended February 28, 2005 vs. the Fiscal Year Ended February 29, 2004

The loss for the fiscal year ended February 28, 2005 was ($230,372) or ($0.01) per share compared to ($165,687) or ($0.01) per share for the fiscal year February 29, 2004. The slightly higher net loss for the fiscal year ended February 28, 2005 as compared to the fiscal year ended February 29, 2004 was due primarily to an increase in expenses of $24,788, a decrease in the category of “other income” in the amount of $11,167 and a decrease in the amount of the recovery of “future income taxes in the amount of $28,730.

Regarding the expenses, the most significant increase was in the category of “stock based compensation”. For the fiscal year ended 2/28/2005 the amount was $83,000 as compared to nil for the fiscal year ended 2/29/2004.  During the fiscal year ended 2/28/2005, the Company granted 500,000 stock options. Based on the fair values for the options granted, compensation expense of $83,000 was recorded in operations for the year.

The Company also recorded a decrease for the fiscal year ended 2/28/2005 as compared to the fiscal year ended 2/29/2004 in the category of shareholder relations in the amount of $57,419. The decrease was the result of managements’ decision to curtail expenses related to stock promotion in Canada. Management made this decision based in their perceived lack of Canadian investor interest in junior resource stocks.

The Company received interest on its bank deposits in the amount of $36,685 during the Fiscal Year ended February 28, 2005 as compared to interest in the amount of $50,292, which was received during the Fiscal Year ended February 29, 2004. The lower level of interest received during the Fiscal Year ended February 28, 2005 resulted from the lower cash and term deposit balance during the Fiscal Year ended February 28, 2005.

The “future income tax recovery” was lower in the amount of ($11,167) for the Fiscal Year ended February 28, 2005 as compared to the prior Fiscal Year. This amount was lower because of lower expenditures incurred on the properties, which caused timing differences between actual taxes payable and future income taxes.

During the Fiscal Year ended February 28, 2005, expenditures of $661,264 were made on the Company’s mineral properties, which was lower than the $956,652 of expenditures made during the Fiscal Year ended February 29, 2004. These expenditures reflect a decreased amount of exploration activity at the Lustdust Property.

Liquidity and Capital Resources

The Fiscal Year Ended February 28, 2007

The working capital of the Company at February 28, 2007 was $1,358,808 as compared to $1,425,879 at February 29, 2006. The Company continued to have no long-term debt at February 28, 2007.

Cash provided by (used in) in the Twelve Months Ended February 28, 2007 by Operating Activities totaled ($267,961) including the net loss of ($298,178). Significant adjustments not affecting cash during the year were amortization in the amount of $24,983; “future income tax recovery” in the amount of ($160,151); stock based compensation in the amount of 195,500; and, gain on disposal of equipment in the amount of $30,115. The “future income tax recovery” resulted from the fact that there were additional expenditures incurred on the properties, which caused timing differences between actual taxes payable and future income taxes. The stock based compensation resulted from the issuance of 1,200,000-share purchase options.

Cash Used in Twelve Months Ended February 28, 2007 Investing Activities totaled ($1,143,463), consisting primarily of items related to mineral properties.

Cash Provided by Twelve Months Ended February 28, 2007 Financing Activities totaled $1,433,638 consisting of the issuance of common stock as disclosed earlier.

The Fiscal Year Ended February 28, 2006    

The working capital of the Company at February 28, 2006 was $1,425,879 as compared to $1,777,087 at February 29, 2005. The Company continued to have no long-term debt at February 28, 2006.

Cash provided by (used in) in the Twelve Months Ended February 28, 2006 by Operating Activities totaled ($192,521) including the net loss of ($415,746). Significant adjustments not affecting cash during the year were amortization in the amount of $28,427; “future income tax recovery” in the amount of ($138,138); stock based compensation in the amount of 49,300; and, write-off of cost of and expenditures on exploration properties abandoned in the amount of $323,636. The “future income tax recovery” resulted from the fact that there were additional expenditures incurred on the properties, which caused timing differences between actual taxes payable and future income taxes. The stock based compensation resulted from the issuance of 100,000-share purchase options. And the write-off of cost of and expenditures on exploration properties abandoned resulted from the Company abandoning the Goldbanks Property.

Cash Used in Twelve Months Ended February 28, 2006 Investing Activities totaled ($629,978), consisting primarily of items related to mineral properties.

Cash Provided by Twelve Months Ended February 28, 2006 Financing Activities totaled $471,280 consisting of the issuance of common stock as disclosed earlier.

The Fiscal Year Ended February 28, 2005    

The working capital of the Company at February 28, 2005 was $1,777,087 as compared to $2,225,344 at February 29, 2004. The Company continued to have no long-term debt at February 28, 2005.

Cash provided in the Twelve Months Ended February 28, 2005 by Operating Activities totaled ($59,195) including the net loss of ($230,372). The two significant adjustments not affecting cash during the year were amortization in the amount of $23,895 and the “future income tax recovery” in the amount of ($22,602). The “future income tax recovery” resulted from the fact that there were additional expenditures incurred on the properties, which caused timing differences between actual taxes payable and future income taxes.

Cash Used in Twelve Months Ended February 28, 2005 Investing Activities totaled ($744,007), consisting primarily of items related to mineral properties.

Cash Provided by Twelve Months Ended February 28, 2005 Financing Activities totaled $439,502 consisting of the issuance of common stock as described earlier.

US GAAP Reconciliation

The financial statements have been prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP) which differ in certain respects from those principles that the Company would have followed had its financial statements been prepared in accordance with United States generally accepted accounting principles (US GAAP).

a)

US GAAP requires that exploration costs related to projects at a pre-feasibility stage of development be charged to expense as incurred. Under Canadian GAAP costs incurred prior to the point where feasibility can be determined are not precluded from initial capitalization and subsequent deferral.

b)

Due to the write off of exploration costs, the future income liability for US GAAP is nil.

c)

Had the Company followed US GAAP, certain items on the statements of income and deficit would have been reported as follows:

	Cumulative, inception to February 28, 2007	2007	2006	2005
Loss per Canadian Gaap	($3,492,818)	($298,178)	($415,746)	($230,372)
Effect of the write-off exploration costs for the year	(6,548,780)	(1,229,752)	(304,342)	(661,265)
Effect of future income taxes	702,943	(111,558)	(138,138)	22,602
Loss per US GAAP	($9,338,655)	$(1,639,488)	($858,226)	($869,034)
Basic loss per share under US GAAP		($0.06)	($0.03)	($0.04)

d) The effects of the differences in accounting under Canadian GAAP and US GAAP on the balance sheets and statements of cash flows are as follows:

Balance Sheets	2007		2006
	Canadian GAAP	US GAAP		Canadian GAAP	US GAAP
Current assets	$1,384,273	$1,384,273		$1,430,289	$1,430,289
Reclamation bonds	25,000	25,000		7,000	7,000
Exploration properties and deferred costs	6,548,780			5,319,028	-
Equipment	50,626	50,626		67,498	67,498
	$8,008,679	$1,459,899		$6,823,815	$1,504,787
Current liabilities	$25,465	$25,465		$11,410	$11,410
Future income tax liability	702,943			814,501	-
Share capital	10,483,489	10,483,489		9,098,444	9,098,444
Contributed surplus	289,600	289,600		94,100	94,100
Deficit	(3,492,818)	(9,338,655)		(3,194,640)	(7,699,167
	$8,008,679	$1,459,899		$6,823,815	$1,504,787

e) Reconciliation of statements of cash flows

		2007
	Operations	Investing	Financing
Cash provided by (used) per Canadian GAAP	$(293,923)	$(1,143,463)	$1,433,638
Effect of the write-off of exploration and G&A project costs	(1,229,752)	1,229,752	-
Cash generated (used) per US GAAP	$(1,523,675	$86,289	$1,433,638
		2006
Cash provided by (used) per Canadian GAAP	$(180,841)	$(722,498)	$471,280
Effect of the write-off of exploration and G&A project costs	(720,510)	720,510
Cash generated (used) per US GAAP	$(901,351)	$(1,988)	$471,280

		2005
	Operations	Investing	Financing
Cash provided by (used) per Canadian GAAP	$(180,841)	$(722,498)	$471,280
Effect of the write-off of exploration and G&A project costs	(720,510)	720,510	-
Cash generated (used) per US GAAP	$(901,351)	$(1,988)	$471,280

Variation in Operating Results

The Company is presently exploring its properties for sufficient reserves to justify production.  None of its properties are yet in production and consequently, the properties do not produce any revenue.  As a result there is little variation expected in operating results from year to year and little is to be expected until such time, if any, as a production decision is made on one of its properties.

The Company derives interest income on its bank deposits, which depend on the Company's ability to raise funds.  

Management periodically through the exploration process, reviews results both internally and externally through mining related professionals.  Decisions to abandon, reduce or expand exploration efforts is based upon many factors including general and specific assessments of mineral deposits, the likelihood of increasing or decreasing those deposits, land costs, estimates of future mineral prices, potential extraction methods and costs, the likelihood of positive or negative changes to the environment, permitting, taxation, labor and capital costs.  There cannot be a pre-determined hold period for any property as geological or economic circumstances render each property unique.

The Company's financial statements are stated in Canadian Dollars (CDN$) and are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP), the application of which, in the case of the Company, conforms in all material respects for the periods presented with United States GAAP except as noted in Footnote 10 to the financial statements.  The value of the U.S. Dollar in relationship to the Canadian Dollar was 1.17 as of February 28, 2007.

The Company has financed its activities through the distribution of equity capital.  The timing of such distributions was dependent on the requirements of the Company and the economic climate.  The Company anticipates having to raise additional funds by equity issuance in the next several years, as the Company does not expect to generate material revenue from mining operations or to achieve self-sustaining commercial mining operations for several years.

5.E.  Off-Balance Sheet Arrangements.

The Company has no off-balance sheet arrangements.

5.F.  Tabular disclosure of contractual obligations.

The Company has no contractual obligations.

ITEM 6.  DIRECTORS, SENIOR MANAGEMENT, AND EMPLOYEES

6.A.  Directors and Senior Management

Table No. 3 lists as of February 28, 2007, the names of the Directors and Senior Management of the Company.  The Directors have served in their respective capacities since their election and/or appointment and will serve until the next Annual General Meeting or until a successor is duly elected, unless the office is vacated in accordance with the Articles/By-Laws of the Company.  The Senior Management serves at the pleasure of the Board of Directors.  Senior Management are citizens and residents of Canada.  All Directors are residents and citizens of Canada, except Claus te Wildt who is a resident and citizen of the United States.

Table No. 3

Directors and Senior Management

2/28/2007

_____________________________________________________________________________

_____________________________________________________________________________

Name	Position	Age	Date of First Election or Appointment
George Whatley (1) (2)	President/Director	70	11/8/1995
Richard Whatley (1) (3)	Secretary/Director	48	12/14/1989
Carl Pines (1)	Director	59	10/29/1999
Claus te Wildt (4)	Director	41	8/30/2005

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(1)  Member of Audit Committee.

(2)  He spends 100% of his time on the affairs of the Company.

(3)  He spends 25% of his time on the affairs of the Company.

(4)  He spends 10% of his time on the affairs of the Company.

__________________________________________________________________________________________________________________________________________________________

George Whatley has been the President of the Company since 1990. Prior to that, from 1970 to 1990, he was the owner of Gibbs Nortac Industries, a private manufacturer and supplier of fishing lures. From 1963 to 1970 he was a self-employed exploration consultant.

Richard Whatley, P.Eng is a self-employed chemical and environmental engineer. He received his Bachelor of Science degree in Chemical Engineering from the University of British Columbia and his Master of Science degree in Biomedical Engineering from the University of British Columbia.

Carl Pines is a lawyer with the law firm Pines, McIntyre & Shrieves.

Claus te Wildt is the Investment Director of Fidelity Investments Institutional Services Company, Smithfield, Rhode Island, USA, since January 2006.  Founder and former Managing Director of teMac Investments LLC, a California based investment firm from June 2004 to December 2006, former Global Head of Institutional Business, Dresdner Asset Management from 1998 to June 2004.  

The Directors have served in their respective capacities since their election and/or appointment and will serve until the next Annual General Meeting or until a successor is duly elected, unless the office is vacated in accordance with the Articles/By-Laws of the Company.

The Senior Management serves at the pleasure of the Board of Directors.

Despite the Company’s Senior Management spending material portions of their time on businesses other than the Company, the Company believes that they devote sufficient time to the Company to properly carry out their duties.

No Director and/or Senior Management had been the subject of any order, judgment, or decree of any governmental agency or administrator or of any court or competent jurisdiction, revoking or suspending for cause any license, permit or other authority of such person or of any corporation of which he is a Director and/or Senior Management, to engage in the securities business or in the sale of a particular security or temporarily or permanently restraining or enjoining any such person or any corporation of which he is an officer or director from engaging in or continuing any conduct/practice/employment in connection with the purchase or sale of securities, or convicting such person of any felony or misdemeanor involving a security or any aspect of the securities business or of theft or of any felony.

There are no family relationships between any two or more Directors or Senior Management other than the fact that Richard Whatley is the son of George Whatley who is the President of the Company.

There are no arrangements or understandings with major shareholders, customers, suppliers or others, pursuant to which any person referred to above was selected as a Director or member of senior management.

6.B.  Compensation

							Long-Term Compensation
	Annual Compensation						Awards		Payouts
Name and Principal  Position		Year	Salary	Bonus	Other Annual Compensation	Securities Under Options/SARs Granted		Restricted Shares or Restricted Share Units		LTIP Payouts	All Other Comp.
George Whatley, President and Director		2007	Nil	Nil	84,800 (1)	400,000 (5)		Nil		Nil	Nil
		2006	Nil	Nil	$69,000 (2)	Nil		Nil		Nil	Nil
		2005	Nil	Nil	$76,800 (3)	400,000		Nil		Nil	Nil
Richard Whatley, CFO, Secretary and Director		2007	Nil	Nil	$67,000 (4)	250,000 (6)		Nil		Nil	Nil
		2006	Nil	Nil	$64,700 (4)	Nil		Nil		Nil	Nil
		2005	Nil	Nil	$59,000 (4)	300,000		Nil		Nil	Nil
		2004	Nil	Nil	$62,000 (4)	Nil		Nil		Nil	Nil

(1)

In Fiscal 2007, George Whatley received $60,000 as a fee for administration of the Company’s affairs, $20,000 as a fee to manage and supervise the drilling program and $4,800 as a car allowance.

(2)

In Fiscal 2006, George Whatley received $60,000 as a fee for administration of the Company’s affairs and $9,000 as a fee to manage and supervise the drilling program.

(3)

In Fiscal 2005, George Whatley received $60,000 as a fee for administration of the Company’s affairs, $12,000 as a fee to manage and supervise the drilling program and $4,800 as a car allowance.

(4)

Richard Whatley received these funds for engineering and survey services. During fiscal 2006, $2,700 was paid for a car allowance.

(5)

These options were granted on June 30, 2006 at an exercise price of $0.40 per Common Share with an expiry date of January 26, 2010.

(6)

On June 30, 2006, 200,000 outstanding options were cancelled prior to the regranting of options on June 30,2006. 100,000 options remained in the case of Richard Whatley.

Director Compensation.

The Company has no formal plan for compensating its Directors for their service in their capacity as Directors.  Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of the Board of Directors. The Board of Directors may award special remuneration to any Director undertaking any special services on behalf of the Company other than services ordinarily required of a Director.  Other than indicated below no Director received any compensation for his services as a Director, including committee participation and/or special assignments.

Stock Options.

The Company grants stock options to Directors, Senior Management and employees.  Refer to ITEM #6.E., "Share Ownership" and Table No. 5 for information about stock options outstanding.

Change of Control Remuneration.

The Company had no plans or arrangements in respect of remuneration received or that may be received by Executive Officers of the Company in Fiscal 2007 to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation exceeds US$60,000 per Senior Management.

Other Compensation.

No Senior Management/Director received “other compensation” in excess of the lesser of US$25,000 or 10% of such officer's cash compensation, and all Senior Management/Directors as a group did not receive other compensation which exceeded US$25,000 times the number of persons in the group or 10% of the compensation.

Bonus/Profit Sharing/Non-Cash Compensation.

Except for the stock option program discussed in ITEM #6.E., the Company had no material bonus or profit sharing plans pursuant to which cash or non-cash compensation is or may be paid to the Company's Directors or Senior Management.

Pension/Retirement Benefits.

No funds were set aside or accrued by the Company during the Fiscal Year ended February 28, 2007 to provide pension, retirement or similar benefits for Directors or Senior Management.

6.C.  Board Practices

6.C.1.  Terms of Office.  Refer to ITEM 6.A.1.

6.C.2.  Directors’ Service Contracts.  --- No Disclosure Necessary ---

6.C.3.  Board of Director Committees.

The Company has an Audit Committee, which recommends to the Board of Directors the engagement of the independent auditors of the Company and reviews with the independent auditors the scope and results of the Company’s audits, the Company’s internal accounting controls, and the professional services furnished by the independent auditors to the Company.  The current members of the Audit Committee are: Richard Whatley, George Whatley and Carl Pines.

6.D.  Employees

As of February 28, 2007, the Company retained, in addition to its Senior Management, one administrative person at its head office in Coquitlam, British Columbia. As required, the Company also retains geologists, engineers, geophysicists and other consultants on a per diem basis.  The Company has not experienced, and does not expect to experience, significant difficulty in attracting and retaining qualified personnel.

6.E.  Share Ownership

Table No. 4 lists, as of February 28, 2007, Directors and Senior Management who beneficially own the Company's voting securities, consisting solely of common shares, and the amount of the Company's voting securities owned by the Directors and Senior Management as a group.

Table No. 4

Shareholdings of Directors and Senior Management

Shareholdings of 5% Shareholders

_____________________________________________________________________________

_____________________________________________________________________________

Title of Class	Name of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class#
Common	George Whatley (1)	1,702,850	5.8%
Common	Richard G. Whatley (2)	585,000	2.0%
Common	Carl Pines (3)	470,000	1.7%
Common	Claus te Wildt (4)	652,695	2.3%
	Total Directors/Management 5% Holders	3,410,545	11.8%

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(1)

Of these shares 400,000 represent currently exercisable share purchase options and 43,000 share purchase warrants.

(2)

Of these shares 350,000 represent currently exercisable share purchase options.

(3)

Of these shares 70,000 represent currently exercisable share purchase options.

(4)

Of these shares 200,000 represent currently exercisable share purchase options and 140,000 share purchase warrants.

# Based on 29,036,919 shares outstanding as of February 28, 2007 and currently outstanding share purchase options and share purchase warrants held individually.

_____________________________________________________________________________

_____________________________________________________________________________

Stock Options

The terms of incentive options grantable by the Company are done in accordance with the rules and policies of the TSX Venture Exchange and the British Columbia Securities Commission, including the number of common shares under option, the exercise price and expiry date of such options, and any amendments thereto.

Such “terms and conditions”, including the pricing of the options, expiry and the eligibility of personnel for such stock options; and are described below.

The principal purposes of the Company’s stock option program are to (a) promote a proprietary interest in the Company among the officers, directors and employees of the Company and its affiliates, (b) retain and attract the qualified officers, directors and employees the Company requires, (c) provide a long-term incentive element in overall compensation, and (d) promote the long-term profitability of the Company.

Stock options for up to 10% of the number of issued and outstanding common shares may be granted from time to time, provided that stock options in favor of any one individual may not exceed 5% of the issued and outstanding common shares.  No stock option granted under the stock option program is transferable by the optionee other than by will or the laws of descent and distribution, and each stock option is exercisable during the lifetime of the optionee only by such optionee.

The exercise prices for stock options are determined in accordance with TSX Venture Exchange guidelines and reflect the average closing price of the Registrant's common shares immediately preceding the day on which the Directors grant and publicly announce the stock options (subject to an regulatory-acceptable discount), and/or at a price no lower than $0.10 exercise price per share; and the maximum term of each stock option may not exceed five years.

The names and titles of the Directors/Executive Officers of the Company to whom outstanding stock options have been granted and the number of common shares subject to such options are set forth in Table No. 5 as of February 28, 2007, as well as the number of options granted to Directors and all employees as a group.

#

Table No. 5

Stock Options Outstanding

_____________________________________________________________________________

_____________________________________________________________________________

Name	Number of Common Shares	Cdn$ Exer. Price	Grant Date	Expiration Date
George Whatley	400,000	$0.40	1/25/2005	1/25/2010
Richard Whatley	100,000	$0.40	1/25/2005	1/25/2010
	250,000	$0.40	6/30/2006	1/26/2006
Carl Pines	70,000	$0.40	6/30/2006	1/26/2010
Natalie Whatley	430,000	$0.40	1/26/2005	1/26/2010
Claus te Wildt	200,000	$0.40	1/25/2005	1/25/2010
CHF Investor Relations	250,000	$0.40	3/31/2006	3/31/2010
Total Officers/Directors	1,020,000
Total Employees/Consultants	680,000
Total Options Outstanding	1,700,000

_____________________________________________________________________________

_____________________________________________________________________________

ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

7.A.  Major Shareholders.

7.A.1.a.  Holdings By Major Shareholders.

Refer to ITEM #6.E and Table No. 4.

7.A.1.b.  Significant Changes in Major Shareholders’ Holdings.

---No Disclosure Required---__________________________________________________

7.A.1.c.  Different Voting Rights.  The Company’s major shareholders do not have different voting rights.

7.A.2.  Canadian Share Ownership.

On 2/28/2006, the Company’s shareholders’ list showed 29,036,919 common shares outstanding and The Company has researched the indirect holding by depository institutions and other financial institutions estimates that there are in excess of 300 the beneficial owners of its common shares.

7.A.3.  Control of Company.

The Company is a publicly owned Canadian corporation, the shares of which are owned by U.S. residents, Canadian residents and other foreign residents.  The Company is not controlled by any foreign government or other person(s) except as described in ITEM #4.A., “History and Growth of the Company”, and ITEM #6.E., “Share Ownership”.

7.A.4.  Change of Control of Company Arrangements.   No Disclosure Necessary

7.B.  Related Party Transactions

During the year, the Company paid fees of $147,000 (2006 - $131,000) for contract negotiation, property investigation, property acquisition, site investigation and management of field programs to George Whatley, the President and a Director of the Company, $8,550 (2006 - $8,350) for secretarial and bookkeeping services to Natalie Whatley, the wife of George Whatley, $6,000 (2006 - $6,000) for office rental, and $4,800 (2006 - $4,800) for car rental to George Whatley or companies controlled by George Whatley.

These transactions are in the normal course of operations and have been valued in these financial statements at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

7.C.  Interests of Experts and Counsel   --- No Disclosure Necessary ---

ITEM 8.  FINANCIAL INFORMATION

8.A.  Consolidated Statements and Other Financial Information

The Company's financial statements are stated in Canadian Dollars (CDN$) and are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP), the application of which, in the case of the Company, conforms in all material respects for the periods presented with United States GAAP, except as discussed in footnotes to the financial statements.

The financial statements as required under ITEM #17 are attached hereto and found immediately following the text of this Annual Report.  The audit reports of De Visser Gray LLP, independent Chartered Accountants, are included herein immediately preceding the financial statements.

8.A.7.  Legal/Arbitration Proceedings

The Directors and the management of the Company do not know of any material, active or pending, legal proceedings against them; nor is the Company involved as a plaintiff in any material proceeding or pending litigation.  

The Directors and the management of the Company know of no active or pending proceedings against anyone that might materially adversely affect an interest of the Company.  

8.B.  Significant Changes

No significant change has occurred since the date of the annual financial statements, and/or since the date of the most recent interim financial statements.

ITEM 9.  THE OFFER AND LISTING

9.A.  Common Share Trading Information

The Company's common shares began trading on the Vancouver Stock Exchange in Vancouver, British Columbia, Canada, under its former name “Info-Stop Communications Inc.” on 01/01/1988.  The Company's common shares presently trade on the TSX Venture Exchange in Vancouver, British Columbia, Canada, under the symbol "ALQ".  The CUSIP number is #02073D.

Table No. 6 lists the high and low sales prices on the TSX Venture Exchange (formerly the Canadian Venture Exchange) for the five most recent financial years, the two most recent financial years by quarter end and the most recent six months for the Company's common shares.

Table No. 6

TSX Venture Exchange

Common Shares Trading Activity

_____________________________________________________________________________

_____________________________________________________________________________                                                                       

	HIGH	LOW
Fiscal Year Ended 2/28/07	$1.18	$0.43
Fiscal Year Ended 2/28/06	$0.52	$0.28
Fiscal Year Ended 2/28/05	$0.62	$0.41
Fiscal Year Ended 2/29/04	$0.85	$0.43
Fiscal Year Ended 2/28/03	$0.79	$0.30
Quarter Ended 2/28/07	$1.18	$0.66
Quarter Ended 11/30/06	$0.75	$0.49
Quarter Ended 8/31/06	$0.64	$0.33
Quarter Ended 5/31/06	$0.49	$0.30
Quarter Ended 2/28/06	$0.42	$0.28
Quarter Ended 11/30/05	$0.47	$0.345
Quarter Ended 8/31/05	$0.52	$0.43
Quarter Ended 5/31/05	$0.52	$0.39
June 2007	$0.80	$0.71
May 2007	$0.90	$0.61
April 2007	$0.78	$0.60
March 2007	$0.78	$0.61
February 2007	$0.87	$0.67
January 2007	$1.18	$0.71

_____________________________________________________________________________

_____________________________________________________________________________

The TSX Venture Exchange

The TSX Venture Exchange (“TSX-V”) is a result of the acquisition by the Toronto Stock Exchange of the Canadian Venture Exchange (“CDNX”) from its member firms on 8/1/2001.  The CDNX resulted from the merger between the Vancouver Stock Exchange and the Alberta Stock Exchange that took place on 11/29/1999, to form the CDNX.  The TSX Venture Exchange currently operates as a complementary but independent exchange from its parent, the Toronto Stock Exchange.

The initial roster of the CDNX was made up of venture companies previously listed on the Vancouver Stock Exchange or the Alberta Stock Exchange and later incorporated junior listings from the Montreal Stock Exchange, the Winnipeg Stock Exchange, and the CDN Over-The-Counter Market.  The TSX Venture Exchange is a venture market as compared to the Toronto Stock Exchange that is Canada’s senior market and the Montreal Exchange that is Canada’s market for derivatives products.

The TSX Venture Exchange currently has five service centers: Calgary, Toronto, Vancouver, Winnipeg and Montreal.  These service centers provide corporate finance, surveillance and marketing expertise.  The corporate office for the TSX Venture Exchange is located in Calgary and the operations office is located in Vancouver.

The TSX Venture Exchange is a self-regulating organization owned and operated by the Toronto Stock Exchange, which in turn is owned by its member brokerage firms.  Representatives of member firms and the public govern it.

Organizationally, the TSX Venture Exchange is comprised of seven business areas: Corporate Finance Services, Trading Services and Market Information Services, Compliance, Marketing, Technology, Corporate Affairs and Human Resources.

The TSX Venture Exchange acts as a business link between TSX members, listed companies and investors.  TSX Venture Exchange policies and procedures are designed to accommodate companies still in their formative stages and recognize those that are more established.  Listings are predominately small and medium sized companies.

The Canadian Investor Protection Fund (“CIPF”) protects investors in Canada.  The CIPF is a private trust fund established to protect customers in the event of the insolvency of a member of any of the following self-regulatory organizations: the TSX Venture Exchange; the Montreal Exchange; the Toronto Stock Exchange; the Toronto Futures Exchange; and the Investment Dealers Association of Canada.

Post-trade monitoring of market activity occurs in the market surveillance department.  Sophisticated software analyses trade data from TRADETSX to detect possible market improprieties.  A variety of surveillance and investigative tools allow the TSX Venture Exchange to perform electronic market monitoring and trade reviews.

The surveillance department is also responsible for monitoring and reviewing listed company activities and detecting breaches of the listing policies or the listing agreement.  Market surveillance and listed company surveillance activities are closely coordinated.

9.A.5.  Common Share Description

Registrar/Common Shares Outstanding/Shareholders

The Company's common shares are issued in registered form and the following information is taken from the records of Pacific Corporate Trust Company (located in Vancouver, British Columbia, Canada), the registrar and transfer agent for the common shares.

Common Share Description

All of the authorized common shares of the Company are of the same class and, once issued, rank equally as to dividends, voting powers, and participation in assets.  Holders of common stock are entitled to one vote for each share held of record on all matters to be acted upon by the shareholders.  Holders of common stock are entitled to receive such dividends as may be declared from time to time by the Board of Directors, in its discretion, out of funds legally available therefore.

Upon liquidation, dissolution or winding up of the Company, holders of common stock are entitled to receive pro rata the assets of Company, if any, remaining after payments of all debts and liabilities.  No shares have been issued subject to call or assessment.  There are no pre-emptive or conversion rights and no provisions for redemption or purchase for cancellation, surrender, or sinking or purchase funds.

Provisions as to the modification, amendment or variation of such shareholder rights or provisions are contained in the British Columbia Company Act (“Company Act”) of British Columbia.  Unless the Company Act or the Company's Articles or Memorandum otherwise provide, any action to be taken by a resolution of the members may be taken by an ordinary resolution or by a vote of a majority or more of the shares represented at the shareholders' meeting.

There are no restrictions on the repurchase or redemption of common shares of the Company while there is any arrearage in the payment of dividends or sinking fund installments.

Stock Options

Refer to ITEM 6.E. and Table No. 5 for additional information.

Share Purchase Warrants

Table No. 7 lists, as of 2/28/2007, share purchase warrants outstanding, the date the share purchase warrants were issued, the exercise price, and the expiration date of the share purchase warrants.

Table No. 7

Share Purchase Warrants Outstanding

_____________________________________________________________________________

_____________________________________________________________________________

Effective Date of Issuance	Number of Share Purchase Warrants Originally Issued	Number of Share Purchase Warrants Still Outstanding	Exercise Price Year #1	Exercise Price Year #2	Expiration Date of Share Purchase Warrants
7/26/2005	971,960	971,960	$0.50	$0.50	7/25/2007
7/28/2006	1,749,612	1,620,864	$0.60	N/A	7/28/2007

9.A.6.  Differing Rights

9.A.7.a.  Subscription Warrants/Right

9.A.7.b.  Convertible Securities/Warrants

          --- No Disclosure Necessary ---

9.C.  Stock Exchanges Identified

The common shares trade on the TSX Venture Exchange in Vancouver, British Columbia.

Refer to ITEM #9.A.4.

ITEM 10.  ADDITIONAL INFORMATION

10.A.  Share Capital

10.A.1.  Authorized/Issued Capital.

There are 100,000,000 common shares, without par value, authorized.  As of February 28, 2007 there were 29,036,919 common shares issued and outstanding.

10.A.2.  Shares Not Representing Capital.

10.A.3.  Shares Held By Company.

--- No Disclosure Necessary ---

10.A.4.  Stock Options/Share Purchase Warrants

10.A.5.  Stock Options/Share Purchase Warrants

--- Refer to Table No. 5 and Table No. 7. ---

10.A.6.  History of Share Capital

Fiscal Year	Nature of Share Issuance	Number of Shares	Capital Raised
2004	Private Placement	1,500,000	$525,000
	Exercise of Stock Options	175,000	$57,750
	Exercise of Share Purchase Warrants	685,714	$315,429
	Exercise of Share Purchase Warrants	250,000	$125,000
	Exercise of Share Purchase Warrants	100,000	$50,000
	Exercise of Share Purchase Warrants	50,000	$21,500
	Private Placement	999,999	$599,999
2005	Private Placement	575,000	$230,000
	Exercise of share purchase warrants	78,100	$39,050
	Exercise of share purchase warrants	396,400	$170,452
2006	Private Placement	957,260	$478,630
2007	Private Placement	3,499,225	$1,399,690
	Exercise of Share Purchase Warrants	128,750	$77,250

The details of these issuances are disclosed in ITEM 4. INFORMATION ON THE COMPANY, FINANCINGS.

10.A.7.  Resolutions/Authorizations/Approvals

--- No Disclosure Necessary ---

10.B.  Memorandum and Articles of Association

Objects and Purposes

The Articles of Incorporation place no restrictions upon the type of business that the Company may engage in.

10.B.2.  Directors

Disclosure of Interest of Directors/Officers

A Director shall not vote in respect of the approval of any contract or transaction with the Company in which he is interested and if he shall do so his vote shall not be counted, but he shall be counted in the quorum present at the meeting at which the vote is taken.

Borrowing Power

The Directors may from time to time in behalf of the Company:

(a)

borrow money in a manner and amount, on any security, from any source and upon any terms and conditions;

(b)

issue bonds, debentures, and other debt obligations either outright or as security for any liability or obligation of the Company or any other person; and

(c)

mortgage, charge, whether by way of specific or floating charge, or give other security on the undertaking, or on the whole or any part of the property and assets, of the Company (both present and future).

Director Retirement

Neither the Company’s memorandum/ articles/by-laws nor British Columbia law requires retirement or non-retirement of directors under an age limit requirement.

Director Stock Ownership

Neither the Company’s memorandum/ articles/by-laws nor British Columbia law requires share ownership by directors.

10.B.3.  Rights, Preferences, Restrictions of Common Shares

Voting Rights

All of the authorized common shares of the Company are of the same class and, once issued, rank equally as to dividends, voting powers, and participation in assets.  Holders of common stock are entitled to one vote for each share held of record on all matters to be acted upon by the shareholders.  Holders of common stock are entitled to receive such dividends as may be declared from time to time by the Board of Directors, in its discretion, out of funds legally available therefore.

Rights in event of liquidation

Upon liquidation, dissolution or winding up of the Company, holders of common stock are entitled to receive pro rata the assets of Company, if any, remaining after payments of all debts and liabilities.

Rights to Share in Profits

Redemption Provisions

Sinking Fund Provisions

Liability to Further Capital Calls

Discriminatory Rights Against Significant Shareholders

The Company’s articles/by-laws do not address these issues.  Accordingly, British Columbia law and any exchange upon which the common shares trade govern the shareholders’ rights regarding these issues.

10.B.4.  Modification of Rights of Shareholders

Provisions as to the modification, amendment or variation of such shareholder rights or provisions are contained in the “Company Act“ of British Columbia.  Unless the “Company Act“ or the Company's Articles or Memorandum otherwise provide, any action to be taken by a resolution of the members may be taken by an ordinary resolution or by a vote of a majority or more of the shares represented at the shareholders' meeting.

A Special Shareholders’ meeting can only alter the rights of holders of the Company’s stock.

Special Resolution

The Company's Articles and the Company Act of British Columbia contain provisions, which require a "special resolution" for effecting certain corporate actions.  Such a "special resolution" requires a three-quarters vote of shareholders rather than a simple majority for passage.  The principle corporate actions that require a "special resolution" include:

a. Transferring the Company's jurisdiction from British Columbia to another jurisdiction;

b. Giving financial assistance under certain circumstances;

c. Certain conflicts of interest by Directors;

d. Disposing of all/substantially all of Company's undertakings;

e. Removing Director before expiration of his term of office;

f. Certain alterations of share capital;

g. Changing the Company name;

h. Altering any restrictions on the Company's business; and

i. Certain reorganizations of the Company.

10.B.5.  Annual Meetings, Special Meetings, Section 9 of the Articles

Subject to Article 9.2 and to The Act, the first annual general meeting shall be held within 15 months from the date of incorporation and the following annual general meetings shall be held once in every calendar year at a time, not being more than 13 months after the holding of the last preceding annual general meeting, and at a place as the Directors shall appoint.  In default of the meeting being held, the meeting shall be called by any two members in the same manner as nearly as possible as that in which meetings are to be called by the Directors.

The Directors may, whenever they think fit, convene a general meeting.  A general meeting, if requisitioned in accordance with The Act, shall be convened by the Directors or, if not convened by the Directors, may be convened by the requisitionists as provided in The Act.

Not less than 21 days’ notice of any general meeting specifying the time and place of meeting and in case of special business, the general nature of that business shall be given in the manner mentioned in Article 22, or in such other manner, if any, as may be prescribed by ordinary resolution whether previous notice has been given or not, to any person as may by law or under these Articles or other regulations of the Company entitled to receive the notice from the Company.  But the accidental omission to give notice of any meeting to, or the non-receipt of any notice, by any person shall not invalidate any proceedings at that meeting.

Persons entitled to notice of a general meeting may waive or reduce the period of notice convening the meeting, by unanimous consent in writing, and may give such waiver before, during or after the meeting.

There are no limitations on the rights to own securities.

There is no provision of the Company’s articles of association, charter or bylaws that would have an effect of delaying, deferring or preventing a change in control of the Company and that would operate only with respect to a merger, acquisition or corporate restructuring involving the Company (or any of its subsidiaries).

Shareholder ownership must be disclosed to the British Columbia Securities Commission and the TSX Venture Exchange by any shareholder who owns more than 10% of the Company’s common stock.

10.B.6.  Limitations on Rights to Own Shares

The Company is unaware of any limitations on the rights to own securities, including those of non-resident or foreign shareholders.

10.B.7.  Change of Control of Company

There are no provisions of the Company’s articles of association, charter or bylaws that would have an effect of delaying, deferring or preventing a change in control of the Company and that would operate only with respect to a merger, acquisition or corporate restructuring involving the Company.

10.B.8.  Disclosure of Share Ownership

Although not expressly enumerated in the Articles/By-Laws, pursuant to Canadian regulations, any shareholder who owns more than 10% of the Company’s common shares must disclose shareholder ownership.

10.C.  Material Contracts   --- No Disclosure Necessary ---

10.D.  Exchange Controls

Except as discussed in ITEM #9, the Company is not aware of any Canadian federal or provincial laws, decrees, or regulations that restrict the export or import of capital, including foreign exchange controls, or that affect the remittance of dividends, interest or other payments to non-Canadian holders of the common shares.  There are no limitations on the right of non-Canadian owners to hold or vote the common shares imposed by Canadian federal or provincial law or by the charter or other constituent documents of the Company.

The Investment Canada Act (the "IC Act") governs acquisitions of Canadian business by a non-Canadian person or entity. The IC Act requires a non-Canadian (as defined in the IC Act) making an investment to acquire control of a Canadian business, the gross assets of which exceed certain defined threshold levels, to file an application for review with the Investment Review Division of Industry Canada.  The IC Act provides, among other things, for a review of an investment in the event of acquisition of "control" in certain Canadian businesses in the following circumstances:

1. If the investor is a non-Canadian and is a national of a country belonging to the North American Free Trade Agreement ("NAFTA") and/or the World Trade Organization ("WTO") ("NAFTA or WTO National"), any direct acquisition having an asset value exceeding $179,000,000 is reviewable. This amount is subject to an annual adjustment on the basis of a prescribed formula in the IC Act to reflect inflation and real growth within Canada.  This threshold level does not apply in certain sections of Canadian industry, such as uranium, financial services (except insurance), transportation services and cultural services (i.e. the publication, distribution or sale of books, magazines, periodicals (other than printing or typesetting businesses), music in print or machine readable form, radio, television, cable and satellite services; the publication, distribution, sale or exhibition of film or video recordings on audio or vi deo music recordings), to which lower thresholds as prescribed in the IC Act are applicable.

2. If the investor is a non-Canadian and is not a NAFTA or WTO National, any direct acquisition having an asset value exceeding $5,000,000 and any indirect acquisition having an asset value exceeding $50,000,000 is reviewable.

3. If the investor is a non-Canadian and is NAFTA or WTO National, an indirect acquisition of control is reviewable if the value of the assets of the business located in Canada represents more than 50% of the asset value of the transaction or the business is involved in uranium, financial services, transportation services or cultural services (as set forth above).

Finally, certain transactions prescribed in the IC Act are exempted from review altogether.

In the context of the Company, in essence, three methods of acquiring control of a Canadian business are regulated by the IC Act: (i) the acquisition of all or substantially all of the assets used in carrying on business in Canada; (ii) the acquisition, directly or indirectly, of voting shares of a Canadian corporation carrying on business in Canada; or (iii) the acquisition of voting shares of an entity which controls, directly or indirectly, another entity carrying on business in Canada.

An acquisition of a majority of the voting shares of a Canadian entity, including a corporation, is deemed to be an acquisition of control under the IC Act.  However, under the IC Act, there is a rebuttable presumption that control is acquired if a non-Canadian person or entity holds one-third of the voting shares of a Canadian corporation or an equivalent undivided interest in the voting shares of such corporation.  An acquisition of less than one-third of the voting shares of a Canadian corporation is deemed not to be an acquisition of control.  An acquisition of less than a majority, but one-third or more, of the voting shares of a Canadian corporation is presumed to be an acquisition of control unless it can be established that, on the acquisition, the Canadian corporation is not, in fact, controlled by the acquirer through the ownership of voting shares. For partnerships, trusts, joint ventures or other unincorporated Canadian entities, an acquisition of less than a majority of the voting interests is deemed not to be an acquisition of control.

In addition, if a Canadian corporation is controlled by a non-Canadian, the acquisition of control of any other Canadian corporation by such corporation may be subject to the prior approval of the Investment Review Division, unless it can be established that the Canadian corporation is not in fact controlled by the acquirer through the ownership of voting shares.

Where an investment is reviewable under the IC Act, the investment may not be implemented unless it is likely to be of net benefit to Canada.  If an applicant is unable to satisfy the Minister responsible for Industry Canada that the investment is likely to be of net benefit to Canada, the applicant may not proceed with the investment.  Alternatively, an acquirer may be required to divest control of the Canadian business that is the subject of the investment.

In addition to the foregoing, the IC Act provides for formal notification under the IC Act of all other acquisitions of control by Canadian businesses by non-Canadian investors.  The notification process consists of filing a notification within 30 days following the implementation of an investment, which notification is for information, as opposed to review, purposes.

10.E.  Taxation

The following summary of the material Canadian federal income tax consequences generally applicable in respect of the common stock reflects the Company’s opinion.  The tax consequences to any particular holder of common stock will vary according to the status of that holder as an individual, trust, corporation or member of a partnership, the jurisdiction in which that holder is subject to taxation, the place where that holder is resident and, generally, according to that holder’s particular circumstances.  This summary is applicable only to holders who are resident in the United States, have never been resident in Canada, deal at arm’s length with the Company, hold their common stock as capital property and who will not use or hold the common stock in carrying on business in Canada.  Special rules, which are not discussed in this summary, may apply to a United States holder that is an issuer that carries on business in Canada and elsewhere.

This summary is based upon the provisions of the Income Tax Act of Canada and the regulations there under (collectively, the "Tax Act" or “ITA”)and the Canada-United States Tax Convention (the “Tax Convention”) as at the date of the Registration Statement and the current administrative practices of Canada Customs and Revenue Agency.  This summary does not take into account provincial income tax consequences.

Management urges each holder to consult his own tax advisor with respect to the income tax consequences applicable to him in his own particular circumstances.

Canadian Federal Income Tax Considerations

The summary below is restricted to the case of a holder (a “Holder”) of one or more common shares (“Common Shares”) who for the purposes of the Tax Act is a non-resident of Canada, holds his Common Shares as capital property and deals at arm’s length with the Company.

Dividends

A Holder will be subject to Canadian withholding tax (“Part XIII Tax”) equal to 25%, or such lower rates as may be available under an applicable tax treaty, of the gross amount of any dividend paid or deemed to be paid on his Common Shares. Under the Tax Convention, the rate of Part XIII Tax applicable to a dividend on Common Shares paid to a Holder who is a resident of the United States is, if the Holder is a company that beneficially owns at least 10% of the voting stock of the Company, 5% and, in any other case, 15% of the gross amount of the dividend. The Company will be required to withhold the applicable amount of Part XIII Tax from each dividend so paid and remit the withheld amount directly to the Receiver General for Canada for the account of the Holder.

Disposition of Common Shares

A Holder who disposes of Common Shares, including by deemed disposition on death, will not be subject to Canadian tax on any capital gain thereby realized unless the common Share constituted “taxable Canadian property” as defined by the Tax Act. Generally, a common share of a public corporation will not constitute taxable Canadian property of a Holder unless he held the common share as capital property used by him carrying on a business in Canada, or he or persons with whom he did not deal at arm’s length alone or together held or held options to acquire, at any time within the 60 months preceding the disposition, 25% or more of the issued shares of any class of the capital stock of the Company.

A Holder who is a resident of the United States and realizes a capital gain on disposition of Common Shares that was taxable Canadian property will nevertheless, by virtue of the Treaty, generally be exempt from Canadian tax thereon unless (a) more than 50% of the value of the Common Shares is derived from, or from an interest in, Canadian real estate, including Canadian mineral resources properties, (b) the Common Shares formed part of the business property of a permanent establishment that the Holder has or had in Canada within the 12 months preceding disposition, or (c) the Holder (i) was a resident of Canada at any time within the ten years immediately preceding the disposition, and for a total of 120 months during any period of 20 consecutive years, preceding the disposition, and (ii) owned the Common Shares when he ceased to be resident in Canada.

A Holder who is subject to Canadian tax in respect of a capital gain realized on disposition of Common Shares must include three quarters (two thirds for dispositions after February 27, 2000 and before October 18, 2000 and one half after October 18, 2000) of the capital gain (“taxable capital gain”) in computing his taxable income earned in Canada. The Holder may, subject to certain limitations, deduct three quarters (two thirds for disposition after February 27, 2000) of any capital loss (“allowable capital loss”) arising on disposition of taxable Canadian property from taxable capital gains realized in the year of disposition in respect to taxable Canadian property and, to the extent not so deductible, from such taxable capital gains of any of the three preceding years or any subsequent year.

United States Taxation

The following is a discussion of material United States Federal income tax consequences, under the law, generally applicable to a U.S. Holder (as defined below) of common shares of the Company. This discussion does not cover any state, local or foreign tax consequences.

The following discussion is based upon the sections of the Internal Revenue Code of 1986, as amended (“the Code”), Treasury Regulations, published Internal Revenue Service (“IRS) rulings, published administrative positions of the IRS and court decisions that are currently applicable, any or all of which could be materially and adversely changed, possible on a retroactive basis, at any time.  In addition, the discussion does not consider the potential effects, both adverse and beneficial, or recently proposed legislation, which, if enacted, could be applied, possibly on a retroactive basis, at any time. The discussion is for general information only and it is not intended to be, nor should it be construed to be, legal or tax advice to any holder or prospective holder of common shares of the Company and no opinion or representation with respect to the U.S. federal income tax consequences to any such holder or prospective holder is made. Management urges h olders and prospective holders of common shares of the Company to consult their own tax advisors about the federal, state, local, and foreign tax consequences of purchasing, owning and disposing of common shares of the Company.

U.S. Holders

As used herein, a (“U.S. Holder”) includes a holder of common shares of the Company who is a citizen or resident of the United States, a corporation created or organized in or under the laws of the United States or of any political subdivision thereof, an estate whose income is taxable in the United States irrespective of source or a trust subject to the primary supervision of a court within the United States and control of a United States fiduciary as described in Section 7701(a)(30) of the Code. This summary does not address the tax consequences to, and U.S. Holder does not include, persons subject to special provisions of Federal income tax law, such as tax-exempt organizations, qualified retirement plans, financial institutions, insurance companies, real estate investment trusts, regulated investment companies, broker-dealers, non-resident alien individuals, persons or entities that have a “functional currency” other than the U.S. dollar, shareholde rs who hold common shares as part of a straddle, hedging or conversion transaction, and shareholders who acquired their common shares through the exercise of employee stock options or otherwise as compensation for services. This summary is limited to U.S. Holders who own common shares as capital assets. This summary does not address the consequences to a person or entity holding an interest in a shareholder or the consequences to a person of the ownership, exercise or disposition of any options, warrants or other rights to acquire common shares.

Distribution on Common Shares of the Company

U.S. Holders receiving dividend distributions (including constructive dividends) with respect to common shares of the Company are required to include in gross income for United States Federal income tax purposes the gross amount of such distributions equal to the U.S. dollar value of such distributions on the date of receipt (based on the exchange rate on such date), to the extent that the Company has current or accumulated earnings and profits, without reduction for any Canadian income tax withheld from such distributions.  Such Canadian tax withheld may be credited, subject to certain limitations, against the U.S. Holder’s United States Federal Income tax liability or, alternatively, individuals may be deducted in computing the U.S. Holder’s United States Federal taxable income by those individuals who itemize deductions.  (See more detailed discussion at “Foreign Tax Credit” below).  To the extent that distributions exceed current or a ccumulated earnings and profits of the Company, they will be treated first as a return of capital up to the U.S. Holder’s adjusted basis in the common shares and thereafter as gain from the sale or exchange of the common shares. Dividend income will be taxed at marginal tax rates applicable to ordinary income while preferential tax rates for long-term capital gains are applicable to a U.S. Holder which is an individual, estate or trust.  There are currently no preferential tax rates for long-term capital gains for a U.S. Holder, which is a corporation.

In the case of foreign currency received as a dividend that is not converted by the recipient into U.S. dollars on the date of receipt, a U.S. Holder will have a tax basis in the foreign currency equal to its U.S. dollar value on the date of receipt. Generally any gain or loss recognized upon a subsequent sale of other disposition of the foreign currency, including the exchange for U.S. dollars, will be ordinary income or loss.

Dividends paid on the common shares of the Company will not generally be eligible for the dividends received deduction provided to corporations receiving dividends from certain United States corporations.  A U.S. Holder which is a corporation may, under certain circumstances, be entitled to a 70% deduction of the United States source portion of dividends received from the Company (unless the Company qualifies as a “foreign personal holding company” or a “passive foreign investment company”, as defined below) if such U.S. Holder owns shares representing at least 10% of the voting power and value of the Company.  The availability of this deduction is subject to several complex limitations, which are beyond the scope of this discussion.

Under current Treasury Regulations, dividends paid on the Company’s common shares, if any, generally will not be subject to information reporting and generally will not be subject to U.S. backup withholding tax. However, dividends and the proceeds from a sale of the Company’s common shares paid in the U.S. through a U.S. or U.S. related paying agent (including a broker) will be subject to U.S. information reporting requirements and may also be subject to the 31% U.S. backup withholding tax, unless the paying agent is furnished with a duly completed and signed Form W-9. Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a refund or a credit against the U.S. Holder’s U.S. federal income tax liability, provided the required information is furnished to the IRS.

Foreign Tax Credit

For individuals whose entire income from sources outside the United States consists of qualified passive income, the total amount of creditable foreign taxes paid or accrued during the taxable year does not exceed $300 ($600 in the case of a joint return) and an election is made under section 904(j), the limitation on credit does not apply.

A U.S. Holder who pays (or has withheld from distributions) Canadian income tax with respect to the ownership of common shares of the Company may be entitled, at the option of the U.S. Holder, to either a deduction or a tax credit for such foreign tax paid or withheld.  Generally, it will be more advantageous to claim a credit because a credit reduces United States Federal income taxes on a dollar-for-dollar basis, while a deduction merely reduces the taxpayer’s income subject to tax.  This election is made on a year-by-year basis and applies to all foreign income taxes (or taxes in lieu of income tax) paid by (or withheld from) the U.S. Holder during the year.  There are significant and complex limitations which apply to the credit, among which is the general limitation that the credit cannot exceed the proportionate share of the U.S. Holder’s United States income tax liability that the U.S. Holder’s foreign source income bears to his/her or its worldwide taxable income in the determination of the application of this limitation. The various items of income and deduction must be classified into foreign and domestic sources. Complex rules govern this classification process.  In addition, this limitation is calculated separately with respect to specific classes of income such as “passive income”, “high withholding tax interest”, “financial services income”, “shipping income”, and certain other classifications of income. Dividends distributed by the Company will generally constitute “passive income” or, in the case of certain U.S. Holders, “financial services income” for these purposes.  The availability of the foreign tax credit and the application of the limitations on the credit are fact specific and  management urges holders and prospective holders of common shares of the Company to consult their own tax advisors regarding their individual circumstances.

Other Considerations

In the following circumstances, the above sections of the discussion may not describe the United States Federal income tax consequences resulting from the holding and disposition of common shares of the Company.

Foreign Personal Holding Company

If at any time during a taxable year more than 50% of the total combined voting power or the total value of the Company’s outstanding shares is owned, actually or constructively, by five or fewer individuals who are citizens or residents of the United States and 60% (50% after the first tax year) or more of the Company’s gross income for such year was derived from certain passive sources (e.g. from interest income received from its subsidiaries), the Company would be treated as a “foreign personal holding company.”  In that event, U.S. Holders that hold common shares of the Company would be required to include in gross income for such year their allocable portions of such passive income to the extent the Company does not actually distribute such income.

The Company does not believe that it currently has the status of a “foreign personal holding company”. However, there can be no assurance that the Company will not be considered a foreign personal holding company for the current or any future taxable year.

Foreign Investment Company

If 50% or more of the combined voting power or total value of the Company’s outstanding shares are held, actually or constructively, by citizens or residents of the United States, United States domestic partnerships or corporations, or estates or trusts other than foreign estates or trusts (as defined by the Code Section 7701(a)(31), and the Company is found to be engaged primarily in the business of investing, reinvesting, or trading in securities, commodities, or any interest therein, it is possible that the Company might be treated as a “foreign investment company” as defined in Section 1246 of the Code, causing all or part of any gain realized by a U.S. Holder selling or exchanging common shares of the Company to be treated as ordinary income rather than capital gains.

Passive Foreign Investment Company

As a foreign corporation with U.S. Holders, the Company could potentially be treated as a passive foreign investment company (“PFIC”), as defined in Section 1297 of the Code, depending upon the percentage of the Company’s income which is passive, or the percentage of the Company’s assets which is held for the purpose of producing passive income.

The management of the Registrant believes that the Company is not a PFIC. Additionally, the Company believes that the anticipated development of its business would not include any activities, which would cause the Company to fall under the criteria of a Passive Foreign Investment Company.  However, there can be no assurance that the Company’s determination concerning its PFIC status will not be challenged by the IRS, or that it will be able to satisfy record-keeping requirements, which will be imposed of QEFs.

Certain United States income tax legislation contains rules governing PFICs which can have significant tax effects on U.S. shareholders of foreign corporations.  These rules do not apply to non-U.S. shareholders.  Section 1297 (a) of the Code defines a PFIC as a corporation that is not formed in the United States and, for any taxable year, either (I) 75% or more of its gross income is “passive income”, which includes interest, dividends and certain rents and royalties or (ii) the average percentage, by fair market value (or, if the company is a controlled foreign corporation or makes an election, by adjusted tax basis), of its assets that produce or are held for the production of “passive income” is 50% or more.  The taxation of a US shareholder who owns stock in a PFIC is extremely complex and is therefore beyond the scope of this discussion.  Management urges US persons to consult with their own tax advisors with regards to the imp act of these rules.

Controlled Foreign Corporation

A Controlled Foreign Corporation (CFC) is a foreign corporation more than 50% of whose stock by vote or value is, on any day in the corporation’s tax year, owned (directly or indirectly) by U.S. Shareholders. If more than 50% of the voting power of all classes of stock entitled to vote is owned, actually or constructively, by citizens or residents of the United States, United States domestic partnerships and corporations or estates or trusts other than foreign estates or trusts, each of whom own actually or constructively 10% or more of the total combined voting power of all classes of stock of the Company could be treated as a “controlled foreign corporation” under Subpart F of the Code.  This classification would effect many complex results, one of which is the inclusion of certain income of a CFC which is subject to current U.S. tax. The United States generally taxes United States Shareholders of a CFC currently on their pro rata shares of the Subpar t F income of the CFC. Such United States Shareholders are generally treated as having received a current distribution out of the CFC’s Subpart F income and are also subject to current U.S. tax on their pro rata shares of the CFC’s earnings invested in U.S. property. The foreign tax credit described above may reduce the U.S. tax on these amounts. In addition, under Section 1248 of the Code, gain from the sale or exchange of shares by a U.S. Holder of common shares of the Corporation which is or was a United States Shareholder at any time during the five-year period ending with the sale or exchange is treated as ordinary income to the extent of earnings and profits of the Company (accumulated in corporate tax years beginning after 1962, but only while the shares were held and while the Company was “controlled”) attributable to the shares sold or exchanged. If a foreign corporation is both a PFIC and a CFC, the foreign corporation generally will not be treated as a PFIC with respect to the United States Shareholders of the CFC. This rule generally will be effective for taxable years of United States Shareholders beginning after 1997 and for taxable years of foreign corporations ending with or within such taxable years of United States Shareholders. The PFIC provisions continue to apply in the case of PFIC that is also a CFC with respect to the U.S. Holders that are less than 10% shareholders. Because of the complexity of Subpart F, a more detailed review of these rules is outside of the scope of this discussion.

The amount of any backup withholding will not constitute additional tax and will be allowed as a credit against the U.S. Holder’s federal income tax liability.

Filing Information Returns

Under a number of circumstances, United States Investor acquiring shares of the Company may be required to file an information return with the Internal Revenue Service Center where they are required to file their tax returns with a duplicate copy to the Internal Revenue Service Center, Philadelphia, PA 19255. In particular, any United States Investor who becomes the owner, directly or indirectly, of 10% or more of the shares of the Company will be required to file such a return. Other filing requirements may apply, and management urges United States Investors to consult their own tax advisors concerning these requirements.

10.G.  Statement by Experts  

The selected financial data of the Company for the Fiscal Year ended February 28, 2007 were derived from the financial statements of the Company that have been audited by De Visser Gray LLP, independent chartered accounts, as indicated in their audit report, which are included elsewhere in this annual report. The selected financial data for the Company for the Fiscal Years ended February 28, 2006/2005 and February 29, 2004 and February 28, 2005 were derived from the financial statements of the Company that have been audited by MacKay & company independent Chartered Accountants; these financial statements are not included herein.  

10.H.  Documents on Display    --- No Disclosure Necessary ---

ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          --- No Disclosure Necessary ---

ITEM 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

12.A.  Debt Securities            --- No Disclosure Necessary ---

12.B.  Warrants and Rights        --- No Disclosure Necessary ---

12.C.  Other Securities           --- No Disclosure Necessary ---

12.D.  American Depository Shares  -- No Disclosure Necessary ---

PART II

ITEM 13.  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

          --- No Disclosure Necessary ---

ITEM 14.  MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY

          HOLDERS AND USE OF PROCEEDS   --- No Disclosure Necessary ---

ITEM 15.  CONTROLS AND PROCEDURES

Within the 90-day period prior to the filing of this report ("Date of Evaluation"), an evaluation was carried out under the supervision and with the participation of the Company's management, including the Chief Executive Officer ("CEO") and Chief Financial Officer ("CFO"), of the effectiveness of our disclosure controls and procedures.  Based on that evaluation, the CEO and CFO have concluded that the Company's disclosure controls and procedures are effective to ensure that information required to be disclosed by the Company in reports that it files or submits under the Securities Exchange Act of 1934 is recorded, processed, summarized and reported within the time periods specified in Securities and Exchange Commission rules and forms.

The Company's disclosure controls and procedures operate such that important information flows to appropriate collection and disclosure points in a timely manner and are effective to ensure that such information is accumulated and communicated to the Company's management, and made known to the Company's Chief Executive Officer and Chief Financial Officer, including the period when this Annual Report on Form 20-F was prepared, as appropriate to allow timely decision regarding the required disclosure.

There have been no changes in the Company's internal controls or the occurrence of events or other factors that could affect these controls, subsequent to the Date of Evaluation.  Nor have there been any corrective actions with regard to deficiencies or material weaknesses.

ITEM 16.  RESERVED

Item 16A. Audit Committee Financial Expert

The Company’s Audit Committee currently consists of three members, all of whom are financially literate. Mr. Richard George Whatley, the Chief Financial Officer of the Company, meets the requirements of “audit committee financial expert”.

Each member of the Audit Committee has:

•

an understanding of the accounting principles used by the Company to prepare its financial statements, and the ability to assess the general application of those principles in connection with estimates, accruals and reserves;

•

experience preparing, auditing, analyzing or evaluating financial statements that present a breadth and level of complexity of accounting issues that are generally comparable to the breadth and complexity of issues that can reasonably be expected to be raised by the Company’s financial statements, or experience actively supervising individuals engaged in such activities; and,

•

an understanding of internal controls and procedures for financial reporting.

The Audit Committee has a charter. This charter contemplates that a majority of the audit committee should be comprised of directors are independent. The Company is currently operating with only one independent member on the audit committee, namely Mr. Pines. Mr. Pines is restricted as a member of the audit committee due to the policies of his current employer.  Accordingly, the Company is currently not in compliance with its audit committee charter at this time.

Item 16B. Code of Ethics

The Company has not adopted a written Code of Ethics.

Item 16C. Principal Accountant Fees and Services

Table Number 14 discloses the fees billed to the Company by its independent auditors, Mackay LLP and De Visser Gray LLP, Chartered Accountants, for each of the last two years.

	Fiscal Year Ended February 28, 2006	Fiscal Year Ended February 28, 2007
Audit Fees	$    22,600	$   23,500
Audit Related Fees	Nil	Nil
Tax Fees	$2,000	$5,450
All Other Fees	Nil	Nil
Total	$24,600	$28,950

Item 16D.  Exemptions from Listing Standards for Audit Committees

Not Applicable

Item 16E.  Purchase of Equity Securities by the Issuer and Affiliated Purchasers

Not Applicable

PART III

ITEM 17.  FINANCIAL STATEMENTS

The Company's financial statements are stated in Canadian Dollars (CDN$) and are prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP), the application of which, in the case of the Company, conforms in all material respects for the periods presented with United States GAAP, except as discussed in footnotes to the financial statements.

The financial statements as required under ITEM #17 are attached hereto and found immediately following the text of this Annual Report.  The audit report of De Visser Gray LLP, independent Chartered Accountants, is included herein immediately preceding the audited financial statements.

Audited Financial Statements

Auditor's Report, dated 6/22/2007

Statements of Operations and Deficit for the years ended 2/28/2007, 2/28/2006, and 2/28/2005 and cumulative Inception to 2/28/2007

Balance Sheets at 2/28/07 and 2/28/06

Statements of Cash Flows for the years ended 2/28/2007, 2/28/2007, and 2/29/2007 and Cumulative Inception to 2/28/2007

Notes to Financial Statements

ITEM 18.  FINANCIAL STATEMENTS

The Company has elected to provide financial statements pursuant to ITEM #17.

ITEM 19.  EXHIBITS

Certifications required by Section 302 of Sarbanes-Oxley Act of 2002 and SEC Rule 33-8124

SIGNATURE PAGE

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Mining Glossary

Alteration – any change in the mineral composition of a rock brought about by physical or chemical means.

Assaying - laboratory examination that determines the content or proportion of a specific metal (ie: silver) contained within a sample.  Technique usually involves firing/smelting.

Batholith – a very large intrusive mass of igneous rock.

Bottle Roll Leach Test – a small-scale laboratory test where representative mineralized samples and solutions or solvents are placed in a bottle which is continuously agitated.  The solutions are frequently measured to determine the cumulative extraction of the contained metals into solution.

Bulk Sample – A collection of representative mineralized material whose location, geologic character and metal assay content can be determined and then used for metallurgical or geotechnical testing purposes.

Chlorargyrite - a silver-bearing mineral (AgC1); silver chloride.

Column Leach Test – a metallurgical test where materials are stacked inside a columnar container and subjected to a controlled flow of fluids or solvents intended to dissolve or extract minerals into solutions which are measured.

Core Samples - the cylindrical form of rock called “core” that is extracted from a diamond drill hole.  Mineralized sections are separated and these samples are sent to a laboratory for analysis.

Cut-off grade - the lowest grade of mineralized material that qualifies as reserve in a deposit.  ie: contributing material of the lowest assay that is included in a reserve estimate.

Diamond Drilling – a type of rotary drilling in which diamond bits are used as the rock-cutting tool to produce a recoverable drill core sample of rock for observation and analysis.

Dip – the angle that a structural surface, a bedding or fault plan, makes with the horizontal, measured perpendicular to the strike of the structure.

Disseminated – where minerals occur as scattered particles in the rock.

Environmental Baseline Study - a geotechnical study that monitors and establishes the numerous naturally occurring base levels present within a specific area/environment.  These can include; water chemistry, flora and fauna.

Epithermal – low temperature hydrothermal process or product.

Exploration – work involved in searching for ore, usually by drilling or driving a drift.

Fault – a fracture or break in rock along which there has been movement.

Feasibility – is a definitive study of the viability of a mineral project by a qualified professional which defines: (1) mining methods, pit configuration, mine scheduling, mine equipment and all related costing, (2) method of mineral processing and all related plant, equipment and costing, (3) necessary determination of all infrastructure required and relevant costs and (4) all requirements of government and markets for mine operation. A definitive financial analysis of the mineral project taking into consideration all relevant factors which will establish the presence of a Mineral Reserve and the details of its economic viability.

Felsic – an adjective describing an igneous rock having mostly light colored minerals and rich in silica, potassium and sodium.

Flow -Through Shares

Proceeds from the sale of Flow-Through common shares are used to fund mineral exploration work that may qualify for the British Columbia Mining Exploration Tax Credit (“METC”). Effective August 1, 1998, expenditures made by eligible individuals and corporations conducting grassroots mineral exploration in British Columbia may qualify for the METC. The METC is a credit of 20% of the amount by which total qualified mining exploration expenses are incurred by the taxpayer in the taxation year.

Qualified Mining Exploration Expenses are defined as any expense (before deducting any assistance) incurred by a taxpayer after July 31, 1998 and before August 1, 2003 for the purpose of determining the existence, location, extent or quality of a mineral resource in British Columbia, other than an excluded expense. Such qualified expenses may include costs incurred in:

a)

Prospecting

b)

Carrying out geological, geophysical or geochemical surveys

c)

Drilling by rotary, diamond, percussion or other methods

d)

Trenching, digging test pits and preliminary sampling

In order to apply for the METC, the taxpayer must be subject to British Columbia Income Tax for the taxation year in which the credit is being claimed. An individual must have resided in British Columbia on the last day of the taxation year to be eligible to apply for the credit. A corporation must have maintained a permanent establishment in British Columbia at any time in the taxation year in order to be eligible to apply for the METC.

Common shares of exploration companies which are issued under the METC program are known as “Flow-Through” shares. During 2001, the Company issued 1,163,333 Flow-Through common shares for proceeds of $99,750. Under the sale, it is the Company’s intention to distribute any proceeds received under the METC program to the purchasers of the Flow-Through shares. To date, the Company has received $17,599 under the METC and distributed the money to the Flow-Through shareholders.

Fracture – a break or crack in rock.

Fracture-controlled - a type of mineralization where circulating fluids deposit minerals preferentially upon fracture planes within a rock mass.

Grade – The metal content of rock with precious metals, grade can be expressed as troy ounces or grams per tonne of rock.

Granodiorite – a medium to coarse-grained intrusive igneous rock, intermediate in composition between quartz diorite and quartz monzonite.

Heap Leach – a mineral processing method involving the crushing and stacking ore on an impermeable liner upon which solutions may be sprayed that dissolves metal i.e. gold/silver, etc.; the solutions containing the metals are then collected and treated to recover the metals.

Hydrothermal – the products or the actions of heated waters in a rock mass such as a mineral deposit precipitating from a hot solution.

Hydrothermal alteration - the process by which heated or superheated water/solutions alter the chemistry of the rocks they circulate through.

Igneous – a primary type of rock formed by the cooling of molten material.

Intrusion; Intrusive – molten rock which is intruded (injected) into spaces that are created by a combination of melting and displacement.

Jones splitter - a mechanical device into which sample material consisting of rock chips from drill holes is fed into a hopper.  The device then statistically splits the volume of material to produce a smaller representative sample, which is then sent to a laboratory for analysis.

Mesothermal – intermediate temperature hydrothermal process (200-300C) or product.

Metamorphosed rocks - rocks that are changed in character by processes of intense heat and pressure deep within the earth’s crust.

Metallurgy – the study of the extractive processes which produce minerals from their host rocks.

Metallurgical Tests - are scientific examinations of rock/material to determine the optimum extraction of metal contained.  Core samples from diamond drill holes are used as representative samples of the mineralization for this testwork.

Mineral – a naturally formed chemical element or compound having a definitive chemical composition and, usually a characteristic crystal form.

Mineralization – a natural concentration in rocks or soil of one or more metalliferous minerals.

Open Pit – a mining method whereby the mineral reserves are accessed from surface by the successive removal of layers of material usually creating a large pit at the surface of the earth.

Prefeasability Study – is a comprehensive study of the viability of a mineral project that has advanced to a stage where the mining method, in the case of underground mining, or the pit configuration, in the case of an open pit, has been established, and where an effective method of mineral processing had been determined.  This Study must include a financial analysis based on reasonable assumptions of technical engineering, operating, and economic factors which are sufficient for a Qualified Person acting reasonably, to determine if all or part of the Mineral Resource may be classified as a Mineral Reserve.

Pyrite - an iron sulphide mineral (FeS2), the most common naturally occurring sulphide mineral.

Quartz – crystalline silica; often forming veins in fractures and faults within older rocks.

Quartz Monzonite - a coarse grained, quartz rich igneous rock usually occurring as a smaller rock mass associated with major granitic bodies.

Resource – a concentration of mineral material in such form and amount that economic extraction of a commodity from the concentration is currently or potentially feasible.  Locations, grade, quality or quantity are estimated from specific geologic evidence.

Reverse Circulation Drilling (RC) – a drilling method used in geological appraisals whereby the drilling fluid passes inside the drill stem to a down-the-hole precision bit and returns to the surface outside the drill stem carrying the drill chip samples.

Silification – the in situ alteration of a rock, which involves an increase in the proportion of silica minerals.

Supergene effects - the effect of the water/solutions percolating down from the earth’s surface (weathering); these solutions can dissolve minerals at the surface and then reconcentrate at depth.

Vein – a thin, sheet-like, crosscutting body of hydrothermal mineralization, principally quartz.

Volcanics – those originally molten rocks, generally fine grained, that have reached or nearly reached the Earth’s surface before solidifying.

Waste – barren rock in a mine, or mineralized material that is too low in grade to be mined and milled at a profit.

Waste to Ore Strip Ratio – the amount of waste material mined for each unit of ore presented as a ratio.

Alpha Gold Corp.

(An Exploration Stage Company)

Years Ended February 28, 2007 and 2006

Financial Statements

Alpha Gold Corp.

(An Exploration Stage Company)

Financial Statements

February 28, 2007

Auditors’ Report	3
Statements of Operations and Deficit	4
Balance Sheets	5
Statements of Cash Flows	6
Notes to the Financial Statements	7 – 18
Schedule of Acquisition Costs	19
Schedule of Deferred Expenditures	20

#

D E  V I S S E R  G R A Y  L L P

CHARTERED ACCOUNTANTS

401 - 905 West Pender Street

Vancouver, BC Canada

V6C 1L6

Tel: (604) 687-5447

Fax: (604) 687-6737

AUDITORS’ REPORT

To the Shareholders of Alpha Gold Corp.

We have audited the balance sheet of Alpha Gold Corp. as at February 28, 2007 and 2006 and the statements of operations and deficit and cash flows for each of the three years ended February 28, 2007, February 28, 2006 and February 28, 2005 and cumulative from inception to February 28, 2007.  These financial statements are the responsibility of the Company’s management.  Our responsibility is to express an opinion on these financial statements based on our audit.

We conducted our audit in accordance with Canadian generally accepted auditing standards and the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform an audit to obtain reasonable assurance whether the financial statements are free of material misstatement.  An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements.  An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation.

In our opinion, these financial statements present fairly, in all material respects, the financial position of Alpha Gold Corp. as at February 28, 2007 and 2006 and the results of its operations and its cash flows for each of the three years ended February 28, 2007, February 28, 2006 and February 28, 2005 and cumulative from inception to February 28, 2007 in accordance with Canadian generally accepted accounting principles.

The financial statements as at February 28, 2006 and 2005 and for the three years ended February 28, 2006, February 28, 2005 and February 29, 2004 and cumulative from inception to February 28, 2006, were audited by the other auditors who expressed an opinion without reservation on those financial statements in their report dated May 31, 2006.

“DeVisser Gray LLP”

CHARTERED ACCOUNTANTS

Vancouver, British Columbia

June 22, 2007

Alpha Gold Corp.

(An Exploration Stage Company)

Statements of Operations and Deficit

	Cumulative Inception to	For the year ended,
	February 28, 2007	February 28, 2007	February 28, 2006	February 28, 2005
Expenses
Amortization	246,237	24,983	28,427	23,895
Automotive	114,535	16,454	9,302	14,494
Bad debts	14,999	-	-	-
Consulting and management fees	529,263	60,000	60,000	60,000
Financial relations	59,000	-	-	-
Gain on disposal of exploration property	(52,202)	-	-	-
Insurance	36,237	4,088	4,079	4,190
Loss (gain) on disposal of equipment	(7,400)	(30,115)	-	2,327
Office, printing and miscellaneous	331,344	13,826	16,016	13,488
Professional fees	750,019	66,420	67,976	51,779
Property investigation	25,052	-	-	-
Regulatory and transfer fees	180,235	25,018	20,785	12,931
Rent	90,930	6,000	6,000	6,000
Repairs and maintenance	13,291	-	-	-
Shareholder relations	253,537	112,740	26,884	4,105
Stock based compensation (note 6)	287,800	195,500	9,300	83,000
Telephone	13,291	3,304	3,961	3,611
Travel and promotion	126,631	10,790	10,959	8,772
Wages	12,864	-	-	-
Write-off of cost of and expenditures on    exploration properties abandoned	1,133,596	-	323,636	-
Write-down of fixed assets	46,527	-	-	-
	4,210,266	509,008	587,325	288,592
Net loss before other items and income taxes	4,210,266	509,008	587,325	288,592
Other items
Insurance proceeds	12,898	-	-	-
Interest	480,346	50,454	34,847	36,685
Gain on disposal of marketable securities	40,094	-	-	-
Interest, bank charges and foreign exchange	(21,607)	225	(1,406)	(1,067)
Loss on realization of demand debenture	(14,487)	-	-	-
	497,244	50,679	33,441	35,618
Net loss before income taxes	3,713,022	458,329	553,884	252,974
Future income taxes (recovery)	(220,204)	(160,151)	(138,138)	(22,602)
Net loss for the period	3,492,818	298,178	415,746	230,372
Deficit – beginning of period	-	(3,194,640)	(2,778,894)	(2,548,522)
Deficit – end of period	$ (3,492,818)	$ (3,492,818)	$ (3,194,640)	$ (2,778,894)
Basic and diluted loss per share		$          (0.01)	$          (0.02)	$          (0.01)
Weighted average number of shares outstanding		27,452,763	25,010,086	23,817,700

Alpha Gold Corp.

(An Exploration Stage Company)

Balance Sheets

February 28,		2007	2006
Assets
Current
Cash and cash equivalents		$1,253,430	$1,257,178
Other receivables		29,134	4,226
Subscription receivable		6,000	-
Taxes receivable		95,709	168,278
Prepaid expense		-	607
		1,384,273	1,430,289
Reclamation bond (note 3)		25,000	7,000
Investment in exploration properties (note 3 and Schedule)		513,682	513,682
Expenditures on exploration properties (note 3 and Schedule)		6,035,098	4,805,346
Equipment (note 4)		50,626	67,498
		$ 8,008,679	$ 6,823,815
Liabilities
Current
Accounts payable and accrued liabilities		$ 25,465	$ 11,410
Future income tax liability (note 7)		702,943	814,501
		728,408	825,911
Shareholders’ Equity
Share capital (note 5)		10,483,489	9,098,444
Contributed surplus (notes 5 and 6)		289,600	94,100
Deficit		(3,492,818)	(3,194,640)
		7,280,271	5,997,904
		$ 8,008,679	$ 6,823,815
Nature of operations (note 1)
Approved by the Directors:
“George Whatley”	Director
“Richard Whatley”	Director

Alpha Gold Corp.

(An Exploration Stage Company)

Statements of Cash Flows

	Cumulative Inception to	For the year ended,
	February 28, 2007	February 28, 2007	February 28, 2006	February 28, 2005
Cash provided by (used in):
Operating activities
Net loss for the period	$   (3,492,818)	$   (298,178)	$   (415,746)	$   (230,372)
Items not affecting cash:
Amortization	246,237	24,983	28,427	23,895
Future income taxes (recovery)	(220,204)	(160,151)	(138,138)	(22,602)
Loss (gain) on disposal of equipment	(7,400)	(30,115)	-	2,327
Gain on sale of exploration property	(52,202)	-	-	-
Gain on disposal of marketable securities	(40,094)	-	-	-
Loss on realization of demand debenture	14,487	-	-	-
Stock based compensation	287,800	195,500	9,300	83,000
Write-off of cost of and expenditures on    exploration properties abandoned	1,133,596	-	323,636	-
Write-down of fixed assets	46,527	-	-	-
	(2,084,071)	(267,961)	(192,521)	(143,752)
Changes in non-cash working capital (note 9)	(337,240)	(25,962)	11,680	3,744
	(2,421,311)	(293,923)	(180,841)	(140,008)
Investing activities
Investment in and expenditures on    exploration properties	(7,485,351)	(1,147,466)	(720,510)	(462,061)
Proceeds on disposal of exploration property	20,000	-	-	-
Proceeds on disposal of marketable securities	60,094	-	-	-
Acquisition of reclamation bonds	(25,000)	(18,000)	-	-
Sale (purchase) of equipment, net of disposal	(291,188)	22,003	(1,988)	(82,743)
Demand debenture	(12,250)	-	-	-
	(7,733,695)	(1,143,463)	(722,498)	(544,804)
Financing activity
Proceeds on issuance of shares,    net of issue costs	11,408,436	1,433,638	471,280	439,502
Increase (decrease) in cash for the period	1,253,430	(3,748)	(432,059)	(245,310)
Cash and cash equivalents – beginning	-	1,257,178	1,689,237	1,934,547
Cash and cash equivalents – ending	$   1,253,430	$ 1,253,430	$ 1,257,178	$  1,689,237

Supplemental cash flow information (note 9)

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

1.	Nature of Operations
	The investment in and expenditures on exploration properties comprise a significant portion of the Company’s assets.  Realization of the Company’s investment in these assets is dependent upon obtaining the necessary financing to continue exploration and development of the properties, the attainment of successful production from the properties or from the proceeds of their disposal.
	The continuing operations of the Company are dependent upon its ability to continue to raise capital to funds its exploration and development programs. The Company has no revenue and has suffered recurring losses from operations that raise substantial doubt about its ability to continue as a going concern. These financial statements do not include any adjustments that might result from the outcome of this uncertainty.
2.	Significant Accounting Policies
	a)	Basis of Presentation The financial statements of the Company are prepared in accordance with Canadian generally accepted accounting principles.  As described in note 10, these principles differ in certain material respects from United States generally accepted accounting principles.
	b)	Translation of Foreign Currency Amounts recorded in a foreign currency have been translated into Canadian dollars as follows:
		(i)	Accounts included in the statement of operations and deficit are translated at average rates of exchange prevailing during the period; and,
		(ii)	Accounts included in the balance sheet are translated at rates of exchange at period end; except that, equipment and investment in and expenditures on exploration properties are translated at rates prevailing at acquisition or exploration date.
		All gains and losses arising from the translation of foreign currency are included in operations.
	c)	Cash and Cash Equivalents The Company considers all investments that are cashable on demand and utilized periodically for day to day operations to be cash equivalents. At February 28, 2007 the Company held a term deposit of $1,100,000 (2006 - $1,184,869), bearing interest at 4% per annum.
	d)	Deferred Expenditures Acquisition costs of exploration properties, rights and options together with direct exploration  and development expenditures thereon are deferred until the property is put into production, sold, or abandoned.  Acquisition costs will be reduced by any payments from the granting of options to purchase the exploration property.
		Such expenditures are to be amortized using the unit of production method based upon the estimated proven reserves in each cost centre as determined by independent engineers, or charged to operations if any cost centre is determined to be unsuccessful.

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

2.	Significant Accounting Policies (continued)
			d)	Deferred Expenditures (continued)
				All deferred expenditures are reviewed by management, on a property by property basis, to consider whether there are any conditions that may indicate an impairment in value. When the carrying value exceeds the net recoverable amount as estimated by management, or the Company’s ability to sell the property for an amount exceeding the deferred costs, provision is made for the impairment in value. Recorded costs are not intended to reflect present or future values of the properties. The recovery of recorded costs is subject to measurement uncertainty, and it is reasonably possible that changes in future conditions in the near term could require a material change in the recorded amount. The Company has adopted the CICA’s Handbook Section 3110 “asset retirement obligations” which establishes standards for the recognition, measurement and disclosure of liabilities for asset retirement obligations and the associated asset retirement costs. The standards apply to legal obligations associated with the retirement of long-lived tangible assets that arise from the acquisition, construction, development or normal operation of such assets. The standards require that a liability for an asset retirement obligation be recognized in the period in which it is incurred and when a reasonable estimate of the fair value of the liability can be made.  Furthermore, a corresponding asset retirement cost should be recognized by increasing the carrying amount of the related long-lived asset.  The asset retirement cost is subsequently allocated in a rational and systematic method over the underlying asset’s useful life.  The initial fair value o f the liability is accreted, by charges to operations, to its estimated nominal future value. As of February 28, 2007 and 2006 no amount has been accrued. Although the Company has taken steps to verify title to mineral properties in which it has an interest, in accordance with industry standards for the current stage of exploration of such properties, these procedures do not guarantee the Company’s title.  Property may be subject to unregistered prior agreements or inadvertent non-compliance with regulatory requirements.
			e)	Equipment
				Equipment is recorded at cost and amortization is calculated on a declining balance basis at the following annual rates:
				Computer equipment		- 30%
				Furniture and fixtures		- 20%
				Trucks		- 30%
			f)	Loss per Share
				Loss per share computations are based on the weighted average number of common shares outstanding during the year. Fully diluted loss per share has not been calculated since the exercise of outstanding options and warrants is anti-dilutive.
		g)			Share Issue Costs
					Share issue costs incurred on the issue of the Company’s shares are charged directly to share capital.

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

2.		Significant Accounting Policies (continued)
		h)	Flow-Through Shares
			The Company has adopted the CICA’s guidance on the accounting treatment of Canadian flow-through shares through Emerging Issues Committee abstract-EIC 146.  All flow-through shares issued by the Company on or after March 19, 2004 have been accounted for in accordance with this Abstract.  The Abstract recommends that upon renunciation to the shareholders, the Company will reduce share capital and record a temporary future income tax liability for the amount of the tax deduction renounced to shareholders.  In instances where the Company has sufficient available tax loss carry forwards or other deductible temporary differences available to offset the renounced tax deductions, the realization of the deductible temporary differences will be credited to operations in the period of renunciation.
		i)	Financial Instruments
			All significant financial assets, financial liabilities and equity instruments of the Company are either recognized or disclosed in the financial statements together with other information relevant for making a reasonable assessment of future cash flows, interest rate risk and credit risk.  Where practicable the fair values of financial assets and financial liabilities have been determined and disclosed; otherwise only available information pertinent to fair value has been disclosed.
	j)			Income Taxes
				The Company follows the liability method of accounting for income taxes. Under this policy, future income tax assets and liabilities are determined based on the differences between the tax basis of assets and liabilities and those reported in the financial statements. The future tax assets or liabilities are calculated using the tax rates for the periods in which the temporary differences are expected to reverse. The effect on future income tax assets and liabilities as a result of a change in tax rates is included in operations in the period in which the change is enacted or substantially assured. The amount of future tax assets recognized is limited to the amount of the benefit that is more likely than not to be realized.
	k)			Stock Based Compensation
				All stock-based awards are measured and recognized using the fair-value method as determined by the Black-Scholes option pricing model.  Awards that the Company has the ability to settle with stock are recorded as equity, whereas awards that the Company is required to, or has the practice of settling in cash are recorded as liabilities.  Compensation is recognized in the statement of operations over the vesting period.
	l)			Use of Estimates
				The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclose of contingent assets and liabilities at the balance sheet date and the reported amounts of revenues and expenses during the year.  Actual results could differ from those estimates.

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

2.				Significant Accounting Policies (continued)
			m)				Measurement Uncertainty
							The amounts recorded for asset retirement obligation, equipment and the future recovery of the recorded cost of the properties are based on estimates.   By their nature, these estimates are subject to measurement uncertainty and the effect on the financial statements of changes in such estimates in future periods could be significant.
	3.	Exploration Properties
									2007	2006
					Acquisition costs (Schedule)				$      513,682	$      513,682
					Deferred expenditures (Schedule)				6,035,098	4,805,346
									$   6,548,780	$   5,319,028
		(a)				Lust Dust Claims
						(i)		On July 15, 1989, the Company acquired a 100% interest in certain mineral claims located in the Omineca Mining Division, British Columbia for cash of $170,000.  The vendor retains a royalty of 3% of net smelter returns.
						(ii)		On February 21, 1992, the Company acquired a 100% interest in certain mineral claims located in the Omineca Mining Division, British Columbia for $100,000 cash and 200,000 shares of the company at a deemed consideration of $0.60 each (previously subject to a 5% net profit interest to a maximum of $100,000 and a royalty of 2% of net smelter returns).  In July 2003, the company acquired the retained “5% net profit interest and the 2% net smelter return royalty” for $150,000 cash.
		(b)				Goldbanks On October 30, 1995, the Company entered into an agreement to acquire a 100% interest in certain mineral claims situated in Pershing County, Nevada, USA.  The Company had previously entered into an option agreement to acquire the mineral claims in the 1995 fiscal year.  The company and the vendor agreed to terminate the option agreement dated April 30, 1994.  Payments under the option agreement totaled $26,400 US and were applied to the purchase.  In addition to the above payments, the Agreement calls for the issuance to the vendor of 100,000 shares of Alpha Gold Corp.  As at February 28, 2007, regulatory approval had been received but the shares had not yet been issued. During the prior year, the Company abandoned its interest in Goldbanks.  The value of the investment and the related deferred expenditures have therefore been written off and charged to operations.

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

4.		Equipment
		February 28, 2007						Cost		Accumulated Amortization		Net Book Value
		Computer equipment						$      7,288		$    4,630		$     2,658
		Furniture & fixtures						16,361		15,393		968
		Trucks						59,384		12,384		47,000
								$    83,033		$  32,407		$   50,626
		February 28, 2006
		Computer equipment						$      7,288		$    3,490			$     3,798
		Furniture & fixtures						16,361		15,151			1,210
		Trucks						105,025		42,535			62,490
								$  128,674		$  61,176			$   67,498
5.			Share Capital
			a)		Authorized
					100,000,000 common shares without par value
			b)		Issued
							2007				2006
							Number				Number
							of Shares		Amount		of Shares			Amount
			Balance - beginning of the year				25,408,944		$9,098,444		24,451,684			$    8,628,964
			Issued during the year
			- for cash @ $0.50				-		-		957,260			478,630
			- for cash @ $0.40				3,499,225		1,399,690		-			-
			Warrants exercised				128,750		77,250		-			-
			Share issue costs				-		(43,302)		-			(9,150)
			Income tax benefits renounced on flow through shares issued				-		(48,593)		-			-
			Balance – end of the year				29,036,919		$10,483,489		25,408,944			$   9,098,444
	c)			Share issuances
				During the current year:
				i)		3,499,225 units were issued at $0.40 per unit (of which 2,781,500 were “flow-through” units).  Each unit consisted of one common share and one-half warrant.  Each whole warrant is exercisable to purchase one additional non flow-through common share for $0.60, expiring July 28, 2007.  Share issue costs on this transaction were $43,302 for finder’s fees paid in cash.
				ii)		The Company renounced the income tax benefits attached to the 285,000 flow-through shares issued during the prior year. This renunciation resulted in an increase in the future income tax liability of $48,593 and a reduction in share capital of the same amount.

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

5.			Share Capital (continued)
	c)			Share issuances (continued)
				In the prior year:
				i)	957,260 units were issued at $0.50 per unit (of which 285,000 were “flow-through” units).  Each unit consisted of one common share and one warrant.  Each warrant is exercisable to purchase one additional non-flow-through common share for $0.50, expiring July 25, 2007. Share issue costs on this transaction included a $7,350 finder’s fee paid in cash, and 14,700 broker warrants.  The fair value of each broker warrant granted was estimated on the grant date using the Black-Scholes option-pricing model with the following assumptions: Dividend rate 0.00% Strike price $ 0.50 Risk-free interest rate 3.04% Spot price $ 0.50 Expected life 2 years Fair value $ 0.12 Expected annual volatility 38.00% Based on the fair values above for the broker warrants granted, non-cash share issue costs of $1,800 were credited to contributed surplus.
		d)		Warrants outstanding
				Warrant transactions for the respective years are summarized as follows:
							Number of warrants		Weighted average exercise price
				Balance, February 28, 2005			575,000		$  0.46
				Warrants granted			971,960		$  0.50
				Balance, February 28, 2006			1,546,960		$  0.49
				Warrants granted			1,749,614		$  0.60
				Warrants exercised			(128,750)		$  0.60
				Warrants expired			(575,000)		$  0.46
				Balance, February 28, 2007			2,592,824		$  0.56
				As of February 28, 2007, the following share purchase warrants were outstanding:
				Number of shares		$ per share		Expiry date
				971,960		$ 0.50		July 25, 2007
				1,620,864		$ 0.60		July 28, 2007
				2,592,824

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

5.		Share Capital (continued)
	e)		Options outstanding
			The Company has established a share purchase option plan whereby the board of directors may, from time to time, grant options to directors, officers, employees or consultants to acquire up to 2,445,168 common shares.  The exercise price of an option is not less than the closing price on the Exchange on the last trading day preceding the grant.
						Number of options		Weighted average exercise price
			Balance, February 28, 2005			1,550,000		$  0.40
			Options granted			100,000		$  0.40
			Options expired			(300,000)		$  0.50
			Balance, February 28, 2006			1,350,000		$  0.40
			Options granted			1,200,000		$  0.40
			Options expired			(850,000)		$  0.40
			Balance, February 28, 2007			1,700,000		$  0.40
			A summary of the Company’s options outstanding at February 28, 2007 are as follows:
			Number of options outstanding	Number of options exercisable			$ per share	Expiry date
			250,000	187,500			$ 0.40	April 1, 2007
			500,000	500,000			$ 0.40	January 28, 2010
			950,000	950,000			$ 0.40	January 26, 2010
			1,700,000		1,637,500
f)			Contributed surplus
						2007			2006
			Balance, beginning of year			$      94,100			$    83,000
			Stock-based compensation expense			195,500			9,300
			Broker warrants			-			1,800
			Balance, end of year			$    289,600			$    94,100

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

6.	Stock Based Compensation
	During the year ended February 28, 2007, the Company granted 1,200,000 stock options.  The fair value of each option granted was estimated on the grant date using the Black-Scholes option-pricing model with the following weighted average assumptions:

Dividend rate

0.00%

Strike price

$ 0.40

Risk-free interest rate

4.09%

Spot price

$ 0.41

Expected life

2.9 years

Fair value

$ 0.17

Expected annual volatility

56.13%

	As disclosed above the Company granted 950,000 options exercisable at $0.40 per share which vested immediately and granted 250,000 options exercisable at $0.40 per share with the following vesting terms; ¼  three months from date of grant and ¼ every three months thereafter. Based on the fair values above for the options granted and vested, compensation expense of $195,500 was recorded in operations for the year, and credited to contributed surplus.
7.	Income Taxes
	A reconciliation of current income taxes at statutory rates with the reported taxes is as follows:
		2007	2006
	Loss for the year before income taxes	$ 458,329	$ 553,884
	Statutory Canadian corporate rates	34.10%	34.10%
	Anticipated tax expense (recovery)	$(156,290)	$(188,874)
	Effect of tax rate change	(44,894)	(26,584)
	Change in rates resulting from:
	Items not deductible for tax purposes	88,281	16,411
	Expiry of non-capital loss carry-forward	35,583	49,926
	Change in valuation allowance	(61,535)	10,983
	Actual income tax recovery	$ (160,151)	$(138,138)
	The significant components of the Company's future income tax assets and liabilities are as follows:
		2007	2006
	Future income tax assets:
	Non-capital loss carry-forwards	$325,665	$318,576
	Property and equipment	42,497	46,536
	Share issue costs	17,105	12,756
	Capital losses	3,797	2,088
	Valuation allowance	(263,804)	(318,576)
		125,260	61,380
	Future income tax liability:
	Mineral properties	(847,562)	(875,881)
	Net future income tax assets (liability)	$(722,302)	$(814,501)

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

	7.		Income Taxes (continued)
		The Company has available non-capital losses of $1,050,531, Cumulative Canadian Exploration Expenses of $2,219,049, Cumulative Canadian Development Expenses of $657,236 and Cumulative Foreign Exploration and Development Expenses of $938,424 which may be carried forward to reduce taxable income in future years.  The potential future income tax benefit arising from the non-capital losses prior to 2007 is not reflected in these financial statements. The non-capital losses expire as follows:
		2008		$   109,248
		2009		121,751
		2010		150,073
		2011		149,625
		2015		143,752
		2016		176,091
		2027		199,991
				$1,050,531
		The Company has recorded a valuation allowance against its future income tax asset related to non-capital loss carry-forwards that expire on or before 2016 because it does not believe it is more likely than not that sufficient taxable income will be realized during the carry-forward period to utilize the future tax asset.
8.		Related Party Transactions
		During the year, the Company paid fees of $147,000 (2006 - $131,000) for contract negotiation, property investigation, property acquisition, site investigation and management of field programs, $8,550 (2006 - $8,350) for secretarial and bookkeeping services, $6,000 (2006 - $6,000) for office rental, and $4,800 (2006 - $2,700) for car rental to directors of the Company or companies controlled by directors of the Company.
		These transactions are in the normal course of operations and have been valued in these financial statements at the exchange amount which is the amount of consideration established and agreed to by the related parties.

9.	Supplemental Cash Flow Information
	Changes in non-cash working capital
		2007	2006	2005
	Other receivables	$(24,908)	$10,563	$  (3,523)
	Subscription receivable	(6,000)	-	-
	Prepaid expense	607	4,047	7,321
	Accounts payable and accrued liabilities	4,339	(2,930)	(54)
		$(25,962)	$11,680	$   3,744

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

9.	Supplemental Cash Flow Information (continued)
	The Company had the following cash transactions
		2007	2006	2005
	Interest paid	$     694	$     415	$       512
	Interest received	$32,496	$34,758	$  63,219
	Income taxes received	$75,746	$           -	$274,919
	The Company had the following non-cash transactions
		2007	2006	2005
	Share issue costs	$       -	$  1,800	$       -

10.	Generally Accepted Accounting Principles in Canada and the United States
	The financial statements have been prepared in accordance with Canadian generally accepted accounting principles (Canadian GAAP) which differ in certain respects from those principles that the Company would have followed had its financial statements been prepared in accordance with United States generally accepted accounting principles (US GAAP).
	a)	US GAAP requires that exploration costs related to projects at a pre-feasibility stage of development be charged to expense as incurred.  Under Canadian GAAP costs incurred prior to the point where feasibility can be determined are not precluded from initial capitalization and subsequent deferral.
	b)	Due to the required expensing of exploration costs, the future income liability for US GAAP is nil.
	c)	Had the Company followed US GAAP, certain items on the statements of income and deficit would have been reported as follows:
			Cumulative, inception to February 28, 2007	2007	2006	2005
		Loss per Canadian GAAP	$(3,492,818)	$(298,178)	$(415,746)	$(230,372)
		Effect of the expensing of exploration costs for the year	(6,548,780)	(1,229,752)	(304,342)	(661,264)
		Effect of future income taxes	702,943	(111,558)	(138,138)	22,602
		Loss per US GAAP	$(9,338,655)	$(1,639,488)	$(858,226)	$(869,034)
		Basic loss per share under US GAAP		$(0.06)	$(0.03)	$(0.04)

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

#

#

10.	Generally Accepted Accounting Principles in Canada and the United States (continued)
		d)	The effects of the differences in accounting under Canadian GAAP and US GAAP on the balance sheets and statements of cash flows are as follows:
			Balance sheets	2007		2006
				Canadian GAAP	US GAAP	Canadian GAAP		US GAAP
			Current assets	$1,384,273	$1,384,273	$1,430,289		$1,430,289
			Reclamation bonds	25,000	25,000	7,000		7,000
			Exploration properties and    deferred costs	6,548,780	-	5,319,028		-
			Equipment	50,626	50,626	67,498		67,498
				$8,008,679	$1,459,899	$6,823,815		$1,504,787
			Current liabilities	$25,465	$     25,465	$     11,410		$    11,410
			Future income tax liability	702,943	-	814,501		-
			Share capital	10,483,489	10,483,489	9,098,444		9,098,444
			Contributed surplus	289,600	289,600	94,100		94,100
			Deficit	(3,492,818)	(9,338,655)	(3,194,640)		(7,699,167)
				$8,008,679	$1,459,899	$ 6,823,815		$ 1,504,787
		e)	Reconciliation of statements of cash flows
					2007
					Operations	Investing		Financing
			Cash provided by (used) per Canadian
			GAAP		$(293,923)	$(1,143,463)		$1,433,638
			Effect of the write-off of exploration and
			G&A project costs		(1,229,752)	1,229,752		-
			Cash generated (used) per US GAAP		$(1,523,675)	$ 86,289		$1,433,638
					2006
					Operations		Investing	Financing
			Cash provided by (used) per Canadian
			GAAP		$ (180,841)		$ (722,498)	$ 471,280
			Effect of the write-off of exploration and
			G&A project costs		(720,510)		720,510	-
			Cash generated (used) per US GAAP		$ (901,351)		$     (1,988)	$ 471,280
					2005
					Operations		Investing	Financing
			Cash provided by (used) per Canadian
			GAAP		$(140,008)		$(544,804)	$ 439,502
			Effect of the write-off of exploration and
			G&A project costs		(462,061)		462,061	-
			Cash generated (used) per US GAAP		$(602,069)		$(82,743)	$ 439,502

Alpha Gold Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

February 28, 2007 and 2006

11.

Subsequent Events

5,862,214 units were issued for proceeds of $4,116,489 (of which 3,060,496 were “flow-through” units and 2,801,718 non-flow-through units).  Each unit consisted of one common share (either flow-through or non-flow-through) and one-half share purchase warrant, priced at $0.75 per flow-through unit and $0.65 per non-flow-through unit.  Each whole warrant is exercisable to purchase one additional non-flow-through common share for $0.90, expiring May 28, 2008.  Share issue costs on this transaction were 8% of proceeds for finder’s fees which was paid in cash.

Alpha Gold Corp.

(An Exploration Stage Company)

Schedule of Acquisition Costs

Years ended February 28, 2007 and 2006

			Total
	Lust Dust	Goldbanks	2007	2006
Balance - beginning of year	$513,682	$        -	$513,682	$550,114
Acquisition costs for the year	-	-	-	-
Write-down of mineral property	-	-	-	(36,432)
Balance - end of year	$513,682	$        -	$513,682	$513,682

Alpha Gold Corp.

(An Exploration Stage Company)

Schedule of Deferred Expenditures

Years ended February 28, 2007 and 2006

			Total
	Lust Dust	Goldbanks	2007	2006
Exploration
Assaying	$90,124	$        -	$90,124	$31,645
Camp expenses	90,198	-	90,198	22,739
Drilling	804,520	-	804,520	496,140
Filing fees & claim assessment	17,446	-	17,446	5,006
Fuel	601	-	601	242
Geological/geochemical
work and reports	128,978	-	128,978	125,682
On-site management	20,000	-	20,000	9,000
Roadwork/reclamation	59,636	-	59,636	18,714
Travel	21,426	-	21,426	11,342
	1,232,929	-	1,232,929	720,510
BC Mining Tax Credit	(3,177)	-	(3,177)	(92,532)
Expenses for the year	1,229,752	-	1,229,752	627,978
Balance – beginning of the year	4,805,346	-	4,805,346	4,464,572
Write-down of mineral property	-		-	(287,204)
Balance – end of the year	$6,035,098	$        -	$ 6,035,098	$4,805,346

Signature Page

Pursuant to the requirements of Section 12 of the Securities Exchange Act of 1934, the Registrant certifies that it meets all of the requirements for filing on Form 20-F and has duly caused this Annual Report to be signed on its behalf by the undersigned, thereunto duly authorized.

Alpha Gold Corp.

Registrant

Dated:  August 28, 2007	Signed:  /s/  George Whatley
	George Whatley, President and CEO

#

EX-31

CERTIFICATIONS PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 I, George Whatley, certify that:

1. 

I have reviewed this annual report on Form 20-F of Alpha Gold Corp.;

2. 

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. 

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. 

The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

c)

Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5. 

The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

Date:  August 28, 2007

By:	/s/  George Whatley
George Whatley, President and CEO

EX-31

CERTIFICATIONS PURSUANT TO

18 U.S.C. SECTION 1350,

AS ADOPTED PURSUANT TO

SECTION 302 OF THE SARBANES-OXLEY ACT OF 2002

 I, Richard Whatley, certify that:

1. 

I have reviewed this annual report on Form 20-F of Alpha Gold Corp.;

2. 

Based on my knowledge, this report does not contain any untrue statement of a material fact or omit to state a material fact necessary to make the statements made, in light of the circumstances under which such statements were made, not misleading with respect to the period covered by this report;

3. 

Based on my knowledge, the financial statements, and other financial information included in this report, fairly present in all material respects the financial condition, results of operations and cash flows of the Company as of, and for, the periods presented in this report;

4. 

The Company’s other certifying officer and I are responsible for establishing and maintaining disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) for the Company and have:

a)

Designed such disclosure controls and procedures, or caused such disclosure controls and procedures to be designed under our supervision, to ensure that material information relating to the Company, including its consolidated subsidiaries, is made known to us by others within those entities, particularly during the period in which this report is being prepared;

b)

Designed such internal control over financial reporting, or caused such internal control over financial reporting to be designed under our supervision, to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with generally accepted accounting principals;

c)

Evaluated the effectiveness of the Company’s disclosure controls and procedures and presented in this report our conclusions about the effectiveness of the disclosure controls and procedures, as of the end of the period covered by this report based on such evaluation; and

d)

Disclosed in this report any change in the Company’s internal control over financial reporting that occurred during the period covered by the annual report that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting; and

5. 

The Company’s other certifying officer and I have disclosed, based on our most recent evaluation of internal control over financial reporting, to the Company’s auditors and the audit committee of the Company’s board of directors (or persons performing the equivalent functions):

a)

all significant deficiencies and material weaknesses in the design or operation of internal control over financial reporting which are reasonably likely to adversely affect the Company’s ability to record, process, summarize and report financial information; and

b)

any fraud, whether or not material, that involves management or other employees who have a significant role in the Company’s internal control over financial reporting.

Date:  August 28, 2007

By:	/s/  Richard Whatley
Richard Whatley Chief Financial Officer

EX-32

CERTIFICATIONS PURSUANT TO THE SARBANES-OXLEY ACT

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, George Whatley, Chief Executive Officer of Alpha Gold Corp. (the “Company”) do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

1.

This Annual Report on Form 20-F of the Company for the period ended February 28, 2007, as filed with the Securities and Exchange Commission (the “report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.

The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 28, 2007

/s/  George Whatley

George Whatley,

President and Chief Executive Officer

#

EX-32

CERTIFICATIONS PURSUANT TO THE SARBANES-OXLEY ACT

18 U.S.C. SECTION 1350

AS ADOPTED PURSUANT TO SECTION 906

OF THE SARBANES-OXLEY ACT OF 2002

I, Richard Whatley, Chief Financial Officer of Alpha Gold Corp. (the “Company”) do hereby certify, pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002, that, to my knowledge:

1.

This Annual Report on Form 20-F of the Company for the period ended February 28, 2007, as filed with the Securities and Exchange Commission (the “report”), fully complies with the requirements of Section 13(a) or 15(d) of the Securities Exchange Act of 1934; and

2.

The information contained in the report fairly presents, in all material respects, the financial condition and results of operations of the Company.

Date: August 28, 2007

/s/  Richard Whatley

Richard Whatley,

Chief Financial Officer

#