SB-2

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
FORM SB-2
REGISTRATION STATEMENT UNDER THE SECURITIES ACT OF 1933
MUSTANG RESOURCES INC.
(Name of small business issuer in its charter)
Nevada	1040	76-0747679
State or jurisdiction of incorporation or organization	(Primary Standard Industrial Classification Code Number)	(I.R.S. Employer Identification No.)
1574 Gulf Rd.  #1505, Point Roberts, Washington  98281  Tel: (604) 261-6100  Fax: 604-608-9185
(Address and telephone number of principal executive offices)
1574 Gulf Rd.  #1505, Point Roberts, Washington  98281
(Address of principal place of business or intended principal place of business)
(Name, address and telephone number of agent for service)
Approximate date of proposed sale to the public           As soon as practicable after the effective date of this Registration Statement.
If this Form is filed to register additional securities for an offering pursuant to Rule 462(b) under the Securities Act, please check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.    o
If this Form is a post-effective amendment filed pursuant to Rule 462(c) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o
If this Form is a post-effective amendment filed pursuant to Rule 462(d) under the Securities Act, check the following box and list the Securities Act registration statement number of the earlier effective registration statement for the same offering.     o
If delivery of the prospectus is expected to be made pursuant to Rule 434, check the following box.     o

CALCULATION OF REGISTRATION FEE

Title of each class of securities to be registered	Dollar Amount to be registered	Proposed maximum offering price per unit (1)	Proposed maximum aggregate offering price (2)	Amount of registration fee
Common Stock	98,000 shares	$0.20	$19,600	$2.31
(1) This price was arbitrarily determined by Mustang Resources Inc. (2) Estimated solely for the purpose of calculating the registration fee in accordance with Rule 457 under the Securities Act.

THE REGISTRANT HEREBY AMENDS THIS REGISTRATION STATEMENT ON SUCH DATE OR DATES AS MAY BE NECESSARY TO DELAY ITS EFFECTIVE DATE UNTIL THE REGISTRANT SHALL FILE A FURTHER AMENDMENT WHICH SPECIFICALLY STATES THAT THIS REGISTRATION STATEMENT SHALL THEREAFTER BECOME EFFECTIVE IN ACCORDANCE WITH SECTION 8(a) OF THE SECURITIES ACT OF 1933 OR UNTIL THE REGISTRATION STATEMENT SHALL BECOME EFFECTIVE ON SUCH DATE AS THE COMMISSION, ACTING PURSUANT TO SECTION 8(a), MAY DETERMINE.

SUBJECT TO COMPLETION, Dated July 26, 2005

Page 2

PROSPECTUS

 MUSTANG RESOURCES INC.

98,000 SHARES

COMMON STOCK 

This prospectus relates to the sale of up to 98,000 shares of our currently outstanding common stock owned by some of our stockholders.  For a list of the selling stockholders, please see "Selling Stockholders".  We are not selling any shares of common stock in this offering and therefore will not receive any proceeds from this offering.

Our common stock is presently not traded on any market or securities exchange.

The shares included in this prospectus may be offered and sold directly by the selling stockholders in the open market or in individually negotiated transactions, through agents designated from time to time or thorough underwriters or dealers.  Brokers or dealers effecting transactions in these shares should confirm that the shares are registered under applicable state law or that an exemption from registration is available.

	Offering Price	Commissions	Proceeds to Selling Shareholders Before Expenses and Commissions
Per Share	$0.20	Not Applicable	$0.20
Total	$19,600	Not Applicable	$19,600

The purchase of the securities offered through this prospectus involves a high degree of risk.  See section entitled "Risk Factors" on pages 7 - 12.

Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or passed upon the adequacy or accuracy of this prospectus.  Any representation to the contrary is a criminal offense.

The Date Of This Prospectus Is: July 26, 2005

Page 3

Table of Contents
		Page
PART I - INFORMATION REQUIRED IN PROSPECTUS
Item 3	Summary Information and Risk Factors	5
Item 4	Use of Proceeds	12
Item 5	Determination of Offering Price	12
Item 6	Dilution	13
Item 7	Selling Security Holders	13
Item 8	Plan of Distribution	17
Item 9	Legal Proceedings	18
Item 10	Directors, Executive Officers, Promoters and Control Persons	18
Item 11	Security Ownership of Certain Beneficial Owners and Management	22
Item 12	Description of Securities	23
Item 13	Interests of Named Experts And Counsel	26
Item 14	Disclosure of Commission Position Of Indemnification For Securities Act Liabilities	26
Item 15	Organization Within Last Five Years	26
Item 16	Description of Business	27
Item 17	Management's Discussion and Analysis or Plan of Operation	37
Item 18	Description of Property	44
Item 19	Certain Relationships and Related Transactions	45
Item 20	Market for Common Equity and Related Stockholder Matters	46
Item 21	Executive Compensation	47
Item 22	Financial Statements	49
Item 23	Changes In and Disagreements With Accountants on Accounting and Financial Disclosure	84
PART II - INFORMATION NOT REQUIRED IN PROSPECTUS
Item 24	Indemnification of Directors and Officers	84
Item 25	Other Expenses of Issuance and Distribution	84
Item 26	Recent Sales of Unregistered Securities	85
Item 27	Exhibits	85
Item 28	Undertakings	86
	SIGNATURES
	Signatures	87

Page 4

Item 3.  Summary Information and Risk Factors

Summary

The Company

Mustang Resources Inc. ("Mustang") is an exploration stage company engaged in the acquisition of mineral claims and exploration of our mineral properties.  We own a 100% interest in four mineral claims known as the JC1, JC2, JC3 and JC4 mining claims located near the city of Nelson, British Columbia, Canada.  Activities to date have consisted solely of the staking of mining claims.  We have not yet developed any mining properties into a producing mine, nor have we earned revenue from any of the properties.  None of our properties contain a known commercially viable deposit suitable for mining.  There is no assurance that any commercially viable mineral deposits exist on our properties.  Exploration will be required before a final evaluation as to the economic feasibility is determined.  Our plan of operations is to conduct mineral exploration activities on the JC mineral claims in order to assess whether these claims possess commercially viable mineral deposits.  Our exploration program is designed to explore for gold deposits.

Corporate Structure

We were incorporated in the State of Nevada on November 23, 1998 as Canadian Northern Lites (Nevada) Inc. and changed our name to Mustang Resources Inc. on December 15, 2003.  Our business office is located at 1574 Gulf Rd. #1505, Point Roberts, Washington, 98281.  Our telephone number is (604) 261-6100 and our fax number is (604) 608-9185.  We maintain our statutory registered agent's office at 1000 East William Street, Suite 204, Carson City, Nevada.

Recent Results

Since we are in the exploration stage of our business plan, we have not yet earned any revenues from our planned operations.  As of July 26, 2005, including the net proceeds of $9,800 from our share issue on July 20, 2005, Mustang had cash on hand of $14,576.

As of June 30, 2005, we had $4,776 in cash on hand and current liabilities in the amount of $4,000.  Accordingly, our working capital position as of June 30, 2005 was $776.  Since our inception in November 23, 1998 through to June 30, 2005, we have incurred cumulative net losses of ($19,376).  We attribute our net loss to having no revenues to offset our expenses from the acquisition and exploration of our mineral claims and the professional fees related to the creation and operation of our business.  We have not begun Phase 1 of our exploration program as the Company does not have enough capital to complete Phase 1 and thus must first raise additional capital in order to proceed.  The Company does not plan to begin Phase 1 until the additional funds needed have been secured.

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The Offering

Securities Being Offered	Up to 98,000 shares of our common stock currently issued and outstanding and owned by the selling shareholders.
Offering Price and Alternative Plan of Distribution	The offering price of the common stock is $0.20 per share.  We intend to apply to the NASD OTC Bulletin Board to allow the trading of our common stock.  If our common stock becomes so traded and a market for the stock develops, the actual price of the stock will be determined by prevailing market prices at the time of sale or by private transactions negotiated by the selling shareholders.  The offering price would thus be determined by market factors and the independent decisions of the selling shareholders.
Minimum Number of Shares To Be Sold in This Offering	None.
Common stock currently outstanding	2,018,002 shares
Common stock to be outstanding after this offering	2,018,002 shares
Use of Proceeds	We will not receive any proceeds from the sale of the common stock by the selling shareholders.

Summary Financial Information

Balance Sheet Data	June 30, 2005 (six months) Unaudited		December 31, 2004 Audited
Cash	$4,776		$4,776
Total Assets	$4,776		$4,776
Total Liabilities	$19,351		$18,594
Total Stockholders' Deficiency	($14,575	)	($13,818	)
Statement of Loss and Deficit	June 30, 2005 (six months) Unaudited		December 31, 2004 Audited
Revenue from Operations	$0		$0
Net Income (Loss) for the Period	($757	)	($7,324	)

Page 6

Risk Factors

You should carefully read our entire prospectus and consolidated financial statements and related notes.  Our present and intended business operations are highly unpredictable and involve substantial risks.

In addition to the other information in this prospectus, the following risk factors should be considered carefully in evaluating our business before purchasing any of our shares of common stock.  A purchase of our common stock is speculative.  No purchase of our common stock should be made by any person who is not in a position to lose the entire amount of his investment.  The order in which the following risk factors are presented is arbitrary.  You should not conclude, because of the order of presentation, that one risk factor is more significant than another.

Exploration Results Will Determine Whether Mustang Can Continue

Our properties are currently in an early exploration stage.  At present we have no mineral reserves.  It is uncertain whether the property contains a mineable quantity of gold reserves.  Development of our properties will only proceed if there are satisfactory exploration results.  If we do not find a mineral reserve containing gold or if we cannot develop a mineral reserve, either because we do not have the capital or because it is not economically feasible to do so, we will have to cease operations and shareholders could lose their entire investment.

Mineral exploration involves a high degree of risk.  Few properties that are explored are ultimately developed into producing mines.  There is no assurance that our future mineral exploration and development activities will result in any discoveries of gold reserves.  The long-term profitability of our operations will be in part dependent upon the cost and success of its future exploration programs, which may be affected by a number of factors.  One critical factor that will have an impact is our use of the evaluation work of professional geologists, geophysicists, and engineers for estimates in determining whether to commence or continue exploration work.  There is a degree of uncertainty associated with the calculation of mineral reserves and mineral resources and corresponding grades being mined or dedicated to future production.  Until mineral reserves or mineral resources are actually mined and processed, the quantity of mineral and reserve grades must be considered as estimates only.  In addition, the quantity of mineral reserves and mineral resources may vary depending on, among other things, metal prices.  Any material change in quantity of mineral reserves, mineral resources, grade or stripping ratio may affect the economic viability of our properties.

These estimates generally rely on scientific estimates and economic assumptions, which in some instances may not be correct, and could result in the expenditure of substantial amounts of money on a property before it can be determined whether or not the property contains economically recoverable mineralization.

If a gold reserve is discovered, the commercial viability of a mineral deposit depends to a high degree on the size and grade of the reserve as well as the proximity of the deposit to infrastructure.  Exploration & development activities all depend on reliable roads, bridges, power sources and water supply which are important factors affecting capital and operating costs.  Commercial viability also depends upon metal prices; and on government regulations regarding royalties and allowable production.

We are not able to determine at present whether or not, or the extent to which, such risks may adversely affect our exploration program.

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Hazards and Risks of Operation Could Have a Serious Financial Impact on Mustang

Mining operations are high risk activities.  Experience, knowledge and careful evaluation are needed.  Operational hazards including accidents and explosions, ground fall, flooding, inclement weather, and earthquakes can result in asset writedowns, personal injury, work stoppages, cost overruns, and damage to the mineral reserves or the ability to extract the reserves.  Hazards such as unusual or unexpected geological formations may result in damage to producing facilities, environmental damage and possible legal liability for damage.  Mustang may become liable for cave-ins and other hazards for which the Company cannot insure or chooses not to insure, where premium costs are disproportionate to our perception of the relevant risks.  For a mining company the size of Mustang the financial burden resulting from an unfortunate accident could be severe.

Payments resulting from such liabilities would reduce the funds available for Mustang's gold exploration.  While insurance policies could reduce the possibility of an incident resulting in Mustang having to cease operations, Mustang's limited financial resources could mean that the payment of such insurance premiums would reduce the funds available for exploration activities.

Failure to Comply With Canadian Mining Regulations Could Jeopardize Operations

In Canada, Mustang's claims are worked under Provincial Mines Acts and Regulations.  As such, any exploration and development activity carried out on the JC1, JC2, JC3 and JC4 mineral properties would fall under the Mineral Tenure Act of British Columbia.  A very significant factor impacting mineral exploration in British Columbia and in Canada, in general, is legislation, policies and controls relating to prospecting, development, production and environmental protection, mining taxes and labor standards.  Changes in governmental legislation, policies and controls can have a substantial impact on the timing, and the capital and operating costs of exploration and development.

The costs associated with compliance with these laws and regulations are substantial and possible future laws and regulations, or more stringent enforcement of current laws and regulations by governmental authorities, could cause additional expense, capital expenditures, restrictions on or suspensions of our operations and delays in the development of JC1, JC2, JC3 and JC4 mineral claims.  Moreover, these laws and regulations may allow governmental authorities and private parties to bring lawsuits based upon damages to property and injury to persons resulting from the environmental, health and safety impacts of our past and current operations, and could lead to the imposition of substantial fines, penalties or other civil or criminal sanctions.

Enactment of new legislation or revisions to existing legislation, either at the provincial level or at the federal level could be sufficient to impair the exploration of our mineral properties.  If the impact of changes in legislation is sufficiently negative to undermine the economic viability of the Company's mineral properties the Company would likely eventually cease operations and shareholders would likely be faced with a loss of their entire investment.

Exploration on mineral claims must be carried out according to the terms outlined by the local mines inspectors.  In the case of the JC1, JC2, JC3 and JC4 mineral properties, any exploration activity would be carried out on terms outlined by the mines inspectors located in the region around Nelson, British Columbia.

We may be required to post small monetary bonds to be held against project cleanup.  Provincial labor health and welfare codes apply to all operations.  We may retain professional exploration consultants who carry general liability and third party insurance.  Our exploration activities in Canada are regulated by various government agencies, both federal and provincial.  Environmental legislation has established restrictions and prohibitions on spills and releases from mining activity that would result in environmental pollution.  A breach of regulations may result in fines and penalties.  If any fines and penalties were substantial, the financial burden on a company with the limited financial resources that Mustang has, could force the Company to cease operations, likely resulting in Mustang shareholders losing their entire investment.

Page 8

We have obtained all necessary permits for exploration work performed to date and are in compliance with all material laws and regulations that currently apply to its activities.  Such laws and regulations could possibly have an adverse effect on any mining project that we might undertake in the future.

Environmental legislation is evolving in a manner that will require more stringent assessments of proposed projects, stricter standards and enforcement, increased fines and penalties for non-compliance, and a heightened degree of responsibility for companies and their officers, directors and employees.  Future changes in environmental regulation, could adversely affect our operations.  Environmental hazards caused by previous owners or operators of the properties may exist that are unknown to us.  We do not have any form of environmental liability insurance at the present time.  We do not expect to be able to obtain such insurance at a reasonable cost.  If we incur liability for environmental damages while we are uninsured, it could have a material adverse effect on our financial condition.

Reselling a Penny Stock Can Be Difficult

Our common stock is defined as a "penny stock" under the Securities and Exchange Act of 1934, and its rules.  Because we are a penny stock, you may be unable to resell our shares.  This is because the Exchange Act and the penny stock rules impose additional sales practice and disclosure requirements on broker-dealers who sell our securities to persons other than accredited investors.  As a result, fewer broker/dealers are willing to make a market in our stock.

Section 15(g) of the Exchange Act and Rule 15g-2 of the Securities and Exchange Commission require broker/dealers dealing in penny stocks to provide potential investors with a document disclosing the risks of penny stocks and to obtain a manually signed and dated written receipt of the document before making any transaction in a penny stock for the investor's account.  In addition, Rule 15g-9 of the Securities and Exchange Commission requires broker/dealers in penny stocks to approve the account of any investor for transactions in these stocks before selling any penny stock to that investor.

No Smelter Contract in Place

If we are able to identify commercially viable quantities of gold, we will have to make supply arrangements with metal traders or integrated mining and smelting companies.  We currently do not have any such arrangements and we cannot provide assurance that we will be able to enter into any on terms that are favorable to Mustang.  In addition, should any such counter parties not honor supply arrangements, or should any of them become insolvent, we may be forced to sell any concentrates that we are able to produce in the spot market.  Our future operating results may be materially adversely affected as a result.

Funding Our Future Capital Requirements is Highly Uncertain

Due to the nature of the mineral exploration business, there can be no assurance that we will be profitable.  We have limited financial resources, and there is no assurance that additional funding will be available.  We have no source of operating cash flow to fund future exploration projects or corporate overhead.  In fiscal 2004 ending December 31, 2004, Mustang reported a net loss of ($7,324).  In fiscal 2003 we reported a net loss of ($5,399) and in fiscal 2002 we reported a net loss of ($224).  If we wish to continue exploration of our properties, then we must raise significant additional funds.  The only source of funds available to us for future exploration expenditures is through the sale of our stock, subject to applicable United States, or state securities laws.

Page 9

Even if the results of future exploration are encouraging, we may not be able to raise sufficient funds through further equity offerings or through the sale or syndication of some of our properties, due to the highly volatile market for shares of junior mining firms and the illiquid market for mineral properties.  As there is no assurance that such funds will be available, on acceptable terms, if at all, Mustang shareholders should be aware that we may not be able to conduct the further exploration necessary to determine whether a commercially feasible deposit of gold reserves exists.

A Small Business Has a Unique Set of Risks

We are subject to risks inherent in the operation of a small business enterprise, including a lack of management depth, limited capital resources, lack of diversification by product or geographic location, and extreme vulnerability to delays, and cost overruns.  If Mustang is not able to effectively deal with these types of risks we may have to curtail or suspend our operations.

Risks Associated With Obtaining Permits and Licenses; and Satisfying Reclamation Obligations

The operations of Mustang may require licenses and permits.  It is uncertain whether Mustang will be able to obtain all licenses and permits required to carry out exploration and development of its properties.

Reclamation requirements aim to minimize long-term effects of exploration by requiring the operating company to control possible harmful discharges and to re-establish to some degree, pre-disturbance land forms and vegetation.  Mustang management is actively providing for or has carried out any requested reclamation activities on its properties.

Operations Are Vulnerable To Supply Constraints

Competition and unforeseen limited sources of supplies in the mining industry could result in occasional spot shortages of supplies, like dynamite, and equipment like helicopters, bulldozers and excavators that we might need to conduct exploration on the JC mineral claims.  We have not attempted to locate or negotiate with any suppliers of products, equipment or materials.  We will attempt to locate products, equipment and materials as we arrange funding.  If we cannot find these, we will have to suspend our exploration plans, at least temporarily.

Forecasting & Developing Plans Are Difficult Due To Mustang's Brief Operating History

In the absence of a lengthy operating history upon which to base an evaluation of Mustang's exploration business and its future prospects there can be no assurance that we will achieve or sustain profitability on an annual or quarterly basis. 

Future operating results will depend upon many factors, including the prevailing price of gold in world commodity markets; our success in attracting and retaining motivated employees who are qualified in the mineral exploration field; our ability to develop and expand our inventory of properties; and the success of Mustang's efforts to secure risk capital.

Page 10

Dependence on Our President

Continuation of our operations is critically dependent, upon the continued contribution of our President, Terry G. Cook.  The loss or unavailability of Mr. Cook could have an adverse effect on Mustang's future.  We do not maintain key man life insurance policies on our President due to the prohibitive cost for a firm our size.  Also, our continued existence and viability is dependent upon our ability to attract and retain qualified people in all areas of the business.  If we are unable to attract and retain qualified personnel, our business may be adversely affected.

There are no employment agreements with Mr. Cook or anyone else.  The death or disability of Terry G. Cook could adversely affect the management of our business as Mr. Cook is our principal executive officer and is directly involved, on a day-to-day basis, in all of the company's business operations.

Our Officers and Directors Have Conflicts Of Interest

Our officers and directors have conflicts of interest in that they are officers and directors of other companies.  In the future, if we decide to acquire a mining property which is also sought by one of the companies which Mr. Cook or Mr. Dalgliesh, are officers or directors of, a direct conflict of interest could result.

Growth May Strain Mustang's Management Capability

None of the Directors or Officers of Mustang have any experience in the area of mineral exploration or mining in general.  The inexperience of the Company's management in the mining field is an important risk factor that should be carefully considered by anyone considering an investment in the Company.

If Mustang is successful in proving up gold reserves that are commercially viable, the Company will likely experience significant growth in its operations.  An expansion of the operations will place further demands on Mustang's small management team of Mr. Cook and Mr. Dalgliesh.  In the event of expanded operations, Mustang will need to recruit and retain people with technical qualifications in the field of mineral exploration and extraction.  Should Mustang succeed in developing its properties the Company will experience further growth in our operations.  If we fail to manage our growth effectively, our business prospects, financial condition and results of operations could be adversely affected.

In addition to concern regarding the management of our exploration program, shareholders should be concerned with the ability of Mustang management to profitably reinvest any earnings and allocate capital efficiently.

Larger Competitors Could Have a Cost Advantage

There is competition from other mining exploration and development companies.  Many of the mining companies with which we compete have operations and financial strength many times that of ours.  The scale of their mining and exploration operations enables them to spread their fixed costs such as management overhead and equipment costs over a much larger mineral resource base.  Nevertheless, the market for our possible future production of minerals tends to be commodity oriented, rather than company oriented.  Accordingly, we expect to compete by taking advantage of the market for all minerals present in our properties, to offset the fixed costs of mining any one of the jointly-occurring minerals.  Commodity prices fluctuate and there is no guarantee that market prices at any one time will be higher than production costs.  We do not engage in any material hedging or other transactions which are intended to manage risks relating to the fluctuations in mineral prices.

Page 11

Management Expects a Continuation of Net Losses

Our net loss since inception to June 30, 2005 is ($19,376) consisting of administrative expenses of $15,697 and mining property expenses of $3,679.  We expect to incur operating losses in future periods.  This will happen because there are expenses associated with the research and exploration of our mineral properties.  We cannot guarantee that we will be successful in generating revenues in the future.  Failure to generate revenues could cause us to go out of business.

Our ability to achieve and maintain profitability and positive cash flow is dependent upon our ability to prove up mineral resources that can be developed into a profitable revenue stream, as well as our ability to reduce exploration stage costs.

Risks Relating to the Presence of a Large Shareholder Group

THE COOK FAMILY IS A LARGE SHAREHOLDER.  HAVING A LARGE SHAREHOLDER COULD LIMIT POTENTIAL ACQUISITION PROPOSALS.

As a result of The Cook Family having a large share position, the value attributable to the right to vote is diminished.  This could result in a reduction in the market value of the Mustang shares you own because of the ineffective voting power.  The Cook Family, represented by Terry G. Cook, and his spouse Nancy Cook, directly and indirectly, has 95.14% of the voting power of our outstanding equity.  As a result, the Cook's votes at shareholder meetings will have a severe impact on determining who is elected to the Board of Directors as well as to our management.  Provisions in our certificate of incorporation, by-laws, and the Nevada Revised Statutes may also enhance the Cook family's control.  Our articles of incorporation do not provide for cumulative voting.  Cumulative voting is a process that allows a shareholder to multiply the number of shares he owns times the number of directors to be elected.  That number is the total votes a person can cast for all of the directors.  Those votes can be allocated in any manner to the directors being elected.  Cumulative voting, in some cases, will allow a minority group to elect at least one director to the board.

The Cook family's large share position could have a depressive effect on the market price of Mustang.

Item 4.  Use of Proceeds

Mustang Resources Inc. will not receive any proceeds from the sale of common stock offered through this prospectus by the selling shareholders.

Item 5.  Determination of Offering Price

The $0.20 per share offering price of our common stock was arbitrarily chosen.  There is no relationship whatsoever between this price and our assets, earnings, book value or any other objective criteria of value.

Page 12

Our common stock is presently not traded on any market or securities exchange.  We intend to apply to the NASD OTC Bulletin Board for the trading of our common stock.  If our common stock becomes so traded and a market for the stock develops, the actual price of stock will be determined by prevailing market prices at the time of sale or by private transactions negotiated by the selling shareholders.  The offering price would thus be determined by market factors and the independent decisions of the selling shareholders.

Item 6.  Dilution

The common stock to be sold by the selling shareholders is currently issued and outstanding.  Accordingly, there will be no dilution to our existing shareholders.

Item 7.  Selling Security Holders

The selling shareholders named in this prospectus are offering all of the 98,000 shares of common stock offered through this prospectus.  The 42 selling shareholders acquired these 98,000 shares of common stock from us at a price of $0.10 per share in an offering that was exempt from registration, pursuant to Regulation S of the Securities Act of 1933, and completed on July 20, 2005   We received a total of $9,800 from this offering.  Each purchaser represented to us that he or she was a non-US person as defined in Regulation S.  We did not engage in a distribution of this offering in the United States.  Appropriate legends were affixed to the stock certificate issued to each purchaser in accordance with Regulation S.  Each investor was given adequate access to sufficient information about us to make an informed investment decision.  None of the securities were sold through an underwriter and accordingly, there were no underwriting discounts or commissions involved.

The following table provides as of July 26, 2005, information regarding the beneficial ownership of our common stock held by each of the selling shareholders, including:

1.	the number of shares owned by each prior to this offering;
2.	the total number of shares that are to be offered by each;
3.	the total number of shares that will be owned by each upon completion of the offering;
4.	the percentage owned by each upon completion of the offering; and
5.	the identity of the beneficial holder of any entity that owns the shares.

Name of Selling Stockholder	Shares Owned Prior To This Offering	Total Number Of Shares To Be Offered For Selling Shareholders Accounts	Total Shares To Be Owned Upon Completion Of This Offering	Percent Owned Upon Completion Of This Offering
A. Bitschy 4650 - 196A St. Langley, B.C.  V3A 5H2	1,000	1,000	Nil	Nil
Ian D. Mellor 6 - 7250 144 St. Surrey, B.C.  V3W 1L7	1,000	1,000	Nil	Nil

Page 13

Name of Selling Stockholder	Shares Owned Prior To This Offering	Total Number Of Shares To Be Offered For Selling Shareholders Accounts	Total Shares To Be Owned Upon Completion Of This Offering	Percent Owned Upon Completion Of This Offering
489361 B.C. Ltd. 8240 Manitoba St. Vancouver, B.C.V5X 3A2	1,000	1,000	Nil	Nil
Laurie Kearns 1000 - 916 W Broadway Vancouver, B.C.  V5Z 1K7	3,000	3,000	Nil	Nil
K. Patrick Bianchini 4440 50A St. Delta, B.C.  V4K 1Z9	1,000	1,000	Nil	Nil
Anita Barr 31104 Sidoni Ave. Abbotsford B.C.  V2S 5K9	1,000	1,000	Nil	Nil
Kelvin R. Finlay 207A - 6411 Nelson Ave. Burnaby, B.C.  V5H 3H4	3,000	3,000	Nil	Nil
Susanne Condon 356 55A Ave. Delta, B.C.  V4M 3L9	1,000	1,000	Nil	Nil
B. R. Kellie 16784 28 Ave Surrey, B.C.  V3S 0A9	1,000	1,000	Nil	Nil
R. P. Keras 29781 Fraser Hwy. Abbotsford, B.C.  V4X 1T3	1,000	1,000	Nil	Nil
Atel Solutions Inc. PO Box 22911, 22940 Westminster Hwy. Richmond, B.C.  V6V 3B8	1,000	1,000	Nil	Nil
Maureen Grudner 12257 101 Ave. Surrey, B.C.  V3V 2Z4	2,000	2,000	Nil	Nil
Dennis Garvey 4922 44B Ave. Delta, B.C.  V4K 1J1	1,000	1,000	Nil	Nil
Niko Condon 1665 56 St. Delta, B.C.  V4L 2B2	1,000	1,000	Nil	Nil

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Name of Selling Stockholder	Shares Owned Prior To This Offering	Total Number Of Shares To Be Offered For Selling Shareholders Accounts	Total Shares To Be Owned Upon Completion Of This Offering	Percent Owned Upon Completion Of This Offering
Patricia Bianchini 6118 49B Ave. Delta, B.C.  V4K 1Z9	1,000	1,000	Nil	Nil
Louise Rouse 4768 W. 6 Ave Vancouver, B.C.  V6T 1C5	1,000	1,000	Nil	Nil
Lesley A. Finlay 6633 MacDonald St. Vancouver, B.C.  V6N 4G6	3,000	3,000	Nil	Nil
Christine L. Weatherby 45915 Higginson Rd. Chilliwack, B.C.  V2R 2C7	1,000	1,000	Nil	Nil
Peter W. Mulyk 1318 Alberni St. Vancouver, B.C.  V6E 4N9	1,000	1,000	Nil	Nil
Scott Euerby 6107 Cresent Dr. Delta, B.C.  V4K 2G1	3,000	3,000	Nil	Nil
Kathy Vanderlee 3556 Bassano Terrace Abbotsford, B.C.  V3G 2Z7	1,000	1,000	Nil	Nil
L. A. Keras 5389 Springgate Pl. Sardis, B.C.  V2R 3W5	1,000	1,000	Nil	Nil
Tina Gabriel 117 - 255 Newport Dr. Port Moody, B.C.  V3H 5H1	1,000	1,000	Nil	Nil
Kevin Garvey 5252 Upland Dr. Delta, B.C.  V4M 2G4	1,000	1,000	Nil	Nil
Diane Ison 7120 Kimberley Dr. Richmond, B.C.  V7A 4S4	1,000	1,000	Nil	Nil
Mat Finlay 11 - 15871 85 Ave. Surrey, B.C.  V3S 1H9	3,000	3,000	Nil	Nil

Page 15

Name of Selling Stockholder	Shares Owned Prior To This Offering	Total Number Of Shares To Be Offered For Selling Shareholders Accounts	Total Shares To Be Owned Upon Completion Of This Offering	Percent Owned Upon Completion Of This Offering
Grace Munro 403 - 1640 Esquimalt Ave. West Vancouver, B.C.  V7V 1R6	1,000	1,000	Nil	Nil
Jason Irvine 1505 Grand Blvd. North Vancouver, B.C.  V7L 3X9	1,000	1,000	Nil	Nil
Jeremy Bianchini 2808 McCoomb Coquitlam, B.C.  V3B 6B3	1,000	1,000	Nil	Nil
D. Malloway 18115 57 Ave. Surrey, B.C.  V3S 5N1	1,000	1,000	Nil	Nil
Ronald J. Schulte 101 - 33731 Marshall Rd. Abbotsford, B.C.  V2S 1L5	1,000	1,000	Nil	Nil
Angela Oonk 29786 Maclure Rd. Abbotsford B.C. V4X 1G5	1,000	1,000	Nil	Nil
Marianna Rille 3037 Glendale Pl. Abbotsford, B.C.  V2S 7H1	1,000	1,000	Nil	Nil
Doug Colbert 3541 Picton St. Abbotsford, B.C.  V2S 7H6	1,000	1,000	Nil	Nil
Mary Garvey 2627 Applegreen Crt. Kelowna, B.C.  V1Z 3K8	1,000	1,000	Nil	Nil
Patty Vickers 59 - 2450 Lobb Ave. Port Coquitlam, B.C.  V3C 6G8	1,000	1,000	Nil	Nil
Kathy McBride 30508 Great Northern Way Abbotsford, B.C.  V2T 6H4	1,000	1,000	Nil	Nil
Jennifer Ann Marie Keras 137 - 3455 Wright St. Abbotsford, B.C.  V2S 5P1	1,000	1,000	Nil	Nil

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Name of Selling Stockholder	Shares Owned Prior To This Offering	Total Number Of Shares To Be Offered For Selling Shareholders Accounts	Total Shares To Be Owned Upon Completion Of This Offering	Percent Owned Upon Completion Of This Offering
George Grzybowski 5932 Jaynes Rd. Duncan, B.C.  V9L 4W8	1,000	1,000	Nil	Nil
Susan Patricia Vieta 362 E. 12th St. North Vancouver, B.C.  V7L 2J9	15,000	15,000	Nil	Nil
Gordon Pybus 238 Waterleigh Dr. Vancouver, B.C.  V5X 4T2	15,000	15,000	Nil	Nil
Lulzim Haxhiavdija 745 Sayers Lane Vancouver, B.C.  V5Z 3Z8	18,000	18,000	Nil	Nil

Item 8.  Plan of Distribution

The selling shareholders may sell some or all of their common stock in one or more transactions, including block transactions:

1.  On such public markets or exchanges as the common stock may from time to time be trading;

2.  In privately negotiated transactions;

3.  Through the writing of options on the common stock;

4.  In short sales; or

5.  In any combination of these methods of distribution.

The sales price to the public is estimated at $0.20 per share until such time as the shares of our common stock become traded on the NASD OTC Bulletin Board or another exchange.  Although we intend to apply for trading of our common stock on the NASD OTC Bulletin Board, public trading of our common stock may never materialize.  If our common stock becomes traded on the NASD OTC Bulletin Board or another exchange, then the sales price to the public will vary according to the selling decisions of each selling shareholder and the market for our stock at the time of resale.  In these circumstances, the sales price to the public may be:

1.  The market price of our common stock prevailing at the time of sale;

2.  A price related to such prevailing market price of our common stock; or

3.  Such other price as the selling shareholders determine from time to time.

Page 17

The shares may also be sold in compliance with the Securities and Exchange Commission's Rule 144.

The selling shareholders may also sell their shares directly to market makers acting as agents in unsolicited brokerage transactions.  Any broker or dealer participating in such transactions as agent may receive a commission from the selling shareholders, or, if they act as agent for the purchaser of such common stock, from such purchaser.  The selling shareholders will likely pay the usual and customary brokerage fees for such services.  If applicable, the selling shareholders may distribute shares to one or more of their partners who are unaffiliated with us.  Such partners may, in turn, distribute such shares as described above.

We can provide no assurance that all or any of the common stock offered will be sold by the selling shareholders.

We are bearing all costs relating to the registration of the common stock.  The selling shareholders, however, will pay any commissions or other fees payable to brokers or dealers in connection with any sale of the common stock.

The selling shareholders must comply with the requirements of the Securities Act of 1933 and the Securities Exchange Act in the offer and sale of the common stock.  In particular, during such times as the selling shareholders may be deemed to be engaged in a distribution of the common stock, and therefore be considered to be an underwriter, they must comply with applicable law and may, among other things:

1.  Not engage in any stabilization activities in connection with our common stock;

2.  Furnish each broker or dealer through which common stock may be offered, such copies of this prospectus, as amended from time to time, as may be required by such broker or dealer; and

3.  Not bid for or purchase any of our securities or attempt to induce any person to purchase any of our securities other than as permitted under the Securities Exchange Act.

Item 9.  Legal Proceedings

Mustang Resources Inc. is currently not a party to any legal proceedings and does not know of any pending legal proceedings.

Item 10.  Directors, Executive Officers, Promoters and Control Persons

Directors and Executive Officers

Our directors and executive officers, their respective positions and ages, and the year in which each director was first elected, are set forth in the following table.  Each director has been elected to hold office until the next annual meeting of shareholders and thereafter until his successor is elected and has qualified.  Vacancies in the existing Board of Directors are filled by majority vote of the remaining Directors.  Officers of the Company serve at the will of the Board of Directors.  There are no agreements or understandings for any officer or director to resign at the request of another person and no officer or director is acting on behalf of or will act at the direction of any other person.  Additional information concerning each of these individuals follows the table.

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Directors and Executive Officers

Name		Age	Positions(s)		Director Since
	Terry G. Cook	56		President, Director	November 1998
	Cam Dalgliesh	62		Director	November 1998

Terry G. Cook

Mr. Cook is the President and a Director of Mustang Resources Inc.  Mr. Cook also holds the positions of Chief Financial Officer, Secretary and Treasurer.  His responsibilities include general management and financial management.  Mr. Cook has been the President, Chief Executive Officer, Chief Financial Officer and a Director of Mustang since its inception in November 1998.  In April 2003, Mr. Cook assumed the position of Secretary of Mustang Resources.

Mr. Cook is a graduate of Harvard Business School where he received an MBA in 1974.  Since 1978 to the present he has continuously been the President and a Director of Stanford Capital, Inc. (formerly Westridge Capital Inc.), a management and investment company.  Mr. Cook has over 20 years experience in creating and building small and medium sized businesses and real estate ventures as a result of his work with Stanford Capital, Inc.

Mr. Cook has also been an Officer and a Director of Western Gems Inc., a privately-held gemstone exploration company, continuously from May 2005 to the present.

Mr. Cook was an Officer and a Director of Cougar Holdings Inc. continuously from June 1999 to July 1, 2005.  Mr. Cook was the President and a Director of Cougar Holdings Inc. and he also held the positions of Chief Financial Officer, Secretary and Treasurer.  Cougar Holdings Inc. is a gemstone exploration and development company incorporated in Nevada.  Cougar Holdings Inc. is an SEC reporting company and is listed on the NASD OTC Bulletin Board with the symbol of CGRH.  On July 1, 2005, Cougar Holdings Inc. went through a change of control and Mr. Cook resigned his positions as an Officer and a Director.

Mr. Cook was the the President and a Director of Leopard Capital Inc. from May 1998 to February 2004.  Mr. Cook also held the positions of Chief Financial Officer and Treasurer.  Leopard Capital is a public reporting company that previously held mining interests in British Columbia, Canada.  In February 2004, Leopard Capital went through a change of control, and a name change to China Expert Technology Inc., and Mr. Cook resigned his positions as an Officer and a Director.

Cam Dalgliesh

Mr. Dalgliesh is a Director of Mustang Resources Inc.  His responsibilities include assisting Mr. Cook in our general administration and planning.  Mr. Dalgliesh has been a Director of Mustang since its inception in November 1998 and also held the position of Secretary from November 1998 to April 2003.

Mr. Dalgliesh has a Bachelor of Arts Degree and has extensive experience in several small and medium sized businesses.  Mr. Dalgliesh joined Quicksilver Messengers in October 1998 in the customer service area and was with them until January 2004, when he joined ICS Courier Services.

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Mr. Dalgliesh has been a Director of Cougar Holdings Inc. continuously from June 1999 to July 1, 2005.  From June 1999 to March 2003, Mr. Dalgliesh also served as Secretary.  Cougar Holdings Inc. is a gemstone exploration and development company incorporated in Nevada.  Cougar Holdings Inc. is an SEC reporting company and is listed on the NASD OTC Bulletin Board with the symbol of CGRH.  On July 1, 2005, Cougar Holdings Inc. went through a change of control and Mr. Dalgliesh resigned his position as a Director.

Mr. Dalgliesh was the Secretary and a Director of Leopard Capital Inc. from May 1998 to February 2004.   Leopard Capital is a public reporting company that previously held mining interests in British Columbia, Canada.  In February 2004, Leopard Capital went through a change of control, and a name change to China Expert Technology Inc., and Mr. Dalgliesh resigned his positions as an Officer and a Director.

Conflicts of Interest

Terry G. Cook, the Company's President and a director, is associated with Western Gems Inc., a mineral exploration company.  Consequently, there are potential inherent conflicts of interest in Mr. Cook acting as an officer and a director of the Company.  Insofar as the officers and directors are engaged in other business activities, management anticipates it will devote only a portion of each person's time to the Company's affairs.

The officers and directors of the Company are now and may in the future become shareholders, officers or directors of other companies that may be engaged in additional business activities similar to those conducted by the Company.  Accordingly, additional direct conflicts of interest may arise in the future with respect to such individuals acting on behalf of the Company or other entities.  Moreover, additional conflicts of interest may arise with respect to opportunities which come to the attention of such individuals in the performance of their duties or otherwise.  The Company does not currently have a right of first refusal pertaining to opportunities that come to management's attention, other than the Exclusive Mineral Claim Registration Area and First Refusal Rights Agreement dated May 5, 2005 with Western Gems Inc. ("Western Gems").  Terry G. Cook is the President, sole director and controlling shareholder of Western Gems Inc.  Western Gems Inc. holds the WC1 and WC2 mineral claims which are under exploration for opal reserves.  A previous similar agreement between Cougar Holdings Inc. and Mustang was terminated on May 5, 2005 when Cougar Holdings Inc. transferred its WC1 and WC2 mineral claims to Western Gems Inc.

The officers and directors are, so long as they are officers or directors of the Company, subject to the restriction that all opportunities which come to their attention, either in the performance of their duties or in any other manner, will be considered opportunities of, and be made available to the Company and the companies that they are affiliated with on an equal basis.  A breach of this requirement will be a breach of the fiduciary duties of the officer or director.

If the Company or the companies in which the officers and directors are affiliated with both desire to take advantage of an opportunity, then said officers and directors would abstain from negotiating and voting upon the opportunity.  The only exception to this policy is the specific Exclusive Mineral Claim Registration Area and First Refusal Rights agreement dated May 5, 2005 between Mustang Resources Inc. and Western Gems Inc., attached as Exhibit 10.7 to this filing.  However, all directors may still individually take advantage of opportunities if the Company should decline to do so.    Except as set forth above, the Company does not have any other conflict of interest policy with respect to such transactions.

By the terms of the May 5, 2005 agreement referred to above, Mustang and Western Gems Inc. have clarified the terms of their competitive relationship in seeking out mineral properties, as follows:

Mustang's Board of Directors passed a Resolution adopted May 5, 2005, adopting an Agreement between Mustang and Western Gems whereby:

Page 20

(a)  Mustang agrees not to register mineral claims for a period of 20 years beginning May 5, 2005, within a 100 mile radius of Western Gems' core properties, the WC1 & WC2 mineral claims located in the Vernon Mining Division, in Central B.C.

(b)  Mustang agrees to grant Western Gems a right of first refusal to acquire a 50% undivided interest in any mineral claims registered by Mustang, where such claims are located outside the 100 mile radius of Western Gems'  WC1 & WC2 mineral claims; and also outside the 100 mile radius of Mustang's JC1-JC4 mineral claims.

To exercise such first refusal Western Gems must:

(a)  provide notice, in writing, to Mustang, within 30 days of the registration of any such "open area claims" that Western Gems wishes to exercise its right to a 50% undivided interest in the subject claims, and

(b)  Submit to Mustang's office a check for 50% of the cost Mustang incurred to register such claims, plus reasonable out-of-pocket expenses, properly documented. Such payment by Western Gems must be made within 10 days of being invoiced by Mustang for such expenses, or the right of first refusal shall lapse.

Western Gems' Board of Directors passed a Resolution adopted May 5, 2005, adopting an Agreement between Western Gems and Mustang whereby:

(a)  Western Gems agrees not to register mineral claims for a period of 20 years beginning May 5, 2005, within a 100 mile radius of Mustang's core properties, the JC1-JC4 claims located in the Nelson Mining Division, in Southern B.C.

(b)  Western Gems agrees to grant Mustang a right of first refusal to acquire a 50% undivided interest in any mineral claims registered by Western Gems, where such claims are located outside the 100 mile radius of Mustang's JC1-JC4 mineral claims; and also outside the 100 mile radius of Western Gems' WC1 & WC2 mineral claims.

To exercise such first refusal Mustang Resources must:

(c)  provide notice, in writing, to Western Gems, within 30 days of the registration of any such "open area claims" that Mustang wishes to exercise its right to a 50% undivided interest in the subject claims, and

(d)  Submit to Western Gems' office a check for 50% of the cost Western Gems incurred to register such claims, plus reasonable out-of-pocket expenses, properly documented. Such payment by Mustang must be made within 10 days of being invoiced by Western Gems for such expenses, or the right of first refusal shall lapse.

Significant Employees

We have no employees at this time.  Mustang is managed by its directors and executive officers.

Page 21

Family Relationships

There is no family relationship between any of our directors or executive officers.

Involvement in Certain Legal Proceedings

There have been no legal proceedings involving either our directors or executive officers during the past five years that are material to an evaluation of the ability or integrity of any director or executive officer of Mustang Resources Inc.

Item 11.  Security Ownership of Certain Beneficial Owners and Management

As of the close of business on July 26, 2005, the following persons owned beneficially more than 5% of our outstanding common shares:

5% or Greater Shareholders

Title of	Name and Address	Amount and Nature of		Percent of
Class	of Beneficial Owner	Beneficial Ownership		Class  (1)
Common	Terry G. Cook	1,920,002	(2)	95.14	%
	1574 Gulf Rd.  #1505
	Point Roberts, WA, 98281

(1)

Based on 2.018,002 shares of common stock outstanding as of July 26, 2005.

(2)

Mr. Terry G. Cook beneficially owns these shares with his spouse, Mrs. Nancy L. Cook.  Mr. Cook is the holder of record of 1,280,002 of these shares while Mrs. Cook is the holder of record of 640,000 shares.  Mr. Terry G. Cook disclaims beneficial ownership of the 640,000 held in the name of Mrs. Cook, and accordingly, without including the shares held in the name of Mrs. Cook, Mr. Terry G. Cook owns 63.43% of the issued and outstanding shares of the Company's common stock.  Mrs. Nancy L. Cook disclaims beneficial ownership of the 1,280,002 shares held in the name of Mr. Cook, and accordingly, without including the shares held in the name of Mr. Cook, Mrs. Nancy L. Cook owns 31.71% of the issued and outstanding shares of the Company's common stock.

The table below lists as of July 26, 2005, all of our directors and executive officers who beneficially owned our voting securities and the amount of our voting securities owned by the directors and executive officers as a group.

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Security Ownership of Management

Title of	Name and Address	Amount and Nature of		Percent of
Class	of Beneficial Owner	Beneficial Ownership		Class  (1)
Common	Terry G. Cook	1,920,002	(2)	95.14	%
	1574 Gulf Rd. #1505
	Point Roberts, WA,  98281
Total Directors and Officers		1,920,002		95.14	%

(1)

Based on 2,018,002 common shares outstanding as of July 26, 2005.

(2)

Mr. Terry G. Cook beneficially owns these shares with his spouse, Mrs. Nancy L. Cook.  Mr. Cook is the holder of record of 1,280,002 of these shares while Mrs. Cook is the holder of record of 640,000 shares.  Mr. Terry G. Cook disclaims beneficial ownership of the 640,000 held in the name of Mrs. Cook, and accordingly, without including the shares held in the name of Mrs. Cook, Mr. Terry G. Cook owns 63.43% of the issued and outstanding shares of the Company's common stock.  Mrs. Nancy L. Cook disclaims beneficial ownership of the 1,280,002 shares held in the name of Mr. Cook, and accordingly, without including the shares held in the name of Mr. Cook, Mrs. Nancy L. Cook owns 31.71% of the issued and outstanding shares of the Company's common stock.

Item 12.  Description of Securities

General

Our authorized capital stock consists of 160,000,000 shares of common stock, with a par value of $0.001 per share, and 40,000,000 shares of preferred stock, with a par value of $0.001 per share.  As of July 26, 2005, there were 2,018,002 shares of our common stock issued and outstanding that were held by 44 stockholders of record.  We have not issued any shares of preferred stock.

Common Stock

Our common stock is entitled to one vote per share on all matters submitted to a vote of the stockholders, including the election of directors.  Except as otherwise required by law or provided in any resolution adopted by our board of directors with respect to any series of preferred stock, the holders of our common stock will possess all voting power.  Generally, all matters to be voted on by stockholders must be approved by a majority, or, in the case of election of directors, by a plurality, of the votes entitled to be cast by all shares of our common stock that are present in person or represented by proxy, subject to any voting rights granted to holders of any preferred stock.  Our Articles of Incorporation do not provide for cumulative voting in the election of directors.

Subject to any preferential rights of any outstanding series of preferred stock created by our board of directors from time to time, the holders of shares of our common stock will be entitled to such cash dividends as may be declared from time to time by our board of directors from funds available therefore.

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Subject to any preferential rights of any outstanding series of preferred stock created from time to time by our board of directors, upon liquidation, dissolution or winding up, the holders of shares of our common stock will be entitled to receive pro rata all assets available for distribution to such holders.

In the event of any merger or consolidation with or into another company in connection with which shares of our common stock are converted into or exchangeable for shares of stock, other securities or property (including cash), all holders of our common stock will be entitled to receive the same kind and amount of shares of stock and other securities and property (including cash).

Holders of our common stock have no pre-emptive rights and no conversion rights.  There are no redemption provisions applicable to our common stock.

Preferred Stock

Our board of directors is authorized by our articles of incorporation to divide the authorized shares of our preferred stock into one or more series, each of which must be so designated as to distinguish the shares of each series of preferred stock from the shares of all other series and classes.  Our board of directors is authorized, within any limitations prescribed by law and our articles of incorporation, to fix and determine the designations, rights, qualifications, preferences, limitations and terms of the shares of any series of preferred stock including but not limited to the following:

(a) the rate of dividend, the time of payment of dividends, whether dividends are cumulative, and the date from which any dividends shall accrue;

(b) whether shares may be redeemed, and, if so, the redemption price and the terms and conditions of redemption;

(c) the amount payable upon shares of preferred stock in the event of voluntary or involuntary liquidation;

(d) sinking fund or other provisions, if any, for the redemption or purchase of shares of preferred stock;

(e) the terms and conditions on which shares of preferred stock may be converted, if the shares of any series are issued with the privilege of conversion;

(f) voting powers, if any, provided that if any of the preferred stock or series thereof shall have voting rights, such preferred stock or series shall vote only on a share for share basis with our common stock on any matter, including but not limited to the election of directors, for which such preferred stock or series has such rights; and

(g) subject to the above, such other terms, qualifications, privileges, limitations, options, restrictions, and special or relative rights and preferences, if any, of shares or such series as our board of directors may, at the time so acting, lawfully fix and determine under the laws of the State of Nevada.

Page 24

Dividend Policy

We have never declared or paid any cash dividends on our common stock.  We currently intend to retain future earnings, if any, to finance the expansion of our business.  As a result, we do not anticipate paying any cash dividends in the foreseeable future.

Share Purchase Warrants

We have not issued and do not have outstanding any warrants to purchase shares of our common stock.

Options

We have not issued and do not have outstanding any options to purchase shares of our common stock.

Convertible Securities

We have not issued and do not have outstanding any securities convertible into shares of our common stock or any rights convertible or exchangeable into shares of our common stock.

Nevada Anti-Takeover Laws

The articles of incorporation of Mustang Resources Inc. state that the provisions of Nevada Revised Statutes, 78.378 through 78.3793 inclusive, regarding the voting of a controlling interest in stock of a Nevada corporation and sections 78.411 through 78.444 inclusive, regarding combinations with interested stockholders, shall not apply.  The Nevada revised statutes sections 78.378 to 78.3793 inclusive, and sections 78.411 through 78.444 inclusive, provide state regulation over the acquisition of a controlling interest in certain Nevada corporations unless the articles of incorporation or bylaws of the corporation provide that the provisions of these sections do not apply.  The statute creates a number of restrictions on the ability of a person or entity to acquire control of a Nevada company by setting down certain rules of conduct and voting restrictions in any acquisition attempt, among other things.  The statute is limited to corporations that are organized in the state of Nevada and that have 200 or more stockholders, at least 100 of whom are stockholders of record and residents of the State of Nevada; and does business in the State of Nevada directly or through an affiliated corporation.

Stock Transfer Agent

Our Company's transfer agent is Madison Stock Transfer, Inc., 1813 East 24th Street, Brooklyn, NY 11229.

Page 25

Item 13.  Interests of Named Experts and Counsel

No expert or counsel named in this prospectus as having prepared or certified any part of this prospectus or having given an opinion upon the validity of the securities being registered or upon other legal matters in connection with the registration or offering of the common stock was employed on a contingency basis, or had, or is to receive, in connection with the offering, a substantial interest exceeding $50,000, direct or indirect, in the registrant or any of its parents or subsidiaries.  Nor was any such person connected with the registrant or any of its parents or subsidiaries as a promoter, managing or principal underwriter, voting trustee, director, officer, or employee.

Clark, Wilson, our independent legal counsel, has provided an opinion on the validity of our common stock.  See Exhibit 5.1.

Telford Sadovnik, P.L.L.C., Certified Public Accountants, has audited our financial statements included in this prospectus and registration statement to the extent and for the periods set forth in their audit report. Telford Sadovnik, P.L.L.C. has presented their report with respect to our audited financial statements.  The report of Telford Sadovnik, P.L.L.C. is included in reliance upon their authority as experts in accounting and auditing.

Item 14.  Disclosure of Commission Position of Indemnification for Securities Act Liabilities

Our articles of incorporation provide that we will indemnify an officer, director, or former officer or director, to the full extent permitted by law.  We have been advised that in the opinion of the Securities and Exchange Commission indemnification for liabilities arising under the Securities Act of 1933 is against public policy as expressed in the Securities Act of 1933, and is, therefore, unenforceable.  In the event that a claim for indemnification against such liabilities is asserted by one of our directors, officers, or controlling persons in connection with the securities being registered, we will, unless in the opinion of our legal counsel the matter has been settled by controlling precedent, submit the question of whether such indemnification is against public policy to a court of appropriate jurisdiction.  We will then be governed by the court's decision.

Item 15.  Organization Within Last Five Years

We were incorporated in the State of Nevada on November 23, 1998 as Canadian Northern Lites (Nevada) Inc.  On December 15, 2003, our name was changed to Mustang Resources Inc. by registering a Certificate of Amendment and Restatement to the Articles of Incorporation with the Nevada Secretary of State.  Our statutory registered agent's office is located at 1000 East William Street, Suite 204, Carson City, Nevada and our business office is located at 1574 Gulf Rd. #1505, Point Roberts, Washington, 98281.  Our telephone number is (604) 261-6100 and our fax number is (604) 608-9185.  We have not had any bankruptcy, receivership or similar proceeding since incorporation.  There have been no material reclassifications, mergers, consolidations or purchases or sales of any significant amount of assets not in the ordinary course of business since the date of incorporation.

We are a start-up exploration stage company engaged in the search for gold on our mineral claims.

In February 2004, Mustang staked a 100% interest in each of four mining claims known as the JC1, JC2, JC3 and JC4 mining claims located in the Nelson Mining District in British Columbia, Canada.  All of the above staking of mining claims have been are recorded in Mr. Cook's name and held in trust for Mustang Resources Inc. by Mr. Cook in order to minimize fees.  Terry G. Cook has no interest whatsoever in the said mineral claims other than that of a bare trustee.  Terry G Cook will deliver full title on demand to Mustang Resources Inc. for as long as the claim is in good standing.  We have no other property other than these mineral claims.

Page 26

We issued 1,920,000 shares of common stock (after adjustment for a two-for-one forward stock split in October 2004) on December 31, 2001 at a price of $0.0025 per share in satisfaction of a $4,800 receivable owed to Hudson Capital Corporation by Mustang Resources.  On the instructions of Hudson, the 1,920,000 shares were issued to two creditors of Hudson.  One of the creditors who received 1,280,000 shares was Mr. Terry G. Cook, President and Director of the Company and also the President, Director and major shareholder of Hudson.  The other Hudson creditor who received 640,000 shares was Nancy L. Cook, the spouse of Mr. Terry G. Cook, who, as a result of this share issuance, became a related party of the Company.  For this share issue, we relied on Section 4(2) of the Securities Act because the transaction did not involve a public offering and was therefore exempt from the registration requirements of the Securities Act.  No underwriters were used, nor were any brokerage commissions paid in connection with the above share issue.

In an offering completed on July 20, 2005, the Company issued 98,000 common shares to a total of 42 investors relying upon an exemption under Regulation S of the Securities Act.  No underwriters were used, nor were any brokerage commissions paid in connection with the above share issues.

There are no preliminary agreements or understandings between Mustang Resources and its officers and directors, affiliates or lending institutions with respect to any loan agreements, other than a related party payable owing to Hudson Capital Corporation, a company controlled by Terry G. Cook, the President of Mustang.  Hudson Capital Corporation has since our inception advanced funds to Mustang for its administrative and operating expenses.  This debt is unsecured, accrues no interest and has no fixed terms of repayment.  On March 10, 2005, Hudson Capital Corporation agreed not to demand payment of any of the Company's related party payables until July 15, 2007.

Item 16.  Description of Business

Business Development

Mustang Resources Inc. is an exploration stage company engaged in the exploration of our mining properties.  The Company was incorporated in the State of Nevada on November 23, 1998 as Canadian Northern Lites (Nevada) Inc. and changed is name on December 15, 2003 to Mustang Resources Inc.  We maintain our statutory registered agent's office at 1000 East William Street, Suite 204, Carson City, Nevada, and our business office is located at 1574 Gulf Rd. #1505, Point Roberts, Washington, 98281.  Our telephone number is (604) 261-6100 and our fax number is (604) 608-9185.

We are not associated or affiliated in any way with Mustang Resources Inc. of 101 - 10th Street NW, Calgary, Alberta, Canada,  T2N 1V4, a company that operates in the oil and gas industry in Canada, and whose shares were traded on the Toronto Stock Exchange under the symbols MUS.A and MUS.B until July 2005 when the company merged with two other companies to form Thunder Energy Trust.

Our Business

We explore our properties in Canada for the presence of gold.  Activities to date have consisted solely of the staking of mining claims.  As yet, we have not yet developed any mining properties into a producing mine, nor have we earned revenue from any of the properties.  Exploration will be required before a final evaluation as to the economic feasibility is determined.  There is no assurance that a commercially viable gold deposit exists on our property.  We have interests in four properties which we may explore.  The four interests consist of a 100% interest in each of the JC1, JC2, JC3 and JC4 mineral properties located near the city of Nelson, British Columbia, Canada.  None of our properties contain a known commercially viable deposit suitable for mining.

Page 27

Our management does not have any technical training in the field of mineral exploration and is inexperienced in exploration, as well as starting and operating a mine.  Due to the lack of direct training and experience in these areas, our management may not be fully aware of many of the specific requirements related to working within the mining industry.  In addition, we will also have to rely on the expertise and services of qualified personnel for the surveying, exploration, and excavation of our mineral claims.  If we are unable to contract such services at reasonable costs, we may have to suspend or cease operations.  Decisions and choices made by our management due to their inexperience in this industry may not take into account standard engineering or managerial approaches that mineral exploration companies commonly use.  Consequently, our operations, earnings and ultimate financial success could suffer irreparable harm.

Our plan of operation is to conduct mineral exploration on our four JC mineral claims in order to determine if our properties contain any commercially viable gold reserves.  Mustang has developed a two phase exploration program to explore our properties for gold deposits (please see "Our Proposed Exploration Program" on page 9 for more information on our two phase exploration program).  We have not started Phase 1 and do not plan to start until we obtain additional capital.  We will not make a decision whether to proceed to Phase 2 until completion of Phase 1 and upon analysis of the results of Phase 1.  Even if we complete our current two phase exploration program and even if we are successful in identifying a mineral deposit, we will have to spend substantial funds on further drilling and engineering studies before we can determine if we have a commercially viable deposit or a deposit that can be defined as a reserve.  A reserve is that part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination.

The success of Mustang Resources is critically dependent upon finding mineralized material.  If we don't find mineralized material or we cannot remove mineralized material, either because we do not have the money to do it or because it is not economically feasible to do it, we will cease operations and you will lose your investment.  Mineralized material or deposit is a mineralized body which has been delineated by appropriate drilling and/or underground sampling to support a sufficient tonnage and average grade of metal(s).  Under SEC standards, such a deposit does not qualify as a reserve until a comprehensive evaluation, based upon unit cost, tonnage, grade, price, recoveries costs and other factors, concludes economic feasibility.

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The likelihood of finding any reserves, or mineral deposits which could be economically and legally extracted or produced, on any of our properties is extremely remote.  In all probability our properties do not contain any reserves.  Any funds spent on exploration will probably be lost.

Mustang has not begun Phase 1 of our exploration program as the Company does not have enough capital to complete Phase 1 and thus must first raise additional capital in order to proceed (please see "Our Proposed Exploration Program" on page 9 for details regarding Phase 1 of our exploration program).  We will need to secure additional funding from a private placement or loans.  At the present time, we have not made any plans to raise additional money and there is no assurance that we would be able to raise additional money in the future.  If we cannot raise additional money to complete Phase 1, we will have to suspend our exploration program.  Mustang's investment capital has consisted entirely of advances and equity investments by our president.  The timing of such capital infusions was dependent on our requirements and the economic climate.  We anticipate having to raise additional funds by equity issuance in the next several years, as we do not expect to generate material revenue from mining operations, or to achieve self-sustaining commercial mining operations for some time.  The Company plans to fund its future operations through additional sales of its unregistered common stock.  There can be no assurance the Company will be successful in its efforts to raise equity.

Our cash balance was $4,776 and we had working capital of $776 at June 30, 2005 compared to a cash balance of $4,776 and working capital of $776 at December 31, 2004 and a cash balance of $10,000 and working capital of $5,000 at December 31, 2003.  The Company maintains its cash balances in an account at one financial institution, Sterling Savings Bank.  The balances are insured by the Federal Deposit Insurance Corporation up to $100,000.  As of June 30, 2005, there were no uninsured cash balances.

On July 20, 2005, the Company completed a share issue that raised $9,800 of equity capital for the Company, increasing the Company's cash balance to $14,576 as of July 26, 2005.

Mustang's entire property base consists of undeveloped raw land.  Exploration and surveying has not yet been initiated, and to our knowledge, the property has never been mined.  Further exploration is essential to determine what amount of minerals, if any, exist on our properties and, if any minerals which are found can be economically extracted and profitably processed.

We must explore for and find mineralized material and determine if it is economically feasible to remove the mineral reserves.  Economically feasible means that the costs associated with the removal of the mineralized material will not exceed the price at which we can sell the mineralized material.  We do not claim to have any minerals or reserves whatsoever at this time on any of our properties.

All Canadian lands and minerals which have not been granted to private persons are owned by either the federal or provincial governments in the name of Her Majesty.  Ungranted minerals are commonly known as Crown minerals.  Ownership rights to Crown minerals are vested by the Canadian Constitution in the province where the minerals are located.  In the case of the Company's property, that is the province of British Columbia.  In the 19th century the practice of reserving the minerals from fee simple Crown grants was established.  Legislation now ensures that minerals are reserved from Crown land dispositions.  The result is that the Crown is the largest mineral owner in Canada, both as the fee simple owner of Crown lands and through mineral reservations in Crown grants.  Most privately held mineral titles are acquired directly from the Crown.  The Company's four properties, JC1 - JC4 inclusive, are examples of such acquisitions.  Accordingly, fee simple title to the Company's properties resides with the Crown.  The Company's claims are mining leases issued pursuant to the British Columbia Mineral Act.  The lessee has exclusive rights to mine and recover all of the minerals contained within the surface boundaries of the lease continued vertically downward.

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According to the Mineral Tenure Act of British Columbia, a mineral claim may be held for one year and thereafter from year to year.  In order to maintain a mineral lease the holder of the lease must, on or before the anniversary date, spend $100 CAD, or approximately $80 USD, each year per unit leased during the first three 1 year terms; and $200 CAD, or approximately $160 USD, each year per unit for subsequent 1 year terms.  The required expenditure can be in the form of expenditures on exploration or can be in the form of a direct payment to the Province of British Columbia.  If in any year, the required exploration work expenditure is not completed and filed with the Province prior to the lease expiry date, or if a payment is not made to the Province of British Columbia in lieu of the required work prior to the lease expiry date, the mineral claims will lapse.  A maximum of ten years of work credit may be filed on a claim.

Mustang's four mineral leases each consist of 20 units for a total of 80 units.  The JC1, 2, 3 and 4 leases expire on February 19, 2005.  The extension of these four leases for another 1 year period therefore requires an expenditure of $8000 CAD or approximately $6,400 USD for exploration work, plus a payment of a recording fee for each claim, or a direct payment of the same amount to the Province of British Columbia.

There is no insurance covering the property and we believe that no insurance is necessary since the property is unimproved and contains no buildings or improvements.  The property is unencumbered and there are no competitive conditions which affect the property.  To date we have not performed any work on the property and we cannot guarantee that a commercially viable mineral deposit or reserve exists in the property until exploration is done and a comprehensive evaluation concludes economic feasibility, based on prevailing and projected mineral prices.

Mustang's Properties

The JC1, JC2, JC3 and JC4 Claims

The JC1, JC2, JC3 and JC4 claims are not producing properties.  They are all currently dormant.  No revenue from mining operations has ever been generated from any of these claims.

The JC claims were originally staked on February, 2004 and subsequently re-staked in February 2005, and consist of the following mineral claims, located within the Nelson Mining District:

Claim Name	Tenure Number	Area	Record Date	Expiry Date
		(hectares)
JC1	507555	525.398	02/20/05	02/20/06
JC2	507554	525.401	02/20/05	02/20/06
JC3	507553	525.616	02/20/05	02/20/06
JC4	507552	525.610	02/20/05	02/20/06

The British Columbia Mineral Tenure Act generally requires all claimholders to be Canadian residents or Canadian corporations amongst other conditions.  We believe the additional costs of incorporating a Canadian subsidiary and the additional associated fees and administrative costs are unwarranted at this time.  In order to minimize fees, the JC claims are registered with the Province of British Columbia in the name of Terry G. Cook, Mustang's President, and are held in trust for Mustang Resources Inc. by Mr. Cook.  A Declaration of Trust, executed by Mr. Cook on February 20, 2005, declares that he holds the mineral claims in trust for the Company and will deliver full title on demand to Mustang Resources Inc. for as long as the claims are in good standing with the Province of British Columbia.  The Declaration of Trust also specifies that Mr. Cook has no interest in the mineral claims other that that of a bare trustee.  All rights in respect of the mineral claims and any distributions whether income or capital and whether in cash or otherwise, do not in any manner belong to Mr. Cook but are the property of Mustang Resources Inc.  In the event that we find mineralized material and the mineralized material can be economically extracted, we intend to form a wholly owned British Columbia subsidiary corporation.  Mr. Cook will then convey title to the JC claims to the wholly owned subsidiary corporation.

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Location of and Access to the JC Claims

The JC1, 2, 3 and 4 claims are Four-Post Mineral claims located 25 kilometers east-southeast of Nelson in southeastern British Columbia and 8 kilometers due west of Drewey Provincial Park.  The claims are situated on a ridge between Seeman Creek and Hughes Creek, both of which are east flowing tributaries of Midge Creek, at an elevation of 1900 meters.  The properties are centered on latitude 49 degrees  24 minutes N and longitude 116 degrees 58 minutes W.

Access to the claims is gained by approximately 30 km of paved road (Highway 6) south of Nelson, 30 km of logging roads along Porcupine, Cultus and Laib Creeks and 6.5 km of four wheel roads.

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Topography and Physiography

Overall topography is moderate to steep with terrain rising at overall 30 degrees from 1189 meters in Seemans Creek to a maximum of 2300 meters on the broad rolling ridge on which the Legal Corner Post rests.  Forest cover is generally moderate to sparse at upper elevations but increasingly thick underbrush is present at lower elevations with vegetation including birch, spruce and minor hemlock and cedar.

Property History

Previous staking and work on the JC1, 2, 3, and 4 claims has been limited, consisting of the following:

The area was prospected intermittently in the late 1890's up to approximately 1935.

No further property work was undertaken until 1980 when the claim holder carried out detailed sampling of accessible surface on top of the ridge east of the Legal Corner Post of the JC claims.  Limited detailed geological mapping, using electro magnetic surveying techniques and a soil geochemical survey was also done covering a small area of 1.6 sq. kilometers.

A subsequent claimholder explored the same area in 1984 and 1985 and constructed 8 km of access roads, 72.5 km of survey grid and undertook an electro magnetic geophysical survey over the northern third of the grid.  The claimholder isolated several geochemical anomalies downslope to the Northwest along the present boundary of the JC 1 & 2 but none of these were followed up.

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Recently an additional area of the limited geochemical sampling was completed along the eastern ridge sloping towards Hughes Creek but again no follow-up and the claims were allowed to lapse.

Regional Geology

The JC1, JC2 JC3 and JC4 properties are located near the southern end of the Kootenay Arc, a complexly deformed, northern trending belt of metasedimentary and metavolcanic rocks of Proterozoic and Early Paleozoic age.  The arc is extensively intruded by granitic plutons and stocks of Jurassic and Cretaceous age.  In the general vicinity of the property, regional stratigraphy becomes progressively younger from east to west.

Property Geology

Geologic mapping of the majority of the JC1, JC2, JC3, and JC4 claims has not, apparently, been undertaken.  Regional geologic maps indicate that a major, north-northeast trending fault bisects the property.  To the east of this fault, the property is underlain by Windermere Supergroup rocks of the Upper Proterozoic - Lower Paleozoic age.  The basal unit of the Windermere is a distinctive conglomerate of the Toby Formation, which is overlain by mafic volcanic tuffs and greenstones of the Irene Volcanic Formation.  Upper Windermere rocks consist of the Monk Formation (phyllites and a gray limestone horizon overlain by quartzites, grits and conglomerate of the Three Sisters Formation).  The Monk Formation and the Three Sisters Formations were grouped by previous workers as the Horsethief Creek Group.  To the west of the major fault, Hamill Group rocks of Lower Cambrian age consist of quartzites and mica schists with thin marble and conglomerate horizons.

Detailed geological maps will be completed for all four of the JC mineral claims and should graphically communicate vast amounts of geologic information. They are to a geologist the equivalent of blueprints to an architect.  These maps will display three-dimensional features on a flat piece of paper, depicting the relative age, composition, and relationships among rocks and sediments and will be printed on a base map, which will show topography, roads, rivers etc. to allow our consultants to accurately determine their location. A detailed geological map would include cross sections that reveal the structure or arrangement of rocks below the Earth's surface which is particularly important in assessing the potential for the presence of mineral resources. 

Previously completed geological mapping in the vicinity of the JC claims indicate that the stratigraphy and structure of the Windermere Super Group is considerably more complex than indicated by regional maps.  The most common rock type in the area is a quartz-sericite schist which was probably originally an impure quartzite.  Lenses of volcanic greenstone and mature quartzite are present within the schists but it is uncertain if these represent original stratigraphic lenses or are repetitions created by tight to isoclinal folding.  Grey weathering marble horizons are also present as apparently discontinuous lenses.

Lithologic contacts generally trend north to northeast with steep to moderate westerly dips which are subparallel to a pervasive schistosity.  The Windermere rocks are cut by complex dikes, sills and plugs of quartz diorite of probable Cretaceous age.  The intrusive rocks are equigranular to weakly porphyritic and are variably altered by shear zones which are most probably related to mineralization.

Our Proposed Exploration Program

We intend to implement an exploration program and intend to proceed in the following two phases:

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JC Project: Phase 1

The JC Properties were staked to cover the bottom of a succession of geological layers or strata called the Horsethief Creek Group (Monk Formation) at the gradational contact between it and the underlying upper part of the Irene Volcanic Formation.  This location is interesting as this transition is the ideal potential location for what is called a SEDEX (Sedimentary Exhalative) deposit.  The volcanics as the last stages of volcanism exhale hot mineral rich brines into the over lying sediments; these minerals are then precipitated out of the brine and into the sediment.  This type of volcanic exhalation (Black Smokers) can be seen today on the Juan De Fuca Ridge off the coast of British Columbia.

The mineralization we are looking for is a stratabound massive to semi-massive sulphide horizon, carrying varying proportions of arsenopyrite, pyrite, barite, galena, sphalerite. chalcopyrite, pyrrhotite and valleriite.

Phase 1 will begin with research of the available geologic literature, personal interviews with geologists, mining engineers and others familiar with the prospect sites.  When the research is completed, our initial work will be augmented with prospecting over the entire claim block and geologic mapping on a initial scale of 1:5000 covering 500m on either side of the north-south boundary between the JC1,2 and JC-3,4 in the central part of the claim block. Detailed geological maps should graphically communicate important geologic information. They are to a geologist the equivalent of blueprints to an architect.  These maps will display three-dimensional features on a flat piece of paper, depicting the relative age, composition, and relationships among rocks and sediments and will be printed on a base map, which will show topography, roads, rivers etc. to allow our consultants to accurately determine their location. A detailed geological map would include cross sections that reveal the structure or arrangement of rocks below the Earth's surface which is particularly important in assessing the potential for the presence of mineral resources.

This area where our geological mapping will be concentrated is where the strata boundary is believed to be located. Additional exploration will consist of VLF-EM geophysical surveys and soil geochemical testing to isolate areas of potential mineralization.  VLF-EM is a very low frequency electromagnetic survey method that uses transmitted signals and instruments that measure changes in the propagating wave fronts as they move through geologic material.  VLF/EM methods are ideal for locating fractures, faults, and conductive overburden depths.

If an apparent mineralized zone is identified and narrowed down to a specific area by the studies, we will begin detailed geophysical surveys and trenching areas of interest.  The geophysical work gives a general understanding of the location and extent of mineralization at depths that are unreachable by surface excavations and provides a target for more extensive trenching and core drilling.

Upon a thorough analysis of the data collected in Phase 1, we will decide if the property warrants proceeding to Phase 2.

Phase 1 will take about 5 months and cost up to $35,000.

JC Project: Phase 2

Trenching is undertaken to remove the overburden and expose the continuity and extent of mineralization on the surface.  Trenches are generally approximately 150 ft. in length and 10-20 ft. wide.  These dimensions allow for a thorough examination of the surface of the vein structure types generally encountered in the area.  They also allow easier restoration of the land to its pre-exploration condition when we conclude our operations.  Once excavation of a trench is completed, the trench is geologically mapped and mineralized samples are taken and then analyzed to ascertain the grade and economic potential of the zone.  This careful interpretation of this available data collected from the various tests will aid in determining whether or not the prospect has current economic potential and whether further exploration is warranted.

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An initial examination of the underground characteristics of the vein structure of the JC properties that was identified by Phase 1 of exploration will be undertaken.  Phase 2 is aimed at precisely defining the depth, the width, the length, the tonnage and the value per ton of any mineral body and testing any mineral deposits of potential economic importance.  The methods employed are more extensive trenching, more advanced geophysical work and diamond drilling.

Phase 2 will take about 7 months and will cost approximately $105,000.

Depending upon the results of our 2 phase exploration program, Company management will consider additional diamond drilling on the JC properties and, if warranted, underground testing and bulk sampling.  Additional diamond drilling would define the extent, structure, grade and tonnage of the deposit.

Bulk Sampling involves constructing an adit and tunnel to access and assist in the removal of a sample of mineralized ore for testing.  Later, the tunnel can be used for mining access.

Exploration Program Cost Estimates

The breakdown of estimated times and dollars for each phase was made by Mustang's Board of Directors.

We do not intend to interest other companies in the property if we find mineral reserves.  We intend to try to develop the reserves ourselves.  If we are unable to complete any phase of exploration because we do not have enough money, we will cease operations until we raise more money.  If we cannot or do not raise more money, we will cease operations.

We cannot provide you with a more detailed discussion of how our exploration program will work and what we expect will be our likelihood of success.  That is because we have a piece of raw land and we intend to look for minerals.  We may or may not find any mineralized material and it is impossible to predict the likelihood of such an event at this stage of Mustang's development.

We will not move on to a subsequent phase until the phase we are working on is completed.  We do not have any plan to take the Company from phase 2 exploration to revenue generation as it is impossible to project revenue generation at this stage.

Competitive Environment

The gold mining industry is fragmented.  We compete with other exploration companies looking for gold deposits.  We are an infinitely small participant in the gold mining market.  However, while we compete with other exploration companies, there is no competition for the exploration or removal of mineral from the JC claims.

We hold no material patents, licenses, franchises or concessions.

Codes & Regulations

Our mineral exploration program is subject to the Canadian Mineral Tenure Act Regulation.  This act sets forth rules for locating claims, posting claims, working claims and reporting work performed.

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We are also subject to the British Columbia Mineral Exploration Code which tells us how and where we can explore for minerals.  We must comply with these laws to operate our business.  Compliance with these rules and regulations will not adversely affect Mustang's operations but may have a significant impact on the costs of carrying out our exploration program.

Environmental Legislation

As a mineral exploration company, Mustang is subject to the Health, Safety and Reclamation Code for Mines in British Columbia.  This code deals with environmental matters relating to the exploration and development of mining properties and aims to protect the environment through a series of regulations affecting health and safety, archaeological sites and exploration access.

Mustang is responsible for providing a safe working environment, to not disrupt archaeological sites, and to conduct its activities in a manner that minimizes unnecessary damage to the property.

To comply with environmental laws, Mustang will secure all necessary permits prior to commencing exploration.  If development is warranted on the property, we will file final plans of operation before we start any mining operations.  We anticipate no discharge of water into active stream, creek, river, lake or any other body of water regulated by environmental law or regulation.  No endangered species will be disturbed.  Restoration of the disturbed land will be completed according to law.  All holes, pits and shafts will be sealed upon abandonment of the property.  It is difficult to estimate the cost of compliance with environmental laws since the full nature and extent of our proposed activities cannot be determined until we start our operations and know what that will involve from an environmental standpoint.

Inspectors for the B.C. Mining Division determine on a case-by-case basis the amount of any bond or other form of security that an exploration company must put up to ensure compliance with government remediation requirements.  Remediation refers to the process of returning the lands to their original state.  It is an important and potentially costly responsibility.  If any of Mustang's properties are abandoned subsequent to any physical activity, such as trenching taking place, then by the terms of the Mineral Tenure Act of British Columbia, Mustang is responsible for remediation of the lands involved.

While the cost of any bond required cannot be precisely estimated, until a detailed work program is finalized and reviewed by the Mining Division, the history of bonding requirements in the Nelson Mining Division would suggest that if government inspectors required the posting of a bond, the cost of such a bond would likely be a minimum of $900 up to a maximum of $3,500.  The time and costs involved in having the Company's properties inspected by inspectors for the B.C. Mining Division and a rough estimate of the cost of a bond that might have to be posted forms part of our estimate of time and costs for phases 1 and 2.

Mustang is in compliance with the Act and will continue to comply with the Act in the future.  We believe that compliance with the Act will not adversely affect our business operations but may represent a significant part of our cost structure.

Employees

Mustang is presently managed by Terry G. Cook and Cam Dalgliesh, our officers and directors.  Neither have employment agreements with us.  Mr. Cook devotes approximately 10% of his time to our operations and Mr. Dalgliesh devotes approximately 5% of his time to our operations.  At present, we have no full or part-time employees.  Mustang does not have pension, health, annuity, insurance, stock options, profit sharing or similar benefit plans; however, we may adopt such plans in the future.  We intend to use the services of subcontractors for manual labor exploration work on our properties.  There are presently no personal benefits available to any employees.

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Shareholder Communication

We will be required to file reports with the SEC under section 15(d) of the Securities Act following completion of this registration.  The reports we will be required to file are Forms 10-KSB, 10-QSB, and 8-K.  The reports will be filed electronically.   Mustang will not be required to furnish you with an annual report and will not be voluntarily sending an annual report.  Our annual reports will include audited financial statements.  Shareholders wishing to receive an annual report may request one by contacting our principal executive offices.

The SEC also maintains an Internet site that will contain copies of the reports we file electronically.  The address for the SEC website is www.sec.gov.  Shareholders may also read copies of any materials we file with the SEC at the SEC's Public Reference Room at 450 Fifth Street, N.W., Washington, D.C. 20549, and may obtain information on the operation of the Public Reference Room by calling the SEC at 1-800-SEC-0330.

Item 17.  Management's Discussion and Analysis or Plan of Operation

The information in this Management's Discussion is current as of July 26, 2005.

Forward-looking Statements

Some discussions in this filing may contain forward-looking statements and be prospective in nature.  Such forward-looking statements reflect management's beliefs and assumptions and are based on information currently available to management.  Forward-looking statements are statements that express our goals, beliefs, plans, current expectations or other statements regarding matters that are not historical facts.  Forward-looking statements are often identified by words such as "believes", "anticipates", "expects", "estimates" and similar expressions, or words which, by their nature, refer to future events.  The forward-looking statements involve known and unknown risks, uncertainties and other factors that may cause actual results to differ materially from those expressed or implied in such statements.

Such factors include, among others, the following:  local, national and international general economic and market conditions; the ability of the Company to attract equity capital; the ability of the Company to implement our proposed exploration program and the success thereof; existing government regulations and changes in, or the failure to comply with, government regulations; changes in business strategy or development plans; the ability to attract and retain qualified personnel; and other factors referenced in this and previous filings.

Given these uncertainties, readers of this Form 10-SB are cautioned not to place undue reliance on such forward-looking statements.  The Company disclaims any obligation to update any such factors or to publicly release the results of any revisions to any of the forward-looking statements contained herein to reflect future events or developments.

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Overview

Mustang Resources Inc. is an exploration stage company engaged in the exploration of our mineral claims for gold.  We were incorporated in November 1998 in the State of Nevada as Canadian Northern Lites (Nevada) Inc.  On December 15, 2003, we changed our name to Mustang Resources Inc. and focused our attention to the acquisition of mineral properties for exploration.  In February 2004, we staked four mineral claims in the Nelson Mining District of British Columbia, Canada, acquiring a 100% interest in these four claims, known as the JC1, JC2, JC3 and JC4 mining claims.  Our plan of operation is to explore these properties for gold reserves by implementing a two phase exploration program.

We are not associated or affiliated in any way with Mustang Resources Inc. of 101 - 10th Street NW, Calgary, Alberta, Canada,  T2N 1V4, a company that operates in the oil and gas industry in Canada, and whose shares were traded on the Toronto Stock Exchange under the symbols MUS.A and MUS.B until July 2005 when the company merged with two other companies to form Thunder Energy Trust.

We have not earned any revenue to date and have limited capital.  We will need to raise additional capital within the next 12 months to continue operations and to implement phase one of our exploration program.

The acquisition of mining claims within the mining industry is intensely competitive.  We are a very small company with limited resources. Many mining companies have significantly more resources to evaluate and acquire mineral claims.  However, with respect to our claims, there is no competition for minerals on our properties.

Plan of Operation

Our plan of operation is to conduct mineral exploration on our four JC mineral claims in order to determine if our properties contain any commercially viable gold reserves.  In consultation with our geologist, Mr. William E. Lumley, B. Sc., Mustang has developed a two phase exploration program to explore our properties for gold deposits.  We have not started phase 1 and do not plan to start until we obtain additional capital.  None of our properties contain any known commercially viable gold reserves.

Our geologist, Mr. Lumley, assisted Mustang in the research and staking of our properties, and with developing our two phase exploration program.  Mr. Lumley is a consulting geologist residing in Vancouver, B.C., Canada and has been practicing his profession for the past 25 years in Canada, United States and internationally.  Mr. Lumley graduated from the University of Waterloo, Ontario, Canada with a Bachelor of Science Degree in Geology.  The Company has no contractual arrangement with Mr. Lumley, professional geologist.  Rather, Mr. Lumley performs consulting services for the Company, if, as and when required, and is compensated in hourly fees, paid in cash.

Phase 1 will begin with research, geologic mapping, geophysical surveys and soil geochemical testing of our claims to isolate areas of potential mineralization.  If any apparent mineralized zones are identified and narrowed down to a specific area by the studies, we will begin detailed geophysical surveys and trenching areas of interest.  The geophysical work gives a general understanding of the location and extent of mineralization at depths that are unreachable by surface excavations and provides a target for more extensive trenching and core drilling.  Following a thorough analysis of the data collected in Phase 1, we will decide if the property warrants proceeding to Phase 2.  Phase 1 will take about 5 months and cost up to $35,000.

Phase 2 will involve an examination of the underground characteristics of the vein structure of the JC properties that were identified by Phase 1 of exploration.  Phase 2 is aimed at precisely defining the depth, the width, the length, the tonnage and the value per ton of any mineral body and testing any mineral deposits of potential economic importance.  The methods employed are more extensive trenching, more advanced geophysical work and diamond drilling.  Phase 2 will take about 7 months and will cost approximately $105,000.

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Management periodically reviews our exploration program and results with the assistance of mining professionals.  Decisions to abandon, reduce or expand exploration efforts are 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.

The Company estimates that it will require $13,000 over the next twelve months to fund its current liabilities, general and administrative expenses and to retain title to its mining claims for another year.  The Company will require an additional $35,000 to implement phase 1 of its exploration program for a total cash requirement over the next twelve months of $48,000.  As of July 26, 2005, including the net proceeds of $9,800 from our share issue on July 20, 2005, Mustang had cash on hand of $14,576.  We do not plan to proceed with phase 1 until we obtain the capital required to complete phase 1.  We intend to raise cash to fund our general and administrative expenses and to fund our our exploration program by the issuance of our common stock to third party investors.  The Company has not explored any third party debt financing options or other sources of external financing and does not plan to in the foreseeable future.  Proceeds from the sale of our stock will be applied first to our general and administrative expense requirements and secondly to our exploration program.

There is no assurance that we will be able to raise enough money from the sale of stock to third party investors to implement either our exploration plan or fund our general or administrative expenses for the twelve months.  In the event that we are not able to raise the required capital to fund our general and administrative expenses for the next twelve months from the sale of stock to third party investors, we expect that Hudson Capital Corporation ( a company controlled by Mustang's president) will continue to advance the required funds either in the form of cash advances or by purchase of stock as it has since Mustang's inception.  If we cannot obtain the funds required to complete Phase 1, we will have to suspend our exploration program.  If we are unable to obtain the funds required to pay our general and administrative expenses, we will have to suspend or cease operations.

Future equity financing may result in substantial dilution to purchasers.

We have not generated any revenue and are dependent upon obtaining financing to fund our operating expenses and to pursue any exploration activities. For these reasons our auditors stated in their report dated February 28, 2005, that they have substantial doubt we will be able to continue as a going concern.

We plan to retain future earnings, if any.  We have very limited resources and do not anticipate paying dividends on our common stock for the foreseeable future.

As we are an exploration stage company and have no end products, we have not conducted any product research or product development and have no plans to conduct any product research or product development over the next fiscal year.

Mustang is presently managed by Terry G. Cook and Cam Dalgliesh, our officers and directors.  At present, we have no full or part-time employees and do not foresee any significant changes in the number of employees.  Our plan is to hire outside consultants or firms to implement our exploration program.  We do not have any plans to purchase any plant or any significant equipment.

In August 2004, the Board of Directors adopted a Code of Ethics for the Company's Officers and Directors.  A copy of the Code of Ethics is included as Exhibit 14.1.

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On October 1, 2004, the Board of Directors of Mustang Resources Holdings Inc. unanimously adopted a resolution setting the close of business on October 3, 2004 as the record date to effect a two-for-one forward stock split (2 new shares for 1 old share), consistent with the approvals obtained from stockholders holding 960,001 (100% of outstanding common stock) shares of common stock.  The authorized number of common shares is not changed by the forward split and will remain at 160,000,000 common shares with a par value of $0.001. On October 3, 2004, following the forward split, there were a total of 1,920,002 shares of common stock outstanding.

On December 16, 2004, the Company re-appointed Telford Sadovnick, P.L.L.C. as their independent auditors for the fiscal year ending December 31, 2004.

Terry G. Cook, the Company's President and a director, is associated with Western Gems Inc., a private company that was engaged in the exploration of its mineral claims in British Columbia, Canada for opal gemstones.  Consequently, there are potential inherent conflicts of interest in Mr. Cook acting as an officer and a director for both companies.  To address this inherent potential conflict of interest, Mustang entered into an agreement with Western Gems Inc., dated May 5, 2005, defining exclusive mineral claim registration areas of a 100 mile radius surrounding each company's core mineral claims, and, defining joint first refusal rights for a 50% undivided interest in any claim staked and registered by the other company for mineral claims staked and registered outside of their core mineral claim areas.  A copy of this agreement is filed as Exhibit 10.7.  A previous similar agreement between Cougar Holdings Inc. and Mustang was terminated on May 5, 2005 when Cougar Holdings Inc. transferred its WC1 and WC2 mineral claims to Western Gems Inc.

Liquidity and Capital Resources

Since our inception, the Company has been financed from advances from Hudson Capital Corporation, a company controlled by Terry G. Cook, the President of Mustang.  At June 30, 2005, this related party payable was $15,351 compared to $14,594 at our fiscal year end on December 31, 2004 and $11,494 at December 31, 2003.  This debt is unsecured, accrues no interest and has no fixed terms of repayment.  On March 10, 2005, Hudson Capital Corporation agreed not to demand payment of any of the Company's related party payables until July 15, 2007.

There are no preliminary agreements or understandings between Mustang Resources and its officers and directors, affiliates or lending institutions with respect to any loan agreements, other than the related party payable owing to Hudson Capital Corporation.

During the fiscal year ended December 31, 2001, the Company extinguished $4,800 of debt owing to Hudson by issuing 1,920,000 common shares (after adjustment for the two-for-one forward stock split in October 2004) of the Company to two creditors of Hudson, on the instructions of Hudson.  One of the creditors who received 1,280,000 shares was Mr. Terry G. Cook, President and Director of the Company and also the President, Director and major shareholder of Hudson.  The other Hudson creditor who received 640,000 shares is Nancy L. Cook, the spouse of Mr. Terry G. Cook, who, as a result of this share issuance, became a related party of the Company.  For this share issue, we relied on Section 4(2) of the Securities Act because the transaction did not involve a public offering and was therefore exempt from the registration requirements of the Securities Act.  No underwriters were used, nor were any brokerage commissions paid in connection with the above share issue.

Page 40

The following table highlights our recent cash and working capital positions:

	As of		As of		As of
	June 30, 2005		Dec. 31, 2004		Dec. 31, 2003
Cash	$	4,776	$	4,776	$	10,000
Working Capital	$	776	$	776	$	5,000

Off-Balance Sheet Arrangements

We have no significant off-balance sheet arrangements that have or are reasonably likely to have a current or future effect on our financial condition, changes in financial condition, revenues or expenses, results of operations, liquidity, capital expenditures or capital resources that is material to our stockholders.

Results of Operations

We have not earned any revenues to date.  We do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties.  We are presently in the exploration stage of our business and we can provide no assurance that we will discover commercially viable levels of mineral resources on our properties or that we will enter into further substantial exploration programs or production if such deposits are discovered.

The following table highlights our recent operating results:

	For the			For the			For the
	Six Months			Year			Year
	Ended			Ended			Ended
	June 30, 2005			Dec. 31, 2004			Dec. 31, 2003
REVENUE	$	0		$	0		$	0
EXPENSES
General and
administrative
expenses	$	73		$	4,329		$	5,399
Property expenses	$	684		$	2,995		$	0
NET (LOSS)	$	(757	)	$	(7,324	)	$	(5,399	)

Page 41

Variation in Operating Results

None of our properties are yet in production, and consequently, the properties do not produce any revenue.  As a result, we expect our losses to continue.

Inflation

Our results of operations have not been significantly affected by inflation.   Management does not expect inflation to have a material impact on our operations in the future.

Significant Uncertainties

There is no assurance that the properties contain any gold reserves.  It is also uncertain whether we can finance the exploration of our properties.  Mineral exploration projects are subject to numerous regulatory requirements, as well as economic uncertainties.  There is no assurance that any of our properties will prove to be profitable.

Possible Dilution to Shareholders

Our plan of operation calls for us to finance business expansion and acquisitions by issuing securities.  Any issue of stock or securities convertible into common stock could result in significant dilution to present and prospective holders of our common shares.

Securities Market Risk and Penny Stock Risk

Mustang's stock is subject to "penny stock" rules as defined in the 1934 Securities and Exchange Act rule 3151-1.  The Securities & Exchange Commission regulates broker-dealers transactions in penny stocks.  Penny stocks, with some exceptions, are equity securities with a price of less than $5.00.  Penny stock rules require a broker-dealer to deliver to a prospective purchaser a standardized disclosure document that provides information about penny stocks and the risks of the penny stock market.

The broker or dealer must also deliver, prior to any transaction in a penny stock, a disclosure schedule prepared by the Commission relating to the penny stock market, which, in highlight form, (i) sets forth the basis on which the broker or dealer made the suitability determination; and (ii) that the broker or dealer received a signed, written agreement from the investor prior to the transaction.  Disclosure also has to be made about the risks of investing in penny stock in both public offering and in secondary trading, and about commissions payable to both the broker-dealer and the registered representative, current quotations for the securities and the rights and remedies available to an investor in cases of fraud in penny stock transactions.  Finally, monthly statements must be sent disclosing recent price information for the penny stock held in the account and information on the limited market in penny stocks.

Bid and offer quotations, and broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting a transaction.  The broker-dealer must make a written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written agreement.  In addition, the disclosure requirements above may reduce trading activity in the secondary market for penny stocks.

Page 42

Transaction costs with purchases and sales of penny stocks are likely to be higher than those for other securities.

Fluctuations in our quarterly operating results may cause our stock price to decline.

Recent Accounting Pronouncements

In May, 2003, the FASB issued Statement of Financial Accounting Standards No. 150, ("SFAS 150") "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity."  SFAS 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity.  It requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances).  The requirements of SFAS 150 apply to issuers' classification and measurement of freestanding financial instruments, including those that comprise more than one option or forward contract.  SFAS 150 does not apply to features that are embedded in a financial instrument that is not a derivative in its entirety.  SFAS 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003, except for mandatory redeemable financial instruments of non-public entities.  It is to be implemented by reporting the cumulative effect of a change in an accounting principle for financial instruments created before the issuance date of SFAS 150 and still existing at the beginning of the interim period of adoption.  Restatement is not permitted.  The Company has determined that the adoption of SFAS 150 does not have an impact on its results of operations or financial position.

In December 2003, the FASB revised Statement of Financial Accounting Standards No. 132 ("SFAS 132(R)"), "Employers' Disclosures About Pensions And Other Postretirement Benefits".  SFAS 132(R) revises employers' disclosures about pension plans and other postretirement benefit plans.  SFAS 132(R) does not change the measurement or recognition of those plans required by FASB Statements No. 87, "Employers' Accounting for Pensions", No.88, "Employers' Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits" or No. 106, "Employers Accounting for Postretirement Benefits Other Than Pensions".  FASB 132(R) retains the disclosure requirements contained in FASB Statement No. 132, "Employers' Disclosures about Pensions and other Postretirement Benefits", which it replaces.  It requires additional disclosures to those in the original SFAS 132 about the assets, obligations, cash flows, and net periodic benefit cost of defined benefit pension plans and other defined benefit postretirement plans.  The required information should be provided separately for pension plans and for other postretirement benefit plans.  The Company has determined that the adoption of SFAS 132(R) does not have an impact on its results of operation or financial position.

In December 2003, the Financial Accounting Standards Board (the "FASB") issued revised FASB Interpretation No. 46 ("FIN 46(R)"), "Consolidation of Variable Interest Entities, an Interpretation of ARB No 51", FIN 46(R) requires certain variable interest entities to be consolidated by the primary beneficiary of the entity if the equity investors in the entity do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties.  FIN 46(R) is effective for all new variable interest entities created or acquired after December 31, 2003.  The Company has determined that the adoption of FIN 46(R) does not have an impact on its results of operations or financial position.

Page 43

In a December 11, 2003 speech, the American Institute of Certified Public Accountants and Securities and Exchange Commission (the "SEC") expressed the opinion that rate-lock commitments represent written put options, and therefore are valued as liabilities.  The SEC expressed that it expects registrants to disclose the effect on the financial statements of recognizing the rate-lock commitments as written put options for quarters commencing after March 15, 2004.  Additionally, the SEC recently issued Staff Accounting Bulletin No. 105 ("SAB 105") "Application of Accounting Principles to Loan Commitments".  SAB 105 clarifies the SEC's position that the inclusion of cash flows from servicing or ancillary income in the determination of the fair value of interest rate lock commitments is not appropriate.  The Company has determined that the adoption of SAB No. 105 does not have an impact on its results of operations or financial position.

In November 2004, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standard 151 "Inventory Costs". This Statement amends the guidance in ARB No. 43, Chapter 4, "Inventory Pricing, "to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs, and wasted material (spoilage).  In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities.  The provisions of this Statement will be effective for the Company beginning with its fiscal year ending 2006. The Company believes that it will not have a material impact on the Company's financial position or results of operations.

In December 2004, the FASB issued Statement of Financial Accounting Standards No. 153 "Exchanges of Nonmonetary Assets - an amendment of APB Opinion No. 29".  This Statement amended APB Opinion 29 to eliminate the exception for nonmonetary exchanges of similar productive assets and replaces it with a general exception for exchanges of nonmonetary assets that do not have commercial substance.  A nonmonetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange.  The adoption of this Standard is not expected to have any material impact on the Company's financial position or results of operations.

In December 2004, the FASB issued Statement of Financial Accounting Standards No. 123 (revised 2004) "Share-Based Payment".  This Statement requires that the cost resulting from all share-based transactions be recorded in the financial statements.  The Statement establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-value-based measurement in accounting for share-based payment transactions with employees.  The Statement also establishes fair value as the measurement objective for transactions in which an entity acquires goods or services from non-employees in share-based payment transactions.  The Statement replaces FASB Statement No. 123 "Accounting for Stock-Based Compensation" and supercedes APB Opinion No. 25 "Accounting for Stock Issued to Employees".  The provisions of this Statement will be effective for the Company beginning with its fiscal year ending 2007.  The Company is currently evaluating the impact this new Standard will have on its operations, but believes that it will not have a material impact on the Company's financial position or results of operations.

Item 18.  Description of Property

Mineral Claims

We have interests in four mineral claims which we may explore.  The four interests consist of a 100% interest in each of the JC1, JC2, JC3 and JC4 mineral claims located near the city of Nelson, British Columbia, Canada.  None of the properties contain a known commercially viable deposit suitable for mining.  Details regarding our interests in mining properties are discussed in a previous item entitled Description of Business.

Page 44

Office Facilities

Other than our mining claims, the Company does not own any other property.  Our offices are located at 1574 Gulf Rd. #1505, Point Roberts, WA, 98281 in an area comprised of approximately 200 square feet.  This office space is rented on a month to month basis and provided at no cost to the Company by its President and any resulting rent expense if the space were rented to the Company would be immaterial.  The Company considers the facilities adequate for its current purposes.

Item 19.  Certain Relationships and Related Transactions

Hudson Capital Corporation, a company controlled by Mustang's President, Terry G. Cook, has since our inception advanced funds to Mustang Resources Inc. for it's administrative and operating expenses.  There are no specific terms of repayment and no interest charged on these related party payables.

Mustang's long-term liabilities totaled $15,351 at June 30, 2005, all payable to Hudson Capital Corporation compared to $14,594 at December 31, 2004 and $11,494 at December 31, 2003, all payable to Hudson Capital Corporation.

Hudson has agreed not to demand payment of any of the Company's related party payables until July 15, 2007.  Correspondence from Hudson to Mustang confirming this deferral of payments until July 15, 2007 is attached as Exhibit 10.6.

During the fiscal year ended December 31, 2001, the Company extinguished $4,800 of debt owing to Hudson by issuing 1,920,000 common shares (after adjustment for the two-for-one forward stock split in October 2004) of the Company to two creditors of Hudson, on the instructions of Hudson.  One of the creditors who received 1,280,000 shares was Mr. Terry G. Cook, President and Director of the Company and also the President, Director and major shareholder of Hudson.  The other Hudson creditor who received 640,000 shares is Nancy L. Cook, the spouse of Mr. Terry G. Cook, who, as a result of this share issuance, became a related party of the Company.  For this share issue, we relied on Section 4(2) of the Securities Act because the transaction did not involve a public offering and was therefore exempt from the registration requirements of the Securities Act.  No underwriters were used, nor were any brokerage commissions paid in connection with the above share issue.

Hudson Capital Corporation has provided office and management services from time to time to the Company at no charge since Mustang's inception.  There is no services contract between Hudson Capital and Mustang Resources.  Valuation and any charges for future services will be determined entirely by prevailing professional fees charged by third parties for such services, with the clear understanding that the fees charged by Hudson to Mustang shall be no less favorable to Mustang than if these services were provided by an independent third party.  Furthermore, any compensation to be paid to Hudson Capital for services rendered will be determined by the Board of Directors of Mustang Resources.

Other than as discussed above, Mustang Resources Inc. has not, since our date of incorporation, been or is to be a party in any transactions or proposed transactions that had or is to have a direct or indirect material interest with any of the following persons:

Any of our directors or officers;
Any person proposed as a nominee for election as a director;
Any person who beneficially owns, directly or indirectly, shares carrying more than 10%
     of the voting rights attached to our outstanding shares of common stock;
Any of our promoters, and;
Any member of the immediate family of any of the foregoing persons.

Page 45

Item 20.  Market for Common Equity and Related Stockholder Matters

Market Information

There is no public trading market as the Company's common stock does not trade on any exchange or any OTC Bulletin Board.

We are not associated or affiliated in any way with Mustang Resources Inc. of 101 - 10th Street NW, Calgary, Alberta, Canada,  T2N 1V4, a company that operates in the oil and gas industry in Canada, and whose shares were traded on the Toronto Stock Exchange under the symbols MUS.A and MUS.B until July 2005 when the company merged with two other companies to form Thunder Energy Trust.

As of July 26, 2005, there were 2,018,002 shares of common stock outstanding.  There are no stock options, warrants, rights, conversion privileges or other similar rights which the listed beneficial owners or anyone else may acquire.  No shares have been offered nor proposed to be offered to the public.

A total of 1,920,002 shares are held by our Officers, Directors and Affiliates, all of which are restricted securities, as that term is defined in Rule 144 of the Rules and Regulations of the Securities and Exchange Commission, promulgated under the Act.  Under Rule 144, such shares can be publicly sold, subject to volume restrictions and certain restrictions on the manner of sale, commencing one year after their acquisition.

Holders

As of July 26, 2005, the shareholders' list for the Company's common shares showed 44 registered shareholders.

Dividends

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 future earnings for use in its operation and expansion of its business.

There are no restrictions in our articles of incorporation or bylaws that prevent the Board of Directors from declaring dividends.  The Nevada Revised Statutes, however, do prohibit the Company from declaring dividends where, after giving effect to the distribution of the dividend:

1.  We would not be able to pay our debts as they become due in the usual course of business; or

2.  Our total assets would be less than the sum of our total liabilities plus the amount that would be needed to satisfy the rights of shareholders who have preferential rights superior to those receiving the distribution.

We have not declared any dividends and we do not plan to declare any dividends in the foreseeable future.

Equity Compensation Plans

The Company does not have any Equity Compensation Plans at this time.

Page 46

Item 21.  Executive Compensation

No compensation has been paid to or accrued for any of our Officers or Directors since our inception.  We have not set aside or accrued any funds since our inception to provide pension, retirement or similar benefits for Executive Officers or Directors.

Long-Term Compensation - - Not Applicable

Summary Compensation Table

The following table sets forth the compensation paid by us to our principal executive officer for fiscal years ending December 31, 2004, 2003 and 2002 and for the six months ending June 30, 2005.

SUMMARY COMPENSATION TABLE
		Annual compensation			Long-term compensation
					Awards		Payouts
Name and principal position	Year	Salary ($)	Bonus ($)	Other annual compen- sation ($)	Restricted stock award(s) ($)	Securities under- lying options/ SARs (#)	LTIP payouts ($)	All other compen- sation ($)
Terry G. Cook, President, CEO, Secretary, Treasurer and Director	2005 (6 months)	0	0	0	0	0	0	0
Terry G. Cook, President, CEO, Secretary, Treasurer and Director	2004	0	0	0	0	0	0	0
Terry G. Cook, President, CEO, Secretary, Treasurer and Director	2003	0	0	0	0	0	0	0
Cam Dalgliesh, Director	2003	0	0	0	0	0	0	0
Terry G. Cook, President, CEO,  Treasurer and Director	2002	0	0	0	0	0	0	0
Cam Dalgliesh, Secretary and Director	2002	0	0	0	0	0	0	0

Page 47

No compensation is payable to directors of the Company in connection with attendance at board meetings, except as to such directors who also serve as officers of the Company in capacities other than directors and/or officers.  At this time, no other compensation has been scheduled for any other member of the Board of Directors of officers of the Company.

 Future compensation of officers will be determined by the Board of Directors based upon financial condition and performance of the Company, the financial requirements of the Company, and upon individual performance of each officer.  The Board of Directors intends to insure that the salaries paid to the Company's officers and employees are reasonable and prudent and are based upon both the financial condition and performance of the Company and upon the performance of the individual officers.

No retirement, pension, profit sharing, stock option or insurance programs or other similar programs have been adopted by the Company for the benefit of its employees.

Page 48

Item 22.  Financial Statements

Part F/S

Item 1.  Audited Financial Statements (Year Ended December 31, 2004 and 2003)

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

FINANCIAL STATEMENTS

(Expressed in United States Dollars)

DECEMBER 31, 2004 AND 2003

Mustang Resources Inc.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
TABLE OF CONTENTS
	Page
Report of Independent Registered Public Accounting Firm	1
Balance Sheets, December 31, 2004 and 2003	2
Statements of Operations	3
Statements of Changes in Stockholders' Deficiency, for the period
from inception on November 23, 1998 through December 31, 2004	4
Statements of Cash Flows	5
Notes to the Financial Statements	6-13

 

REPORT OF INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM

To the Board of Directors and Stockholders of
Mustang Resources Inc.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)

We have audited the accompanying balance sheets of Mustang Resources Inc. (Formerly Canadian Northern Lites (Nevada) Inc.), (An Exploration Stage Company) as at December 31, 2004 and 2003 and the related statements of operations, changes in stockholders' deficiency and cash flows for each of the years then ended and for the period from inception on November 23, 1998 to December 31, 2004.  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 audits in accordance with the standards of the Public Company Accounting Oversight Board (United States).  Those standards require that we plan and perform the audit to obtain reasonable assurance about 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.  We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Mustang Resources Inc. (Formerly Canadian Northern Lites (Nevada) Inc.), (An Exploration Stage Company) as at December 31, 2004 and 2003 and the results of its operations and its cash flows for each of the years then ended and for the period from inception on November 23, 1998 to December 31, 2004 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern. As described in Note 1 to the financial statements, the Company's operating losses raise substantial doubt about its ability to continue as a going concern. Management's plans in regard to these matters are also described in Note 1. The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ TELFORD SADOVNICK, P.L.L.C.

CERTIFIED PUBLIC ACCOUNTANTS

Bellingham, Washington
February 28, 2005

Page 1

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
BALANCE SHEETS
(Expressed in United States Dollars)
As at December 31,	2004			2003
ASSETS
CURRENT
Cash	$	4,776		$	10,000
TOTAL ASSETS	$	4,776		$	10,000
LIABILITIES
CURRENT
Accounts payable and accrued liabilities	$	4,000		$	5,000
		4,000			5,000
RELATED PARTY PAYABLE		14,594			11,494
TOTAL LIABILITIES		18,594			16,494
STOCKHOLDERS' DEFICIENCY
Capital Stock
Preferred stock, $0.001 par value;
40,000,000 shares authorized, no shares outstanding		-			-
Common stock, $0.001 par value;
160,000,000 shares authorized, 1.920,002
(2003 - 1,920,002) voting shares outstanding		1,920			1,920
Additional paid-in capital		2,881			2,881
Deficit accumulated during the exploration stage		(18,619	)		(11,295	)
TOTAL STOCKHOLDERS' DEFICIENCY		(13,818	)		(6,494	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY	$	4,776		$	10,000
The accompanying notes are an integral part of these financial statements
Page 2

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
(Expressed in United States Dollars)
	For the period
	from inception
	on November			For the year			For the year
	23, 1998 to			ended			ended
	December 31,			December 31,			December 31,
	2004			2004			2003
OPERATING EXPENSES
Mining property expenses	$	2,995		$	2,995		$	-
General and administrative  expenses		15,624			4,329			5,399
NET (LOSS)	$	(18,619	)	$	(7,324	)	$	(5,399	)
NET (LOSS) PER SHARE - BASIC				$	0.00		$	0.00
WEIGHTED AVERAGE COMMON SHARES
OUTSTANDING - BASIC					1,920,002			1,920,002
The accompanying notes are an integral part of these financial statements
Page 3

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY
(Expressed in United States Dollars)
For the period from inception on November 23, 1998 through December 31, 2004
							Deficit
							accumulated
					Additional		during the
	Common Stock				paid-in		exploration
	Shares		Amount		capital		Stage			Total
Inception November 23, 1998
Common stock issued for
cash ($0.50 per share)		2	$	-	$	1	$	-		$	1
Net (loss)		-		-		-		(580	)		(580	)
Balance, December 31, 1999		2		-		1		(580	)		(579	)
Net (loss)		-		-		-		(1,305	)		(1,305	)
Balance, December 31, 2000		2		-		1		(1,885	)		(1,884	)
Common stock issued in
satisfaction of the related
party payable
($0.0025 per share)		1,920,000		1,920		2,880		-			4,800
Net (loss)		-		-		-		(3,787	)		(3,787	)
Balance, December 31, 2001		1,920,002		1,920		2,881		(5,672	)		(871	)
Net (loss)		-		-		-		(224	)		(224	)
Balance, December 31, 2002		1,920,002		1,920		2,881		(5,896	)		(1,095	)
Net (loss)		-		-		-		(5,399	)		(5,399	)
Balance, December 31, 2003		1,920,002		1,920		2,881		(11,295	)		(6,494	)
Net (loss)		-		-		-		(7,324	)		(7,324	)
Balance, December 31, 2004		1,920,002	$	1,920	$	2,881	$	(18,619	)	$	(13,818	)
The accompanying notes are an integral part of these financial statements
Page 4

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
(Expressed in United States Dollars)
	For the period
	from inception
	on November			For the year			For the year
	23, 1998 to			ended			ended
	December 31,			December 31,			December 31,
	2004			2004			2003
OPERATING ACTIVITIES
Net (loss)	$	(18,619	)	$	(7,324	)	$	(5,399	)
Increase in accounts payable and
accrued liabilities		4,000			(1,000	)		5,000
Net Cash Used For Operating  Activities		(14,619	)		(8,324	)		(399	)
FINANCING ACTIVITIES
Issuance of capital stock		1			-			-
Advances from related party		19,394			3,100			10,399
Net Cash Provided By  Financing Activities		19,395			3,100			10,399
NET INCREASE (DECREASE) IN CASH		4,776			(5,224	)		10,000
CASH, BEGINNING OF  PERIOD		-			10,000			-
CASH, END OF PERIOD	$	4,776		$	4,776		$	10,000
SUPPLEMENTAL DISCLOSURE OF CASH
FLOW INFORMATION
Non-cash Financing Activity
Common stock issued in satisfaction of the
related party payable	$	4,800			-		$	-
Income Taxes Paid	$	-			-		$	-
Interest Paid	$	-			-		$	-
The accompanying notes are an integral part of these financial statements
Page 5

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 1 - NATURE OF BUSINESS

Mustang Resources Inc. (the "Company") was incorporated in the State of Nevada on November 23, 1998 as Canadian Northern Lites (Nevada) Inc. and changed its corporate name on December 15, 2003 to Mustang Resources Inc.  The Company was organized to explore mineral properties in British Columbia, Canada.

The financial statements are presented on the basis that the Company is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business over a reasonable length of time.  The Company has incurred operating losses since its inception, has a stockholders' deficiency, and no recurring sources of revenue.  These conditions raise substantial doubt as to the Company's ability to continue as a going concern.

Management's plans for the continuation of the Company as a going concern include financing the Company's operations through advances from related parties and issuance of its unregistered common stock.  There are no assurances, however, with respect to the future success of these plans.  The financial statements do not contain any adjustments, which might be necessary, if the Company is unable to continue as a going concern.

Unless otherwise indicated, amounts provided in these notes to the financial statements pertain to continuing operations.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Exploration Stage Enterprise

The Company's financial statements are prepared using the accrual method of accounting and according to the provisions of Statement of Financial Accounting Standards No. 7, "Accounting and Reporting for Development Stage Enterprises," as it devotes substantially all of its efforts to acquiring and exploring mineral properties in British Columbia, Canada.  Until such properties are acquired and developed, the Company will continue to prepare its financial statements and related disclosures in accordance with entities in the exploration stage.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates.

Page 6

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

Income Taxes

Income taxes are recognized in accordance with Statement of Financial Accounting Standards No. 109, "Accounting for Income Taxes", whereby deferred income tax liabilities or assets at the end of each period are determined using the tax rate expected to be in effect when the taxes are actually paid or recovered.  A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of these deferred tax assets will not be realized.

Net Income (Loss) Per Share

Statement of Financial Accounting Standards No. 128, "Earnings per Share", requires dual presentation of basic earnings per share ("EPS") and diluted EPS on the face of all income and loss statements, for all entities with complex capital structures.  Basic EPS is computed as net income divided by the weighted average number of common shares outstanding for the period.  Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants and other convertible securities.  At December 31, 2004 and 2003, the Company had no outstanding stock options, warrants and other convertible securities; accordingly, only basic EPS is presented.

Regulatory Matters

The Company and its mineral property interests are subject to a variety of Canadian national and provincial regulations governing land use, health and safety, and environmental matters.  The Company's management believes it has been in substantial compliance with all such regulations, and is unaware of any pending action or proceeding relating to regulatory matters that would affect the financial position of the Company.

Exploration Costs

Exploration costs of mineral properties that do not add net realizable value to the properties are charged to operations as incurred.

Foreign Currency Translation

In accordance with the Statement of Financial Accounting Standards No. 52, "Foreign Currency Translation," ("SFAS No. 52"), the United States dollar is considered the functional and reporting currency.

Transaction amounts denominated in foreign currencies are translated into United States currency at prevailing transaction date exchange rates.  Carrying values of foreign currency monetary assets and liabilities are adjusted at each balance sheet date to reflect the exchange rate at that date.  Gains and losses from restatement of foreign currency monetary assets and liabilities are included in income.  For the fiscal years ended December 31, 2004 and 2003, the Company did not incur any foreign currency gains or losses.

Page 7

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

New Accounting Pronouncements

In May, 2003, the Financial Accounting Standards Board ("FASB") issued Statement of Financial Accounting Standards No. 150, ("SFAS 150") "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity".  SFAS No 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity.  It requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances).  The requirements of SFAS 150 apply to issuers' classification and measurement of freestanding financial instruments, including those that comprise more than one option or forward contract.  SFAS 150 does not apply to features that are embedded in a financial instrument that is not a derivative in its entirety.  SFAS 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003, except for mandatory redeemable financial instruments of non-public entities.  It is to be implemented by reporting the cumulative effect of a change in an accounting principle for financial instruments created before the issuance date of SFAS 150 and still existing at the beginning of the interim period of adoption.  Restatement is not permitted.  The Company has determined that the adoption of SFAS 150 is not expected to have an impact on its results of operations or financial position.

In December 2003, the FASB revised Statement of Financial Accounting Standards No. 132 ("SFAS 132(R)"), "Employers' Disclosures About Pensions And Other Postretirement Benefits".  SFAS 132(R) revises employers' disclosures about pension plans and other post-retirement benefit plans.  SFAS 132(R) does not change the measurement or recognition of those plans required by FASB Statements No, 87, "Employers' Accounting for Pensions", No. 88, "Employers' Accounting for Settlements and Curtailments of Defined Benefit Pension Plans and for Termination Benefits" or No. 106, "Employers Accounting for Post-retirement Benefits Other Than Pensions".  FSAS 132(R) retains the disclosure requirements contained in FASB Statement No. 132, "Employers' Disclosures about Pensions and other Post-retirement Benefits", which it replaces.  It requires additional disclosures to those in the original SFAS 132 about the assets, obligations, cash flows, and net periodic benefit cost of defined benefit pension plans and other defined benefit post-retirement plans.  The required information should be provided separately for pension plans and for other post-retirement benefit plans.  The Company has determined that the adoption of FSAS 132(R) does not have an impact on its results of operations or financial position.

In December 2003, the Financial Accounting Board (the "FASB) issued revised FASB interpretation No. 46 (FIN 46(R)"), "Consolidation of Variable Interest Entities, an interpretation of ARB No. 51".  FIN 46(R) requires certain variable interest entities to be consolidated by the primary beneficiary of the entity if the equity investors in the entity do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties.  FIN 46(R) is effective for all new variable interest entities created or acquired after December 31, 2003.  The Company has determined that the adoption of FIN 46(R) does not have an impact on its results of operations or financial position.

Page 8

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

New Accounting Pronouncements (Cont'd)

In a December 11, 2003 speech, the American Institute of Certified Public Accountants and Securities and Exchange Commission (the "SEC") expressed the opinion that rate-lock commitments represent written put options, and therefore are valued as liabilities.  The SEC expressed that it expects registrants to disclose the effect on the financial statements of recognizing the rate-lock commitments as written put options for quarters commencing after March 15, 2004.  Additionally, the SEC recently issued Staff Accounting Bulletin No. 105 ("SAB 105") "Application of Accounting Principles to Loan Commitments".  SAB 105 clarifies the SEC's position that the inclusion of cash flows from servicing or ancillary income in the determination of the fair value of interest rate lock commitments is not appropriate.  The Company has determined that the adoption of SAB No. 105 does not have an impact on its results of operations or financial position.

In November 2004, the FASB issued Statement of Financial Accounting Standards 151 "Inventory Costs".  This Statement amends the guidance in ARB No. 43, Chapter 4, Inventory Pricing, "to clarify the accounting for abnormal amounts of idle facility expense, freight, handling costs and wasted material (spoilage).  In addition, this Statement requires that allocation of fixed production overheads to the costs of conversion be based on the normal capacity of the production facilities.  The provisions of this Statement will be effective for the Company beginning with its fiscal year ending 2006.  The Company has determined that the adoption of SFAS 151 does not have an impact on its results of operations or financial position.

In December 2004, the FASB issued Statement of Financial Accounting Standards No. 153 "Exchanges of Non-monetary Assets - an amendment of APB Opinion No. 29".  This Statement amended APB Opinion 29 to eliminate the exception of non-monetary exchanges of similar productive assets and replaces it with a generally exception for exchanges of non-monetary assets and do not have commercial substance.  A non-monetary exchange has commercial substance if the future cash flows of the entity are expected to change significantly as a result of the exchange.  The Company has determined that the adoption of SFAS 153 does not have an impact on its results of operations or financial position.

In December 2004, the FASB issued Statement of Financial Accounting Standards No. 123 (revised 2004) "Share-Based Payment".  This Statement requires that the cost resulting from all share-based transactions be recorded in the financial statements.  The Statement establishes fair value as the measurement objective in accounting for share-based payment arrangements and requires all entities to apply a fair-value-based measurement in accounting for share-based payment transactions with employees.  The Statement also establishes fair value as the measurement objective for transactions in which an entity acquires goods or services from non-employees in share-based payment transactions.  The Statement replaces FASB Statement No. 123 "Accounting for Stock-Based Compensation" and supercedes APB Opinion No. 25 "Accounting for Stock Issued to Employees".  The provisions of this Statement will be effective for the Company beginning with its fiscal year ending 2007.  The Company has determined that the adoption of SFAS 123 (revised 2004) does not have an impact on its results of operations or financial position.

Page 9

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

Fair Values of Financial Instruments

The carrying amounts of financial instruments, including cash, accounts payable and accrued liabilities, and related party payable approximate their fair values as of December 31, 2004 and 2003.

Concentration of Risk

The Company maintains its cash accounts in one commercial bank, Sterling Savings Bank.  The Company's cash accounts are in a business checking account, which is insured by the Federal Insurance Corporation for up to $100,000.  As at December 31, 2004, the Company has not engaged in any transactions that would be considered derivative instruments or hedging activities.

Start-up Expenses

The Company has adopted Statement of Position No. 98-5, "Reporting the Costs of Start-up Activities", which requires that costs associated with start-up activities be expensed as incurred. Accordingly, start-up costs associated with the Company's formation have been included in the Company's general and administrative expenses for the period from inception on November 23, 1998 to December 31, 2004.

NOTE 3 - MINERAL PROPERTIES

The Company staked four mineral claims on February 19, 2004. These claims are known as the JC1, JC2, JC3 and JC4 Mineral Claims and are located in the Nelson Mining Division of British Columbia.

Title to mineral properties involves certain inherent risks due to the difficulties of determining the validity of certain claims as well as the potential for problems arising from the frequently ambiguous conveyancing history characteristic of many mineral properties.  The Company has investigated title to all its mineral properties and, to the best of its knowledge, title to all of its properties is in good standing and unencumbered.

As of December 31, 2004, the Company has a 100% interest in four mineral properties known as the JC1, JC2, JC3 and JC4 Mineral Claims located in the Nelson Mining Division, Province of British Columbia, administered by the Mineral Titles Branch, Ministry of Energy and Mines of the Province of British Columbia, Canada.  These four claims expire on February 19, 2005.  In connection with staking or establishing the claims, the Company incurred costs totaling $2,995 for the year ended December 31, 2004 that is reflected in the Company's operating expenses.  None of the Company's properties contain a known commercially viable deposit suitable for mining.

Subsequent to December 31, 2004, in February 2005, the Company re-staked the JC1, JC2, JC3 and JC4 and recorded these claims with the Ministry of Energy and Mines, Province of British Columbia.  The tenures for these re-staked claims expire on February 20, 2006.

Page 10

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 4 - INCOME TAXES

(a)	Income tax provision
	The provision for income taxes differs from the result which would be obtained by applying the statutory income tax rate of 34% (2003 - 34%) to income before income taxes.  The difference results from the following items:
		2004			2003
	Computed expected (recovery of) income taxes	$	(2,490	)	$	(1,836	)
	Increase in tax resulting from:
	Increase in valuation allowance		(2,490	)		1,836	)
	Total income tax operating loss carry forward	$	-		$	-

b)	Significant components of the Company's deferred income tax assets are as follows:
		2004			2003
	Net income tax operating loss carry forward	$	18,618			11,295
	Statutory tax rate	34%			34%
	Deferred income tax asset		6,330			3,840
	Valuation allowance		(6,330	)		3,840	)
		$	-		$	-

c)	The Company has incurred operating losses and approximately $18,619 which, if unutilized, will expire through to 2024.  Future tax benefits, which may arise as a result of these losses, have not been recognized in these financial statements, and have been offset by a valuation allowance.  The following table lists the fiscal year in which the loss was incurred and the expiration date of the operating loss carryforwards:
				Expiration date of
				income tax operating
		Net loss		loss carryforwards
	1999	$	580		2019
	2000		1,305		2020
	2001		3,787		2021
	2002		224		2022
	2003		5,399		2023
	2004		7,324		2024
	Total income tax operating loss carry forward	$	18,619

Page 11

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 5 - RELATED PARTY TRANSACTIONS

Certain transactions of the Company involve Hudson Capital Corporation ("Hudson"), a company  having directors, officers and/or principal shareholders in common with the Company. Transactions  with related parties have occurred in the normal course of operations and are measured in the  exchange amount, which is the amount of consideration established and agreed by the related  parties.

The Company's operations have been financed mainly through advances from Hudson. During the fiscal year ended December 31, 2001, the Company extinguished $4,800 of debt owing to Hudson  by issuing 1,920,000 (after adjustment for the two-for-one forward stock split in October 2004)  common shares of the Company to two creditors of Hudson, on the instructions of Hudson. One of  the creditors who received 1,280,000 shares was Mr. Terry G. Cook, President and Director of the  Company and also is the President, Director and major shareholder of Hudson. The other Hudson  creditor who received 640,000 shares is the spouse of Mr. Terry G. Cook and, as a result of this  share issuance, became a related party of the Company. In addition to the transactions described  in Note 6, the following table schedules the Company's transactions with Hudson: 

	For the period
	from inception			For the year		For the year
	on November 23, 1998			ended		ended
	to December 31,			December 31,		December 31,
	2004			2004		2003
Beginning balance	$	-		$	11,494	$	1,095
Advances		19,394			3,100		10,399
Repayment		(4,800	)		-		-
Ending balance	$	14,594		$	14,594	$	11,494

Hudson has provided office and management services to the Company since its inception.  The balance in the related party payable consists of amounts paid by Hudson on the Company's behalf to fund operating activities, or funds advanced to the Company by Hudson.  These amounts are unsecured, do not bear interest and have no fixed date of repayment.  Hudson has agreed not to demand payment on any of the amounts prior to January 15, 2006.

NOTE 6 - CAPITAL STOCK

Authorized

The total number of shares which the Company shall have authority to issue is 200,000,000 of which 40,000,000 shall be Preferred Stock of par value $0.001 per share and 160,000,000 shall be Common Stock of par value of $0.001 per share.  The authorized capital for both Preferred and Common Stock may be issued in one or more series or classes with the voting rights to be determined by the Board of Directors at the time of issue.

Page 12

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 6 - CAPITAL STOCK (Cont'd)

Common Stock Issued for Cash

As at December 31, 2004, the Company has only issued voting Common Stock.  The Company was initially capitalized at its inception by the sale of two (after adjustment for the two-for-one forward stock split in October 2004) shares of its common stock for $1 to Mr. Terry G. Cook.  During the years ended December 31, 2004 and 2003, the Company did not issue any additional common stock for cash.  During the fiscal year ended December 31, 2001, the Company issued 1,920,000 (after adjustment for the two-for-one forward stock split in October 2004) shares of its common stock at $0.0025 per share to a Director and the spouse of a Director of the Company as described in Note 5.

Common Stock Issued in Satisfaction of the Related Party Payable

As at December 31, 2004, the Company has only issued voting Common Stock.  During the years ended December 31, 2004 and 2003, the Company did not issue any additional common stock in satisfaction of any related party payables.

Forward Stock Split

On October 3, 2004, the Company effected a two-for-one forward stock split of the outstanding shares of common stock.  After the forward stock split, the outstanding common stock was 1,920,002 shares.  All shares and per share amounts in the financial statements have been adjusted to give effect to the stock split.  No voting or other rights were affected by the forward stock split.  The authorized number of common shares is not changed by the forward split and will remain at 160,000,000 common shares with a par value of $0.001.  The statements of changes in the stockholders' deficiency have been restated up to its inception date on November 23, 1998 to reflect the forward stock split.

Preferred Stock Issued

As at December 31, 2004, the Company has not issued any Preferred Stock.

NOTE 7 - SEGMENTED INFORMATION

The Company operates in Canada in one business segment, being the exploration of mineral properties.

NOTE 8- COMPARATIVE FIGURES

Certain comparative figures have been reclassified to conform to the presentation of the current year.

Page 13

Part F/S

Item 1.  Audited Financial Statements (Year Ended December 31, 2003).

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

FINANCIAL STATEMENTS

DECEMBER 31, 2003 AND 2002

Mustang Resources Inc.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
TABLE OF CONTENTS
	Page
Independent Auditor's Report	1
Balance Sheets, December 31, 2003 and 2002	2
Statements of Operations	3
Statements of Changes in Stockholders' Deficiency, for the Period
from Inception on November 23, 1998 through December 31, 2003	4
Statements of Cash Flows	5
Notes to the Financial Statements	6-11

INDEPENDENT AUDITORS' REPORT

To the Board of Directors and Stockholders of
Mustang Resources Inc.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)

We have audited the accompanying balance sheets of Mustang Resources Inc. (Formerly Canadian Northern Lites (Nevada) Inc.), (An Exploration Stage Company) as at December 31, 2003 and 2002 and the related statements of operations, changes in stockholders' deficiency and cash flows for each of the three years in the period ended December 31, 2003 and for the period from inception on November 23, 1998 to December 31, 2003.  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 auditing standards generally accepted in the United States of America.  Those standards require that we plan and perform the audit to obtain reasonable assurance about 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.  We believe that our audit provides a reasonable basis for our opinion.

In our opinion, the financial statements referred to above present fairly, in all material respects, the financial position of Mustang Resources Inc. (Formerly Canadian Northern Lites (Nevada) Inc.), (An Exploration Stage Company) as at December 31, 2003 and 2002 and the results of its operations and its cash flows for each of the three years in the period ended December 31, 2003 and for the period from inception on November 23, 1998 to December 31, 2003 in conformity with accounting principles generally accepted in the United States of America.

The accompanying financial statements have been prepared assuming the Company will continue as a going concern.  As described in Note 1 to the financial statements, the Company's operating losses raise substantial doubt about its ability to continue as a going concern.  Management's plans in regard to these matters are also described in Note 1.  The financial statements do not include any adjustments that might result from the outcome of this uncertainty.

/s/ TELFORD SADOVNICK, P.L.L.C.

CERTIFIED PUBLIC ACCOUNTANTS

 Bellingham, Washington

 February 27, 2004

Page 1

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
BALANCE SHEETS
As at December 31,	2003			2002
ASSETS
CURRENT
Cash	$	10,000		$	-
	$	10,000		$	-
LIABILITIES
CURRENT
Accounts payable and accrued liabilities	$	5,000		$	-
		5,000			-
RELATED PARTY PAYABLE		11,494			1,095
		16,494			1,095
STOCKHOLDERS' DEFICIENCY
Capital Stock
Common stock, $0.001 par value; 200,000,000
shares authorized; 960,001 (2002 -- 960,001)
Shares issued and outstanding		960			960
Additional paid-in capital		3,841			3,841
Deficit accumulated during the exploration stage		(11,295	)		(5,896	)
		(6,494	)		(1,095	)
	$	10,000		$	-
The accompanying notes are an integral part of these financial statements
Page 2

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS
	For the Period
	from Inception
	on November		For the Year		For the Year		For the Year
	23, 1998 to		ended		ended		ended
	December 31,		December 31,		December 31,		December 31,
	2003		2003		2002		2001
OPERATING EXPENSES
General and administrative
expenses	$	11,295	$	5,399	$	224	$	3,887
NET LOSS	$	11,295	$	5,399	$	224	$	3,887
NET LOSS PER SHARE -
BASIC	$	0.03	$	0.01	$	0.00	$	1.44
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING - BASIC		375,967		960,001		960,001		2,630
The accompanying notes are an integral part of these financial statements
Page 3

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY
For the Period From Inception on November 23, 1998 Through December 31, 2003
							Deficit
							Accumulated
					Additional		During the
	Common Stock				Paid-in		Exploration
	Shares		Amount		Capital		Stage			Total
Inception November 23, 1998
Common stock issued for
cash ($1 per share)		1	$	-	$	1	$	-		$	1
Net (loss)		-		-		-		(580	)		(580	)
Balance, December 31, 1999		1		-		1		(580	)		(579	)
Net (loss)		-		-		-		(1,305	)		(1,305	)
Balance, December 31, 2000		1		-		1		(1,885	)		(1,884	)
Common stock issued in
satisfaction of the related
party payable
($0.005 per share)		960,000		960		3,840		-			4,800
Net (loss)		-		-		-		(3,787	)		(3,787	)
Balance, December 31, 2001		960,001		960		3,841		(5,672	)		(871	)
Net (loss)		-		-		-		(224	)		(224	)
Balance, December 31, 2002		960,001		960		3,841		(5,896	)		(1,095	)
Net (loss)		-		-		-		(5,399	)		(5,399	)
Balance, December 31, 2003		960,001	$	960	$	3,841	$	(11,295	)	$	(6,494	)
The accompanying notes are an integral part of these financial statements
Page 4

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS
	For the Period
	from Inception
	on November			For the Year			For the Year			For the Year
	23, 1998 to			ended			ended			ended
	December 31,			December 31,			December 31,			December 31,
	2003			2003			2002			2001
OPERATING ACTIVITIES
Net (loss)	$	(11,295	)	$	(5,399	)	$	(224	)	$	(3,787	)
Increase in accounts
payable and accrued
liabilities		5,000			5,000			-			-
Net Cash Used For Operating
Activities		(6,295	)		(399	)		(224	)		(3,887	)
FINANCING ACTIVITIES
Issuance of capital stock		1			-			-			-
Advances from related
party		16,294			10,399			224			3,787
Net Cash Provided By
Financing Activities		16,295			10,399			224			3,787
NET INCREASE IN CASH		10,000			10,000			-			-
CASH, BEGINNING OF
PERIOD		-			-			-			-
CASH, END OF PERIOD	$	10,000		$	10,000		$	-		$	-
SUPPLEMENTAL
DISCLOSURE OF CASH
FLOW INFORMATION
Non-cash Financing Activity
Common stock issued in
satisfaction of the related
party payable	$	4,800		$	-		$	-		$	4,800
Income Taxes Paid	$	-		$	-		$	-		$	-
Interest Paid	$	-		$	-		$	-		$	-
The accompanying notes are an integral part of these financial statements
Page 5

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 1 - NATURE OF BUSINESS

Mustang Resources Inc. (the "Company") was incorporated in the State of Nevada on November 23, 1998 as Canadian Northern Lites (Nevada) Inc. and changed its corporate name on December 15, 2003 to Mustang Resources Inc.  The Company was organized to explore mineral properties in British Columbia, Canada.

The financial statements are presented on the basis that the Company is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business over a reasonable length of time.  The Company has incurred operating losses since its inception (except as described in Note 4), has a stockholders' deficiency, and no recurring sources of revenue.  These conditions raise substantial doubt as to the Company's ability to continue as a going concern.

Management's plans for the continuation of the Company as a going concern include financing the Company's operations through advances from related parties and issuance of its unregistered common stock.  There are no assurances, however, with respect to the future success of these plans.  The financial statements do not contain any adjustments, which might be necessary, if the Company is unable to continue as a going concern.

 Unless otherwise indicated, amounts provided in these notes to the financial statements pertain to continuing operations.

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES

Exploration Stage Enterprise

The Company's financial statements are prepared using the accrual method of accounting and according to the provisions of Statement of Financial Accounting Standards No. 7, "Accounting and Reporting for Development Stage Enterprises," as it devotes substantially all of its efforts to acquiring and exploring mineral properties in British Columbia, Canada.  Until such properties are acquired and developed, the Company will continue to prepare its financial statements and related disclosures in accordance with entities in the exploration stage.

Use of Estimates

The preparation of financial statements in conformity with accounting principles generally accepted in the United States of America requires management to make estimates and assumptions that affect the amounts reported in the financial statements and accompanying notes.  Actual results could differ from those estimates. 

Income Taxes

Income taxes are recognized in accordance with Statements of Financial Accounting Standards No. 109, "Accounting for Income Taxes", whereby deferred income tax liabilities or assets at the end of each period are determined using the tax rate expected to be in effect when the taxes are actually paid or recovered.  A valuation allowance is recognized on deferred tax assets when it is more likely than not that some or all of these deferred tax assets will not be realized.

Page 6

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

Net Income (Loss) Per Share

Statements of Financial Accounting Standards No. 128, "Earnings per Share", requires dual presentation of basic earnings per share ("EPS") and diluted EPS on the face of all income and loss statements, for all entities with complex capital structures.  Basic EPS is computed as net income divided by the weighted average number of common shares outstanding for the period.  Diluted EPS reflects the potential dilution that could occur from common shares issuable through stock options, warrants and other convertible securities.  At December 31, 2003 and 2002, the Company had no outstanding stock options, warrants and other convertible securities; accordingly, only basic EPS is presented.

Regulatory Matters

The Company and its mineral property interests are subject to a variety of Canadian national and provincial regulations governing land use, health and safety, and environmental matters.  The Company's management believes it has been in substantial compliance with all such regulations, and is unaware of any pending action or proceeding relating to regulatory matters that would affect the financial position of the Company.

Exploration Costs

Exploration costs of mineral properties that do not add net realizable value to the properties are charged to operations as incurred.

Foreign Currency Translation

The Company translates monetary assets and liabilities at the period-end exchange rate while non-monetary assets and liabilities are translated at historical exchange rates.  Income and expense accounts are translated at the average exchange rate for each period.  Translation adjustments and transaction gains and losses are reflected in the net income (loss) for the period.

Impaired Asset Policy

The Company periodically reviews its long-lived assets when applicable to determine if any events or changes in circumstances have transpired which indicate that the carrying value of its assets may not be recoverable.  The Company determines impairment by comparing the undiscounted future cash flows estimated to be generated by its assets to their respective carrying amounts.

New Accounting Pronouncements

In November 2002, the Emerging Issues Task Force ("EITF") reached a consensus regarding EITF Issue 00-21, "Accounting for Revenue Arrangements with Multiple Deliverables".  The consensus addresses not only when and how an arrangement involving multiple deliverables should be divided into separate units of accounting but also how the arrangement's consideration should be allocated among separate units.  The pronouncement is effective for the Company commencing with its 2004 fiscal year and is not expected to have a material impact on its results of operations or financial position.

Page 7

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

New Accounting Pronouncements (cont'd)

In November, 2002, the FASB issued FASB Interpretation No 45 ("FIN 45"), "Guarantor's Accounting and Disclosure Requirements for Guarantees, including indirect Guarantees of Indebtedness of Others, an interpretation of FASB statements 5, 57, 107 and rescission of FASB Interpretation No. 34".  FIN 45 requires recognition and measurement of guarantees entered into or modified beginning on January 1, 2003 and requires expanded disclosure of guarantees as at December 31, 2002.  The Company has determined that the adoption of FIN 45 did not have an impact on its results of operations or financial position.

In December 2002, the FASB issued Statement of Financial Accounting Standards No., 148, ("SFAS 148"), "Accounting for Stock-Based Compensation - Transition and Disclosure, an amendment of FASB Statement No. 123".  SFAS 148 provided alternative methods for voluntary transition to the fair value based method of accounting for stock-based employees compensation.  SFAS 148 also requires that disclosures of the pro forma effect of using the fair value method of accounting for stock-based employee compensation be displayed more prominently and in a tabular format.  Additionally, SFAS 148 requires disclosure of the pro forma effect in interim financial statements.  The transition and annual disclosure requirements of SFAS 148 are effective for the Company's 2003 fiscal year.  The interim disclosure requirements are effective for the second quarter of the Company's 2003 fiscal year.  The Company has determined that the adoption of SFAS 148 did not have an impact on its results of operations or financial position.

In January 2003, the FASB issued FASB Interpretation No. 46 ("FIN 46"), "Consolidation of Variable Interest Entities, an Interpretation of ARB No 51".  FIN 46 requires certain variable interest entities to be consolidated by the primary beneficiary of the entity if the equity investors in the entity do not have the characteristics of a controlling financial interest or do not have sufficient equity at risk for the entity to finance its activities without additional subordinated financial support from other parties.  FIN 46 is effective for all new variable interest entities created or acquired after January 31, 2003.  For variable interest entities created or acquired prior to February 1, 2003, the provisions of FIN 46 must be applied for the first interim or annual period beginning after June 15, 2003.  The Company has determined that the adoption of FIN 45 will not have an impact on its results of operations or financial position.

In May, 2003, the FASB issued Statement of Financial Accounting Standards No. 150, ("SFAS 150") "Accounting for Certain Financial Instruments with Characteristics of both Liabilities and Equity".  SFAS No 150 establishes standards for how an issuer classifies and measures certain financial instruments with characteristics of both liabilities and equity.  It requires that an issuer classify a financial instrument that is within its scope as a liability (or an asset in some circumstances).  The requirements of SFAS 150 apply to issuers' classification and measurement of freestanding financial instruments, including those that comprise more than one option or forward contract.  SFAS 150 does not apply to features that are embedded in a financial instrument that is not a derivative in its entirety.  SFAS 150 is effective for financial instruments entered into or modified after May 31, 2003, and otherwise is effective at the beginning of the first interim period beginning after June 15, 2003, except for mandatory redeemable financial instruments of non-public entities.  It is to be implemented by reporting the cumulative effect of a change in an accounting principle for financial instruments created before the issuance date of SFAS 150 and still existing at the beginning of the interim period of adoption.  Restatement is not permitted.  The Company has determined that the adoption of SFAS 150 is not expected to have an impact on its results of operations or financial position.

Page 8

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 2 - SUMMARY OF SIGNIFICANT ACCOUNTING POLICIES (Cont'd)

New Accounting Pronouncements (Cont'd)

In October 2002 and April 2003, respectively, FASB issued the following Statements of Financial Accounting Standards:
     - No. 147, "Accounting of Certain Financial Institutions - an amendment of FASB Statements
          No. 72 and 44 and FASB Interpretation No. 9", and
     - No. 149 "Amendment of Statement 133 on Derivative Instruments and Hedging Activities".

The Company has determined that these will not have any relationship to the operations or financial position of the Company.  Therefore, a description of each and their respective impact on the Company's operations have not been disclosed.

Fair Values of Financial Instruments

The carrying amounts of financial instruments including cash and related party payable approximate their fair values as of December 31, 2003 and 2002.

Concentration of Risk

The Company maintains its cash accounts in one commercial bank in Point Roberts, WA.  The Company's cash accounts are in a business checking account, which is insured by the Federal Insurance Corporation for up to $100,000.  As at December 31, 2003 the Company has not engaged in any transactions that would be considered derivative instruments on hedging activities.

Start-up Expenses

The Company has adopted Statement of Position No. 98-5, "Reporting the Costs of Start-up Activities," which requires that costs associated with start-up activities be expensed as incurred.  Accordingly, start-up costs associated with the Company's formation have been included in the Company's general and administrative expenses for the period from inception on November 23, 1998 to December 31, 2003.

NOTE 3 - INCOME TAXES

Significant components of the Company's deferred income tax assets are as follows:

		2003			2002
Net income tax operating loss carry forward	$	11,295		$	5,896
Statutory tax rate		34%			34%
Deferred income tax asset		3,840			2,005
Valuation allowance		(3,840	)		(2,005	)
	$	-		$	-

Page 9

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 4 - RELATED PARTY TRANSACTIONS

Certain transactions of the Company involve Hudson Capital Corporation ("Hudson"), a company having directors, officers and/or principal shareholders in common with the Company.  Transactions with related parties have occurred in the normal course of operations and are measured in the exchange amount, which is the amount of consideration established and agreed by the related parties.

The Company's operations have been financed mainly through advances from Hudson.  During the fiscal year ended December 31, 2001, the Company extinguished $4,800 of debt owing to Hudson by issuing 960,000 common shares of the Company to two creditors of Hudson, on the instructions of Hudson.  One of the creditors who received 640,000 shares was Mr. Terry G. Cook, President and Director of the Company and also is the President, Director and major shareholder of Hudson.  The other Hudson creditor who received 320,000 shares is the spouse of Mr. Terry G. Cook and, as a result of this share issuance, became a related party of the Company.  In addition to the transactions described in Note 5, the following table schedules the Company's transactions with Hudson:

	For the Period
	from Inception
	on November 23,			For the Year		For the Year
	1998			ended		ended
	to December 31,			December 31,		December 31,
	2003			2003		2002
Beginning balance	$	-		$	1,095	$	871
Advances		16,294			10,399		224
Reduction		(4,800	)		-		-
Ending balance	$	11,494		$	11,494	$	1,095

Hudson has provided office and management services to the Company since its inception.  The balance in the related party payable consists of amounts paid by Hudson on the Company's behalf to fund operating activities, or funds advanced to the Company by Hudson.  These amounts are unsecured, do not bear interest and have no fixed date of repayment.  Hudson has agreed not to demand payment on any of the amounts prior to January 15, 2006.

NOTE 5 - CAPITAL STOCK

Common Stock Issued

The Company was initially capitalized at its inception by the sale of one share of its common stock for $1.00 to Mr. Terry G. Cook.  During the years ended December 31, 2000, 2002 and 2003, the Company did not issue any additional common stock for cash.  During the fiscal year ended December 31, 2001, the Company issued 960,000 shares of its common stock at $0.005 per share to a Director and the spouse of a Director of the Company as described in Note 4.

Page 10

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

NOTES TO THE FINANCIAL STATEMENTS

NOTE 5 - CAPITAL STOCK (Cont'd)

Common Stock Issued in Satisfaction of the Related Party Payable

During the years ended December 31, 2002 and 2003, the Company did not issue any additional common stock in satisfaction of related party payable.

NOTE 6 - SUBSEQUENT EVENTS

Subsequent to year end, the Company staked four mineral claims on February 19, 2004.  These claims are known as the JC1, JC2, JC3 and JC4 Mineral Claims and are located in the Nelson Mining Division of British Columbia.

Page 11

Unaudited Financial Statements (Six Months Ended June 30, 2005)

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

FINANCIAL STATEMENTS

(Unaudited)

(Expressed in United States Dollars)

JUNE 30, 2005

Mustang Resources Inc.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
TABLE OF CONTENTS
	Page
Balance Sheets, June 30, 2005 and December 31, 2004	FS 1
Statements of Operations for the three and six months ended June 30, 2005
and 2004, and from inception on November 23, 1998 through June 30, 2005	FS 2
Statements of Changes in Stockholders' Deficiency, for the period
from inception on November 23, 1998 through June 30, 2005	FS 3
Statements of Cash Flows for the three and six months ended June 30, 2005
and 2004, and from inception on November 23, 1998 through June 30, 2005	FS 4
Condensed Notes to the Financial Statements	FS 5-6

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
BALANCE SHEETS (Unaudited)
(Expressed in United States Dollars)
As at	Jun. 30, 2005			Dec. 31, 2004
ASSETS
CURRENT
Cash	$	4,776		$	4,776
TOTAL ASSETS	$	4,776		$	4,776
LIABILITIES
CURRENT
Accounts payable and accrued liabilities	$	4,000		$	4,000
		4,000			4,000
RELATED PARTY PAYABLE		15,351			14,594
TOTAL LIABILITIES		19,351			18,594
STOCKHOLDERS' DEFICIENCY
Capital Stock
Preferred stock, $0.001 par value;
40,000,000 shares authorized, no shares outstanding		-			-
Common stock, $0.001 par value;
160,000,000 shares authorized, 1.920,002
(Dec. 31, 2004 - 1,920,002) voting shares outstanding		1,920			1,920
Additional paid-in capital		2,881			2,881
Deficit accumulated during the exploration stage		(19,376	)		(18,619	)
TOTAL STOCKHOLDERS' DEFICIENCY		(14,575	)		(13,818	)
TOTAL LIABILITIES AND STOCKHOLDERS' DEFICIENCY	$	4,776		$	4,776
The accompanying notes are an integral part of these financial statements
Page FS 1

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF OPERATIONS (Unaudited)
(Expressed in United States Dollars)
	For the
	period from
	inception on			For the			For the			For the			For the
	June 2,			three months			three months			six months			six months
	1999  to			ended			ended			ended			ended
	June 30,			June 30,			June 30,			June 30,			June 30,
	2005			2005			2004			2005			2004
OPERATING EXPENSES
Mining property expenses		3,679			-			-			684			2,995
General and administrative
expenses		15,697			36			-			73			5
	$	19,376			36		$	-		$	757		$	3,000
NET (LOSS)	$	(19,376	)	$	(36	)	$	-		$	(757	)	$	(3,000	)
NET (LOSS) PER
SHARE - BASIC				$	(0.00	)	$	(0.00	)	$	(0.00	)	$	(0.00	)
WEIGHTED AVERAGE
COMMON SHARES
OUTSTANDING - BASIC					1,920,002			1,920,002			1,920,002			1,920,002
The accompanying notes are an integral part of these financial statements.
Page FS 2

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CHANGES IN STOCKHOLDERS' DEFICIENCY (Unaudited)
(Expressed in United States Dollars)
For the period from inception on November 23, 1998 through June 30, 2005
							Deficit
							accumulated
					Additional		during the
	Common Stock				paid-in		exploration
	Shares		Amount		capital		Stage			Total
Inception November 23, 1998
Common stock issued for
cash ($0.50 per share)		2	$	-	$	1	$	-		$	1
Net (loss)		-		-		-		(580	)		(580	)
Balance, December 31, 1999		2		-		1		(580	)		(579	)
Net (loss)		-		-		-		(1,305	)		(1,305	)
Balance, December 31, 2000		2		-		1		(1,885	)		(1,884	)
Common stock issued in
satisfaction of the related
party payable
($0.0025 per share)		1,920,000		1,920		2,880		-			4,800
Net (loss)		-		-		-		(3,787	)		(3,787	)
Balance, December 31, 2001		1,920,002		1,920		2,881		(5,672	)		(871	)
Net (loss)		-		-		-		(224	)		(224	)
Balance, December 31, 2002		1,920,002		1,920		2,881		(5,896	)		(1,095	)
Net (loss)		-		-		-		(5,399	)		(5,399	)
Balance, December 31, 2003		1,920,002		1,920		2,881		(11,295	)		(6,494	)
Net (loss)		-		-		-		(7,324	)		(7,324	)
Balance, December 31, 2004		1,920,002	$	1,920	$	2,881	$	(18,619	)	$	(13,818	)
(Loss) for the six months
ended June 30, 2005		-		-		-		(757	)		(757	)
Balance, June 30, 2005		1,920,002	$	1,920	$	2,881	$	(19,376	)	$	(14,575	)
The accompanying notes are an integral part of these financial statements
Page FS 3

MUSTANG RESOURCES INC.
(Formerly Canadian Northern Lites (Nevada) Inc.)
(An Exploration Stage Company)
STATEMENTS OF CASH FLOWS (Unaudited)
(Expressed in United States Dollars)
	For the
	period from
	inception on			For the			For the			For the			For the
	June 2,			three months			three months			six months			six months
	1999  to			ended			ended			ended			ended
	June 30,			June 30,			June 30,			June 30,			June 30,
	2005			2005			2004			2005			2004
OPERATING ACTIVITIES
Net (loss)		(19,376	)		(36	)		-			(757	)		(3,000	)
Increase in accounts payable
and accrued liabilities		4,000			-			(5,000	)		-			(5,000	)
Net Cash Used For
Operating Activities	$	(15,376	)		(36	)	$	-		$	(757	)	$	(8,000	)
FINANCING ACTIVITIES
Issuance of capital stock		1			-			-			-			-
Advances from related party		20,151			36			-			757			3,100
Net Cash Provided By
Financing Activities	$	20,152			36		$	-		$	757		$	3,100
NET INCREASE (DECREASE)
IN CASH	$	4,776		$	-		$	-		$	-		$	(4,900	)
CASH, BEGINNING OF PERIOD		-			4,776			10,100			4,776			10,000
CASH, END OF PERIOD		4,776			4,776			5,100			4,776			5,100
SUPPLEMENTAL DISCLOSURE OF
CASH FLOW INFORMATION
Non-cash Financing Activity
Common stock issued in satisfaction
of the related party payable		4,800			-			-			-			-
Income Taxes Paid		-			-			-			-			-
Interest Paid		-			-			-			-			-
The accompanying notes are an integral part of these financial statements.
Page FS 4

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

CONDENSED NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 1 - BASIS OF FINANCIAL STATEMENT PREPARATION

The second quarter financial statements have been prepared by MUSTANG RESOURCES INC. without audit, in accordance with United States Generally Accepted Accounting Principles for interim financial information and pursuant to the rules and regulations of the Securities and Exchange Commission.  The information furnished in the financial statements include normal recurring adjustments and reflects all adjustments, which are, in the opinion of management, necessary for a fair presentation of such financial statements.  Certain information and footnote disclosures normally included in financial statements prepared in accordance with generally accepted accounting principles have been condensed or omitted pursuant to such rules and regulations.  The Company believes that the information presented is not misleading.  These condensed financial statements should be read in conjunction with the audited financial statements and the accompanying notes for the fiscal year ended December 31, 2004, included in the Company's Form 10-SB.  The results of operations for the period ended June 30, 2005 are not necessarily indicative of operating results for the fiscal year ending December 31, 2005.

NOTE 2 - EXPLORATION STAGE COMPANY

We are an exploration stage company formed to explore our four mineral claims in Canada for the presence of gold.  Activities to date have consisted solely of the staking of mining claims.  We have not yet developed any mining properties into a producing mine, nor have we earned revenue from any of the properties.  We have minimal cash and no history of earnings.  Since we have been an exploration stage company since inception and have not generated revenues, we operate with minimal overhead.

NOTE 3 - GOING CONCERN

These second quarter financial statements are prepared on the basis that the Company is a going concern, which contemplates the realization of assets and satisfaction of liabilities in the normal course of business over a reasonable length of time.  As of June 30, 2005, the Company had $4,776 in cash, working capital of ($776), a stockholders' deficiency of $14,539 and accumulated net losses of $19,376 since inception.  The Company's continuation as a going concern is dependent upon its ability to generate sufficient cash flow to meet its obligation on a timely basis, to obtain additional financing and re-financing as may be required, to develop commercially viable mining resources, an ultimately to establish profitable operations.

NOTE 4- COMPARATIVE FIGURES

Certain amounts in prior periods have been restated to conform to the presentation used in the current period.

Page FS 5

MUSTANG RESOURCES INC.

(Formerly Canadian Northern Lites (Nevada) Inc.)

(An Exploration Stage Company)

CONDENSED NOTES TO THE FINANCIAL STATEMENTS

(Expressed in United States Dollars)

NOTE 5 - NET LOSS PER SHARE

At June 30, 2005 and 2004, the Company had no outstanding stock options, warrants, and other convertible securities.  Accordingly, only basic earnings or loss per share is presented.

NOTE 6 - MINERAL CLAIMS

During the first quarter ended March 31, 2005, Mustang's management reviewed its mineral property holdings and upon expiry of the JC1, JC2, JC3 and JC4 mineral claims in February 2005, re-registered its core property with the Mineral Titles Branch of the Province of British Columbia, which now comprises 21 units or 525 hectares each for the JC1, JC2, JC3 and JC4 mineral claims compared to the previously recorded claim sizes of 20 units or approximately 500 hectares each for the mineral claims that expired in February 2005.  The current tenure numbers are  507555, 507554, 507553 and 507552 for the JC1, JC2, JC3 and JC4 mineral claims respectively. All four current tenures expire on February 20, 2006.  The costs for re-registering the above mineral claims in the first quarter of fiscal 2005 were $684 compared to staking and recording costs of $2,995 incurred in the first quarter of fiscal 2004.

NOTE 7 - EXCLUSIVE MINERAL CLAIM AGREEMENT

Members of the Company's management are associated with Cougar Holdings Inc., a reporting company engaged in the exploration of its mineral claims in British Columbia, Canada for gemstones.  Consequently, there are potential inherent conflicts of interest in their acting as officers and directors for both companies.  To address this inherent potential conflict of interest, Cougar entered into an agreement with Cougar Holdings Inc., dated March 1, 2005, defining exclusive mineral claim registration areas of a 100 mile radius surrounding each company's core mineral claims, and, defining joint first refusal rights for a 50% undivided interest in any claim staked and registered by the other company for mineral claims staked and registered outside of their core mineral claim areas.

Page FS 6

Item 23.  Changes In and Disagreements With Accountants
on Accounting and Financial Disclosure

We have had no disagreements with our independent auditors on accounting or financial disclosures.

Item 24.  Indemnification of Directors and Officers

The only statute, charter provision, bylaw, contract, or other arrangement under which any controlling person, director or officer of the Registrant is insured or indemnified in any manner against any liability which he may incur in his capacity as such, is as follows:

1.  Articles X and XIV of the Amended and Restated Articles of Incorporation of the company, filed as Exhibit 3.1 to the Registration Statement.

2.  Article XI of the Restated Bylaws of the company, filed as Exhibit 3.2 to the Registration Statement.

3.  Nevada Revised Statutes, Chapter 78.

The general effect of the foregoing is to indemnify a control person, officer or director from liability, thereby making the company responsible for any expenses or damages incurred by such control person, officer or director in any action brought against them based on their conduct in such capacity, provided they did not engage in fraud or criminal activity.

Item 25.  Other Expenses of Issuance and Distribution

The estimated costs of this offering are as follows:

Securities and Exchange Commission registration fee	$	5
Federal Taxes		NIL
State Taxes and Fees		NIL
Transfer Agent Fees		600
Accounting fees and expenses		1,000
Legal fees and expenses		1,800
Miscellaneous		NIL
Total	$	3,405
All amounts are estimates.

We are paying all expenses of the offering listed above.  No portion of these expenses will be borne by the selling shareholders.  The selling shareholders, however, will pay any other expenses incurred in selling their common stock, including any brokerage commissions or costs of sale.

Page 84

Item 26.  Recent Sales of Unregistered Securities

During the past three years, the Registrant has sold the following securities which were not registered under the Securities Act of 1933, as amended.

We issued 1,920,000 shares of common stock (after adjustment for a two-for-one forward stock split in October 2004) on December 31, 2001 at a price of $0.0025 per share in satisfaction of a $4,800 receivable owed to Hudson Capital Corporation by Mustang Resources.  On the instructions of Hudson, the 1,920,000 shares were issued to two creditors of Hudson.  One of the creditors who received 1,280,000 shares was Mr. Terry G. Cook, President and Director of the Company and also the President, Director and major shareholder of Hudson.  The other Hudson creditor who received 640,000 shares was Nancy L. Cook, the spouse of Mr. Terry G. Cook, who, as a result of this share issuance, became a related party of the Company.  For this share issue, we relied on Section 4(2) of the Securities Act because the transaction did not involve a public offering and was therefore exempt from the registration requirements of the Securities Act.  No underwriters were used, nor were any brokerage commissions paid in connection with the above share issue.

On July 20, 2005, we completed an offering of 98,000 shares of our common stock to a total of 42 purchasers at a price of $0.10 per share.  We received a total of $9,800 from this offering.  We completed the offering pursuant to Regulation S of the Securities Act.  Each purchaser represented to us that he or she was a non-US person as defined in Regulation S.  We did not engage in a distribution of this offering in the United States.  Appropriate legends were affixed to the stock certificate issued to each purchaser in accordance with Regulation S.  Each investor was given adequate access to sufficient information about us to make an informed investment decision.  None of the securities were sold through an underwriter and accordingly, there were no underwriting discounts or commissions involved.  No registration rights were granted to any of the purchasers.

Item 27.  Exhibits

Item 1.  Index to Exhibits
Item 2.  Description of Exhibits

Exhibit Number	Description of Exhibits
3.1	Articles of Incorporation
3.2	Bylaws
4.1	Front of Sample Common Stock Certificate
4.2	Back of Sample Common Stock Certificate
5.1	Opinion re: Legality
10.1	JC1 Mining Claim
10.2	JC2 Mining Claim
10.3	JC3 Mining Claim
10.4	JC4 Mining Claim
10.5	Declaration of Trust - Mining Properties
10.6	Related Party Payable - March 10, 2005 Letter
10.7	Mustang / Western Gems Mineral Claim Agreement
14.1	Code of Ethics
23.1	Consent of Expert
23.2	Consent of Auditor
99.1	Glossary of Mining Terms

Page 85

Item 28.  Undertakings

The undersigned registrant hereby undertakes:

1.  To file, during any period in which offers or sales are being made, a post-effective amendment to this registration statement:

(a) To include any prospectus required by Section 10(a)(3) of the Securities Act of 1933;

(b) To reflect in the prospectus any facts or events arising after the effective date of this registration statement, or most recent post-effective amendment, which, individually or in the aggregate, represent a fundamental change in the information set forth in this registration statement; and

(c) To include any material information with respect to the plan of distribution not previously disclosed in this registration statement or any material change to such information in the registration statement.

2.  That, for the purpose of determining any liability under the Securities Act, each such post-effective amendment shall be deemed to be a new registration statement relating to the securities offered herein, and the offering of such securities at that time shall be deemed to be the initial bona fide offering thereof.

3.  To remove from registration by means of a post-effective amendment any of the securities being registered hereby which remain unsold at the termination of the offering.

Insofar as indemnification for liabilities arising under the Securities Act of 1933 may be permitted to our directors, officers and controlling persons pursuant to the provisions above, or otherwise, we have been advised that in the opinion of the Securities and Exchange Commission such indemnification is against public policy as expressed in the Securities Act of 1933, and is, therefore, unenforceable.

In the event that a claim for indemnification against such liabilities, other than the payment by us of expenses incurred or paid by one of our directors, officers, or controlling persons in the successful defense of any action, suit or proceeding, is asserted by one of our directors, officers, or controlling person sin connection with the securities being registered, we will, unless in the opinion of its counsel the matter has been settled by controlling precedent, submit to a court of appropriate jurisdiction the question whether such indemnification is against public policy as expressed in the Securities Act of 1933, and we will be governed by the final adjudication of such issue.

Page 86

SIGNATURES

In accordance with the requirements of the Securities Act of 1933, the registrant certifies that it has reasonable grounds to believe that it meets all of the requirements of filing on Form SB-2 and authorized this registration statement to be signed on its behalf by the undersigned, in the City of Vancouver, Province of British Columbia, Canada on July 26, 2005.

MUSTANG RESOURCES INC.

By /s/ Terry G. Cook

Terry G. Cook
President

In accordance with the requirements of the Securities Act of 1933, this registration statement was signed by the following persons in the capacities and on the dates stated:

/s/ Terry G. Cook

Terry G. Cook
President, Chief Executive Officer,
Chief Financial Officer and Director
July 26, 2005

/s/ Cam Dalgliesh

Cam Dalgliesh
Director
July 26, 2005

Page 87

EX-3

EX3.1 - Articles of Incorporation

AMENDED AND RESTATED ARTICLES OF INCORPORATION
OF
MUSTANG RESOURCES INC.

ARTICLE I
NAME

The name of this corporation is MUSTANG RESOURCES INC.

ARTICLE II
DURATION

This corporation has perpetual existence.

ARTICLE III
CORPORATION PURPOSES

The purpose or purposes for which the Corporation is organized are all things necessary or convenient to carry out any lawful business, including the financial services industry, as well as those itemized under Chapter 78 of Nevada Revised Statutes, including any amendments thereto or successor statute that may hereinafter be enacted.

ARTICLE IV
CAPITALIZATION

Section 1: Aggregate Number of Shares

The total number of shares which the Corporation shall have authority to issue is 200,000,000 of which (a) 40,000,000 shares shall be Preferred Stock of par value $0.001 per share, (b) 160,000,000 shares shall be Common Stock of the par value of $0.001 per share.

Section 2: Rights of Preferred Stock

The Preferred Stock may be issued from time to time in one or more series and with such designation for each such series as shall be stated and expressed in the resolution or resolutions providing for the issue of each such series adopted by the Board of Directors. The Board of Directors in any such resolution or resolutions is expressly authorized to state and express for each such series:

(i) The voting powers, if any, of the holders of stock of such series;

(ii) The rate per annum and the times at and conditions upon which the holders of stock of such series shall be entitled to receive dividends, and whether such dividends shall be cumulative or noncumulative and if cumulative the terms upon which such dividends shall be cumulative;

(iii) The price or prices and the time or times at and the manner in which the stock of such series shall be redeemable and the terms and amount of any sinking fund provided for the purchase or redemption of shares;

(iv) The rights to which the holders of the shares of stock of such series shall be entitled upon any voluntary or involuntary liquidation, dissolution or winding up of the Corporation; (v) The terms, if any, upon which shares of stock of such series shall be convertible into, or exchangeable for, shares of stock of any other class or classes or of any other series of the same or any other class or classes, including the price or prices or the rate or rates of conversion or exchange and the terms of adjustment, if any; and

(v) Any other designations, preferences, and relative participating, optimal or other special rights, and qualifications, limitations or restrictions thereof so far as they are not inconsistent with the provisions of the Articles of Incorporation, as amended, and to the full extent now or hereafter permitted by the laws of Nevada.

Section 3: Rights of Common Stock

The Common Stock may be issued from time to time in one or more Classes and with such designation for each such Classes as shall be stated and expressed in the resolution or resolutions providing for the issue of each such Classes adopted by the Board of Directors. The Board of Directors in any such resolution or resolutions is expressly authorized to state and express for each such Class:

(i) The voting powers, if any, of the holders of stock of such Class;

(ii) The rate per annum and the times at and conditions upon which the holders of stock of such Class shall be entitled to receive dividends, and whether such dividends shall be cumulative or noncumulative and if cumulative the terms upon which such dividends shall be cumulative;

(iii) The terms, if any, upon which shares of stock of such series shall be convertible into, or exchangeable for, shares of stock of any other class or classes or of any other series of the same or any other class or classes, including the price or prices or the rate or rates of conversion or exchange and the terms of adjustment, if any; and

(iv) Any other designations, preferences, and relative participating, optimal or other special rights, and qualifications, limitations or restrictions thereof so far as they are not inconsistent with the provisions of the Articles of Incorporation, as amended, and to the full extent now or hereafter permitted by the laws of Nevada.

ARTICLE V
STOCK SPLITS

The Board of Directors shall have the authority, in accordance with NRS 78.2055, by resolution or resolutions at any time or from time to time after the Issuance Date to fix a record date for and to effect a forward or reverse split of the issued and outstanding shares of Common Stock. Shareholder approval shall not be required. The Corporation will not be required to reduce or increase its authorized shares in a corresponding ratio in the event of a reverse or forward split.

ARTICLE VI
COMPANY PURCHASES OF ITS' OWN STOCK

The Corporation, by action of its directors, and without action by its shareholders, may purchase its own shares in accordance with the provisions of Nevada Revised Statutes. Such purchases may be made either in the open market or at public or private sale, in such manner and amounts, from such holder or holders of outstanding shares of the Corporation, and at such prices as the directors shall from time to time determine.

ARTICLE VII
NO PREEMPTIVE RIGHTS

Except as may otherwise be provided by the Board of Directors, no preemptive rights shall exist with respect to shares of stock or securities convertible into shares of stock of this corporation. 

ARTICLE VIII
NO CUMULATIVE VOTING

Each shareholder entitled to vote at any election for Directors shall have the right to vote, in person or by proxy, one vote for each share of stock owned by such shareholder for as many persons as there are Directors to be elected and for whose election such shareholder has a right to vote, and no shareholder shall be entitled to cumulate their votes.

ARTICLE IX
BYLAWS

The Board of Directors shall have the power to adopt, amend or repeal the Bylaws or adopt new Bylaws. Nothing herein shall deny the concurrent power of the shareholders to adopt, alter, amend or repeal the Bylaws. 

ARTICLE X
DIRECTORS' LIABILITY

To the full extent from time to time permitted by law, no director of the corporation shall be personally liable to the corporation or its shareholders for damages for conduct as a director. Neither the amendment or repeal of this Article, nor the adoption of any provision of the Articles of Incorporation inconsistent with this Article, shall eliminate or reduce the protection afforded by this Article to a director of the corporation with respect to any matter which occurred, or any cause of action, suit or claim which but for this Article would have accrued or arisen, prior to such amendment, repeal or adoption.

ARTICLE XI
LIMITATION ON RIGHT TO CALL SPECIAL SHAREHOLDERS' MEETING

Special meetings of stockholders of the Corporation may be called only by the Board of Directors pursuant to a resolution approved by a majority of the entire Board of Directors, upon not less than 30 nor more than 50 days' written notice to the stockholders of the Corporation.

ARTICLE XII
AMENDMENT TO ARTICLES OF INCORPORATION

This corporation reserves the right to amend or repeal any provisions contained in these Articles of Incorporation, in any manner now or hereafter permitted by law, and all rights and powers conferred herein on the shareholders and directors of this corporation are subject to this reserved power. 

ARTICLE XIII
BOARD OF DIRECTORS

The qualifications, terms of office, manner of election, time and place of meetings, and powers and duties of the Directors shall be prescribed in the Bylaws. The number of members of the Board of Directors shall not be less than one nor more than fifteen.

ARTICLE XIV
LIMITATION OF LIABILITY

No director or officer of the Corporation shall be personally liable to the Corporation or any of its stockholders for damages for breach of fiduciary duty as a director or officer involving any act or omission of any such director or officer. However, the foregoing provision shall not eliminate or limit the liability of a director or officer for (i) acts or omissions which involve intentional misconduct, fraud or a knowing violation of law; or (ii) the payment of dividends in violation of Section 78.300 of the Nevada Revised Statutes. Any repeal or modification of this Article by the shareholders of the Corporation shall be prospective only and shall not adversely affect any limitation on the personal liability of a director or officer of the Corporation for acts or omissions prior to such repeal or modification.

ARTICLE XV
STATUTES NOT APPLICABLE

The provisions of Nevada Revised Statutes, 78.378 through 78.3793, inclusive, regarding the voting of a controlling interest in stock of a Nevada corporation and sections 78.411 through 78.444, inclusive, regarding combinations with interested stockholders, shall not be applicable to this Corporation.

EX-3

EX3.2 - Bylaws of Mustang Resources Inc.

BYLAWS
OF
MUSTANG RESOURCES INC.

A NEVADA CORPORATION

ARTICLE I
OFFICES

SECTION 1.  The registered office of this corporation shall be in the City of Carson City, State of Nevada.

SECTION 2.  The Corporation may also have offices at such other places both within and without the State of Nevada as the Board of Directors may from time to time determine or the business of the corporation may require.

ARTICLE II
MEETINGS OF STOCKHOLDERS

SECTION 1.  All annual meetings of the stockholders shall be held at the registered office of the corporation or at such other place within or without the State of Nevada as the Directors shall determine.  Special meetings of the stockholders may be held at such time and place within or without the State of Nevada as shall be stated in the notice of the meeting, or in a duly executed waiver of notice thereof.

SECTION 2.  Annual meetings of the stockholders shall be held on the anniversary date of incorporation each year if not a legal holiday and, and if a legal holiday, then on the next secular day following, or at such other time as may be set by the Board of Directors from time to time, at which the stockholders shall elect by vote a Board of Directors and transact such other business as may properly be brought before the meeting.

SECTION 3.  Special meetings of the stockholders, for any purpose or purposes, unless otherwise prescribed by statute or by the Articles of Incorporation, may be called by the President or the Secretary, by resolution of the Board of Directors or at the request in writing of stockholders owning a majority in amount of the entire capital stock of the corporation issued and outstanding and entitled to vote.  Such request shall state the purpose of the proposed meeting.

SECTION 4.  Notices of meetings shall be in writing and signed by the President or Vice- President or the Secretary or an Assistant Secretary or by such other person or persons as the Directors shall designate.  Such notice shall state the purpose or purposes for which the meeting is called and the time and the place, which may be within or without this State, where it is to be held.  A copy of such notice shall be either delivered personally to or shall be mailed, postage prepaid, to each stockholder of record entitled to vote at such meeting not less than ten nor more than sixty days before such meeting.  If mailed, it shall be directed to a stockholder at his address as it appears upon the records of the corporation and upon such mailing of any such notice, the service thereof shall be complete and the time of the notice shall begin to run from the date upon which such notice is deposited in the mail for transmission to such stockholder.  Personal delivery of any such notice to an officer of the corporation or association, or to any member of a partnership shall constitute delivery of such notice to such corporation, association or partnership.  In the event of the transfer of stock after delivery of such notice of and prior to the holding of the meeting, it shall not be necessary to deliver or mail such notice of the meeting to the transferee.

SECTION 5.  Business transactions at any special meeting of stockholders shall be limited to the purpose stated in the notice.

SECTION 6.  The holders of a majority of the stock issued and outstanding and entitled to vote thereat, present in person or represented by proxy, shall constitute a quorum at all meetings of the stockholders for the transaction of business except as otherwise provided by statute or by the Articles of Incorporation.  If, however, such quorum shall not be present or represented at any meeting of the stockholders, the stockholders entitled to vote thereat, present in person or represented by proxy, shall have power to adjourn the meeting from time to time, without notice other than announcements at the meeting, until a quorum shall be presented or represented.  At such adjourned meetings at which a quorum shall be present or represented, any business may be transacted which might have been transacted at the meeting as originally notified.

SECTION 7.  When a quorum is present or represented at any meeting, the vote of the holders of a majority of the stock having voting power present in person or represented by proxy shall be sufficient to elect Directors or to decide any question brought before such meeting, unless the question is one upon which by express provision of the statute or of the Articles of Incorporation, a different vote shall govern and control the decision of such question.

SECTION 8.  Each stockholder of record of the corporation shall be entitled at each meeting of the stockholders to one vote for each share standing in his name on the books of the corporation.  Upon the demand of any stockholder, the vote for Directors and the vote upon any question before the meeting shall be by ballot.

SECTION 9.  At any meeting of the stockholders any stockholder may be represented and vote by a proxy or proxies appointed by an instrument in writing.  In the event that any such instrument in writing shall designate two or more persons to act as proxies, a majority of such persons present at the meeting, or, if only one shall be present, then that one shall have and may exercise all the powers conferred by such written instruction upon all of the persons so designated unless the instrument shall otherwise provide.  No proxy or power of attorney to vote shall be voted at a meeting of the stockholders unless it shall have been filed with the Secretary of the meeting when required by the inspectors of election.  All questions regarding the qualifications of voters, the validity of proxies and the acceptance of or rejection of votes shall be decided by the inspectors of election who shall be appointed by the Board of Directors, or if not so appointed, then by the presiding officer at the meeting.

SECTION 10.  Any action which may be taken by the vote of the stockholders at a meeting may be taken without a meeting if authorized by the written consent of stockholders holding at least a majority of the voting power, unless the provisions of the statute or the Articles of Incorporation require a greater proportion of voting power to authorize such action in which case such greater proportion of written consents shall be required.

ARTICLE III
DIRECTORS

SECTION 1.  The business of the corporation shall be managed by its Board of Directors which may exercise all such powers of the corporation and do all such lawful acts and things as are not by statute or by the Articles of Incorporation or by these Bylaws directed or required to be exercised or done by the stockholders.

SECTION 2.  The number of Directors which shall constitute the whole board shall be not less than one and not more than eight.  The number of Directors may from time to time be increased or decreased to not less than one nor more than eight by action of the Board of Directors.  The Directors shall be elected at the annual meeting of the stockholders and except as provided in section 2 of this Article, each Director elected shall hold office until his successor is elected and qualified.  Directors need not be stockholders.

SECTION 3.  Vacancies in the Board of Directors including those caused by an increase in the number of Directors, may be filled by a majority of the remaining Directors, though less than a quorum, or by a sole remaining Director, and each Director so elected shall hold office until his successor is elected at the annual or a special meeting of the stockholders.  The holders of a two-thirds of the outstanding shares of stock entitled to vote may at any time peremptorily terminate the term of office of all or any of the Directors by vote at a meeting called for such purpose or by a written statement filed with the Secretary or, in his absence, with any other officer.  Such removal shall be effective immediately, even if successors are not elected simultaneously and the vacancies on the Board of Directors resulting therefrom shall only be filled from the stockholders.

A vacancy or vacancies on the Board of Directors shall be deemed to exist in case of death, resignation or removal of any Director, or if the authorized number of Directors be increased, or if the stockholders fail at any annual or special meeting of stockholders at which any Director or Directors are elected to elect the full authorized number of Directors to be voted for at that meeting.  The stockholders may elect a Director or Directors at any time to fill any vacancy or vacancies not filled by the Directors.  If the Board of Directors accepts the resignation of a Director tendered to take effect at a future time, the Board or the stockholders shall have power to elect a successor to take office when the resignation is to become effective.

No reduction of the authorized number of Directors shall have the effect of removing any Director prior to the expiration of his term of office.

ARTICLE IV
MEETING OF THE BOARD OF DIRECTORS

SECTION 1.  Regular meetings of the Board of Directors shall be held at any place within or without the State which has been designated from time to time by resolution of the Board or by written consent of all members of the Board.  In the absence of such designation regular meetings shall be held at the registered office of the corporation.  Special meetings of the Board may be held either at a place so designated or at the registered office.

SECTION 2.  The first meeting of each newly elected Board of Directors shall be held immediately following the adjournment of the meeting of stockholders and at the place thereof.  No notice of such meeting shall be necessary to the Directors in order legally to constitute the meeting, provided a quorum be present.  In the event such meeting is not so held, the meeting may be held at such time and place as shall be specified in a notice given as hereinafter provided for special meetings of the Board of Directors.

SECTION 3.  Regular meetings of the Board of Directors may be held without call or notice at such time and at such place as shall from time to time be fixed and determined by the Board of Directors.

SECTION 4.  Special meetings of the Board of Directors may be called by the Chairman or the President or by the Vice-President or by any two Directors.  Written notice of the time and place of special meetings shall be delivered personally to each Director, or sent to each Director by mail or by other form of written communication, charges prepaid, addressed to him at his address as it is shown upon the records or if not readily ascertainable, at the place in which the meetings of the Directors are regularly held.  In case such notice is mailed or telegraphed, it shall be deposited in the postal service or delivered to the telegraph company at least forty-eight (48) hours prior to the time of the holding of the meeting.  In case such notice is delivered or taxed, it shall be so delivered or taxed at least twenty-four (24) hours prior to the time of the holding of the meeting.  Such mailing, telegraphing, delivery or taxing as above provided shall be due, legal and personal notice of such Director.

SECTION 5.  Notice of the time and place of holding an adjourned meeting need not be given to the absent Directors if the time and place be fixed at the meeting adjourned.

SECTION 6.  The transaction of any meeting of the Board of Directors, however called and noticed or wherever held, shall be as valid as though transacted at a meeting duly held after regular call and notice, if a quorum be present, and if, either before or after such meeting, each of the Directors not present signs a written waiver of notice, or a consent of holding such meeting, or approvals of the minutes thereof.  All such waivers, consents or approvals shall be filed with the corporate records or made a part of the minutes of the meeting.

SECTION 7.  The majority of the authorized number of Directors shall be necessary to constitute a quorum for the transaction of business, except to adjourn as hereinafter provided.  Every act or decision done or made by a majority of the Directors present at a meeting duly held at which a quorum is present shall be regarded as the act of the Board of Directors, unless a greater number be required by law or by the Articles of Incorporation.  Any action of a majority, although not at a regularly called meeting, and the record thereof, if assented to in writing by all of the other members of the Board shall be as valid and effective in all respects as if passed by the Board in regular meeting.

SECTION 8.  A quorum of the Directors may adjourn any Directors meeting to meet again at stated day and hour; provided, however, that in the absence of a quorum, a majority of the Directors present at any Directors meeting, either regular or special, may adjourn from time to time until the time fixed for the next regular meeting of the Board.

ARTICLE V
COMMITTEES OF DIRECTORS

SECTION 1.  The Board of Directors may, by resolution adopted by a majority of the whole Board, designate one or more committees of the Board of Directors, each committee to consist of two or more of the Directors of the corporation which, to the extent provided in the resolution, shall and may exercise the power of the Board of Directors in the management of the business and affairs of the corporation and may have power to authorize the seal of the corporation to be affixed to all papers which may require it.  Such committee or committees shall have such name or names as may be determined from time to time by the Board of Directors.  The members of any such committee present at any meeting and not disqualified from voting may, whether or not they constitute a quorum, unanimously appoint another member of the Board of Directors to act at the meeting in the place of any absent or disqualified member.  At meetings of such committees, a majority of the members or alternate members at any meeting at which there is a quorum shall be the act of the committee.

SECTION 2.  The committee shall keep regular minutes of their proceedings and report the same to the Board of Directors.

SECTION 3.  Any action required or permitted to be taken at any meeting of the Board of Directors or of any committee thereof may be taken without a meeting if a written consent thereto is signed by a majority of the members of the Board of Directors or of such committee, as the case may be, and such written consent is filed with the minutes of proceedings of the Board or committee.

ARTICLE VI
COMPENSATION OF DIRECTORS

SECTION 1.  The Directors may be paid their expenses of attendance at each meeting of the Board of Directors and may be paid a fixed sum for attendance at each meeting of the Board of Directors or a stated salary as Director.  No such payment shall preclude any Director from serving the corporation in any other capacity and receiving compensation therefore.  Members of special or standing committees may be allowed like reimbursement and compensation for attending committee meetings.

ARTICLE VII
NOTICES

SECTION 1.  Notices to Directors and stockholders shall be in writing and delivered personally or mailed to the Directors or stockholders at their addresses appearing on the books of the corporation.  Notices to Directors may also be given by fax and by telegram.  Notice by mail, fax or telegram shall be deemed to be given at the time when the same shall be mailed.

SECTION 2.  Whenever all parties entitled to vote at any meeting, whether of Directors or stockholders, consent, either by a writing on the records of the meeting or filed with the Secretary, or by presence at such meeting or oral consent entered on the minutes, or by taking part in the deliberations at such meeting without objection, the doings of such meeting shall be as valid as if had at a meeting regularly called and noticed, and at such meeting any business may be transacted which is not excepted from the written consent to the consideration of which no objection for want of notice is made at the time, and if any meeting be irregular for want of notice or such consent, provided a quorum was present at such meeting, the proceedings of said meeting may be ratified and approved and rendered likewise valid and the irregularity or defect therein waived by a writing signed by all parties having the right to vote at such meeting; and such consent or approval of stockholders may be by proxy or attorney, but all such proxies and powers of attorney must be in writing.

SECTION 3.  Whenever any notice whatever is required to be given under the provisions of the statute, of the Articles of Incorporation or of these Bylaws, a waiver thereof in writing, signed by the person or persons entitled to said notice, whether before or after the time stated therein, shall be deemed equivalent thereto.

ARTICLE VIII
OFFICERS

SECTION 1.  The officers of the corporation shall be chosen by the Board of Directors and shall be a President, a Secretary and a Treasurer.  Any person may hold two or more offices.

SECTION 2.  The Board of Directors at its first meeting after each annual meeting of stockholders shall choose a President, a Secretary and a Treasurer, none of whom need be Directors.

SECTION 3.  The Board of Directors may appoint a Chairman of the Board, a Vice-Chairman of the Board, Vice- Presidents and one or more Assistant Secretaries and Assistant Treasurers and such other officers and agents as it shall deem necessary who shall hold their offices for such terms and shall exercise such powers and perform such duties as shall be determined from time to time by the Board of Directors.

SECTION 4.  The salaries and compensation of all officers of the corporation shall be fixed by the Board of Directors.

SECTION 5.  The officers of the corporation shall hold office at the pleasure of the Board of Directors.  Any officer elected or appointed by the Board of Directors may be removed any time by the Board of Directors.  Any vacancy occurring in any office of the corporation by death, resignation, removal or otherwise shall be filled by the Board of Directors.

SECTION 6.  The CHAIRMAN OF THE BOARD, if one has been appointed, shall preside at meetings of the stockholders and the Board of Directors, and shall see that all orders and resolutions of the Board of Directors are carried into effect.

SECTION 7.  The VICE-CHAIRMAN, if one has been appointed, shall, in the absence or disability of the Chairman of the Board, perform the duties and exercise the powers of the Chairman of the Board and shall perform other such duties as the Board of Directors may from time to time prescribe.

SECTION 8.  The PRESIDENT shall be the chief executive officer of the corporation and shall have active management of the business of the corporation.  He shall execute on behalf of the corporation all instruments requiring such execution except to the extent the signing and execution thereof shall be expressly designated by the Board of Directors to some other officer or agent of the corporation.

SECTION 9.  The VICE-PRESIDENTS shall act under the direction of the President and in absence or disability of the President shall perform the duties and exercise the powers of the President.  They shall perform such other duties and have such other powers as the President or the Board of Directors may from time to time prescribe.  The Board of Directors may designate one or more Executive Vice-Presidents or may otherwise specify the order of seniority of the Vice-Presidents.  The duties and powers of the President shall descend to the Vice-Presidents in such specified order of seniority.

SECTION 10.  The SECRETARY shall act under the direction of the President.  Subject to the direction of the President he shall attend all meetings of the Board of Directors and all meetings of the stockholders and record the proceedings.  He shall perform like duties for the standing committees when required.  He shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the Board of Directors, and will perform other such duties as may be prescribed by the President or the Board of Directors.

SECTION 11.  The ASSISTANT SECRETARIES shall act under the direction of the President.  In order of their seniority, unless otherwise determined by the President or the Board of Directors, they shall, in the absence or disability of the Secretary, perform the duties and exercise the powers of the Secretary.  They shall perform other such duties and have such other powers as the President and the Board of Directors may from time to time prescribe.

SECTION 12.  The TREASURER shall act under the direction of the President.  Subject to the direction of the President he shall have custody of the corporate funds and securities and shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation and shall deposit all money and other valuable effects in the name and to the credit of the corporation in such depositories as may be designated by the Board of Directors.  He shall disburse the funds of the corporation as may be ordered by the President or the Board of Directors, taking proper vouchers for such disbursements, and shall render to the President and the Board of Directors, at its regular meetings, or when the Board of Directors so requires, an account of all his transactions as Treasurer and of the financial condition of the corporation.

If required by the Board of Directors, the Treasurer shall give the corporation a bond in such sum and with such surety as shall be satisfactory to the Board of Directors for the faithful performance of the duties of his office and for the restoration to the corporation, in case of his death, resignation, retirement or removal from office, of all books, papers, vouchers, money and other property of whatever kind in his possession or under his control belonging to the corporation.

SECTION 13.  The ASSISTANT TREASURERS in order of their seniority, unless otherwise determined by the President or the Board of Directors, shall, in the absence or disability of the Treasurer, perform the duties and exercise the powers of the Treasurer.  They shall perform such other duties and have such other powers as the President or the Board of Directors may from time to time prescribe.

ARTICLE IX
CERTIFICATES OF STOCK

SECTION 1.  Every stockholder shall be entitled to have a certificate signed by the President or a Vice- President and the Treasurer or an Assistant Treasurer, or the Secretary or an Assistant Secretary of the corporation, certifying the number of shares owned by him in the corporation.  If the corporation shall be authorized to issue more than one class of stock or more that one series of any class, the designations, preferences and relative, participating, optional or other special rights of the various classes of stock or series thereof and the qualifications, limitations or restrictions of such rights, shall be set forth in full or summarized on the face or back of the certificate which the corporation shall issue to represent such stock.

SECTION 2.  If a certificate is signed (a) by a transfer agent other than the corporation or its employees or (b) by a Registrant other than the corporation or its employees, the signatures of the officers of the corporation may be facsimiles.  In case any officer who has signed or whose facsimile signatures have been placed upon a certificate shall cease to be such officer before such certificate is issued, such certificate may be issued with the same effect as though the person had not ceased to be such officer.  The seal of the corporation, or a facsimile thereof, may, but need not be, affixed to certificates of stock.

SECTION 3.  The Board of Directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the corporation alleged to have been lost or destroyed upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost or destroyed.  When authorizing such issue of a new certificate or certificates, the Board of Directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost or destroyed certificate or certificates, or his legal representative, to advertise the same in such manner as it shall require and/or give the corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the corporation with respect to the certificate alleged to have been lost or destroyed.

SECTION 4.  Upon surrender to the corporation or the transfer agent of the corporation of a certificate for shares duty endorsed or accompanied by proper evidence of succession, assignment or authority to transfer, it shall be the duty of the corporation, if it is satisfied that all provisions of the laws and regulations applicable to the corporation regarding transfer and ownership of shares have been compiled with, to issue a new certificate to the person entitled thereto, cancel the old certificate and record the transaction upon its books.

SECTION 5.  The Board of Directors may fix in advance a date not exceeding sixty (60) days nor less than ten (IO) days preceding the date of any meeting of stockholders, or the date of the payment of any dividend, or the date of the allotment of rights, or the date when any change or conversion or exchange of capital stock shall go into effect, or a date in connection with obtaining the consent of stockholders for any purpose, as a record date for the termination of the stockholders entitled to notice of and to vote at any such meeting, and any adjournment thereof, or entitled to receive payment of any such dividend, or to give such consent, and in the such case, such stockholders, and only such stockholders as shall be stockholders of record on the date so fixed, shall be entitled to notice of and to vote as such meeting, or any adjournment thereof, or to receive such payment of dividend, or to receive such allotment of rights, or to exercise such rights, or to give such consent, as the case may be, notwithstanding any transfer of any stock on the books of the corporation after such record date fixed as aforesaid.

SECTION 6.  The corporation shall be entitled to recognize the person registered on its books as the owner of the share to be the exclusive owner for all purposes including voting and dividends, and the corporation shall not be bound to recognize any equitable or other claims to or interest in such shares or shares on the part of any -other person, whether or not it shall have express or other notice thereof, except as otherwise provided by the laws of Nevada.

ARTICLE X
GENERAL PROVISIONS

SECTION 1.  Dividends upon the capital stock of the corporation, subject to the provisions of the Articles of Incorporation, if any, may be declared by the Board of Directors at any regular or special meeting, pursuant to law.  Dividends may be paid in cash, in property or in shares of the capital stock, subject to the provisions of the Articles of Incorporation.

SECTION 2.  Before payment of any dividend, there may be set aside out of any funds of the corporation available for dividends such sum or sums as the Directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, or for equalizing dividends or for repairing and maintaining any property of the corporation, or for such other purpose as the Directors shall think conducive to the interests of the corporation, and the Directors may modify or abolish any such reserve in the manner in which it was created.

SECTION 3.  All checks or demands for money and notes of the corporation shall be signed by such officer or officers or such other person or persons as the Board of Directors may from time to time designate.

SECTION 4.  The fiscal year of the corporation shall be fixed by resolution of the Board of Directors.

SECTION 5.  The corporation may or may not have a corporate seal, as may be from time to time determined by resolution of the Board of Directors.  If a corporate seal is adopted, it shall have inscribed thereon the name of the corporation and the words "Corporate Seal" and "Nevada".  The seal may be used by causing it or a facsimile thereof to be impressed or affixed or in any manner reproduced.

ARTICLE XI
INDEMNIFICATION

Every person who was or is a party or is a threatened to be made a party to or is involved in any action, suit or proceeding, whether civil, criminal, administrative or investigative, by reason of the fact that he or a person of whom he is the legal representative is or was a Director or officer of the corporation or is or was serving at the request of the corporation or for its benefit as a Director or officer of another corporation, or as its representative in a partnership, joint venture, trust or other enterprise, shall be indemnified and held harmless to the fullest legally permissible under the laws of the State of Nevada (currently set forth in NRS 78.751) from time to time against all expenses, liability and loss (including attorney's fees, judgments, fines and amounts paid or to be paid in settlement) reasonably incurred or suffered by him in connection therewith.  The expenses of officers and Directors incurred in defending a civil or criminal action, suit or proceeding must be paid by the corporation as they are incurred and in advance of the final disposition of the action, suit or proceeding upon receipt of an undertaking by or on behalf of the Director or officer to repay the amount if it is ultimately determined by a court of competent jurisdiction that he is not entitled to be indemnified by the corporation.  Such right of indemnification shall be a contract right which may be enforced in any manner desired by such person.  Such right of indemnification shall not be exclusive of any other right which such Directors, officers or representatives may have or hereafter acquire and, without limiting the generality of such statement, they shall be entitled to their respective rights of indemnification under any bylaw, agreement, vote of stockholders, provision of law or otherwise, as well as their rights under this Article.

The Board of Directors may cause the corporation to purchase and maintain insurance on behalf of any person who is or was a Director or officer of the corporation, or is or was serving at the request of the corporation as a Director or officer of another corporation, or as its representative in a partnership, joint venture, trust or other enterprise against any liability asserted against such person and incurred in any such capacity or arising out of such status, whether or not the corporation would have the power to indemnify such person.

The Board of Directors may form time to time adopt further Bylaws with respect to indemnification and amend these and such Bylaws to provide at all times the fullest indemnification permitted by the laws of the State of Nevada.

ARTICLE XII
AMENDMENTS

SECTION 1.  The Bylaws may be amended by a majority vote of all the stock issued and outstanding and entitled to vote at any annual or special meeting of the stockholders, provided notice of intention to amend shall have been contained in the notice of the meeting.

SECTION 2.  The Board of Directors by a majority vote of the whole Board at any meeting may amend these Bylaws, including Bylaws adopted by the stockholders, but the stockholders may from time to time specify particulars of the Bylaws which shall not be amended by the Board of Directors.

APPROVED AND ADOPTED October 1, 2004.

.

CERTIFICATE OF THE SECRETARY

I, Terry G. Cook, hereby certify that I am the Secretary of MUSTANG RESOURCES INC., and the foregoing Bylaws, consisting of 10 pages, constitute the code of Bylaws of this company as duly adopted at a meeting of the Board of Directors of the corporation held on October 1, 2004.

IN WITNESS WHEREOF, I have hereunto subscribed my name on October 1, 2004.

/s/  Terry G. Cook

TERRY G. COOK
SECRETARY

EX-4

EX4.1 - Front of Sample Common Stock Certificate

EX-4

EX4.2 - Back of Sample Common Stock Certificate

EX-5

Exhibit 5.1 - Opinion re: Legality

CLARK, WILSON BC's Law Firm for Business	Our File No.     28362 / D/WLM740186.1	Clark, Wilson Barristers & Solicitors Patent & Trade-Mark Agents 800 - 885 W Georgia Street Vancouver, BC  V6C 3H1 Tel.     604.687.5700 Fax.     604.687.6314
		Exhibit 5.1

July 26, 2005

Mustang Resources Inc.
1574 Gulf Rd., #1505
Point Roberts, WA 98281

Dear Sirs:

                    Re:     Common Stock of Mustang Resources Inc. - Registration
                               Statement on Form SB-2 filed July 26, 2005
                 _______________________________________________________

                    We have acted as special counsel to Mustang Resources Inc. (the "Company"), a Nevada corporation, in connection with the filing of a registration statement on Form SB-2 (the "Registration Statement") in connection with the registration under the Securities Act of 1933, as amended, of up to 98,000 shares of the Company's common stock (the "Registered Shares"), as further described in the Registration Statement filed on July 26, 2005.

                    In connection with this opinion, we have examined the following documents:

          (a)     Corporate Charter and Articles of the Company;

          (b)     By-Laws of the Company;

          (c)     Resolutions adopted by the Board of Directors of the Company pertaining to the Registered Shares;

          (d)     The Registration Statement; and

          (e)     The Prospectus/Information Statement (the "Prospectus") constituting a part of the Registration Statement.

                    In addition, we have examined such other documents as we have deemed necessary or appropriate as a basis for the opinions hereinafter expressed.

                    We have assumed that the signatures on all documents examined by us are genuine, that all documents submitted to us as originals are authentic and that all documents submitted to us as copies or as facsimiles of copies or originals, conform with the originals, which assumptions we have not independently verified.

                    Based upon the foregoing and the examination of such legal authorities as we have deemed relevant, and subject to the qualifications and further assumptions set forth below, we are of the opinion that the Registered Shares to which the Registration Statement and

D/WLM/740186.1 www.cwilson.com

- 2 -

Prospectus relate, have been duly and validly authorized and issued, fully paid and non-assessable.

                    We have attorneys admitted to practice in California, Florida, New York, Washington, Virginia and the District of Columbia.  We are familiar with the General Corporation Law of the State of Nevada, the applicable provisions of the Nevada Constitution and reported judicial decisions interpreting these laws, and we have made such inquiries with respect thereto as we consider necessary to render this opinion with respect to a Nevada corporation.  This opinion letter is opining upon and is limited to the current federal laws of the United States and, to the limited extent set forth above, Nevada law, including the statutory provisions, all applicable provisions of the Nevada Constitution and reported judicial decisions interpreting those laws, as such laws presently exist and to the facts as they presently exist.  We express no opinion with respect to the effect or applicability of the laws of any other jurisdiction.  We assume no obligation to revise or supplement this opinion letter should the laws of such jurisdiction be changed after the date hereof by legislative action, judicial decision or otherwise.

                    We hereby consent to the filing of this opinion as an exhibit to the Registration Statement.  In giving this consent, we do not admit that we are within the category of persons whose consent is required under Section 7 of the Securities Act of 1933 or the General Rules and Regulations of the Securities and Exchange Commission.

Yours truly,

CLARK WILSON LLP

/s/ "Clark Wilson LLP"

D/WLM/740186.1

EX-10

EX10.1 - JC1 Mining Claim - Registered February 20, 2005

EX-10

EX10.2 - JC2 Mining Claim - Registered February 20, 2005

EX-10

EX10.3 - JC3 Mining Claim - Registered February 20, 2005

EX-10

EX10.4 - JC4 Mining Claim - Registered February 20, 2005

EX-10

EX10.5 - Declaration of Trust

DECLARATION OF TRUST

This Declaration of Trust verifies that Terry G. Cook of 1574 Gulf Rd. #1505, Point Roberts, WA, 98281 does hereby declare that title to the mineral claims shown below are held in the name of Terry G. Cook but that all these claims are held in trust for Mustang Resources Inc. of 1574 Gulf Rd. #1505, Point Roberts, WA, 98281.  The claims are:

NAME OF CLAIM	TENURE NUMBER	AREA	PERCENTAGE OF TITLE
		(hectares)
JC1	507555	525.398	100%
JC2	507554	525.401	100%
JC3	507553	525.616	100%
JC4	507553	525.610	100%

The above mineral claims are in the Nelson Mining Division of British Columbia.

Terry G. Cook has no interest whatsoever in the said mineral claims other than that of a bare trustee and that any distribution whether income or capital and whether in cash or otherwise, and any rights in respect of the said mineral claims do not in any manner belong to Terry G. Cook, but are the property of the said Mustang Resources Inc.

Terry G. Cook will deliver full title on demand to Mustang Resources Inc. for as long as the claims are in good standing with the Province of British Columbia.

DATED for reference the 20th day of February 2005.

SIGNED, SEALED and DELIVERED

/s/  Terry G. Cook

_______________________________
Terry G. Cook

By Terry G. Cook in the presence of:

/s/  Cam Dalgliesh

_______________________________
Cam Dalgliesh
Witness

EX-10

EX10.6 - Related Party Payable - March 10, 2005 Letter

Hudson Capital Corporation

10655 NE 4th Street  Suite 400
Bellevue, WA  98004
Phone: (604) 879-9001  Fax: (604) 263-4035

March 10, 2005

Mustang Resources Inc.
1574 Gulf Rd.  #1505
Point Roberts, WA  98281

Re:  Deferral of Accounts Payable

Dear Sirs:

Hudson Capital Corporation hereby agrees to not demand payment of any monies currently owed to Hudson by Mustang Resources Inc., or any monies that Hudson may advance to Mustang Resources Inc. from this date up to and including July 14, 2007, until July 15, 2007.  This letter also confirms that all monies owed to Hudson by Mustang Resources Inc. are unsecured, non-interest bearing and have no fixed date for repayment

Sincerely,

/s/ Terry G. Cook

T. G. Cook, President
Hudson Capital Corporation

EX-10

EX10.7

Agreement between MUSTANG RESOURCES INC. and WESTERN GEMS INC.

EXCLUSIVE MINERAL CLAIM REGISTRATION AREA
AND
JOINT FIRST REFUSAL RIGHTS

Dated May 5, 2005

The parties to this Agreement dated May 5, 2005, namely Mustang Resources Inc. ("Mustang") of 1574 Gulf Rd. #1505, Point Roberts, Washington, 98281, and Western Gems Inc. ("Western") of 10655 NE 4th Street, Suite 400, Bellevue, WA, 98004, hereby agree as follows:

(1)  Joint Recognition of each Party's Exclusive Claim Registration Area.

Mustang and Western jointly agree that each company has a core mineral property.  Mustang's core mineral property is the JC1 (Tenure # 507555), JC2 (Tenure # 507554), JC3 (Tenure # 507553) and JC4 (Tenure # 507552) mineral claims located in the Nelson Mining Division of British Columbia, Canada.  Western's core mineral property is the WC1 (Tenure # 507442) and WC2 (Tenure # 507556) mineral claims located in the Vernon Mining Division of British Columbia, Canada.

Henceforth all lands within a 100 mile radius of Mustang's JC1 - JC4 claims shall be designated as Mustang's Exclusive Mineral Claim Registration Area ("Mustang's Exclusive Area").

All lands within a 100 mile radius of Western's WC1 and WC2 claims shall be designated as Western's Exclusive Mineral Claim Registration Area ("Western's Exclusive Area").

Mustang agrees that Mustang will not register mineral claims for a period of 20 years beginning May 5, 2005 within Western's Exclusive Area.

Western agrees that Western will not register mineral claims for a period of 20 years beginning May 5, 2005 within Mustang's Exclusive Area.

(2)  Joint Rights of First Refusal

With respect to lands located outside of the defined Exclusive Area's the two companies agree as follows:

Mustang Resources Inc.:

(i)  Mustang agrees to grant Western a right of first refusal to acquire a 50% undivided interest in any mineral claims registered by Mustang, where such claims are located outside the 100 mile radius of Western's WC1 and WC2 claims, and also outside the 100 mile radius of Mustang's JC1 - JC4 mineral claims ("Mustang Open Area Claims"), and

Page 1 of 3

(ii)  Mustang agrees to notify Western, in writing within 10 days, of any Mustang Open Area Claims registered by Mustang.

To exercise such first refusal Western Gems Inc. must:

(iii)  provide notice, in writing, to Mustang, within 30 days of the written notification by Mustang of any such Mustang Open Area Claims registrations that Western wishes to exercise its right to a 50% undivided interest in the subject claims, and

(iv)  Submit to Mustang's office a check for 50% of the cost Mustang incurred to register such claims, plus reasonable out-of-pocket expenses, properly documented.  Such payment by Western must be made within 10 days of being invoiced by Mustang for such expenses, or the right of first refusal shall lapse.

Western Gems Inc.:

(i)  Western agrees to grant Mustang a right of first refusal to acquire a 50% undivided interest in any mineral claims registered by Western, where such claims are located outside the 100 mile radius of Mustang's JC1 - JC4 claims, and also outside the 100 mile radius of Western's WC1 and WC2 mineral claims ("Western Open Area Claims"), and

(ii)  Western agrees to notify Mustang, in writing within 10 days, of any Western Open Area Claims registered by Western.

To exercise such first refusal Mustang Resources Inc. must:

(iii)  provide notice, in writing, to Western, within 30 days of the written notification by Western of any such Western Open Area Claims registrations that Mustang wishes to exercise its right to a 50% undivided interest in the subject claims, and

(iv)  Submit to Western's office a check for 50% of the cost Western incurred to register such claims, plus reasonable out-of-pocket expenses, properly documented.  Such payment by Mustang must be made within 10 days of being invoiced by Western for such expenses, or the right of first refusal shall lapse.

Page 2 of 3

This agreement of Joint Mineral Claim Registration Area And Joint First Refusal Rights  is signed by the following persons on behalf of the companies and in the capacities and on the dates indicated.

MUSTANG RESOURCES INC.

/s/ Terry G. Cook

TERRY G. COOK
PRESIDENT
May 5, 2005

/s/ Cam Dalgliesh

CAM DALGLIESH
WITNESS

WESTERN GEMS INC.

/s/ Terry G. Cook

TERRY G. COOK
PRESIDENT
May 5, 2005

/s/ Cam Dalgliesh

CAM DALGLIESH
WITNESS

Page 3 of 3

EX-23

EX23.1 - Consent of Expert

William Lumley
208 - 708 8th Ave.
New Westminster, B.C.
V3M 2R3

(604)  715-4182

July 10, 2005

Board of Directors
Mustang Resources Inc.
1574 Gulf Rd. #1505
Point Roberts WA  98281

CONSENT of William Lumley, B.Sc. (Honors Geology)

I consent to the use of my name and reference to me as an expert in Geology in the SB-2 registration and any subsequent amendments filed by Mustang Resources with the United States Securities and Exchange Commission.

/s/ William E. Lumley

WILLIAM E. LUMLEY, B. Sc.

EX-23

Exhibit 23.2 - Consent of Auditor

TELFORD SADOVNICK, P.L.L.C.
CERTIFIED PUBLIC ACCOUNTANTS

INDEPENDENT REGISTERED PUBLIC ACCOUNTING FIRM'S CONSENT

Board of Directors
Mustang Resources Inc.
(An Exploration Stage Company)

We consent to the use in the Registration Statement of Mustang Resources Inc. on Form SB-2 (the "Registration Statement") of our Report of Independent Registered Public Accounting Firm dated February 28, 2005 on the consolidated balance sheets of Mustang Resources Inc. as at December 31, 2004 and 2003, and the related consolidated statements of operations, stockholders' deficiency and cash flows for each of the three years then ended and for the period from inception on Novemeber 23, 1998 to December 31, 2004.

In addition, we consent to the reference to us under the heading "Interests of Named Experts and Legal Counsel" in the Registration Statement.

    /s/ TELFORD SADOVNICK, P.L.L.C.

CERTIFIED PUBLIC ACCOUNTANTS

Bellingham, Washington

July 21, 2005

114 West Magnolia Street, Suite 423, Bellingham, Washington  98225
Telephone: (360) 392-2886     Facsimile: (360) 392-2887

EX-99

EX99.1 - Glossary of Mining Terms

Glossary of Mining Terms

A B C D E F G H I J K L M N O P Q R S T U V W X Y Z

A

Acidic precipitation - Snow and rain that have a low pH, caused by sulphur dioxide and nitric oxide gases from industrial activity released into the atmosphere.
Acidic rocks - Igneous rock carrying a high (greater than 65%) proportion of silica.
Acid mine drainage - Acidic run-off water from mine waste dumps and mill tailings ponds containing sulphide minerals. Also refers to ground water pumped to surface from mines.
Adit - An opening driven horizontally into the side of a mountain or hill for providing access to a mineral deposit.
Aerial magnetometer - An instrument used to measure magnetic field strength from an airplane.
Aeromagnetic survey - A geophysical survey using a magnetometer aboard, or towed behind, an aircraft.
Age - An interval of geologic time shorter than an Epoch.
Agglomerate - A breccia composed largely or entirely of fragments of volcanic rocks.
Agglomeration - A method of concentrating valuable minerals based on their adhesion properties.
Agitation - In metallurgy, the act or state of being stirred or shaken mechanically, sometimes accomplished by the introduction of compressed air.
Airborne survey - A survey made from an aircraft to obtain photographs, or measure magnetic properties, radioactivity, etc.
Alloy - A compound of two or more metals.
Alluvium - Relatively recent deposits of sedimentary material laid down in river beds, flood plains, lakes, or at the base of mountain slopes. (adj. alluvial)
Alpha meter - An instrument used to measure positively charged particles emitted by radioactive materials.
Alpha ray - A positively charged particle emitted by certain radioactive materials.
Alteration - Any physical or chemical change in a rock or mineral subsequent to its formation. Milder and more localized than metamorphism.
Amorphous - A term applied to rocks or minerals that possess no definite crystal structure or form, such as amorphous carbon.
Amortization - The gradual and systematic writing off of a balance in an account over an appropriate period.
Amphibolite - A gneiss or schist largely made up of amphibole and plagioclase minerals.
ANFO - Acronym for ammonium nitrate and fuel oil, a mixture used as a blasting agent in many mines.
Annual report - The formal financial statements and report on operations issued by a corporation to its shareholders after its fiscal year-end.
Anode - A rectangular plate of metal cast in a shape suitable for refining by the electrolytic process.
Anomaly - Any departure from the norm which may indicate the presence of mineralization in the underlying bedrock.
Anthracite - A hard, black coal containing a high percentage of fixed carbon and a low percentage of volatile matter.
Anticline - An arch or fold in layers of rock shaped like the crest of a wave.
Apex - The top or terminal edge of a vein on surface or its nearest point to the surface.
Arsenopyrite - A silver-white to gray arsenic ore, essentially FeAsS. Also called mispickel.
Ash - The inorganic residue remaining after ignition of coal.
Assay - A chemical test performed on a sample of ores or minerals to determine the amount of valuable metals contained.
Assay foot (metre, inch, centimetre) - The assay value multiplied by the number of feet, metres, inches, centimetres across which the sample is taken.
Assay map - Plan view of an area indicating assay values and locations of all samples taken on the property.
Assessment work - The amount of work, specified by mining law, that must be performed each year in order to retain legal control of mining claims.
Authorized capital - see capital stock.
Autogenous grinding - The process of grinding ore in a rotating cylinder using large pieces of the ore instead of conventional steel balls or rods.

B

Back - The ceiling or roof of an underground opening.
Backfill - Waste material used to fill the void created by mining an orebody.
Background - Minor amounts of radioactivity due not to abnormal amounts of radioactive minerals nearby, but to cosmic rays and minor residual radioactivity in the vicinity.
Back sample - Rock chips collected from the roof or back of an underground opening for the purpose of determining grade.
Backwardation - A situation when the cash or spot price of a metal stands at a premium over the price of the metal for delivery at a forward date.
Balance sheet - A formal statement of the financial position of a company on a particular day, normally presented to shareholders once a year.
Ball mill - A steel cylinder filled with steel balls into which crushed ore is fed. The ball mill is rotated, causing the balls to cascade and grind the ore.
Banded iron formation - A bedded deposit of iron minerals.
Barite - A yellow, white, or colorless crystalline mineral of barium sulfate.  Also called heavy spar.
Basalt - An extrusive volcanic rock composed primarily of plagioclase, pyroxene and some olivine.
Basal till - Unsorted glacial debris at the base of the soil column where it comes into contact with the bedrock below.
Basement rocks - The underlying or older rock mass. Often refers to rocks of Precambrian age which may be covered by younger rocks.
Base camp - Centre of operations from which exploration activity is conducted.
Base metal - Any non-precious metal (eg. copper, lead, zinc, nickel, etc.).
Basic rocks - Igneous rocks that are relatively low in silica and composed mostly of dark-colored minerals.|
Batholith - A large mass of igneous rock extending to great depth with its upper portion dome-like in shape. Similar, smaller masses of igneous rocks are known as bosses or plugs.
Bauxite - A rock made up of hydrous aluminum oxides; the most common aluminum ore.
Bear market - Term used to describe market conditions when share prices are declining.
Bedding - The arrangement of sedimentary rocks in layers.
Beneficiate - To concentrate or enrich; often applied to the preparation of iron ore for smelting.
Bentonite - A clay with great ability to absorb water and which swells accordingly.
Bessemer - An iron ore with a very low phosphorus content.
Bio-leaching - A process for recovering metals from low-grade ores by dissolving them in solution, the dissolution being aided by bacterial action.
Biotite - A platy magnesium-iron mica, common in igneous rocks.
Bit - The cutting end of a drill frequently made of an extremely hard material such as industrial diamonds or tungsten carbide.
Blackjack - A miner's term for sphalerite (zinc sulphide).
Black smoker - Volcanic vent found in areas of active ocean floor spreading, through which sulphide-laden fluids escape.
Blaster - A mine employee responsible for loading, priming and detonating blastholes.
Blast furnace - A reaction vessel in which mixed charges of oxide ores, fluxes and fuels are blown with a continuous blast of hot air and oxygen-enriched air for the chemical reduction of metals to their metallic state.
Blasthole - A drill hole in a mine that is filled with explosives in order to blast loose a quantity of rock.
Blister copper - A crude form of copper (assaying about 99%) produced in a smelter, which requires further refining before being used for industrial purposes.
Block caving - An inexpensive method of mining in which large blocks of ore are undercut, causing the ore to break or cave under its own weight.
Board lot - One hundred shares.
Bond - An agreement to pay a certain amount of interest over a given period of time.
Boom - A telescoping, hydraulically powered steel arm on which drifters, manbaskets and hydraulic hammers are mounted.
Box hole - A short raise or opening driven above a drift for the purpose of drawing ore from a stope, or to permit access.
Break - Loosely used to describe a large-scale regional shear zone or structural fault.
Breast - A working face in a mine, usually restricted to a stope.
Breccia - A rock in which angular fragments are surrounded by a mass of fine-grained minerals.
Broken reserves - The ore in a mine which has been broken by blasting but which has not yet been transported to surface.
Brunton compass - A pocket compass equipped with sights and a reflector, used for sighting lines, measuring dip and carrying out preliminary surveys.
Bulk mining - Any large-scale, mechanized method of mining involving many thousands of tonnes of ore being brought to surface per day.
Bulk sample - A large sample of mineralized rock, frequently hundreds of tonnes, selected in such a manner as to be representative of the potential orebody being sampled. Used to determine metallurgical characteristics.
Bullion - Metal formed into bars or ingots.
Bull market - Term used to describe financial market conditions when share prices are going up.
Bull quartz - A prospector's term for white, coarse-grained, barren quartz.
Byproduct - A secondary metal or mineral product recovered in the milling process.

C

Cable bolt - A steel cable, capable of withstanding tens of tonnes, cemented into a drillhole to lend support in blocky ground.
Cage - The conveyance used to transport men and equipment between the surface and the mine levels.
Calcine - Name given to concentrate that is ready for smelting (i.e. the sulphur has been driven off by oxidation).
Call - An option to buy shares at a specified price. The opposite of a "put".
Cambrian - The first of the six Geologic Periods of the Paleozoic Era. It extends from the end of the Precambrian Era (about 570 million years ago) to the beginning of the Ordovician Period (about 500 million years ago).
Capitalization - A financial term used to describe the value financial markets put on a company. Determined by multiplying the number of outstanding shares of a company by the current stock price.
Capital stock - The total ownership of a limited liability company divided among a specified number of shares.
Captive stope - A stope that is accessible only through a manway.
Carbon-in-pulp - A method of recovering gold and silver from pregnant cyanide solutions by adsorbing the precious metals to granules of activated carbon, which are typically ground up coconut shells.
Cash flow - The net of the inflow and outflow of cash during an accounting period. Does not account for depreciation or bookkeeping write-offs which do not involve an actual cash outlay.
Cathode - A rectangular plate of metal, produced by electrolytic refining, which is melted into commercial shapes such as wirebars, billets, ingots, etc.
Cesium magnetometer - An geophysical instrument which measures magnetic field strength in terms of vertical gradient and total field.
Chalcocite - A sulphide mineral of copper common in the zone of secondary enrichment.
Chalcopyrite - A sulphide mineral of copper and iron; the most important ore mineral of copper.
Change house - The mine building where workers change into work clothes; also known as the "dry".
Channel sample - A sample composed of pieces of vein or mineral deposit that have been cut out of a small trench or channel, usually about 10 cm wide and 2 cm deep.
Charter - A document issued by a governing authority creating a company or other corporation.
Chartered bank - A financial institution that accepts deposits and provides loans.
Chip sample - A method of sampling a rock exposure whereby a regular series of small chips of rock is broken off along a line across the face.
Chromite - The chief ore mineral of chromium.
Chute - An opening, usually constructed of timber and equipped with a gate, through which ore is drawn from a stope into mine cars.
Cinnabar - A vermilion-colored ore mineral of mercury.
Circulating load - Over-sized chunks of ore returned to the head of a closed grinding circuit before going on to the next stage of treatment.
Claim - A portion of land held either by a prospector or a mining company. In Canada, the common size is 1,320 ft. (about 400 m) square, or 40 acres (about 16 ha).
Clarification - Process of clearing dirty water by removing suspended material.
Classifier - A mineral-processing machine which separates minerals according to size and density.
Clay - A fine-grained material composed of hydrous aluminum silicates.
Cleavage - The tendency of a mineral to split along crystallographic planes.
Closed circuit - A loop in the milling process wherein a selected portion of the product of a machine is returned to the head of the machine for finishing to required specification.
Coal - A carbonaceous rock mined for use as a fuel.
Coalification - The metamorphic processes of forming coal.
Collar - The term applied to the timbering or concrete around the mouth of a shaft; also used to describe the top of a mill hole.
Column flotation - A milling process, carried out in a tall cylindrical column, whereby valuable minerals are separated from gangue minerals based on their wetability properties.
Common stock - Shares in a company which have full voting rights which the holders use to control the company in common with each other. There is no fixed or assured dividend as with preferred shares, which have first claim on the distribution of a company's earnings or assets.
Complex ore - An ore containing a number of minerals of economic value. The term often implies that there are metallurgical difficulties in liberating and separating the valuable metals.
Cone crusher - A machine which crushes ore between a gyrating cone or crushing head and an inverted, truncated cone known as a bowl.
Concentrate - A fine, powdery product of the milling process containing a high percentage of valuable metal.
Concentrator - A milling plant that produces a concentrate of the valuable minerals or metals. Further treatment is required to recover the pure metal.
Confirmation - A form delivered by a broker to the client, setting forth the details of stock sales or purchases for the client.
Conglomerate - A sedimentary rock consisting of rounded, water-worn pebbles or boulders cemented into a solid mass.
Contact - A geological term used to describe the line or plane along which two different rock formations meet.
Contact metamorphism - Metamorphism of country rocks adjacent to an intrusion, caused by heat from the intrusion.
Contango - A situation in which the price of a metal for forward or future delivery stands at a premium over the cash or spot price of the metal.
Continuous miner - A piece of mining equipment which produces a continuous flow of ore from the working face.
Controlled blasting - Blasting patterns and sequences designed to achieve a particular objective. Cast blasting, where the muck pile is cast in a particular direction, and deck blasting, where holes are loaded once but blasted in successive blasts days apart, are examples.
Converter - In copper smelting, a furnace used to separate copper metal from matte.
Core - The long cylindrical piece of rock, about an inch in diameter, brought to surface by diamond drilling.
Core barrel - That part of a string of tools in a diamond drill hole in which the core specimen is collected.
Cordillera - The continuous chain of mountain ranges on the western margin of North and South America.
Country rock - Loosely used to describe the general mass of rock adjacent to an orebody. Also known as the host rock.
Cretaceous - The last of the three Geologic Periods of the Mesozoic Era.  It extends from the end of the Jurassic Period about 135 million years ago) to the end of the Mesozoic Era at about 65 million years ago.
Crosscut - A horizontal opening driven from a shaft and (or near) right angles to the strike of a vein or other orebody.
Crust - The outermost layer of the Earth; includes both continental and oceanic crust.
Cum-dividend - Buyer entitled to pending dividend payment.
Current assets - Assets of company which can and are likely to be converted into cash within a year. Includes cash, marketable securities, accounts receivable and supplies.
Current liabilities - A company's debts that are payable within a year's time.
Custom smelter - A smelter which processes concentrates from independent mines. Concentrates may be purchased or the smelter may be contracted to do the processing for the independent company.
Cut-and-fill - A method of stoping in which ore is removed in slices, or lifts, and then the excavation is filled with rock or other waste material (backfill), before the subsequent slice is extracted.
Cut value - Applies to assays that have been reduced to some arbitrary maximum to prevent erratic high values from inflating the average.
Cyanidation - A method of extracting exposed gold or silver grains from crushed or ground ore by dissolving it in a weak cyanide solution. May be carried out in tanks inside a mill or in heaps of ore out of doors.
Cyanide - A chemical species containing carbon and nitrogen used to dissolve gold and silver from ore.

D

Day order - An order to buy or sell shares, good only on the day the order was entered.
Debenture - See bonds.
Debt financing - Method of raising capital whereby companies borrow money from a lending institution.
Deck - The area around the shaft collar where men and materials enter the cage to be lowered underground.
Decline - A sloping underground opening for machine access from level to level or from surface; also called a ramp.
Deferred charges - Expenses incurred but not charged against the current year's operation.
Depletion - An accounting device, used primarily in tax computations. It recognizes the consumption of an ore deposit, a mine's principal asset.
Depreciation - The periodic, systematic charging to expense of plant assets reflecting the decline in economic potential of the assets.
Development - Underground work carried out for the purpose of opening up a mineral deposit. Includes shaft sinking, crosscutting, drifting and raising.
Development drilling - drilling to establish accurate estimates of mineral reserves.
Diabase - A common basic igneous rock usually occurring in dykes or sills.
Diamond - The hardest known mineral, composed of pure carbon; low-quality diamonds are used to make bits for diamond drilling in rock.
Diamond drill - A rotary type of rock drill that cuts a core of rock that is recovered in long cylindrical sections, two cm or more in diameter.
Diamond driller - A person who operates a diamond drill.
Dilution (mining) - Rock that is , by necessity, removed along with the ore in the mining process, subsequently lowering the grade of the ore.
Dilution (of shares) - A decrease in the value of a company's shares caused by the issue of treasury shares.
Diorite - An intrusive igneous rock composed chiefly of sodic plagioclase, hornblende, biotite or pyroxene.
Dip - The angle at which a vein, structure or rock bed is inclined from the horizontal as measured at right angles to the strike.
Dip needle - A compass with the needle mounted so as to swing in a vertical plane, used for prospecting to determine the magnetic attraction of rocks.
Directional drilling - A method of drilling involving the use of stabilizers and wedges to direct the orientation of the hole.
Discount - The minimum price below the par value at which treasury shares may legally be sold.
Disseminated ore - Ore carrying small particles of valuable minerals spread more or less uniformly through the host rock.
Dividend - Cash or stock awarded to preferred and common shareholders at the discretion of the company's board of directors.
Dividend claim - Made when a dividend has been paid to the previous holder because stock has not yet been transferred to the name of the new owner.
Dor bar - The final saleable product of a gold mine. Usually consisting of gold and silver.
Drag fold - The result of the plastic deformation of a rock unit where it has been folded or bent back on itself.
Drawpoint - An underground opening at the bottom of a stope through which broken ore from the stope is extracted.
Drift - A horizontal underground opening that follows along the length of a vein or rock formation as opposed to a crosscut which crosses the rock formation.
Drifter - A hydraulic rock drill used to drill small-diameter holes for blasting or for installing rock bolts.
Drill-indicated reserves - The size and quality of a potential orebody as suggested by widely spaced drillholes; more work is required before reserves can be classified as probable or proven.
Dry - A building where the miner changes into working clothes.
Due diligence - The degree of care and caution required before making a decision; loosely, a financial and technical investigation to determine whether an investment is sound.
Dump - A pile of broken rock or ore on surface.
Dyke - A long and relatively thin body of igneous rock that, while in the molten state, intruded a fissure in older rocks.
 

E

Electrolysis - An electric current is passed through a solution containing dissolved metals, causing the metals to be deposited onto a cathode.
Electrolytic refining - The process of purifying metal ingots that are suspended as anodes in an electrolytic bath, alternated with refined sheets of the same metal which act as starters or cathodes.
EM survey - A geophysical survey method which measures the electromagnetic properties of rocks.
En echelon - Roughly parallel but staggered structures.
Environmental impact study - A written report, compiled prior to a production decision, that examines the effects proposed mining activities will have on the natural surroundings.
Epigenetic - Orebodies formed by hydrothermal fluids and gases that were introduced into the host rocks from elsewhere, filling cavities in the host rock.
Epithermal deposit - A mineral deposit consisting of veins and replacement bodies, usually in volcanic or sedimentary rocks, containing precious metals or, more rarely, base metals.
Epoch - An interval of geologic time longer than an Age and shorter than a Period.
Equity financing - The provision of funds by buying shares.
Era - An interval of geologic time longer than a Period and shorter than an Eon. Geologic time can be summarized, in chronological order, as the Precambrian, Paleozoic, Mesozoic and Cenozoic Eras.
Erosion - The breaking down and subsequent removal of either rock or surface material by wind, rain, wave action, freezing and thawing and other processes.
Erratic - Either a piece of visible gold or a large glacial boulder.
Escrowed shares - Shares deposited in trust pending fulfilment of certain conditions, and not ordinarily available to trading until released.
Ex-dividend - On stocks selling "ex-dividend", the seller retains the right to a pending dividend payment.
Exploration - Prospecting, sampling, mapping, diamond drilling and other work involved in searching for ore.
 

F

Face - The end of a drift, crosscut or stope in which work is taking place.
Fault - A break in the Earth's crust caused by tectonic forces which have moved the rock on one side with respect to the other.
Feldspar - A group of common rock-forming minerals that includes microcline, orthoclase, plagioclase and others.
Felsic - Term used to describe light-colored rocks containing feldspar, feldspathoids and silica.
Ferrous - Containing iron.
Fine gold - Fineness is the proportion of pure gold or silver in jewelry or bullion expressed in parts per thousand. Thus, 925 fine gold indicates 925 parts out of 1,000, or 92.5% is pure gold.
Fissure - An extensive crack, break or fracture in rocks.
Fixed Assets - Possessions such as buildings, machinery and land which, as opposed to current assets, are unlikely to be converted into cash during the normal business cycle.
Float - Pieces of rock that have been broken off and moved from their original location by natural forces such as frost or glacial action.
Flotation - A milling process in which valuable mineral particles are induced to become attached to bubbles and float as others sink.
Flowsheet - An illustration showing the sequence of operations, step by step, by which ore is treated in a milling, concentration or smelting process.
Flow-through shares - Shares in an exploration company that allow the tax deduction or credits for mineral exploration to be passed to the investor.
Flux - A chemical substance that reacts with gangue minerals to form slags, which are liquid at furnace temperature and low enough in density to float on the molten bath of metal or matte.
Fluxgate magnetometer - An instrument used in geophysics to measure total magnetic field.
Fold - Any bending or wrinkling of rock strata.
Footwall - The rock on the underside of a vein or ore structure.
Forward contract - The sale or purchase of a commodity for delivery at a specified future date.
Fracture - A break in the rock, the opening of which allows mineral-bearing solutions to enter. A "cross-fracture" is a minor break extending at more-or-less right angles to the direction of the principal fractures.
Free milling - Ores of gold or silver from which the precious metals can be recovered by concentrating methods without resorting to pressure leaching or other chemical treatment.
 

G

Gabbro - A dark, coarse-grained igneous rock.
Galena - Lead sulphide, the most common ore mineral of lead.
Gamma - A unit of measurement of magnetic intensity.
Gangue - The worthless minerals in an ore deposit.
Geiger counter - An instrument used to measure the radioactivity that emanates from certain minerals by means of a Geiger-Mueller tube.
Geochemistry - The study of the chemical properties of rocks.
Geology - The science concerned with the study of the rocks which compose the Earth.
Geophysics - The study of the physical properties of rocks and minerals.
Geophysical survey - A scientific method of prospecting that measures the physical properties of rock formations. Common properties investigated include magnetism, specific gravity, electrical conductivity and radioactivity.
Geothermal - Pertains to the heat of the Earth's interior.
Glacial drift - Sedimentary material that has been transported by glaciers.
Glacial striations - Lines or scratches on a smooth rock surface caused by glacial abrasion.
Glory hole - An open pit from which ore is extracted, especially where broken ore is passed to underground workings before being hoisted.
Gneiss - A layered or banded crystalline metamorphic rock, the grains of which are aligned or elongated into a roughly parallel arrangement.
Gold loan - A form of debt financing whereby a potential gold producer borrows gold from a lending institution, sells the gold on the open market, uses the cash for mine development, then pays back the gold from actual mine production.
Gossan - The rust-colored capping or staining of a mineral deposit, generally formed by the oxidation or alteration of iron sulphides.
Gouge - Fine, putty-like material composed of ground-up rock found along a fault.
Grab sample - A sample from a rock outcrop that is assayed to determine if valuable elements are contained in the rock. A grab sample is not intended to be representative of the deposit, and usually the best-looking material is selected.
Graben - A downfaulted block of rock.
Granite - A coarse-grained intrusive igneous rock consisting of quartz, feldspar and mica.
Gravity meter, gravimeter - An instrument for measuring the gravitational attraction of the earth; gravitational attraction varies with the density of the rocks in the vicinity.
Greenstone - An altered or metamorphosed mafic igneous rock that owes its dark color to the presence of chlorite, epidote, or amphiboles.
Greenstone belt - An area underlain by metamorphosed volcanic and sedimentary rocks, usually in a continental shield.
Grizzly (or mantle) - A grating, usually constructed of steel rails, placed over the top of a chute or ore pass for the purpose of stopping large pieces of rock or ore that may hang up in the pass.
Gross value - The theoretical value of ore determined simply by applying the assay of metal or metals and the current market price. It must be used only with caution and severe qualification.
Gross value royalty - A share of gross revenue from the sale of minerals from a mine.
Grouting - The process of sealing off a water flow in rocks by forcing a thin slurry of cement or other chemicals into the crevices; usually done through a diamond drill hole.
Grubstake - Finances or supplies of food, etc., furnished to a prospector in return for an interest in any discoveries made.
Guides - The timber rails installed along the walls of a shaft for steadying, or guiding, the cage or conveyance.
Gypsum - A sedimentary rock consisting of hydrated calcium sulphate.
Gyratory crusher - A machine that crushes ore between an eccentrically mounted crushing cone and a fixed crushing throat. Typically has a higher capacity than a jaw crusher.

H

Halite - Rock salt.
Hangingwall - The rock on the upper side of a vein or ore deposit.
Head grade - The average grade of ore fed into a mill.
Heap leaching - A process whereby valuable metals, usually gold and silver, are leached from a heap, or pad, of crushed ore by leaching solutions percolating down through the heap and collected from a sloping, impermeable liner below the pad.
Hedging - Taking a buy or sell position in a futures market opposite to a position held in the cash market to minimize the risk of financial loss from an adverse price change.
Hematite - An oxide of iron, and one of that metal's most common ore minerals.
High grade - Rich ore. As a verb, it refers to selective mining of the best ore in a deposit.
High-grader - One who steals rich ore, especially gold, from a mine.
Hoist - The machine used for raising and lowering the cage or other conveyance in a shaft.
Holding company - A corporation engaged principally in holding a controlling interest in one or more other companies.
Hornfels - A fine-grained contact metamorphic rock.
Horse - A mass of waste rock lying within a vein or orebody.
Horst - An upfaulted block of rock.
Host rock - The rock surrounding an ore deposit.
Hydrometallurgy - The treatment of ore by wet processes, such as leaching, resulting in the solution of a metal and its subsequent recovery.
Hydrothermal - Relating to hot fluids circulating in the earth's crust.

I

Igneous rocks - Rocks formed by the solidification of molten material from far below the earth's surface.
Ilmenite - An ore mineral of titanium, being an iron-titanium oxide.
Induced polarization - A method of ground geophysical surveying employing an electrical current to determine indications of mineralization.
Industrial minerals - Non-metallic, non-fuel minerals used in the chemical and manufacturing industries. Examples are asbestos, gypsum, salt, graphite, mica, gravel, building stone and talc.
Initial public offering - The first sale of shares to the public, usually by subscription from a group of investment dealers.
Institutional investors - Pension funds and mutual funds, managing money for a large number of individual investors.
Intermediate rock - An igneous rock containing 52% to 66% quartz.
Intrusive - A body of igneous rock formed by the consolidation of magma intruded into other rocks, in contrast to lavas, which are extruded upon the surface.
Ion exchange - An exchange of ions in a crystal with irons in a solution. Used as a method for recovering valuable metals, such as uranium, from solution.
 

J

Jaw crusher - A machine in which rock is broken by the action of steel plates.
Jig - A piece of milling equipment used to concentrate ore on a screen submerged in water, either by the reciprocating motion of the screen or by the pulsation of water through it.
Jurassic - The middle of the three Geologic Periods of the Mesozoic Era.  It extends from the end of the Triassic Period (about 195 million years ago) to the beginning of the Cretaceous Period (about 135 million years ago).

K

Kimberlite - A variety of peridotite; the most common host rock of diamonds.

L

Lagging - Planks or small timbers placed between steel ribs along the roof of a stope or drift to prevent rocks from falling, rather than to support the main weight of the overlying rocks.
Lamprophyre - An igneous rock, composed of dark minerals, that occurs in dykes; sometimes contains diamonds.
Laterite - A residual soil, ususally found in tropical countries, out of which the silica has been leached. May form orebodies of iron, nickel, bauxite and manganese.
Launder - A chute or trough for conveying pulp, water or powdered ore in a mill.
Lava - A general name for the molten rock ejected by volcanoes.
Leachable - Extractable by chemical solvents.
Leaching - A chemical process for the extraction of valuable minerals from ore; also, a natural process by which ground waters dissolve minerals, thus leaving the rock with a smaller proportion of some of the minerals than it contained originally.
Lens - Generally used to describe a body of ore that is thick in the middle and tapers towards the ends.
Lenticular - A deposit having roughly the form of a double convex lens.
Level - The horizontal openings on a working horizon in a mine; it is customary to work mines from a shaft, establishing levels at regular intervals, generally about 50 metres or more apart.
Lignite - A soft, low-rank, brownish-black coal.
Limestone - A bedded, sedimentary deposit consisting chiefly of calcium carbonate.
Limit order - An order made by a client to a broker to buy or sell shares at a specified price or better.
Limonite - A brown, hydrous iron oxide.
Line cutting - Straight clearings through the bush to permit sightings for geophysical and other surveys.
Lode - A mineral deposit in solid rock.
Logging - The process of recording geological observations of drill core either on paper or on computer disk.
London fix - The twice-daily bidding session held by five dealing companies to set the gold price. There are also daily London fixes to set the prices of other precious metals.
London Metals Exchange - A major bidding market for base metals, which operates daily in London.
Long position - Securities owned outright or carried on margin.
Long ton - 2,240 lbs. avoirdupois (compared with a short ton, which is 2,000 lbs.).

M

Mafic - Igneous rocks composed mostly of dark, iron- and magnesium-rich minerals.
Magma - The molten material deep in the Earth from which rocks are formed.
Magmatic segregation - An ore-forming process whereby valuable minerals are concentrated by settling out of a cooling magma.
Magnetic gradient survey - A geophysical survey using a pair of magnetometers a fixed distance apart, to measure the difference in the magnetic field with height above the ground.
Magnetic separation - A process in which a magnetically susceptible mineral is separated from gangue minerals by applying a strong magnetic field; ores of iron are commonly treated in this way.
Magnetic susceptibility - A measure of the degree to which a rock is attracted to a magnet.
Magnetic survey - A geophysical survey that measures the intensity of the Earth's magnetic field.
Magnetite - Black, magnetic iron ore, an iron oxide.
Magnetometer - An instrument used to measure the magnetic attraction of underlying rocks.
Map-staking - A form of claim-staking practised in some jurisdictions whereby claims are staked by drawing lines around the claim on claim maps at a government office.
Marble - A metamorphic rock derived from the recrystallization of limestone under intense heat and pressure.
Margin - Cash deposited with a broker as partial payment of the purchase price for any type of listed stock. The stock is held by the broker as security for the loan.
Marginal deposit - An orebody of minimal profitability.
Market order - An order to buy or sell at the best price available. In absence of any specified price or limit, an order is considered to be "at the market".
Matte - A product of a smelter, containing metal and some sulphur, which must be refined further to obtain pure metal.
Mesozoic - The third of the four Geologic Eras in which geologic time is divided. It extends from the end of the Paleozoic Era (about 230 million years ago) to the beginning of the Cenozoic Era (about 65 million years ago). The Mesozoic Era is subdivided into the Triassic, Jurassic and Cretaceous periods.
Metallurgical coal - Coal used to make steel.
Metallurgy - The study of extracting metals from their ores.
Metamorphic rocks - Rocks which have undergone a change in texture or composition as the result of heat and/or pressure.
Metamorphism - The process by which the form or structure of rocks is changed by heat and pressure.
Metasedimentary rocks - Rocks derived from sedimentary rocks changed chemically, mineralogically or structurally as a result of pressure or temperature.
Metavolcanic rocks - Rocks derived from volcanic rocks changed chemically, mineralogically or structurally as a result of pressure or temperature.
Migmatite - Rock consisting of thin, alternating layers of granite and schist.
Mill - A plant in which ore is treated and metals are recovered or prepared for smelting; also a revolving drum used for the grinding of ores in preparation for treatment.
Milling ore - Ore that contains sufficient valuable mineral to be treated by milling process.
Millivolts - A measure of the voltage of an electric current, specifically, one-thousandth of a volt.
Minable reserves - Ore reserves that are known to be extractable using a given mining plan.
Mineral - A naturally occurring homogeneous substance having definite physical properties and chemical composition and, if formed under favorable conditions, a definite crystal form.
Muck - Ore or rock that has been broken by blasting.
Muck sample - A representative piece of ore that is taken from a muck pile and then assayed to determine the grade of the pile.

N

Nanotesla - The international unit for measuring magnetic flux density.
Native metal - A metal occurring in nature in pure form, uncombined with other elements.
Net profit interest - A portion of the profit remaining after all charges, including taxes and bookkeeping charges, such as depreciation, have been deducted.
Net smelter return - A share of the net revenues generated from the sale of metal produced by a mine.
Net worth - The difference between total assets and total liabilities.
Norite - A coarse-grained igneous rock that is host to copper/nickel deposits in the Sudbury area of Ontario.
Nugget - A small mass of precious metal, found free in nature.

O

Odd lot - A block of shares that is less than a board lot.
Open order - An order to buy or sell stock, which is good until cancelled by the client.
Open pit - A mine that is entirely on surface. Also referred to as open-cut or open-cast mine.
Option - An agreement to purchase a property reached between the property vendor and some other party who wishes to explore the property further.
Option (on stock) - The right to buy or sell a share at a set price, regardless of market value.
Ore - A mixture of ore minerals and gangue from which at least one of the metals can be extracted at a profit.
Ore pass - Vertical or inclined passage for the downward transfer of ore connecting a level with the hoisting shaft or a lower level.
Orebody - A natural concentration of valuable material that can be extracted and sold at a profit.
Ore Reserves - The calculated tonnage and grade of mineralization which can be extracted profitably; classified as possible, probable and proven according to the level of confidence that can be placed in the data.
Oreshoot - The portion, or length, of a vein or other structure that carries sufficient valuable minerals to be extracted profitably.
Organic maturation - The process of turning peat into coal.
Orogeny - A period of mountain-building characterized by the folding of a portion of the earth's crust.
Outcrop - An exposure of rock or mineral deposit that can be seen on surface, that is, not covered by soil or water.
Overturned - Where the oldest sedimentary rock beds are lying on top of a younger beds.
Oxidation - A chemical reaction caused by exposure to oxygen that results in a change in the chemical composition of a mineral.

P

Paleozoic - - An era of geologic time lasting from 570 to 245 million years ago.
Pan - To wash gravel, sand or crushed rock samples in order to isolate gold or other valuable metals by their higher density.
Participating interest - A company's interest in a mine, which entitles it to a certain percentage of profits in return for putting up an equal percentage of the capital cost of the project.
Par value - The stated face value of a stock. Par value shares have no specified face value, but the total amount of authorized capital is set down in the company's charter.
Patent - The ultimate stage of holding a mineral claim, after which no more assessment work is necessary because all mineral rights have been earned.
Pegmatite - A coarse-grained, igneous rock, generally coarse, but irregular in texture, and similar to a granite in composition; usually occurs in dykes or veins and sometimes contains valuable minerals.
Pellet - A marble-sized ball of iron ore fused with clay for transportation and use in steelmaking.
Pentlandite - Nickel iron sulphide, the most common nickel ore.
Peridotite - An intrusive igneous rock consisting mainly of olivine.
Period - An interval of geologic time longer than an Epoch and shorter than an Era.
Phaneritic - A term used to describe the coarse-grained texture of some igneous rocks.
Phyllites - Mudstone that has metamorphized, or changed through heat and pressure, to a grade slightly beyond slate.  It generally has a silky sheen on the surface cause by mica crystals.
Picket line - A reference line, marked by pickets or stakes, established on a property for mapping and survey purposes.
Pig iron - Crude iron from a blast furnace.
Pillar - A block of solid ore or other rock left in place to structurally support the shaft, walls or roof of a mine.
Pitchblende - An important uranium ore mineral. It is black in color, possesses a characteristic greasy lustre and is highly radioactive.
Placer - A deposit of sand and gravel containing valuable metals such as gold, tin or diamonds.
Plant - A building or group of buildings in which a process or function is carried out; at a mine site it will include warehouses, hoisting equipment, compressors, maintenance shops, offices and the mill or concentrator.
Plate tectonics - A geological theory which postulates that the Earth's crust is made up of a number of rigid plates which collide, rub up against and spread out from one another.
Plug - A common name for a small offshoot from a large body of molten rock.
Plunge - The vertical angle a linear geological feature makes with the horizontal plane.
Plutonic - Refers to rocks of igneous origin that have come from great depth.
Plutons - Body of rock exposed after solidification at great depth.
Point - Unit of value of a stock as quoted by a stock exchange. May represent one dollar, one cent or one-eighth of a dollar, depending on the stock exchange.
Polishing pond - The last in a series of settling ponds through which mill effluent flows before being discharged into the natural environment.
Pooling shares - See escrowed shares.
Porphyry - Any igneous rock in which relatively large crystals , called phenocrysts, are set in a fine-grained groundmass.
Porphyry copper - A deposit of disseminated copper minerals in or around a large body of intrusive rock.
Portal - The surface entrance to a tunnel or adit.
Portfolio - A list of financial assets.
Possible reserves - Valuable mineralization not sampled enough to accurately estimate its tonnage and grade, or even verify its existence. Also called "inferred reserves".
Potash - Potassium compounds mined for fertilizer and for use in the chemical industry.
Precambrian - The first of the four Geologic Eras in which geologic time is divided. It extends from the beginning of Earth history (over 4 billion years ago) to the beginning of the Paleozoic Era (about 570 million years ago).
Precambrian Shield - The oldest, most stable regions of the earth's crust, the largest of which is the Canadian Shield.
Preferred shares - Shares of a limited liability company that rank ahead of common shares, but after bonds, in distribution of earnings or in claim to the company's assets in the event of liquidation. They pay a fixed dividend but normally do not have voting rights, as with common shares.
Price-to-earnings ratio - The current market price of a stock divided by the company's net earnings per share for the year.
Primary deposits - Valuable minerals deposited during the original period or periods of mineralization, as opposed to those deposited as a result of alteration or weathering.
Private placement - Sale of shares to individuals or corporations outside the normal market, at a negotiated price. Often used to raise capital for a junior exploration company.
Pro rata - In proportion, usually to ownership, income or contribution.
Probable (indicated) reserves - Reserves for which quantity and grade and/or quality are computed form information similar to that used for proven (measure) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.
Profit and loss statement - The income statement of a company detailing revenues minus total costs to give total profit.
Prospect - A mining property, the value of which has not been determined by exploration.
Prospectus - A document filed with the appropriate securities commission detailing the activities and financial condition of a company seeking funds from the public through the issuance of shares.
Proterozoic - The geologic eon lying between the Archean and Phanerozoic eons, beginning about 2.5 billion years ago and ending about 0.57 billion years ago.
Proton precession magnetometer - A geophysical instrument which measures magnetic field intensity in terms of vertical gradient and total field.
Proven (measured) reserves - Reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.
Proxy - A power of attorney given by the shareholder so that his stock may be voted by his nominee(s) at shareholders' meetings.
Pulp - Pulverized or ground ore in solution.
Put - An option to sell a stock at an agreed upon price within a specified time. The owner can present his put to the contracting broker at any time within the option period and compel him to buy the stock.
Pyramiding - The use of increased buying power to increase ownership arising from price appreciation.
Pyrite - A yellow iron sulphide mineral, normally of little value. It is sometimes referred to as "fool's gold".
Pyrrhotite - A bronze-colored, magnetic iron sulphide mineral.

Q

Quartz - Common rock-forming mineral consisting of silicon and oxygen.
Quartz Diorite - A plutonic rock that is intermediate in composition between acidic and basic and in which quartz comprises 5% to 20 % of the felsic (light mineral) constituents.
Quartzite - A metamorphic rock formed by the transformation of a sandstone by heat and pressure.

R

Radioactivity - The property of spontaneously emitting alpha, beta or gamma rays by the decay of the nuclei of atoms.
Radon survey - A geochemical survey technique which detects traces of radon gas, a product of radioactivity.
Raise - A vertical or inclined underground working that has been excavated from the bottom upward.
Rake - The trend of an orebody along the direction of its strike.
Rare earth elements - Relatively scarce minerals such as niobium and yttrium.
Reaming shell - A component of a string of rods used in diamond drilling, it is set with diamonds and placed between the bit and the core barrel to maintain the gauge (or diameter) of the hole.
Reclamation - The restoration of a site after mining or exploration activity is completed.
Reconnaissance - A preliminary survey of ground.
Record date - The date by which a shareholder must be registered on the books of a company in order to receive a declared dividend, or to vote on company affairs.
Recovery - The percentage of valuable metal in the ore that is recovered by metallurgical treatment.
Refractory ore - Ore that resists the action of chemical reagents in the normal treatment processes and which may require pressure leaching or other means to effect the full recovery of the valuable minerals.
Regional metamorphism - Metamorphism caused by both the heat of igneous processes and tectonic pressure.
Replacement ore - Ore formed by a process during which certain minerals have passed into solution and have been carried away, while valuable minerals from the solution have been deposited in the place of those removed.
Reserve - That part of a mineral deposit which could be economically and legally extracted or produced at the time of the reserve determination.  Proven (Measured) Reserves - Reserves for which (a) quantity is computed from dimensions revealed in outcrops, trenches, workings or drill holes; grade and/or quality are computed from the results of detailed sampling and (b) the sites for inspection, sampling and measurement are spaced so closely and the geologic character is so well defined that size, shape, depth and mineral content of reserves are well-established.  Probable (Indicated) Reserves - Reserves for which quantity and grade and/or quality are computed form information similar to that used for proven (measure) reserves, but the sites for inspection, sampling, and measurement are farther apart or are otherwise less adequately spaced. The degree of assurance, although lower than that for proven (measured) reserves, is high enough to assume continuity between points of observation.
Resistivity survey - A geophysical technique used to measure the resistance of a rock formation to an electric current.
Resource - The calculated amount of material in a mineral deposit, based on limited drill information.
Resuing - A method of stoping in narrow-vein deposits whereby the wallrock on one side of the vein is blasted first and then the ore.
Reverberatory furnace - A long, flat furnace used to slag gangue minerals and produce a matte.
Rhyolite - A fine-grained, extrusive igneous rock which has the same chemical composition as granite.
Rib samples - Ore taken from rib pillars in a mine to determine metal content.
Rights - In finance, a certified right to purchase treasury shares in stated quantities, prices and time limits; usually negotiable at a price which is related to the prices of the issue represented; also referred to as warrants. Rights and warrants can be bought and sold prior to their expiry date because not all shareholders wish to exercise their rights.
Rock - Any natural combination of minerals; part of the earth's crust.
Rockbolting - The act of supporting openings in rock with steel bolts anchored in holes drilled especially for this purpose.
Rockburst - A violent release of energy resulting in the sudden failure of walls or pillars in a mine, caused by the weight or pressure of the surrounding rocks.
Rock factor - The number of cubic metres of a particular rock type required to make up one tonne of the material. One tonne of a highly siliceous ore may occupy 0.40 cubic metres, while a tonne of dense sulphide ore may occupy only 0.25 cubic metres.
Rock mechanics - The study of the mechanical properties of rocks, which includes stress conditions around mine openings and the ability of rocks and underground structures to withstand these stresses.
Rod mill - A rotating steel cylinder that uses steel rods as a means of grinding ore.
Room-and-pillar mining - A method of mining flat-lying ore deposits in which the mined-out area, or rooms, are separated by pillars of approximately the same size.
Rotary drill - A machine that drills holes by rotating a rigid, tubular string of drill rods to which is attached a bit. Commonly used for drilling large-diameter blastholes in open-pit mines.
Royalty - An amount of money paid at regular intervals by the lessee or operator of an exploration or mining property to the owner of the ground. Generally based on a certain amount per tonne or a percentage of the total production or profits. Also, the fee paid for the right to use a patented process.
Run-of-mine - A term used loosely to describe ore of average grade.

S

Salting - The act of introducing metals or minerals into a deposit or samples, resulting in false assays. Done either by accident or with the intent of defrauding the public.
Sample - A small portion of rock or a mineral deposit taken so that the metal content can be determined by assaying.
Sampling - Selecting a fractional but representative part of a mineral deposit for analysis.
Sandstone - A sedimentary rock consisting of grains of sand cemented together.
Scaling - The act of removing loose slabs of rock from the back and walls of an underground opening, usually done with a hand-held scaling bar or with a boom-mounted scaling hammer.
Scarp - An escarpment, cliff or steep slope along the margin of a plateau, mesa or terrace.
Schist - A foliated metamorphic rock the grains of which have a roughly parallel arrangement; generally developed by shearing.
Scintillation counter - An instrument used to detect and measure radioactivity by detecting gamma rays; more sensitive than a geiger counter.
Secondary enrichment - Enrichment of a vein or mineral deposit by minerals that have been taken into solution from one part of the vein or adjacent rocks and redeposited in another.
SEDEX - Sedimentary exhalative (sedex) is a type of massive sulphide deposit associated with sedimentary rocks.  Sedex deposits consist of layers of massive sulphide (a rock composed of at least 60% sulphide minerals) interbedded with layers of sedimentary rock.
Sedimentary exhalative - See SEDEX.
Sedimentary rocks - Secondary rocks formed from material derived from other rocks and laid down under water. Examples are limestone, shale and sandstone.
Seismic prospecting - A geophysical method of prospecting, utilizing knowledge of the speed of reflected sound waves in rock.
Self-potential - A technique, used in geophysical prospecting, which recognizes and measures the minute electric currents generated by sulphide deposits.
Semi-autogenous grinding (SAG) - A method of grinding rock into fine powder whereby the grinding media consist of larger chunks of rocks and steel balls.
Serpentine - A greenish, metamorphic mineral consisting of magnesium silicate.
Shaft - A vertical or inclined excavation in rock for the purpose of providing access to an orebody. Usually equipped with a hoist at the top, which lowers and raises a conveyance for handling workers and materials.
Shale - Sedimentary rock formed by the consolidation of mud or silt.
Shear or shearing - The deformation of rocks by lateral movement along innumerable parallel planes, generally resulting from pressure and producing such metamorphic structures as cleavage and schistosity.
Shear zone - A zone in which shearing has occurred on a large scale.
Sheave wheel - A large, grooved wheel in the top of a headframe over which the hoisting rope passes.
Shoot - A concentration of mineral values; that part of a vein or zone carrying values of ore grade.
Short selling - The borrowing of stock from a broker in order to sell it in the hope that it may be purchased at a lower price later on.
Short ton - 2,000 lbs. avoirdupois.
Shrinkage stoping - A stoping method which uses part of the broken ore as a working platform and as support for the walls of the stope.
Siderite - Iron carbonate, which when pure, contains 48.2% iron; must be roasted to drive off carbon dioxide before it can be used in a blast furnace. Roasted product is called sinter.
Silica - Silicon dioxide. Quartz is a common example.
Siliceous - A rock containing an abundance of quartz.
Sill - An intrusive sheet of igneous rock of roughly uniform thickness that has been forced between the bedding planes of existing rock.
Silt - Muddy deposits of fine sediment usually found on the bottoms of lakes.
Sinter - Fine particles of iron ore that have been treated by heat to produce blast furnace feed.
Skarn - Name for the metamorphic rocks surrounding an igneous intrusive where it comes in contact with a limestone or dolostone formation.
Skip - A self-dumping bucket used in a shaft for hoisting ore or rock.
Slag - The vitreous mass separated from the fused metals in the smelting process.
Slash - The process of blasting rock from the side of an underground opening to widen the opening.
Slate - A metamorphic rock; the metamorphic equivalent of shale.
Slickenside - The striated, polished surface of a fault caused by one wall rubbing against the other.
Sludge - Rock cuttings from a diamond drill hole, sometimes used for assaying.
Sodium cyanide - A chemical used in the milling of gold ores to dissolve gold and silver.
Solvent extraction-electrowinning (SX-EW) - A metallurgical technique, so far applied only to copper ores, in which metal is dissolved from the rock by organic solvents and recovered from solution by electrolysis.
Spelter - The zinc of commerce, more or less impure, cast from molten metal into slabs or ingots.
Sphalerite - A zinc sulphide mineral; the most common ore mineral of zinc.
Split - The shareholder-approved division of a company's outstanding common shares into a larger number of new common shares.
Spot price - Current delivery price of a commodity traded in the spot market.
Station - An enlargement of a shaft made for the storage and handling of equipment and for driving drifts at that elevation.
Step-out drilling - Holes drilled to intersect a mineralization horizon or structure along strike or down dip.
Stock exchange - An organized market concerned with the buying and selling of common and preferred shares and warrants by stockbrokers who own seats on the exchange and meet membership requirements.
Stockpile - Broken ore heaped on surface, pending treatment or shipment.
Stope - An excavation in a mine from which ore is, or has been, extracted.
Stop-loss order - An arrangement whereby a client gives his broker instructions to sell a stock if and when its price drops to a specified figure on the market.
Stratabound - General term for mineralization confined by physical or chemical controls to specific stratigraphic units. Such deposits can include veins, lenses, layers, etc. which may or may not be transgressive relative to the enclosing stratigraphy.
Stratigraphy - Strictly, the description of bedded rock sequences; used loosely, the sequence of bedded rocks in a particular area.
Streak - A diagnostic characteristic of minerals, where scratching a sample on a piece of unglazed porcelain leaves powder of a characteristic color.
Street certificate - A certificate representing ownership in a specified number of shares that is registered in the name of some previous owner who has endorsed the certificate so that it may be transferred to a new owner without referral to transfer agent.
Striations - Prominent parallel scratches left on bedrock by advancing glaciers.
Strike - The direction, or bearing from true north, of a vein or rock formation measure
on a horizontal surface.
Stringer - A narrow vein or irregular filament of a mineral or minerals traversing a rock mass.
Strip - To remove the overburden or waste rock overlying an orebody in preparation for mining by open pit methods.
Stripping ratio - The ratio of tonnes removed as waste relative to the number of tonnes of ore removed from an open-pit mine.
Strip mine - An open-pit mine, usually a coal mine, operated by removing overburden, excavating the coal seam, then returning the overburden.
Sub-bituminous - A black coal, intermediate between lignite and bituminous.
Sublevel - A level or working horizon in a mine between main working levels.
Subsidiary company - A company in which the majority of shares (a controlling position) is held by another company.
Sulphide - A compound of sulphur and some other element.
Sulphide dust explosions - An underground mining hazard involving the spontaneous combustion of airborne dust containing sulphide minerals.
Sulphide horizon - Sulfide deposits containing zones of massive sulfide minerals.  Economically exploitable massive sulfide deposits associated with mafic rocks are variably enriched in copper and zinc.  Deposits associated with mafic rocks can contain anomalous concentrations of gold, silver, and cobalt.
Sulphur dioxide - A gas liberated during the smelting of most sulphide ores; either converted into sulphuric acid or released into the atmosphere in the form of a gas.
Sump - An underground excavation where water accumulates before being pumped to surface.
Sustainable development - Industrial development that does not detract from the potential of the natural environment to provide benefits to future generations.
Syenite - An intrusive igneous rock composed chiefly of orthoclase.
Sylvite - potassium chloride, the principal ore of potassium mined for fertilizer manufacturing.
Syncline - A down-arching fold in bedded rocks.
Syngenetic - A term used to describe when mineralization in a deposit was formed relative to the host rocks in which it is found. In this case, the mineralization was formed at the same time as the host rocks. (The opposite is epigenetic.)

T

Taconite - A highly abrasive iron ore.
Tailings - Material rejected from a mill after most of the recoverable valuable minerals have been extracted.
Tailings pond - A low-lying depression used to confine tailings, the prime function of which is to allow enough time for heavy metals to settle out or for cyanide to be destroyed before water is discharged into the local watershed.
Talus - A heap of broken, coarse rock found at the base of a cliff or mountain.
Telluride - A chemical compound consisting of the element tellurium and another element, often gold or silver.
Thermal coal - Coal burned to generate the steam that drives turbines to generate electricity.
Thickener - A large, round tank used in milling operations to separate solids from liquids; clear fluid overflows from the tank and rock particles sink to the bottom.
Tonnes-per-vertical-metre - Common unit used to describe the amount of ore in a deposit; ore length is multiplied by the width and divided by the appropriate rock factor to give the amount of ore for each vertical metre of depth.
Trading floor - the area of a stock exchange building where shares are bought and sold.
Trading post - An area on the trading floor of a stock exchange where current stock prices are listed and where the floor traders (representatives of brokerage firms) meet to buy or sell the stocks listed at that particular post.
Tram - To haul cars of ore or waste in a mine.
Treasury shares - The unissued shares in a company's treasury.
Trench - A long, narrow excavation dug through overburden, or blasted out of rock, to expose a vein or ore structure.
Trend - The direction, in the horizontal plane, of a linear geological feature, such as an ore zone, measured from true north.
Triassic - The first of the three Geologic Periods of the Mesozoic Era. It extends from the end of the Paleozoic Era (about 230 million years ago) to the beginning of the Jurassic Period (about 195 million years ago).
Tube mill - An apparatus consisting of a revolving cylinder about half-filled with steel rods or balls and into which crushed ore is fed for fine grinding.
Tuff - Rock composed of fine volcanic ash.
Tunnel - A horizontal underground opening, open to the atmosphere at both ends.
Tunnel-boring-machine - A machine used to excavate a tunnel through soil or rock by mechanical means as opposed to drilling and blasting.

U

Umpire sample or assay - An assay made by a third party to provide a basis for settling disputes between buyers and sellers of ore.
Uncut value - The actual assay value of a core sample as opposed to a cut value which has been reduced by some arbitrary formula.
Underwrite - A firm commitment made by a broker or other financial institution to purchase a block of shares at a specified price.
Uraninite - A uranium mineral with a high uranium oxide content. Frequently found in pegmatite dykes.
Uranium - A radioactive, silvery-white, metallic element.

V

Valleriite - an iron copper ore.
Vein - A fissure, fault or crack in a rock filled by minerals that have travelled upwards from some deep source.
Vendor - A seller. In the case of mining companies, the consideration paid for properties purchased is often a block of treasury shares. These shares are termed vendor shares and are normally pooled or escrowed.
Visible gold - Native gold which is discernible, in a hand specimen, to the unaided eye.
Volcanic rocks - Igneous rocks formed from magma that has flowed out or has been violently ejected from a volcano.
Volcanogenic - A term used to describe the volcanic origin of mineralization.
Voting right - The stockholder's right to vote in the affairs of the company. Most common shares have one vote each. Preferred stock usually has the right to vote when preferred dividends are in default.
Vug - A small cavity in a rock, frequently lined with well-formed crystals. Amethyst commonly forms in these cavities.

W

Wall rocks - Rock units on either side of an orebody. The hangingwall and footwall rocks of an orebody.
Warrant - See Rights.
Waste - Unmineralized, or sometimes mineralized, rock that is not minable at a profit.
Wedge - A technique of directing a diamond drill hole in a desired direction away from its current orientation.
Winze - An internal shaft.
Witness post - A claim post placed on a claim line when it cannot be placed in the corner of a claim because of water or difficult terrain.
Working capital - The liquid resources a company has to meet day-to-day expenses of operation; defined as the excess of current assets over current liabilities.
Writeoffs - Amounts deducted from a company's reported profit for depreciation or preproduction costs. Writeoffs are not an out-of-pocket expense, but reduce the amount of taxable profit.

X

Xenolith - A fragment of country rock enclosed in an intrusive rock.

Y

Yield - The current annual dividend rate expressed as a percentage of the current market price of the stock.

Z

Zone - An area of distinct mineralization.
Zone of oxidation - The upper portion of an orebody that has been oxidized.