20FR12G/A

UNITED STATES

SECURITIES AND EXCHANGE COMMISSION

Washington, D.C.  20549

FORM 20-F

Amendment #1

[ X ]

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

OR

[   ]

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

For the fiscal year ended ______________

OR

[   ]

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

For the transition period __________

OR

[   ]

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

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

STRATHMORE  MINERALS CORP.

(Exact name of Registrant as specified in its charter)

British Columbia, Canada

(Jurisdiction of incorporation or organization)

700 – 1620 Dickson Avenue, Kelowna, British Columbia, Canada  V1Y 9Y2

(Address of principal executive offices)

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

None

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

Common Shares, without par value

(Title of Class)

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

Indicate the number of outstanding shares of each of the Company’s classes of capital or common stock as of the close of the period covered by the annual report.                                           70,631,548 Common Shares

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

If this report is an annual or a transition report, indicate by check mark if the registrant is not required to file reports pursuant to Section 13 or 15(d) of the Securities Exchange Act of 1934. Yes ___  No ___  N/A  ___

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

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

Large accelerated filer   Accelerated filer   Non-accelerated filer  xxx

Indicate by check mark which financial statement item the registrant has elected to follow:

Item 17 xxx   Item 18 ___

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

Yes ___    No  ____  N/A  _X_

Page 2 of 204

Index to Exhibits on Page 112

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STRATHMORE MINERALS CORP.

COMPREHENSIVE FORM 20-F

REGISTRATION STATEMENT

TABLE OF CONTENTS

	PART I	Page
Item 1.	Identity of Directors, Senior Management and Advisors	7
Item 2.	Offer Statistics and Expected Timetable	8
Item 3.	Key Information	8
Item 4.	Information on the Company	15
Item 5.	Operating and Financial Review and Prospects	64
Item 6.	Directors, Senior Management and Employees	82
Item 7.	Major Shareholders and Related Party Transactions	89
Item 8.	Financial Information	91
Item 9.	The Offer and Listing	92
Item 10.	Additional Information	96
Item 11.	Quantitative and Qualitative Disclosures about Market Risk	110
Item 12.	Description of Other Securities Other Than Equity Securities	110
	PART II
Item 13.	Defaults, Dividend Arrearages and Delinquencies	110
Item 14.	Material Modifications to the Rights of Security Holders and Use of Proceeds	110
Item 15.	Controls and Procedures	110
Item 16.	Reserved	111
Item 16A.	Audit Committee Financial Expert	111
Item 16B.	Code of Ethics	111
Item 16C.	Principal Accountant Fees and Services	111
Item 16D.	Exemptions from Listing Standards for Audit Committees	111
Item 16E.	Purchase of Equity Securities by the Issuer and Affiliated Purchasers	111
	PART III
Item 17.	Financial Statements	111
Item 18.	Financial Statements	111
Item 19.	Exhibits	112

3

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METRIC EQUIVALENTS

For ease of reference, the following factors for converting metric measurements into imperial equivalents are provided:

To Convert from Metric	To Imperial	Multiply by
Hectares	Acres	2.471
Meters	Feet (ft.)	3.281
Kilometers (km)	Miles	0.621
Tonnes	Tons (2000 pounds)	1.102
Grams/tonne	Ounces (troy/ton)	0.029

Glossary:

Adit - A horizontal excavation made into a hill that is usually driven for the purpose of intersecting or mining an ore body.

Arkose – a feldspar-rich sandstone.

Breccia - A rock in which angular fragments are surrounded by a mass of fine-grained minerals.

Chloritization – The conversion of or replacement by chlorite.

Cutoff grade: The lowest grade of uranium ore, in percent U3O8, at a minimum specified thickness that can be mined at a specified cost.

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

Electro-magnetic (“EM”) Survey - A geophysical survey method which measures the electromagnetic properties of rocks.

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

Fluvial: Of or pertaining to a river or rivers

Gamma Log - A type of survey that records the amount of radiation in the surrounding rock.

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.

Grade GT - A factor used in the method to determine the contained resource of uranium deposits.  The number of cubic feet that comprise 1 ton of ore is multiplied by the cut-off grade to obtain the GT (grade in %U3O8 times thickness in ft).

Granite - any holocrystalline, quartz-bearing plutonic rock.

Hematite - An oxide of iron, and one of iron’s most common ore minerals.

Ignimbrite - The rock formed by the widespread deposition and consolidation of ash flows.

In Situ leach mining (ISL): The recovery through chemical leaching of uranium from an ore body without physical extraction of the ore from the ground: also referred to as "solution mining."

Lense - A body of ore that is thick in the middle and tapers towards the ends.

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National Instrument 43-101 (NI 43-101) – A rule developed by the Canadian Securities Administrators (CSA) and administered by the provincial securities commissions in Canada that governs how issuers disclose scientific and technical information about their mineral projects to the public. It covers oral statements as well as written documents and websites. It requires that all disclosure be based on advice by a "qualified person" and in some circumstances that the person be independent of the issuer and the property.

A qualified person (QP) as defined in NI 43-101 as an individual who:

a)

is an engineer or geoscientist with at least five years of experience in mineral exploration, mine development or operation or mineral project assessment, or any combination of these;

b)

has experience relevant to the subject matter of the mineral project and the technical report; and

c)

is a member in good standing of a professional association.

Pyroclastic - Produced by explosive or aerial ejection of ash, fragments, and glassy material from a volcanic vent. Applied to the rocks and rock layers as well as to the textures so formed.

Roll Front Deposit - A sandstone uranium deposits formed in an aquifer through which uranium bearing groundwater flows. The uranium and other metals dissolved in the ground water precipitate out of the ground water and forms a uranium deposit. Roll front deposits are most typically mined by in-situ methods.

Sandstone - A medium-grained sedimentary rock composed of abundant rounded or angular fragments of sand size set in a fine-grained matrix and more or less firmly united by a cementing material

Syncline - A down-arching fold in bedded rocks

Tuff - A general term for all consolidated pyroclastic rocks.

U3O8 - Triuranium Octaoxide, the oxide form of uranium that is the most common chemical form found in nature and is commercially mined for its uranium metal content.

Yellowcake: A natural uranium concentrate that takes its name from its color and texture. Yellowcake typically contains 70 to 90 percent U3O8 by weight. It is used as feedstock for uranium fuel enrichment and fuel pellet fabrication.

5

INTRODUCTION

Strathmore Minerals Corp. is organized under the laws of British Columbia, Canada.  In this Registration Statement, the “Company”, “The Company”, "we," "our" and "us" refer to Strathmore Minerals Corp. (unless the context otherwise requires).  We refer you to the actual corporate documents for more complete information than may be contained in this Registration Statement.  Our principal corporate offices are located at 700 – 1620 Dickson Ave, Kelowna, British Columbia, Canada V1Y 9Y2.  Our telephone number is 800-647-3303.

BUSINESS OF STRATHMORE MINERALS CORP.

Strathmore Minerals Corp. (the “Company") is a mineral exploration company.  Its main focus is on property interests, which may contain economic reserves of uranium. The property interests in which the Company has an interest or the right to acquire an interest are currently in the exploration stage.

There are no known proven reserves of minerals on the Company’s property interests.  The Company does not have any commercially producing mines or sites, nor is the Company in the process of developing any commercial mines or sites.  The Company has not reported any revenue from operations since incorporation.  As such, the Company is defined as an “exploration-stage company”.

FINANCIAL AND OTHER INFORMATION

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

FORWARD-LOOKING STATEMENTS

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

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PART I

ITEM 1.  IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISORS

1.A.1.  Directors

Table No. 1 lists as of 2/15/2007 the names of the Directors of the Company.

Table No. 1

Directors

______________________________________________________________________________

______________________________________________________________________________

Name	Age	Date First Elected of Appointed
Michael Halvorson     (1)	57	December 23, 1996
Dr. Dieter Krewedl     (1)	62	January 14, 2005
Devinder Randhawa     (1)	45	October 18, 1996
David Miller	54	June 8, 2006
Ray Larson	67	December 20, 2006

(1)

Member of Audit Committee.

______________________________________________________________________________

______________________________________________________________________________

1.A.2.  Senior Management

Table No. 2 lists, as of 2/15/2007, the names of the Senior Management of the Company.  The Senior Management serves at the pleasure of the Board of Directors.

Table No. 2

Senior Management

______________________________________________________________________________

______________________________________________________________________________

Name	Age	Date First Elected of Appointed
Devinder Randhawa, Chairman and Chief Executive Officer (1)	45	July 3, 2002
David Miller, President and Chief Operating Officer (2)	54	October 26, 2005
Bob Hemmerling, Corporate Secretary (1)	46	January 23, 2004
Patrick Groening, Chief Financial Officer (1)	35	April 27, 2005
Stephen Khan, Executive Vice President (1)	49	November 25, 2003
Mr. John De Joia, Vice President of Technical Services (1)	58	March 15, 2005
Mr. Juan Velasquez, Vice President        of environmental and Regulatory Affairs (1)	56	March 15, 2005

(1)

Business address:

700 – 1620 Dickson Ave, Kelowna, B.C. V1Y 9Y2

(2)

Business address:

213 W. Main, Suite F, Riverton, WY 82501

______________________________________________________________________________

______________________________________________________________________________

Mr. Randhawa’s business functions, as Chairman and Chief Executive Officer, include strategic planning, business development, operations, liaison with auditors-accountants-lawyers-regulatory authorities-financial community and shareholders.

Mr. Miller’s business functions, as President of the Company, include strategic planning, business development, operations, financial administration, accounting, liaison with auditors-accountants-lawyers-regulatory authorities-financial community/ shareholders; and preparation/payment/organization of the expenses/taxes/ activities of the Company, and reporting to the Board of Directors.

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Mr. Hemmerling’s business functions, as Corporate Secretary, include attending and be the secretary of all meetings of the Board, shareholders and committees of the Board and shall entering or causing to be entered in records kept for that purpose minutes of all proceedings thereat; gives or causes to be given, as and when instructed, all notices to shareholders, Directors, officers, auditors and members of committees of the Board; is the custodian of the stamp or mechanical device generally used for affixing the corporate seal of the Company and of all books, records and instruments belonging to the Company, except when some other officer or agent has been appointed for that purpose; and in the future can have such other powers and duties as the Board of the chief executive officer may specify.  Mr. Hemmerling may delegate all or part of his duties as Corporate Secretary to a nominee from time to time.

Mr. Groening’s business functions, as Chief Financial Officer, include financial administration; accounting and financial statements; liaison with auditors, accountants, and financial community/shareholders; and preparation/ payment/organization of the expenses/taxes/activities of the Company.  He assists in ensuring the Company’s compliance with all statutory and regulatory compliance.

Stephen Kahn’s business functions include administration, strategic planning, and business development.

Mr. De Joia’s business functions, as Vice President of Technical Services, include reviewing the property interests held by the Company. This includes taking part in feasibility studies, permitting and licensing applications, environmental studies and assessments.

Mr. Velasquez’s business functions, as Vice President of Environmental and Regulatory Affairs, include taking part in feasibility studies, permitting and licensing applications, environmental studies and assessments. They also include liaising with regulatory authorities and providing advice to the Company on lobbying efforts necessary to advance uranium mining and nuclear energy worldwide.

1.B.  Advisors   

       ---No Disclosure Necessary ---

1.C.  Auditors

The Company’s auditors for its financial statements for each of the preceding ten years was Davidson & Company LLP, Chartered Accountants, 1200 – 609 Granville Street, Vancouver, British Columbia, Canada V7Y 1G6.  They are members of the British Columbia Institute of Chartered Accountants.

ITEM 2.  OFFER STATISTICS AND EXPECTED TIMETABLE.

         --- No Disclosure Necessary ---

ITEM 3.  KEY INFORMATION.

3.A.1.  Selected Financial Data

3.A.2.  Selected Financial Data

The selected financial data of the Company for the fiscal years ended December 31^st 2006/2005/2004/2003/2002/2001/2000/1999/1998/1997 were derived from the financial statements of the Company that have been audited by Davidson & Company LLP, independent Chartered Accountants, as indicated in their audit report which is included elsewhere in this Registration Statement.

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

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

Table No. 3 is derived from the financial statements of the Company, which have been prepared in accordance with Canadian Generally Accepted Accounting Principles (GAAP). The auditor conducted the audits in accordance with Canadian Generally Accepted Auditing Standards (GAAS), as well as the standards of the Public Company Accounting Oversight Board of the United States.

8

All material numerical differences between Canadian GAAP and US GAAP, as applicable to the Company, are described in footnotes to the financial statements.

Table No. 3

Selected Financial Data

(Cdn$ in 000, except per share data)

	Three months Ended 3/31/07	Three months Ended 3/31/06	Fiscal Year Ended 12/31/06	Fiscal Year Ended 12/31/05	Fiscal Year Ended 12/31/04	Fiscal Year Ended 12/31/03
Canadian GAAP
Revenue	Nil	Nil	Nil	Nil	Nil	Nil
Income (Loss) for the period	($707)	($500)	($2,310)	($1,623)	($1,994)	($433)
Basic Income (Loss) Per Share	$0.01	($0.01)	($0.03)	($0.03)	($0.08)	($0.05)
Dividends Per Share	Nil	Nil	Nil	Nil	Nil	Nil
Wtg. Avg. Shares - Basic (000)	71,433	58,891	66,314	53,550	26,140	8,346
Wtg. Avg. Shares – Diluted (000)	74,363	58,891	66,314	53,550	26,140	8,346
Period-end Shares (000)	72,153	62,002	70,631	55,756	36,241	14,158
Working Capital	$31,857	$28,137	$32,426	$21,226	$9,056	$1,030
Mineral Property interests	$8,135	$7,162	$7,702	$9,151	$2,856	$207
Long-Term Debt	Nil	Nil	Nil	Nil	Nil	Nil
Capital Stock	$70,293	$53,364	$69,061	$41,300	$23,457	$12,625
Shareholders’ Equity	$55,565	$39,885	$52,766	$30,585	$11,983	$1,243
Total Assets	$56,638	$40,142	$53,490	$30,771	$12,057	$1,291
US GAAP
Net Loss	N/A	N/A	($10,601)	($5,513)	($3,622)	($531)
Loss Per Share	N/A	N/A	($0.16)	($0.10)	($0.14)	($0.06)
Mineral Property Interests	N/A	N/A	$5,729	$3,522	$1.022	Nil
Shareholders’ Equity	N/A	N/A	37,709	$24,956	$10,148	$1,036
Total Assets	N/A	N/A	39,571	$25,142	$10,223	$1,084

Table No. 3a

Selected Financial Data

(Cdn$ in 000, except per share data)

	Year Ended 12/31/02	Year Ended 12/31/01	Year Ended 12/31/00	Year Ended 12/31/99	Year Ended 12/31/98	Year Ended 12/31/97
Canadian GAAP
Revenue	Nil	Nil	Nil	Nil	Nil	Nil
Income (Loss) for the period	($1,159)	($291)	($399)	($1,680)	($1,315)	($1,412)
Basic Income (Loss) Per Share	($0.17)	($0.05)	($0.10)	($0.47)	($0.44)	($0.20)
Dividends Per Share	Nil	Nil	Nil	Nil	Nil	Nil
Wtg. Avg. Shares  (000)	6,961	5,630	4,083	3,609	2,980	2,016
Period-end Shares (000)	8,047	5,802	4,150	3,990	3,416	2,545
Working Capital (deficiency)	($31)	($87)	$69	($118)	$175	$1,080
Mineral Property interests	$109	$976	$874	$967	$1,692	$800
Long-Term Debt	Nil	Nil	Nil	Nil	$24	$30
Capital Stock	$11,612	$11,182	$10,767	$10,647	$10,038	$8,675
Shareholders’ Equity	$86	$924	$1,016	$970	$2,040	$1,993
Total Assets	$136	$1,018	$1,068	$1,092	$2,414	$2,097
US GAAP
Net Loss	($291)	($497)	($306)	($1,056)	($2,380)	($2,227)
Loss Per Share	($0.04)	($0.09)	($0.08)	($0.30)	($0.82)	($1.15)
Mineral Property interests	Nil	Nil	Nil	Nil	Nil	Nil
Shareholders’ Equity (Deficiency)	($23)	($52)	$142	$3	$349	$1,193
Total Assets	$27	$42	$194	$126	$722	$1,297

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3.A.3.  Exchange Rates

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

Table No. 4 sets forth the exchange rates for the Canadian Dollar at the end of the fiscal years ended 12/31/97 thru 12/31/06; the end of the latest three month interim periods ended 3/31/2007 and 3/31/2006; and, the last eight monthly periods. The average rates for the annual and nine month periods, and the range of high and low rates for all the periods.  

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

Table No. 4

U.S. Dollar/Canadian Dollar

______________________________________________________________________________

______________________________________________________________________________

Period	Average	High	Low	Close
June 2007		$1.07	$1.06	$1.06
May 2007		1.11	1.07	1.07
April 2007		1.16	1.11	1.11
March 2007		1.18	1.15	1.15
February 2007		1.19	1.16	1.17
January 2007		1.19	1.16	1.19
December 2006		1.17	1.14	1.17
November 2006		1.15	1.13	1.14
Six Months Ended 6/30/2007	$1.13	$1.19	$1.06	$1.06
Six Months Ended 6/30/2006	1.13	1.17	1.10	1.12
Fiscal Year Ended 12/31/2006	$1.15	$1.17	$1.10	$1.17
Fiscal Year Ended 12/31/2005	1.22	1.27	1.15	1.17
Fiscal Year Ended 12/31/2004	1.30	1.39	1.18	1.19
Fiscal Year Ended 12/31/2003	1.39	1.58	1.29	1.29
Fiscal Year Ended 12/31/2002	1.57	1.61	1.51	1.58
Fiscal Year Ended 12/31/2001	1.55	1.60	1.49	1.59
Fiscal Year Ended 12/31/2000	1.50	1.56	1.44	1.50
Fiscal Year Ended 12/31/1999	1.49	1.53	1.44	1.44
Fiscal Year Ended 12/31/1998	1.40	1.46	1.34	1.42
Fiscal Year Ended 12/31/1997	1.39	1.45	1.35	1.43

______________________________________________________________________________

______________________________________________________________________________

3.B.  Capitalization and Indebtedness

Table No. 5 sets forth the capitalization and indebtedness of the Company as of 5/31/2007.

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Table No. 5

Capitalization and Indebtedness

May 31, 2007

______________________________________________________________________________

______________________________________________________________________________

Designation of Security	Amount Authorized	Amount Outstanding as of May 31, 2007
Common Shares	Unlimited	72,213,911 shares
Common Share Purchase Warrants		541,324 warrants
Common Share Options		3,905,000 options
Long Term Debt		$0
Long Term Liabilities		$0

______________________________________________________________________________

______________________________________________________________________________

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

      --- No Disclosure Necessary ---

3.D.  Risk Factors

Risks Associated with Resource Exploration:

Strathmore Has No Reserves on the Property interests in Which It Has an Interest and If Reserves Are Not Defined Strathmore Could Have to Cease Operations:

Strathmore is an exploration stage company and has not yet established any economically recoverable uranium reserves on any of its properties. The long-term success of Strathmore depends on the ability to successfully define economically recoverable quantities of uranium ore. If the Company does not ultimately define an economically recoverable uranium ore, it would have to cease operations.    

Cumulative Unsuccessful Exploration Efforts By Strathmore Personnel Could Result In Strathmore Having to Cease Operations:

The expenditures to be made by the Company in the exploration of its uranium property interests as described herein may not result in discoveries of mineralized material in commercial quantities. Uranium exploration requires substantial capital expenditures to define commercially recoverable ore, and substantial amounts of additional funds would be required to develop any development infrastructure required to mine and process the uranium ore. Most exploration projects do not result in the discovery of commercially mineable ore deposits. If the Company is unable to define a commercially recoverable uranium deposit on its properties, it would likely lose the entire amount of capital invested in the properties, and this occurrence could ultimately result in the Company having to cease operations.

Uranium Prices May Not Support Corporate Profit for Strathmore:

Uranium prices have been highly volatile, and are affected by numerous international economic and political factors which Strathmore has no control. The Company’s long-term success is highly dependent upon the price of uranium, as the economic feasibility of any ore body discovered on its properties would in large part be determined by the prevailing market price of uranium. If a profitable market does not exist, the Company could have to cease operations.  

The Uranium Exploration and Mining Industry is Highly Competitive

The uranium industry is highly competitive, and Strathmore is required to compete with other corporations that may have greater resources than the Company. Such corporations could outbid the Company for potential projects or produce minerals at lower costs which would have a negative effect on the Company’s operations.

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Operating Hazards and Risks Associated with the Mining Industry Could Result in Strathmore Having to Cease Operations:      

Resource exploration activities generally involve a high degree of risk.  Hazards such as unusual or unexpected formations and other conditions are involved.  Operations in which the Company has a direct or indirect interest will be subject to all the hazards and risks normally incidental to exploration, development and production of precious and base metals, any of which could result in work stoppages, damage to or destruction of exploration facilities, damage to life and property, environmental damage and legal liability for any or all damage.  The Company may become subject to liability for cave-ins and other hazards for which it cannot insure or against which it may elect not to insure where premium costs are disproportionate to the Company’s perception of the relevant risks.  The payment of such insurance premiums and of such liabilities would reduce the funds available for exploration activities and could force Strathmore to cease operations.

The Company is Subject to Substantial Government Regulatory Requirements

Strathmore’s exploration operations are affected by government regulations relating to resource operations, including the acquisition of land, pollution control and environmental protection, waste disposal and toxic substances, and safety.  Changes in these regulations or in their application are beyond the control of the Company and may adversely affect its operations, business and results of operations.  The requirements to comply with these regulations may result in increased costs, as well as delays in obtaining the permits required to conduct operations. Failure to comply with the conditions set out in any permit or failure to comply with the applicable statutes and regulations may result in orders to cease or curtail operations or to install additional equipment.  The Company may be required to compensate those suffering loss or damage by reason of its operating or exploration activities.

On the Federal, Provincial and State level, the Company must comply with exploration permitting requirements which require sound operating and reclamation plans to be approved by the applicable government body prior to the start of exploration. Depending upon the type and extent of the exploration activities, the Company may be required to post reclamation bonds and/or assurances that the affected areas will be reclaimed. If the reclamation requires funds in addition to those already allocated, the Company could be forced to pay for the extra work and it could have a significant negative effect upon the Company’s financial position and operations.

The Company is Subject to Substantial Environmental Requirements

In connection with its operations and properties, Strathmore is subject to extensive and changing environmental legislation, regulation and actions.  The Company cannot predict what environmental legislation, regulation or policy will be enacted or adopted in the future or how future laws and regulations will be administered or interpreted.  The recent trend in environmental legislation and regulation generally is toward stricter standards and this trend is likely to continue in the future. These regulations may require obtaining permits or other authorizations for certain activities.  These laws and regulations may also limit or prohibit activities on certain lands lying within certain types of areas, area providing for habitat for certain species or other protected areas.  

Compliance with more stringent laws and regulations, as well as potentially more vigorous enforcement policies or stricter interpretation of existing laws, may necessitate significant capital outlays, may materially affect the Company’s results of operations and business, or may cause material changes or delays in the Company’s intended activities.

The Navajo Nation has Banned Uranium Mining in “Indian Country” and Has Threatened Legal Action Against Uranium Mining in the Area of the Reservation, Which May Include Certain of the Company’s Properties

The Navajo Nation Council passed the Diné Natural Resources Protection Act of 2005 in April 2005 which  prohibiting uranium mining and processing on any sites within the reservation and “Indian Country”. Indian Country defines that certain lands which, although not within the Navajo reservation, yet within close proximity to Navajo lands which contain a “dependent Indian community”, may fall under the Navajo regulations. The legal determination of which areas and properties are contained within “Indian Country” is a matter of dispute. Some of Strathmore’s New Mexico properties, particularly Church Rock and Nose Rock, are situated on State or Federal land but lie in close proximity to the Navajo nation. These properties have not at this time been determined to be within “Indian Country”; However, if the Federal Government does ultimately determine some of the Company’s properties lie in India n Country, the ban may prevent Strathmore from exploring or developing the properties so defined until the legal and jurisdictional issues are resolved, either through negotiation or through the courts.

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Risks Associated with the Financing Requirements of the Company

Strathmore Has Minimal Positive Cash Flow and No History Earnings

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

Strathmore Will Require Additional Funds Under its Expected Business Plan, and is Dependent Upon Public and Private Distributions of Common Shares to Obtain Capital in Order to Sustain Operations.

The Company will require additional funds to continue to explore its uranium properties. This work will require additional capital, the amount and timing of which is unknown at this time. The exploration of the Company’s mineral properties is, therefore, dependent upon the Company’s ability to obtain financing through the joint venturing of projects, debt financing, equity financing or other means. Historically, Strathmore has depended upon the issuance of common shares to raise capital for operations. Such sources of financing may not be available on acceptable terms in the future, if at all.  These financings may also be on terms less favorable to the Company than those obtained previously. Failure to obtain such financing may result in delay or indefinite postponement of exploration work on the Company’s mineral properties, as well as the possible loss of such properties. The issuance of additional common share equity will cause dilution to current s hareholders.

Strathmore has also historically issued stock options as part of its compensation of officers, directors and consultants, as well as issuing common stock warrants as part of its equity financings. These issuances are likely to cause further dilution to common shareholders. The Company currently has 3,905,000 share purchase options outstanding and 541,324 share purchase warrants outstanding. If all of the share purchase warrants and share purchase options were exercised, the number of common shares issued and outstanding would increase from 72,213,911  (as of May 31, 2007) to 76,660,235. This represents an increase of 6.16% in the number of shares issued and outstanding and would result in dilution to current shareholders.

The Amount of Capital Necessary to Meet All Environmental Regulations Associated with the Exploration Programs of Strathmore Could Be In An Amount Great Enough to Force Strathmore to Cease Operations:

The current and anticipated future operations of the Company, including further exploration activities require permits from various Canadian, U.S. and Peruvian federal, provincial, state and local governmental authorities.   Such operations are subject to various laws governing land use, the protection of the environment, production, exports, taxes, labor standards, occupational health, waste disposal, toxic substances, mine safety and other matters. Unfavorable amendments to current laws, regulations and permits governing operations and activities of resource exploration companies, or more stringent implementation thereof, could have a materially adverse impact on the Company and cause increases in capital expenditures which could result in a cessation of operations by the Company.

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

Risks Relating to an Investment in the Securities of the Company

The Company is Currently Effecting a Spin-Out of its Canadian and Peruvian Assets into a Separate Company, which May have a Negative Effect on the Company’s Share Price

Under the Plan of Arrangement approved by shareholders, Strathmore is currently effecting the spin-out of its Canadian and Peruvian mineral exploration property assets into a separately traded public company, Fission Energy (“Fission”). This spin-out will remove approximately $3,500,000 in mineral property assets from the Company’s balance sheet, as well as $500,000 cash. The investment market’s reaction to the spin-off is unknown, and it could result in a negative effect on the Company’s share price.

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Strathmore is Dependent on Key Personnel and the Absence of Any of These Individuals Could Result in Strathmore Having to Cease Operations:

While engaged in the business of exploiting mineral property interests, the nature of the Company’s business, its ability to continue its exploration of potential exploration projects, and to develop a competitive edge in the marketplace, depends, in large part, on its ability to attract and maintain qualified key management personnel.  Competition for such personnel is intense and the Company may not be able to attract and retain such personnel.  The Company’s growth will depend, on the efforts of its Senior Management, particularly its Chairman and CEO, Dev Randhawa; it’s President and COO, David Miller; and, it’s Corporate Secretary, Mr. Bob Hemmerling. The Company also relies on Mr. Robert Quartermain, a member of the Executive Advisory Board, and Dr. Dieter Krewedl, a member of the Board of Directors for advice pertaining to exploration work. In the area of capital issues, the Company relies on Steven Khan because of his expertise in this area. Loss of these individuals could have a material adverse effect on the Company.  The Company has no key-man life insurance with the Senior Officers or the Directors.

Under the Plan of Arrangement, Officers and Directors will Serve the New Company, which Could Reduce the Time and Focus on Strathmore Business.

The Company is currently effecting a spin-out of its Canadian and Peruvian mineral exploration property assets into a separately traded public company, Fission Energy (“Fission”). The officers and directors of Strathmore are expected to serve in the same capacity with Fission. The requirements of operating an additional public company may necessitate management to spend less time on Strathmore business, which could have a negative effect on the operations of the Company.

The Market for the Company’s Stock has Been Subject to Volume and Price Volatility which Could Negatively Effect a Shareholder’s Ability to Buy or Sell the Company’s Shares

The market for the common shares of the Company may be highly volatile for reasons both related to the performance of the Company or events pertaining to the industry (ie. mineral price fluctuation/high production costs/accidents) as well as factors unrelated to the Company or its industry.  In particular, market demand for products incorporating minerals fluctuates from one business cycle to the next, resulting in change of demand for the mineral and an attendant change in the price for the mineral.  The Company’s common shares can be expected to be subject to volatility in both price and volume arising from market expectations, announcements and press releases regarding the Company’s business, and changes in estimates and evaluations by securities analysts or other events or factors.  In recent years the securities markets in the United States and Canada have experienced a high level of price and volume volatility, and the market price of securit ies of many companies, particularly small-capitalization companies such as the Company, have experienced wide fluctuations that have not necessarily been related to the operations, performances, underlying asset values, or prospects of such companies.  For these reasons, the price of the Company’s common shares can also be expected to be subject to volatility resulting from purely market forces over which the Company will have no control.  Further, despite the existence of a market for trading the Company’s common shares in Canada, stockholders of the Company may be unable to sell significant quantities of common shares in the public trading markets without a significant reduction in the price of the stock.

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

The Company’s stock is subject to “penny stock” rules as defined in 1934 Securities and Exchange Act rule 3a51-1.  The Commission has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks.  The Company’s common shares are subject to these penny stock rules. Transaction costs associated with purchases and sales of penny stocks are likely to be higher than those for other securities.  Penny stocks generally are equity securities with a price of less than U.S. $5.00 (other than securities registered on certain national securities exchanges or quoted on the NASDAQ system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or system).  

The penny stock rules require a broker-dealer, prior to a transaction in a penny stock not otherwise exempt from the rules, to deliver a standardized risk disclosure document that provides information about penny stocks and the nature and level of risks in the penny stock market.  The broker-dealer also must provide the customer with current bid and offer quotations for the penny stock, the compensation of the broker-dealer and its salesperson in the transaction, and monthly account statements showing the market value of each penny stock held in the customer’s account.  The bid and offer quotations, and the broker-dealer and salesperson compensation information, must be given to the customer orally or in writing prior to effecting the transaction and must be given to the customer in writing before or with the customer’s confirmation.

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In addition, the penny stock rules require that prior to a transaction in a penny stock not otherwise exempt from such rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser’s written agreement to the transaction.  These disclosure requirements may have the effect of reducing the level of trading activity in the secondary market for the Company’s common shares in the United States and shareholders may find it more difficult to sell their shares.

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

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

As a "foreign private Company”, Strathmore is exempt from the Section 14 proxy rules and Section 16 of the 1934 Securities Act May Result in Shareholders Having Less Complete and Timely Data

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

ITEM 4.  INFORMATION ON THE COMPANY

4.A. History and Development of the Company

Introduction

The Company is engaged in the acquisition and exploration of uranium exploration properties. The property interests in which the Company has an interest or the right to acquire on interest are all currently in the exploration stage and there is no guarantee that an economic ore body will ever be discovered.

The Company’s executive office is located at:

 700 – 1620 Dickson Ave, Kelowna, B.C. Canada V1Y 9Y2

 Telephone: (800) 647-3303

 Facsimile: (604) 868-8493

 e-mail: Bob@rdcapital.com

The contact person is:

  Mr. Robert Hemmerling, Corporate Secretary

The Company’s registered office is located at:

 700 – 595 Howe Street, Vancouver, B.C. Canada V6C 2T5

 Telephone: (604) 687-2923

 Facsimile: (604) 687-5960

The Company's fiscal year ends December 31st.

The Company's common shares trade on the TSX Venture Exchange under the symbol “STM”.

The Company has an unlimited number of no par common shares authorized. At 12/31/2006, the end of the Company's most recent fiscal year, there were 70,631,548 common shares issued and outstanding.  At  3/31/2007, there were 72,153,687 common shares issued/outstanding.

15

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

Proposed Corporate Reorganization

Strathmore currently has mineral exploration property interests located in Canada, the United States and Peru. The Company proposed to reorganize its mineral property interests under a Plan of Arrangement (the “Plan”) by transferring all of its Canadian and Peruvian mineral properties and $500,000 cash into a new exploration company, known as Fission Energy (“Fission”) pursuant to a plan of arrangement. Strathmore would continue to hold the United States properties. The purpose of the Plan will allow Strathmore to concentrate on the exploration and, if warranted, possible development of the more advanced uranium exploration assets in the United States, while the early stage Canadian and Peruvian uranium exploration properties can be financed separately through Fission Energy.

Immediately following such arrangement, Strathmore's shareholders, other than any dissenting shareholders, would be issued shares in Fission, so that collectively, they would own all of Fission’s shares which would seek a listing on the TSX Venture Exchange. This reorganization is designed to improve the identification and valuation of specific Strathmore properties, to enhance Strathmore's ability to divest specific properties through simpler corporate ownership, to enter into strategic joint venture agreements, and to enable Strathmore to separately finance and develop its various uranium property assets.

If the Plan is completed, Strathmore would retain all of the United States property assets, all of the liabilities, and the majority of the current assets. The following selected unaudited pro forma consolidated financial information for Strathmore is based on the Plan and the assumption, among other things, that the Arrangement had occurred on December 31, 2006.

	PRO FORMA STRATHMORE MINERALS CORP. (CONSOLIDATED)
ASSETS
CURRENT:
Cash and cash equivalents	$   4,799,908
Short term investments	$ 27,412,579
Receivables	$      407,910
Prepaid expenses	$        30,593
	$ 32,650,990
Equipment	$      320,201
Land	$      370,703
Mineral property interests	$   4,547,525
Deferred exploration costs	$   3,004,864
TOTAL:	$ 40,894,283
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	$      708,606
Due to related parties	$        15,449
	$      724,055
SHAREHOLDERS’ EQUITY
Share capital	$ 56,464,982
Contributed surplus	$   1,591,993
Deficit	$(17,886,747)
	$ 40,170,228
	$ 40,894,283

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Fission Energy would receive the Canadian mineral exploration property assets and $500,000 cash, and would succeed to all of Strathmore’s agreements and obligations over the Canadian and Peruvian mineral properties. The following selected unaudited pro forma financial information for Fission Energy is based on the Plan and the assumption, among other things, that the Arrangement had occurred on December 31, 2006.

	PRO FORMA FISSION ENERGY
ASSETS
CURRENT:
Cash and cash equivalents	$      500,000
Short term investments	-
Receivables	-
Prepaid expenses	-
	$      500,000
Equipment	-
Land	-
Mineral property interests	$   3,154,921
Deferred exploration costs	$   8,941,150
TOTAL:	$ 12,596,071
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	-
Due to related parties	-
	-
SHAREHOLDERS’ EQUITY
Share capital	$  12,596,071
Contributed surplus	-
Deficit	-
	$  12,596,071
	$  12,596,071

Details of the Plan of Arrangement

Pursuant to the Plan, common shareholders of Strathmore will receive, for each common share of Strathmore held, one Strathmore New Share and one-third of a common share of Fission Energy. No fraction shares will be issued and shareholders will not receive any compensation in lieu thereof.

As of the Effective Date, for each outstanding Strathmore option held by an Employee Optionholder, the option will be exchanged for one Strathmore new option. The Strathmore New Option will be identical in every respect to the Strathmore Option originally granted except it will have an adjusted exercise price to take into account any change in the fair market value of Strathmore Shares as a result of transferring the Spin-Out Assets from Strathmore to Fission. The exercise price of Strathmore New Options will be determined by the Board of Directors such that the difference between the fair market value of a Strathmore Share and the exercise price of the Strathmore Option immediately prior to the Arrangement becoming effective, shall be equal to the difference between the fair market value of a Strathmore New Share and the exercise price of the Strathmore New Option immediately after the Arrangement becoming effective. The fair market value of the Strathmore Shares and the Strathmore New Shares shall be determined as the weighted average trading price for the three days prior to and after the Share Distribution Record Date, respectively.

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As of the Effective Date, for each outstanding Strathmore option held by a Non-Employee Optionholder, such as a consultant, will have its exercise price adjusted in accordance with the terms of such Strathmore Options to take into account any difference in the fair market value of the Strathmore Shares prior to the Arrangement becoming effective and the Strathmore New Shares immediately after the Arrangement becoming effective. The adjusted exercise price of the existing Strathmore Option held by a Non-Employee Optionholder will be set so that the difference between the fair market value of a Strathmore New Share and the adjusted exercise price of the existing Strathmore Option immediately after the adjustment of the exercise price is equal to the difference between the fair market value of a Strathmore Share and the exercise price of a holder’s Strathmore Option, immediately before the adjustment of the exercise price, determined by the same method as for Employee Op tionholders.

For Strathmore warrantholders, as of the Effective Date, pursuant to the terms of the warrant agreements entered into on May 9, 2006 between Strathmore and the Warrantholders who received Strathmore Warrants pursuant to Strathmore’s May 2006 brokered private placement, each Strathmore Warrant received in such private placement will be adjusted upon the occurrence of a spin-out transaction to compensate the Warrantholders for the assets spun out and, in the case of the Arrangement, the securities received by a Warrantholder on exercise of a Warrant will be adjusted to reflect the securities received by Shareholders on the Arrangement. After the Arrangement, each Warrantholder will upon exercise of the right to purchase Strathmore Shares, be entitled to receive, and shall accept, in lieu of the number of Strathmore Shares to which the Warrantholder was initially entitled upon such exercise, the kind and amount of shares and other securities or property which the Warrant holder would have been entitled to receive as a result of the transferring of the Spin-Out Assets if, on the effective date thereof, the Warrantholder had been the registered holder of the number of Strathmore Shares to which the Warrantholder was therefore entitled upon such exercise. Therefore, upon the exercise of the Warrants, the Warrantholder will receive one Strathmore New Share and one-third of one Fission Energy Share for each Strathmore Warrant so exercised. The exercise price paid will be divided between Strathmore and Fission on the same ratio that the fair market value of the Spin-Out Assets has to the fair market value of all assets of Strathmore.

The intended officers and directors of Fission are Devinder Randhawa, David R. Miller, Michael Halvorson, Dr. Dieter Krewedl, Raymond Larson, Steven Kahn, and Patrick Groening, all of whom are also officers and/or directors of Strathmore.

All costs relating to the Plan to the Effective Date will be borne by Strathmore.

Result of Shareholder Meeting

The proposed reorganization was subject to shareholder approval by resolution approved by not less than 66-2/3 per cent of the votes cast. Strathmore presented the matter to shareholders at a special meeting held in Vancouver, British Columbia on June 19, 2007. 36,264,607 common shares were represented at the meeting. 98.98% of the represented shares voted for the Motion to approve the Plan. The completion of the Plan is subject to approval by the British Columbia Supreme Court, negotiation of definitive agreements, acceptance by the TSX Venture Exchange, the approval for listing of Fission on the TSX Venture Exchange, and other regulatory approvals.

A copy of the Plan of Arrangement is contained within the Management Information Circular for the Annual and Special Meeting of Securityholders held on June 19, 2007, a copy of which has been filed as an exhibit to this amended 20-F Registration Statement.

History and Development

The Company was incorporated by memorandum and articles pursuant to the Company Act (British Columbia) on April 16, 1987 under the name 325240 B.C. Ltd. On July 28, 1988, the Company changed its name to Achievers Media Corporation and was continued under the Canada Business corporations Act. The Company was extra-provincially registered in British Columbia effective September 29, 1988.  The Company was listed on the TSX Venture Exchange on September 26, 1989. On November 2, 1992, the TSX Venture Exchange declared the Company inactive. On November 6, 1992, the Company changed its name to The Achievers Training Group Inc. and consolidated it share capital on the basis of one new share for every five existing shares. On May 5, 1993, the Company was continued into British Columbia, and the British Columbia Registrar of Companies issued a Certificate of Continuation under the Company Act on June 21, 1993, at which time the Company changed its name to Rockwealth Internation al Resource Corp.  On June 25, 1993, the TSX Venture Exchange removed the Company’s inactive designation. On August 7, 1996 the Company changed its name to Strathmore Resources Ltd. On September 19, 2000, the Company changed its name to Strathmore Minerals Corp. and consolidated its share capital on a five old for one new basis.

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Financings  

The Company has financed its operations through funds raised in public and private placements of common shares and the exercise of stock options and warrants. Table No. 6 details the issuances of common shares since 1997.

Table No. 6

Common Stock Share Issuances

Fiscal Year	Nature of Share Issuance	Number of Shares	Capital
1997	Exercise of share purchase options	60,500	$198,925
	Exercise of share purchase warrants	118,055	$300,737
	Private Placement (1)	80,000	$740,000
	Private Placement (2)	20,000	$63,000
	Exercise of Agent’s Special Warrants (3)	27,170	$61,750
	Mineral Property Purchases (4)	45,712	$225,250
	Payment of Finder’s Fees (5)	4,600	$14,950
	Exercise of Special Warrants (6)	660,000	$1,369,836
	Exercise of Agent’s Warrants (7)	41,400	Nil

1998	Private Placement (8)	431,091	$916,072
	Private Placement (9)	300,000	$337,500
	Exercise of share purchase options (10)	130,000	$136,500
	Mineral Property Purchase (11)	9,240	$39,100
1999	Private Placement (12)	262,400	$262,400
	Exercise of share purchase options (13)	60,400	$63,420
	Exercise of share purchase warrants (14)	251,200	$283,800
2000	Private Placement (15)	160,000	$120,000
2001	Private Placements (16)	1,620,000	$414,600
2002	Private Placements (17)	550,000	$110,000
	Private Placements (18)	1,535,000	307,000
	Finder’s Fee on Mineral Property Acquisition	60,000	$13,200
2003	Private Placement (19)	2,222,229	$400,000
	Private Placement (20)	3,000,000	$750,000
	Exercise of share purchase options	454,000	$68,100
	Exercise of share purchase warrants	435,000	$108,750
	Acquisition of mineral property (21)	100,000	$56,000
2004	Private Placement(22)	4,767,444	$1,287,210
	Private Placement (23)	1,501,334	$900,800
	Private Placement (24)	3,436,167	$2,061,700
	Private Placement (25)	2,857,143	$2,000,000
	Private Placement (26)	2,000,000	$2.000,000
	Exercise of share purchase warrants	6,208,392	$2,656,557
	Exercise of share purchase options	250,000	$79,698
	Acquisition of mineral property interests	550,000	$757,500
2005	Private Placement (27)	543,000	$1,058,850
	Private Placement (28)	10,000,000	$15,000,000
	Private Placement (29)	114,286	$200,000
	Exercise of share purchase warrants	7,082,971	$4,280,507
	Exercise of share purchase options	887,000	$466,080
	Acquisition of mineral property interests	1,400,000	$2,377,750
2006	Exercise of share purchase warrants	8,340,084	$11,610,850
	Exercise of share purchase options	2,370,000	$1,930,800
	Private Placement (30)	3,265,950	$8,699,795
	Acquisition of mineral property interests	900,000	$2,207,000
2007	Exercise of share purchase warrants	1,179,363	$2,945,252
to date	Exercise of share purchase options	302,500	$354,500
	Acquisition of mineral property interests	100,000	$425,000

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*Share amounts for the period prior to September 19, 2000 have been adjusted to reflect a 1 for 5 reverse split.

Share transactions of the Company are as follows:

(1)

The Company issued 80,000 units at a price of $9.25 per unit. Each unit consisted of one common share and one common share purchase warrant. Each warrant was convertible into an additional common share at a price of $9.25 until 12/26/98 and at a price of $10.65 until 12/26/99.

(2)

The Company issued 20,000 units at a price of $3.15 per unit. Each unit consisted of one common share and one common share purchase warrant. Each warrant was convertible into an additional common share at a price of $3.15 until 8/13/98 and at a price of $3.65 until 8/13/99.

(3)

Issued common shares to an agent pursuant to the Company’s 1996 private placement of 3,000,000 special warrants.

(4)

These shares were issued in payment for the San Rafael River property interests; the Hot Rock property interests; and the Rio Puerco and Apex property interests.

(5)

Issued for finder’s fees pursuant to the private placement described in (1) above.

(6)

Converted 660,000 special warrants issued in 1996 into units of the Company. Each unit consisted of 1.1 common shares and 1.1 common share purchase warrants, each warrant entitling the holder to acquire one additional common share of the Company for a period of two years at a price of $2.50 in the first year and $2.90 in the second.

(7)

Issued on the exercise of agent’s warrants described in (3).  

(8)

The Company issued 431,091 units at a price of $2.125 per unit. Each unit consisted of one common share and one common share purchase warrant. Each Warrant allowed the holder to purchase one additional common share at a price of $2.125 until 1/19/99 and at a price of $2.50 until 1/19/00.

(9)

The Company issued 300,000 units at a price of $1.125 per unit. Each unit consisted of one common share and one common share purchase warrant. Each warrant allowed the holder to purchase one additional common share for $1.125 until 9/9/99 and at a price of $1.30 until 9/9/00.

(10)

Issued on the exercise of share purchase options by Directors, Officers and Consultants of the Company at a cost of $1.05 per share.

(11)

These shares were issued in payment for the San Rafael River property interests; the Hot Rock property interests; and, the Aurora property.

(12)

The Company issued 262,400 units at a price of $1.00 per unit. Each unit was convertible into one share of common stock at no additional cost.

(13)

Issued on the exercise of share purchase options by Directors, Officers and Consultants of the Company at a cost of $1.05 per share.

(14)

These share purchase warrants were issued pursuant to the private placement described in (9) above.

(15)

The Company issued 160,000 shares to insiders raising $120,000.

(16)

In September 2001, the Company issued 1,620,000 units, 1,300,000 at $0.25 and 320,000 at $0.28 per unit.  Each unit consisted of one common share and one share purchase warrant. Each warrant entitled the holder to acquire one additional common share at $0.30 for the $0.25 private placement and $0.38 for the $0.28 private placement until 1/31/03. A Finder’s Fee of 32,000 units was included in this placement.

(17)

In February 2002, the Company issued 550,000 shares at $0.20 per share.

(18)

In June 2002, the Company issued 1,535,000 units at $0.20 per unit. Each unit consists of one common share and share purchase warrant. Each warrant entitled the holder to acquire one additional common share at $0.25 until 6/3/04.

(19)

In November 2003, the Company issued 2,222,229 units at $0.18 per unit. Each unit consisted of one common share and one share purchase warrant. Each warrant entitled the holder to acquire one additional common share at $0.25 until 11/24/05.

(20)

In December 2003, the Company issued 3,000,000 units at a price of $0.25 per unit. Comprised of 400,000 flow-through units and 2,600,00 non-flow-through units for total proceeds of $750,000. Each unit consisted of one flow-through or non-flow-through common share and one share purchase warrant.  Each share purchase warrant is exercisable into an additional common share at $0.35 per share until 12/17/05.

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(21)

During fiscal 2003, the Company amended the terms of a lease agreement for the Chord property located in South Dakota, USA. Consideration of 100,000 shares valued at $56,000 was issued as per the terms of the amendment.

(22)

In January 2004, the Company issued 4,767,444 units at $0.27 per unit. Each unit consisted of one common share and one share purchase warrant for total proceeds of $1,287,210.  Each warrant entitles the holder to acquire one additional common share at $0.36 per share.

(23)

In February 2004, the Company issued 1,501,334 units at $0.60 per unit consisting of one common share and one share purchase warrant. Each warrant entitles the holder to acquire one additional common share at $0.76 per share expiring 2/23/06.

(24)

In April 2004, the Company issued 3,436,167 units at $0.60 per unit. Each unit consisted of one common share and one share purchase warrant. Each share purchase warrant entitles the holder to purchase one additional share for $0.76 until April 16, 2006.

(25)

In September 2004, the Company sold 2,857,143 common shares at a price of $0.70 per share.

(26)

In September 2004, the Company sold 2,000,000 common shares at a price of $1.00 per share.

(27)

On January 10, 2005, the Company announced that this private placement had closed. This financing consisted of the sale of 543,000 Flow Through shares at a price of $1.95 per Flow Through share.

(28)

On February 23, 2005,The Company announced that this private placement had closed. It consisted of the sale of 10,000,000 units at a price of $1.50 per unit. Each unit consisted of one common share and one half share purchase warrant exercisable at $1.75 until February 21, 2006, and at $2.00 until February 21, 2007. In connection with this financing, The Company issued Agent options to purchase 1,027,180 share at a price of $1.75 until February 21, 2006 and at a price of $2.00 until February 21, 2007. The Company also paid cash commissions in the amount of $1,027,180 in conjunction with the financing.

(29)

This private placement consisted of the sale of 114,286 units at a price of $1.75 per unit. Each unit consists of one common share and one half common share purchase warrant exercisable at $2.00 per share until October 26, 2007.

(30)

This private placement consisted of the sale of 1,697,300 flow-through common shares at a price of $3.00 per flow-through share and 1,568,650 units at a price of $2.30 per unit. Each unit consisted of one common share and one-half of one common share purchase warrant. Each whole common share purchase warrant entitles the holder to acquire on common share of the company until November 9, 2007 at a price of $3.25.

Capital Expenditures

1997: $879,173 (1)

1998: $965,600 (2)

1999: $142,132 (3)

2000: $48,992  (4)

2001: $102,701 (5)

2002: $38,819  (6)

2003: $42,343  (7)

2004: $1,964,507 (8)

2005: $3,978,040 (9)

2006: $8,467,796 (10)

2007 (3 months):$3,336,826 (11)

(1)

The Company spent $100,653 on capital assets which consisted of office equipment; computer equipment; a vehicle; and, computer software. The Company also spent $67,850 on a geological database. The Company spent a total of $533,449 (cash) on mineral property acquisitions. These funds were spent on the San Rafael River property interests; the Hot Rock property interests; and, the Staked property interests. Deferred exploration costs on The Company’s mineral property interests were as follows:

21

	Staked Property interests	Utah Property interests	Rio Puerco Apex-Lowboy property interests
Consulting Fees	$60,356
General expenditures	$40,954	$7,831
Renewal fees	$2,936	$10,116	$13,910
Report preparation	$21,402		$1,567
Travel	$18,149

(2)

$70,935 was spent on capital assets consisting of office and computer equipment; computer software; and, vehicles. $41,720 was spent on a geological database. $88,435 (cash) was spent on mineral property acquisitions. These funds were spent on the San Rafael River property interests; the Hot Rock property interests; the Aurora property; and, the Staked property interests. Deferred exploration costs on the Company’s mineral property interests were as follows:

	Property interests in U.S.A.(San Rafael River, Hot Rock, Aurora)	Property interests in Peru (Staked)
Accommodation and Camp Costs		$26,338
Communications		$16,257
Geological consulting fees	$96,978	$166,695
General expenditures	$9,110	$42,386
Legal fees		$29,700
Maintenance and claim fees	$131,145	$16,444
Management fees		$43,200
Report and map preparation		$14,663
Samples		$73,482
Survey	$13,349
Transportation		$33,719
Travel	$5,202	$45,842

(3)

$2,406 was spent on capital assets consisting of office equipment; computer equipment; and, vehicles. $22,218 (cash) was spent on mineral property acquisitions. These funds were spent on the Aurora property and the Staked property interests. Deferred exploration costs on the Company’s mineral property interests were as follows:

	Property interests in U.S.A. (San Rafael River, Hot Rock, Aurora)	Property interests in Peru (Staked)
Geological consulting fees	$26,961	$40,000
General expenditures	$5,271	$7,735
Maintenance and claim fees	$37,541

(4)

The Company spent $22,700 (cash) on mineral property acquisitions. These funds were spent on the Aurora property; the Chord property; and, the Staked property interests in Peru. Deferred exploration costs on The Company’s mineral property interests were as follows:

	Property interests in U.S.A (Chord and Aurora)	Property interests in Peru (Staked)
General expenditures		$12,355
Maintenance and claim fees	$12,436	$1,501

(5)

The Company spent only $241 on office equipment, which was classified as capital assets. The Company spent $38,605 (cash) on mineral property acquisitions. These funds were spent on the Aurora property, the Chord property and the Staked property interests in Peru. Deferred exploration costs on the Company’s mineral property interests were as follows:

22

	Property interests in U.S.A. (Chord and Aurora)	Property interests in Peru (Staked)
General expenditures		$4,992
Maintenance and claim fees	$28,929	$29,934

(6)

The Company spent $35,000 (cash) on mineral property acquisitions. These funds were spent on the Chord property. Deferred exploration costs on the Company’s mineral property interests were as follows:

	Property interests in U.S.A. (Chord)
General expenditures	$3,819

(7)

The Company spent $42,343 (cash) on mineral property acquisitions. These funds were spent on the Athabasca property; the Chord property; the Staked property interests in Peru; and, the Comstock property. In addition, The Company spent $1,612 on “pre-acquisition property costs.

(8)

The Company spent $72,621 on equipment, $1,784,245 on mineral property costs and $107,641 on deferred exploration costs as follows:

$118,612 (Towards purchase)	Athabasca
$13,616  (Towards purchase)	Chord
$87 (Towards purchase)	Comstock
$15,792  (Towards purchase)	Dieter Lake
$38,245 (Towards purchase)	Duddridge Lake
$424,765 (Towards purchase)	New Mexico claims
$798,153 (Exploration expenses)	Canadian staked claims
$46,019  (Exploration expenses)	Peruvian staked claims
$174,516 (Towards purchase)	Wyoming claims
$154,440 (Investigation costs)	Pre-Acquisition Costs
$103,933 (Deferred Exploration Costs)	Canadian property interests
$3,708   (Deferred Exploration Costs)	U.S. property interests

(9)

The Company spent $181,217 on equipment; $513,300 on mineral property costs; and, $3,283,523 on deferred exploration costs as follows:

Canada
Airborne geophysics surveys	$1,377,507
Camp costs	$41,534
Claim fees	$38,178
Geologist’s fees and supplies	$418,162
General expenses	$16,326
Helicopter rental and equipment fees	$586,482
Lab analysis and sampling	$38,802
Reports	$21,334
Report/map preparation	$33,869
United States
Claim fees	$168,188
Geologist’s fees and supplies	$370,852
General expenses	$8,074
Reports	$3,841
Report/map preparation	$606

23

Peru
Camp Costs	$4,573
Claim fees	$22,165
Geologist’s fees and supplies	$129,554
General Expenses	$1,861
Report Preparation	$1,615

 (10)

The Company spent $176,721 on equipment; $370,703 on land; $41,957 on mineral property interests; and, $7,878,415 on deferred exploration costs as follows:

Canada
Airborne geophysics surveys	$2,516,823
Camp costs	$238,368
Claim fees	$181,430
Geologist’s fees and supplies	$1,247,177
General expenses	$62,172
Travel	$506,005
Helicopter rental and equipment fuel	$424,851
Lab analysis and sampling	$19,990
Reports	$10,417
Report/map preparation	$51,346
United States
Claim fees	$514,003
Geologist’s fees and supplies	$1,582,897
General expenses	$130,264
Travel	$159,605
Helicopter rental & equipment fuel	$494
Report/map preparation	$2,324
Peru
Claim fees	$30,276
Geologist’s fees and supplies	$131,355
General Expenses	$37,633
Travel	$30,224
Report/Map preparation	$761

(11)

The Company spent $172,070 on equipment; $8,295 on mineral property interests; and, $2,731,461 on deferred exploration costs as follows:

Canada
Drilling	$812
Equipment/Vehicles	$267,882
Facilities/Construction	$2,419
Geology	$563,878
Geophysics	$483,250
General Expenses	$24,128
Property fees	$102,133
Permitting/Regulatory	$95,684
Personnel time	$274,362
Travel	$31,354

24

United States
Drilling	$7,775
Engineering	$279,305
Equipment/Vehicles	$349
Geology	$16,390
General Expenses	$17,117
Property fees	$42,385
Permitting/Regulatory	$62,918
Personnel time	$379,178
Travel	$38,953
Peru
General expenses	$8,807
Personnel time	$27,316
Travel	$5,066

Plan Of Operations

Source of Funds for Fiscal 2007

The Company’s primary source of funds since incorporation has been through the issuance of equity.  Currently the Company does not have operating revenues, and anticipates generating no revenue during the next year.  As of 3/31/2007, the Company had working capital of $31,857,204.

Use of Funds for Fiscal 2007

During Fiscal 2007, the Company has budgeted that it might expend $3,000,000 on general/administrative expenses.  

The Company’s current property acquisition and exploration budget for fiscal 2007 is US$16,400,000 for its United States properties, and C$8,400,000 for its Canadian and Peruvian properties. However, if the spin-out of its Canadian and Peruvian property interests into Fission Energy is completed, Strathmore will provide C$500,000 cash to Fission but will have no current or future obligations to fund exploration on those properties. Additionally, Strathmore has recently signed an option agreement with a partner where the partner will fund the current exploration on a property, and has signed Letters of Intent with other potential partners on several additional properties. If these Letters of Intent are converted into definitive option agreements, current exploration on these properties will be funded by the optionees and the Company’s anticipated expenditures for the current year will be reduced.

Strathmore has sufficient funds on hand to fund all of its anticipated property expenditures for fiscal 2007. The amount of funds required for future periods is dependent upon the completion of the spin-out with Fission Energy, the success and advancement of its exploration programs, and the number and size of any option agreements on certain of its properties.

Anticipated Changes to Facilities/Employees

The Company has no plans to add any additional personnel.  Management anticipates that any property exploration efforts will be carried out by outside contractors.

4.B.  BUSINESS OVERVIEW  

Since 1993 the Company has been exploring property interests with a primary emphasis on the search for economic deposits of uranium.

There are no known proven reserves of minerals on the Company’s property interests.  The Company does not have any commercially producing mines or sites, nor is the Company in the process of developing any commercial mines or sites.  The Company has not reported any revenue from operations since incorporation.  As such, the Company is defined as an “exploration-stage company”.

25

Historical Corporate Development – January 1, 1997 to Date

During Fiscal 1997, ended 12/31/1997, the Company acquired by staking seven exploration stage property interests in the United States. Since that time all of these property interests have been abandoned by the Company because of poor exploration results.

In early fiscal 1998, the Company acquired the Aurora Property, which is located in southeastern Oregon. The Company subsequently dropped this property because of poor exploration results. In November 1998, the Company announced that it had acquired the Chord Property located in South Dakota. The Company also increased its land holdings in Peru by four square kilometers and continued exploration work on these holdings.

During Fiscal 1999, the Company engaged in exploration work on its property interests located in South Dakota, Oregon and in Peru. This work consisted general exploration work, which entailed sampling and mapping. The Company spent $69,773 on these efforts in the United States in South Dakota and Oregon. The Company spent $47,735 on these efforts in Peru.

During Fiscal 2000, the Company did not engage in any exploration work and wrote off a number of its exploration property interests in an effort to conserve cash. The Staked Property interests in South Dakota were written off in the amount of $48,730. The Company management elected to write off these property interests because, based on prior exploration work, they felt the potential for success on these property interests was considerably less than on those property interests which were retained.

On May 11, 2000, the Company, pursuant to a special resolution passed by shareholders of the company, consolidated its share capital on a five old for one new basis. At the same time the authorized capital of the Company was increased to the present amount. The name was also changed from Strathmore Resources Ltd. to Strathmore Minerals Corp.

During Fiscal 2001, the Company continued to conserve cash and, consequently, did not engage in new exploration work. Capital spent on the Company’s property interests during Fiscal 2001 consisted exclusively of maintenance and claim fees.

During Fiscal 2002, the Company wrote off the Aurora Property, located in Oregon, and allowed all of its claims located in Peru to lapse. The Aurora Property was written off because of poor exploration results and the property interests in Peru were written off in an effort to conserve capital. The amount written off associated with the Aurora Property was $98,880 and the amount written off associated with the property interests located in Peru was $605,243. This was done in a continuing effort to conserve capital. As discussed in ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS, Operating Results, Fiscal 2002 Ended 12/31/2002 versus Fiscal 2001 Ended 12/31/2001, general and administrative expenses also were reduced. The Company also entered into letters of intent to acquire options on the Wemindji East and the Portage West property interests located in Quebec, Canada. Later in the Fiscal Year, the Company elected not complete these two option agreements

In November 2003, the Company entered into an arm's-length purchase agreement to acquire a 100-per­cent interest in a Comstock polymetallic Silver-Gold property located in the Slocan Mining Division of British Columbia.

In January 2004, the Company entered into an agreement to earn a 100% interest in the Athabasca Property as described in Item 4.D. below.

In February 2004, the Company acquired a 100% interest in the Duddridge Lake property and the Dieter Lake property as described in Item 4.D. below.

In March 2004, the Company agreed to acquire the Churchrock Property (Ram Claims) and the Roca Honda property, both located in New Mexico, as described in Item 4.D. below.

During April 2004, the Company began an exploration program, consisting of sampling and mapping, on the Macusani property in Peru. During this same period, the Company also announced that it had agreed to acquire five State of Wyoming mineral leases located in the Powder River Basin. (The Company later terminated this agreement in favor of concentrating its efforts on property interests that management felt held greater potential for discoveries of mineralization.)

26

In May 2004, the Company acquired the Cedar Rim Claims, located in Wyoming, as described below in Item 4.D.

In the second half of 2004, the Company formed an advisory board to add expertise in the area of uranium exploration. In July 2004, Ray Larson joined this board (before resigning upon being named a Director of Strathmore in December 2006); in August Dr. Franz J. Dahlkamp joined this board (but resigned in December 2006); in September 2004 Dr. Hans von Michaelis and Dr. Dieter A. Krewedl joined this board (Dr. Krewedl resigned upon being named a Director of Strathmore in January 2005); and, in January 2005 Robert Quartermain joined this board. (Biographies of the members of the Advisory Board are disclosed in ITEM 6. Directors, Senior Management and Employees).

On December 14, 2004, the Company announced that it had agreed to acquire a property in New Mexico called the Noserock State Lease.

Also, during December 2004, the Company applied for an additional approximately 1.9 million acres of new exploration permits, covering lands with the Athabasca Basin. The company received these permits and the total amount of land under claim permit or permit application by the Company within the Athabasca Basin grew to 2.8 million acres.

On March 3, 2005, the Company announced that it had agreed to acquire a group of property interests in Wyoming.

The Company began an exploration program on its Waterbury Lake property in April 2005. Also, later in April 2005 the Company received its mineral prospecting permits for the Davy Lake project and the Hall Lake project.

In June 2005 the Company began further exploration work on its Dieter Lake Property.  This work consisted of mapping, sampling and ground geophysical surveys.

In August 2005, the Company began full time operations at its office in Santa Fe, New Mexico. John DeJoia, Vice President of Technical Services and Juan Velasquez, Vice President of Environmental and Government Affairs manage this office. During this month, the Company also added an additional full time and four part time individuals at its exploration office located in Riverton, Wyoming.

Also, in August 2005, the Company signed a letter of intent with an unrelated public company, North American Gem, Inc. (TSX symbol: “NAG”) whereby North American Gem, Inc. could earn a 50% interest in the Company’s Hall Lake and Duddridge Lake projects. In February 2006, the Company announced that this agreement never was completed, as the company’s could not come to mutually agreeable final terms on the agreement.

In November 2005, the Company added 11 State of Wyoming uranium leases and 99 mining claims totaling 9,504 acres to its property holdings in Wyoming and in February 2006 it added an additional 5,000 acres.

At the end of February 2006, the Company acquired 900,000 acres located in Alberta. The Company acquired this land by paying staking costs and committing to issue 200,000 common shares in stages over the next two years to Jody Dahrouge, an unaffiliated individual who originally acquired this acreage by staking it.

In early March 2006, the Company announced that from the exercise of share purchase warrants from an earlier private placement, it received additional capital in the amount of $7,514,815.

On March 15, 2006, the Company announced that it had begun an exploration program at its Waterbury Lake property. This program included both ground geophysics and a 3,000 meter exploratory drill program.

On April 4, 2006, the Company announced that it had completed an independent national Instrument 43-101 compliant resource estimate for Roca Honda uranium property located in New Mexico. This new resource estimate provided an update to the previously completed independent National Instrument 43-101 technical report for Roca Honda which was filed on March 6, 2005.

On May 9, 2006, the Company announced that it had completed a private placement raising additional capital in the amount of $8,699,795.

27

Throughout Fiscal 2006, the Company continued to engage in exploration work at both its Waterbury Lake and Patterson Lake properties.

On July 18, 2006, the Company acquired, by staking, the Ketchum Buttes Property located in Wyoming. At the same time, the Company announced that it had acquired, by staking, an additional 640 acres in the Shirley Basin Uranium District in Wyoming.

On August 21, 2006, the Company acquired, by staking, 51 claims within the Crownpoint-Dalton Pass and Church Rock areas bringing the total amount of acres in New Mexico in which it has an interest to 17,000.

The Company began the mining permit application process for the Roca Honda property. This process included planning feasibility studies pertaining to conventional mining and milling operations; a Cultural Resource Clearance Survey; and, environmental reports. All of this work is being managed Juan Valasquez, the company’s vice President of Environmental and Regulatory Affairs and John DeJoia, the Company’s Vice President of Technical Services. Both of these individuals are based in the Company’s office located in Santa Fe, New Mexico. In November 2006, the company completed the purchase of 620 acres of land in the Ambrosia Lake district as a potential mill site for the Roca Honda project.

On August 21, 2006, the Company announced it has staked additional lands in the Grants uranium district of New Mexico. A total of 51 new claims were staked in the Crownpoint-Dalton Pass and Church Rock areas, bringing the Company’s total acreage in New Mexico to over 17,000 acres.

In November 2006, the Company announced that it had acquired through staking 1,900 acres in Wyoming known as the Jeep property and 1,700 acres in Wyoming known as the Gas Hills properties.

In January 2007, the Company signed a Letter of Intent (“LOI”) with Yellowcake Mining Inc. to form at joint-venture to develop the Baggs, Juniper Ridge project in Wyoming. Under the LOI, the Company will option an 80% interest in the Baggs properties to Yellowcake. In consideration for the option, Yellowcake will:

•

Issue nine million shares of Yellowcake to Strathmore upon closing;

•

Pay Strathmore US$100,000 upon closing, and pay US$100,000 on each anniversary date of the closing for a total of US$500,000;

•

Spend US$1.6 million per year for a period of 5 years for a total of US$8 million. Upon expending half of these funds (US$4 million), Yellowcake will have earned 50% of the optioned interest, and upon the expenditure of the additional US$4 million, will earn the additional 50% of the optioned interest (80% total).

•

Pay an NSR of 3% on the optioned portion on all future production.

Yellowcake also agreed that in consideration for an initial payment of US$25,000 upon closing, and a commitment for Yellowcake to spend US$440,000 for a minimum period of one year, Yellowcake will finance the evaluation of Strathmore’s database regarding uranium prospects in Texas. If a suitable target is identified, Yellowcake will be required to spend the necessary funds to acquire land leases, and Strathmore and Yellowcake will be 50-50 partners in the development of the identified targets resulting from the database evaluation. A definitive joint-venture was completed in March 2007.

In April 2007, the Company signed second and third Letters of Intent with Yellowcake. Under the second LOI, Yellow would finance the development of Strathmore’s Sky project located in Wyoming. In order to earn a 60% interest in the project, Yellowcake would provide up to US$7,500,000 over four years. Under the third LOI, Yellowcake would finance the exploration and development of Strathmore’s Jeep property in Wyoming, where Yellowcake could earn up to a 60% interest in the property by providing US$10,000,000 in property expenditures over six years.

In May 2007, the Company signed two Letters of Intent for option agreements on two of its properties:

Under the first LOI, American Uranium Corporation can explore and develop Strathmore’s Pine Tree–Reno Creek property in Wyoming. Under the proposed agreement, American Uranium could earn a 60% interest in the project by reimbursing Strathmore of all reasonable expenditures incurred by Strathmore relating to the project to a maximum of $300,000; issue Strathmore 6,000,000 common shares of American Uranium; and spend up to $33,000,000 in expenditures on the project over six years. Strathmore would retain a right to earn back an 11% interest in the property by paying $14,000,000 to American Uranium.

28

Under the second LOI, Tribune Resources Corp. could acquire a 60% interest in Strathmore’s North Shore property in Alberta. Under the proposed agreement, Tribune could earn a 60% interest in the property by issuing Strathmore 600,000 common shares and incurring expenditures of $10,000,000 over six years. The Company would retain a buy back provision where it could buy an 11% interest for $10,000,000. Tribune’s interest in the property would be subject to an NSR royalty based upon the market price of yellowcake.

In May 2007, the Company entered an option agreement with Great Bear Resources Ltd. where Great Bear can acquire a 60% interest in Strathmore’s Duddridge Lake property in Saskatchewan. To earn up to a 60% interest, Great Bear must pay Strathmore $300,000 cash, plus additional staking costs up to $100,000, issue 400,000 common shares, and expend $6,000,000 in exploration expenditures on the property., with Great Bear earning a percentage interest in the property based upon  meeting commitment milestones.

In June 2007, the Company signed a Letter of Intent (since amended) with Nu-Mex Uranium Corp. on the Nose Rock property in New Mexico. The amended LOI proposed that Nu-Mex can earn up to a 65% interest in the Nose Rock property by paying Strathmore $250,000 cash and issuing 5,000,000 common shares, and incurring a total of US$44,500,000 in work commitments over seven years. Strathmore will retain the right to buy back a 16% undivided interest in the property by paying US$25,000,000 to Nu-Mex within 90 days of the delivery of a Bankable Feasibility Study. Strathmore has also granted Nu-Mex a Right of First Refusal, for 90 days, to negotiate a Joint Venture agreement for Strathmore’s Dalton Pass project.

On January 31, 2007, the Company announced its intention to spin-off its Canadian and Peruvian mineral property assets, as well as a portion of its cash, into a new exploration company to be known as “Fission Energy”. The proposed transaction would be through a Plan of Arrangement, with Strathmore continuing to hold the United States mineral exploration property assets. Immediately following such arrangement, Strathmore shareholders would be issued shares in Fission Energy which will seek a listing on the TSX Venture Exchange. The proposed reorganization was subject to shareholder approval by resolution approved by not less than 66 2/3% of the votes cast at a special meeting held on June 19, 2007 in Vancouver, British Columbia, where it was approved. The completion of the Plan is subject to approval by the British Columbia Supreme Court, negotiation of definitive agreements, acceptance by the TSX Venture Exchange, the approval for listing of Fission on the TSX Ve nture Exchange, and other regulatory approvals.

United States vs. Foreign Sales/Assets

During Fiscal 2006/2005/2004/2003/2002/2001/2000/1999/1998/1997, the Company generated no sales revenue. During the three month period ended 3/31/2007, the Company generated no sales revenue.

The distribution of the Company’s assets geographically at the end of each fiscal year were as follows:

Fiscal Year Ended December 31	Assets in the United States	Assets in Canada	Assets in Peru
2006	$7,900,767	$45,129,990	$459,597
2005	$3,957,312	$26,584,117	$229,348
2004	$1,290,274	$10,697,489	$69,580
2003	$172,728	$1,094,454	$23,561
2002	$108,648	$27,317	$  Nil
2001	$324,929	$75,122	$667,698
2000	$257,395	$170,511	$639,869
1999	$364,170	$91,902	$636,152
1998	$1,137,767	$647,567	$629,164
1997	$753,448	$1,259,856	$83,414

Of the Company’s assets located in Canada as of December 31, 2006, $3,085,341 of the amount is capital property costs which are subject to the Plan of Arrangement with Fission Energy and will be transferred to Fission if and when the Plan is completed. All of the $459,597 of assets located in Peru would also be transferred to Fission, as well as $500,000 cash located in Canada.

29

4.C. Organization Structure

The Company was incorporated by memorandum and articles pursuant to the Company Act (British Columbia) on April 16, 1987 under the name 325240 B.C. Ltd. On July 28, 1988, the Company changed its name to Achievers Media Corporation and was continued under the Canada Business Corporations Act by filing Articles of Continuance with the Director, Consumer and Corporate Corporations Act by filing Articles of Continuance with the Director, Consumer and Corporate Affairs, Canada.  The Company was extra-provincially registered in British Columbia effective September 29, 1988.  The Company was listed on the Exchange on September 26, 1989. On November 6, 1992, The Company changed its name to The Achievers Training Group Inc. and consolidated its share capital on the basis of one new share for every five existing shares.  On May 5, 1993, The Company was continued into British Columbia, and the British Columbia Registrar of Companies issued a Certificate of Continuation under the Company Act on June 21, 1993, at which time The Company changed its name to Rockwealth International Resource Corp.  On June 25, 1993, the Exchange removed the Company’s inactive designation.  On August 7, 1996, the Company changed its name to Strathmore Resources Ltd. On September 19, 2000, the Company changed its name to Strathmore Minerals Corp. and consolidated its share capital on a five old for one new basis.

The Company has two wholly owned subsidiaries;

a)

Strathmore Resources (US) Ltd., incorporated in the state of Nevada.

b)

Minera Peruran S.A., incorporated in Peru.

4.D.  Property, Plant and Equipment

The Company’s executive offices are located in rented premises of approximately 600, sq. ft. at 700 – 1620 Dickson Avenue, Kelowna, British Columbia Canada V1Y 9Y2.  The Company began occupying these facilities in March 2007.  Monthly rent is $4,400. The Company also rents office space for development offices located in Riverton, Wyoming for monthly rent of US$900, and Santa Fe, New Mexico, for monthly rent of $445.13.

Mineral Properties

The Company’s uranium exploration property portfolio is grouped into three geographic areas: United States, Canada, and Peru.  Within these areas, the Company has further divided its properties by Province or State. The Company’s principal properties are described below:

United States Exploration Properties

State of New Mexico Projects

1.

Roca Honda Property

The Roca Honda Property is an exploration stage property without proven reserves. The Company’s interest in the Roca Honda Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the property from David Miller through his introduction to Rio Algom Corporation.  As consideration Mr. Miller  received 150,000 shares of stock in the Company and Rio Algom was paid US$75,000 cash. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore.

LOCATION

The Roca Honda property is located in the Ambrosia Lake District of the Grants Uranium Mineral Belt.  The property is located northeast of Grants, New Mexico in McKinley County. Access to the property is by US Forest Service dirt roads from nearby paved roads and year round access.

30

Land Position

The Company controls 1,840 acres consisting of 63 unpatented mining claims totaling 1,200 acres located on Federal land administered by the US Forest Service, as well as one State of New Mexico adjoining lease totaling 640 acres. The claims were originally staked June 1965 and have been continuously maintained.

Geology and Uranium Mineralization

Uranium deposits are located within the Westwater Canyon Member of the Morrison Formation of Jurassic age.  Mineralization is contained in humate rich pods similar to many other Ambrosia Lake ore deposits.  The area lies on the east flank and near the top of the San Mateo Dome which dips ESE into the McCarty’s syncline.  The average dip is 9 to 11 degrees running from section 9 to section 10.  Faulting and some folding occur in the sections.

History

63 unpatented claims have been continuously held since 1965.  Kerr McGee Corporation, an unaffiliated public company, controlled the property until the late 1980’s.  Rio Algom, an unaffiliated public company, purchased the property at that time and maintained the property until it was acquired by the Company.  Kerr McGee performed all of the drilling on the unpatented claims. The New Mexico State lease was held by Rare Metals Corp. in the 1950’s and by Western Nuclear Corporation in the late 1960’s and 1970’s.. In 2004, the Company purchased Rio Algom’s database which included all of Kerr-McGee and Rio Algom’s exploration data on the property.

Work performed by Kerr McGee Nuclear, Rio Algom, and Western Nuclear includes over 438 drill holes totaling over 960,000 feet. The drill holes are mostly spaced from 100 to 300 feet apart.

Work Conducted by Strathmore

The Company reviewed all of the available exploration information on the property, and Rio Algom’s database formed the basis of an NI 43-101 complaint independent resource estimate for the property which was completed by geologist David C. Fitch for the Company in March 2005 and then updated in March 2006.

Cautionary Note to U.S. Investors concerning estimates of Measured and Indicated Resources

This section uses the terms “measured” and “indicated resources”. We advise U.S. investors that while those terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. U.S. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

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The measured and indicated resource reported in the updated resource estimate is:

Category	Cut-off Grade (GT)	Tons	Grade U3O8 (%)
Measured	0.6	1,305,000	0.23
Indicated	0.6	2,477,000	0.23
Total		3,782,000

Cautionary Note to U.S. Investors concerning estimates of Inferred Resources

This section uses the term “inferred resources”. We advise U.S. investors that while this term is recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize it. “Inferred resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.  

The inferred resource reported in the updated resource estimate is:

Category	Cut-off Grade (GT)	Tons	Grade U3O8 (%)
Inferred	0.6	4,546,000	0.17

Current and Anticipated Work

The review of the historical work database identified the exploration potential for additional uranium mineralization beyond the closely spaced drill holes. Exploratory drilling, as well as coring and baseline groundwater characterization activities are planned on the property for calendar 2007.

In September, the Company announced that its had initiated the mining permit application process for the Roca Honda property. As part of the permitting process, the Company acquired 620 acres of land in the Ambrosia Lake district northwest of Grants, New Mexico for the potential use as a mining and milling facility for Roca Honda uranium ore. The Ambrosia Lake property will be studied for its suitability as a mill site, including geologic and hydrologic studies to determine its ability to withstand long-term erosional stability for disposal of mill tailings.

In May 2007, the Company received approval from the New Mexico Mining and Minerals Division to conduct drilling on the project, with drilling set to commence in June. This drill program will provide the Company with data to support the preparation of its license application and further evaluate In-Situ Recovery and conventional mining operations at the site. The required geologic, hydrologic, and baseline background water quality data to support the permit applications will be gathered; in addition, data necessary to facilitate well-field design, evaluate possible conventional underground mine planning, and additional site information, will be collected. The company intends to install four wells that will be used to perform hydrologic pump tests and provide long-term water quality monitoring and hydrologic data.

Strathmore has budgeted approximately $8,500,000 for exploration work at Roca Honda during Fiscal 2007.

Potential Joint-Venture

In February, the Company announced that it had granted the exclusive right to negotiate a joint-venture agreement to develop the Roca Honda project to an international diversified resource and industrial corporation. Under the terms of the exclusivity agreement, the industrial corporation will pay Strathmore US$100,000 and will have 90 days to negotiate a joint-venture agreement with Strathmore. The agreement would include all aspects of financing the development of Roca Honda, the construction of a new uranium ore processing plant and state-of-the-art mill in New Mexico, as well as the international marketing of the uranium produced. In May 2007, the companies mutually agreed to extend the negotiation period until July 9, 2007.

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There is no guarantee that an agreement on a joint-venture will be agreed to and signed either within the 90 day exclusivity period, or at all.

2.

The Churchrock Property  (Ram Claims) – New Mexico

The Churchrock Property, formerly known as the Ram Claims, is without proven reserves. The Company’s interest in the property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the property from David Miller through his contacts with Rio Algom Corporation, an unrelated public company.   As consideration Mr. Miller received 150,000 shares of stock in the Company and Rio Algom was paid $75,000 cash. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore.

Location

The Chruchrock property is located in the Churchrock District of the Grants Uranium Mineral Belt .   The property is located northeast of the town of Gallup in McKinley Count y, New Mexico .. It covers approximately 640 acres of Federal minerals land administered by the U.S. Bureau of Land Management and consists of 36 unpatented mining claims, which were originally staked on October 6, 1965. Access to the property is from nearby paved roads with year round access , which will require access agreements with nearby private surface owners

Geology and Uranium Mineralization

Uranium deposits are located within the sandstones of the Westwater Canyon Member of the Morrison Formation of Jurassic age.  Uranium mineralization occurs as uranium-humate lenses that form north - northwest facing solution fronts and roll fronts.  There are six mineralized sandstone units in the Westwater in Section 4 - 1616.  The "C", “E”, and "F" sandstone units, middle and basal, contain 70% of the measured and indicated resources. Actual surface of Section 4 - 1616 is on a dip slope of approximately 2 to 3.5 degrees to north. The deposits are potentially amenable to in-situ extraction methods, and the property terrain’s slope is gentle enough so that leach fields can be laid out with only minor problems

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History

The property has been continuously held since 1965.  Kerr McGee Corporation , an unrelated public company, controlled the property until the late 1980’s.  Rio Algom , an unrelated public company, purchased the property at that time and maintained the property until acquired by the Company .   A total of 165 drill holes were completed by the previous operators totaling approximately 306,000 feet. Most of the drilling was performed during the period 1967 through 1977, with additional drilling up to 1991.

Work Conducted by Strathmore

The Company reviewed all of the available exploration information on the property. Geologist David C. Fitch was retained by the Company to prepare an NI 43-101 complaint independent resource estimate for the property which was completed in December 2005.

Cautionary Note to U.S. Investors concerning estimates of Measured and Indicated Resources

This section uses the terms “measured” and “indicated resources”. We advise U.S. investors that while those terms are recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize them. U.S. Investors are cautioned not to assume that any part or all of mineral deposits in these categories will ever be converted into reserves.

The measured and indicated resource reported in the resource estimate is:

Category	Cut-off Grade (GT)	Tons	Grade U3O8 (%)
Measured	0.3	1,680,333	0.10
Indicated	0.3	4,541,134	0.09
Total		6,221,467	0.10

Cautionary Note to U.S. Investors concerning estimates of Inferred Resources

This section uses the term “inferred resources”. We advise U.S. investors that while this term is recognized and required by Canadian regulations, the U.S. Securities and Exchange Commission does not recognize it. “Inferred resources” have a great amount of uncertainty as to their existence, and great uncertainty as to their economic and legal feasibility. It cannot be assumed that all or any part of an Inferred Mineral Resource will ever be upgraded to a higher category. Under Canadian rules estimates of Inferred Mineral Resources may not form the basis of feasibility or other economic studies. U.S. investors are cautioned not to assume that part or all of an inferred resource exists, or is economically or legally mineable.  

The inferred resource reported in the resource estimate is:

Category	Cut-off Grade (GT)	Tons	Grade U3O8 (%)
Inferred	0.3	1,950,560	0.09

Current and Anticipated Work

The Company began the work required for permitting process for an in situ uranium recovery facility on the property during 2005. This work included performing the required studies and preparing the required draft reports for submission to the federal and state government agencies. These including radiation protection, health-and-safety, and quality assurance programs; cultural and archaeological surveys; sampling and analysis plan; waste management plan; storm water pollution prevention plan; draft spill prevention, control and countermeasure plan; transportation plan for the product; and a reclamation plan. As part of the data gathering process, the Company intends to drill wells for gathering background water-quality data and for performing hydrologic pumping tests.

Strathmore has budgeted approximately $625,000 for exploration at Church Rock in fiscal 2007.

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3.

The Nose Rock Property

The Nose Rock Property is without proven reserves. The Company’s interest in the property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the Nose Rock Lease from David Miller. Mr. Miller received 300,000 shares of the Company’s common stock, and US$30,000 as consideration. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore. Additional acreage was acquired by the Company through staking and New Mexico state leases.

In June 2007, the Company announced that it had entered into a Letter of Intent with Nu-Mex Uranium Corp., where Nu-Mex could earn a 65% interest in the property by paying Strathmore US$250,000 cash, issuing 5,000,000 common shares, and incurring a total of US$44,500,000 in work commitment expenditures on the property over seven years. Strathmore would retain the right to buy back a 16% interest in the project by paying US$25,000,000 to Nu-Mex within 90 days of the delivery of a Bankable Feasibility Study.

Location and Access

The Nose Rock property is located in the Nose Rock District of the Grants Uranium Mineral Belt.  The property is located approx. 12 miles northeast of Crownpoint in McKinley County, New Mexico. Access to the property is excellent with nearby paved and gravel roads with year round access.

Land Position

The Company originally acquired 1 State of New Mexico mineral lease, known as Section 36, totaling 640 acres which was acquired by David Miller from a State of New Mexico Lease Auction in the spring of 2004. Through claim staking and mineral leases, the Company has acquired an additional 7 sections of land contiguous or near the original lease. The property now consists of a total of 5,000 acres.

Geology and Mineralization           

The uranium deposits are located within the sandstones of the Westwater Canyon Member of the Morrison Formation of Jurassic age.  Uranium mineralization occurs as north - northwest trending primary ore bodies and redistributed roll front deposits.  There are several mineralized sandstone units that have been identified through prior exploration on the property.  

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History

The Nose Rock property interests were acquired by Phillips Uranium in the early 1970’s and drilling commenced in mid 1973. Phillips Uranium controlled the property interests until the mid 1980’s. The Company acquired copies of a portion of the drill logs and ore mineralization database of Phillips Uranium in December, 2004, from the files of the State of New Mexico’s Bureau of Geology in Socorro, New Mexico, and the data is currently under evaluation.  

The Section 36 Lease makes up a portion of what Phillips Uranium referred to as Unit 1, which consisted also of sections, or portions thereof, to the east currently under Bureau of Indian Affairs or Indian Allottees control. By the late 1970’s, Phillips Uranium had begun drilling a shaft to access the Unit 1 ore body. However, no actual removal of uranium-containing ore was performed prior to closure of the mine in the early 1980’s following collapse of the uranium market. Until further exploration and studies are performed on the property, it is unknown if this existing shaft will be a viable asset for any future economic production from the property.

Joint Venture Agreement

In June 2007, the Company signed a Letter of Intent (later amended) with Nu-Mex Uranium Corp. to explore and develop the Nose Rock property. Under the amended LOI, Nu-Mex can earn-in a 65% interest in the project under the following terms:

a)

Pay $250,000 and issue 5,000,000 common shares to Strathmore in the capital stock of Nu-Mex on closing; and

b)

Incurring a total of US$44,500,000 in work commitment expenditures on the property and additional payments of $6,000,000 to Strathmore in accordance with the following schedule:

•

$750,000 work commitment plus $1,000,000 payment in cash or stock in each of the first 2 years;

•

an additional $1,5000,000 work commitment plus $1,000,000 payment in cash or stock in the third year;

•

an additional US$6,000,000 work commitment plus $1,000,000 payment in cash or stock in the fourth year; and

•

an additional $5,000,000 work commitment plus $1,000,.000 payment in cash or stock in each of the fifth and sixth years.

Nu-Mex will earn a 25% interest in the property once Nu-Mex has completed its commitments of cash/shares of $3,000,000 and work of $3,000,000 on or before the anniversary of the third year. Nu-Mex will earn an additional 35% interest in the property once Nu-Mex has completed its additional commitments of additional cash/shares of $3,000,000 and additional $16,000,000 in work on or before the anniversary of the sixth year.

There is no assurance that a definitive agreement on a joint-venture will be finalized with Nu-Mex on the property under the proposed terms, or at all.

The Company’s Future Plans

Future work of the Company in the Nose Rock area will consist of the following:

1.

Review all available information in the Company’s possession on the Nose Rock Property.  

2.

Digitize all available factual information

3.

Complete an NI 43-101 compliant report with qualified geologist familiar with uranium mineralization in the Grants Mineral Belt.  

4.

Determine feasibility and amenability of extracting the uranium ore via an ISL operation.

If the Letter of Intent with Nu-Mex is converted to a definitive agreement, Nu-Mex will fund exploration on the property during fiscal 2007.

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4.

Dalton Pass Property

The Dalton Pass Property is without proven reserves. The Company’s interest in the property stemmed from earlier exploration work, as described below, that was done in the area.

The Property consists of 640 acres covered by federal lode mining claims administered by the U.S. Bureau of Land Management and is situated in the western portion of the Grants Mineral Belt.

In June 2007, the Company granted Nu-Mex Uranium Corp. the right of first refusal for 90 days to negotiate a joint-venture agreement on the property.

The Company has performed minimal exploration on the property to date. The previous operator, Pathfinder Mining Company, drilled in excess of 130 exploratory holes and identified a uranium resource. Pathfinder was in the process determining the economic feasibility of the resource and the amenability of in-situ extraction of the uranium resource prior but ended their program on the property as a result of the decline in the uranium commodity price in the late 1980’s

The Company intends to review the available past exploration data and hold the property for future exploration. No funds have been budgeted by the Company for exploration on the property in Fiscal 2007.

State of Wyoming Projects

1.

Baggs/Juniper Ridge Project (Red Creek Claims)

The Baggs/Juniper Ridge Project is without proven reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Baggs/Juniper Ridge Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest:

The Company acquired the property from David Miller. As consideration, Mr. Miller received 200,000 shares of common stock. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore.

In March 2007, the Company signed a definitive joint-venture agreement with Yellowcake Mining Inc., whereupon Yellowcake can earn up-to an 80% interest in the property from Strathmore. To earn an 80% interest, Yellowcake must issue 9,000,000 common shares to Strathmore, pay a total of US$500,000 cash, and expend US$1,600,000 per year for 5 years for a total commitment of US$8 million. Strathmore will retain a 3% NSR on all production from Yellowcake’s interest.

Location:

The property consists of 128 unpatented lode claims and one State of Wyoming lease totaling approximately 3,200 acres located in south-central Wyoming.

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Geology and Mineralization           

The uranium mineralization, which occurs at and near the surface, is hosted in the Miocene age Brown Park Formation, which consists of interbedded sandstones, siltstones and mudstones.

History and Previous Work:

The Property, also known as the Juniper Ridge Uranium District, was previously explored several operators, including Teton Exploration, AGIP Mining and others. During the 1970’s, while under control by the German firm Urangesellschaft, the Property was considered for full-scale production but the plan was ended due to declining uranium prices. A total of 2,000 drill holes have been drilled on the property by Urangesellshaft in the 1970’s and AGIP in the 1980’s.

Joint Venture Agreement

In January 2007, the Company signed a Letter of Intent (“LOI”) with Yellowcake Mining Inc. to form at joint-venture on the property. Under the LOI, the Company will option an 80% interest in the property to Yellowcake. In consideration for the option, Yellowcake will:

•

Issue nine million shares of Yellowcake to Strathmore upon closing;

•

Pay Strathmore US$100,000 upon closing, and pay US$100,000 on each anniversary date of the closing for a total of US$500,000;

•

Spend US$1.6 million per year for a period of 5 years for a total of US$8 million. Upon expending half of these funds (US$4 million), Yellowcake will have earned 50% of the optioned interest, and upon the expenditure of the additional US$4 million, will earn the additional 50% of the optioned interest (80% total).

•

Pay an NSR of 3% on the optioned portion on all future production.

Yellowcake also agreed that in consideration for an initial payment of US$25,000 upon closing, and a commitment for Yellowcake to spend US$440,000 for a minimum period of one year, Yellowcake will finance the evaluation of Strathmore’s database regarding uranium prospects in Texas. If a suitable target is identified, Yellowcake will be required to spend the necessary funds to acquire land leases, and Strathmore and Yellowcake will be 50-50 partners in the development of the identified targets resulting from the database evaluation.

Strathmore will be in charge of all operations on the Baggs/Juniper Ridge property during the earn-in period. Once Yellowcake has earned its 80% interest in the property, it will assume the position of operator.

In March 2007, the Company and Strathmore completed a joint-venture agreement under the same terms given above. Subsequent to the completion of the definitive agreement, David Miller, President of Strathmore, was named a director of Yellowcake.

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Planned Work Program by The Company:

The property is to be evaluated as a potential conventional mining operation with heap-leach extraction. Since the Joint-Venture agreement with Yellowcake has now been signed, Strathmore has begun exploration of the property as funded by Yellowcake. In March 2007, the Company contracted BRS Engineering of Riverton, Wyoming, to acquire historic drill information on the property. BRS has been able to obtain data from 961 drill holes, which is approximately half of the estimated 2,000 historical drill holes conducted on the property. The information has been digitized and collected into a new data base, which is currently being analyzed. Several historic feasibility studies from the 1970’s and from 1987 have also been obtained.

On completion of the analysis of all available data, a preliminary resource estimate will be calculated, and plans for additional development drilling and pre-permitting work has been scheduled for the fall. The preparation of required background data for permitting purposes has begun, and flora, fauna, archeology, and other studies will commence shortly.

Since the completion of the definitive option agreement on the property with Yellowcake, Yellowcake will be responsible for funding further exploration of the property in fiscal 2007.

2.

Sky Property

The Sky Property is without proven reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Sky Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest:

The Company acquired the original claims of 800 acres from David Miller. As consideration, Mr. Miller received 50,000 shares of common stock. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore. The Company has acquired additional claims through staking.

The property is currently subject to a Letter of Intent with Yellowcake Mining, where Yellowcake could earn a 60% interest in the project by providing up to US$7,500,000 in property expenditures over 4 years. At the time of the entering into the LOI, Yellowcake was considered a “related party” as David Miller, President of Strathmore, was serving as a director of Yellowcake.

Location:

The property consists of 50 claims totaling 1,030 acres of unpatented lode mining claims located in eastern Fremont County, Wyoming.   Good paved roads service the area while dirt/gravel roads provide local access.

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Geology and Mineralization           

The uranium deposits are hosted in the Eocene age Wind River formation which underlies the entire area.  Uranium mineralization is considered to be roll-front mineralization that is amenable to In-situ leach recovery.   

History and Previous Work:

This property was originally discovered by Exxon Minerals in the 1970’s. Historical exploration and evaluation work was performed by a number of companies.  The most work was done in the 1970’s by Exxon and in the 1980’s by Pathfinder (COGEMA). These former operators conducted enough drilling to determine a uranium deposit is present on the property. However, the prior work was not sufficient to classify any of the mineralization as a reserve. Pathfinder also conducted an in-situ recovery study in the 1980’s indicating excellent permeability and high porosity which suggests the property is a candidate for an in-situ operation.

Joint Venture Letter of Intent

In April 2007, the Company signed a Letter of Intent (“LOI”) with Yellowcake Mining Inc. to form at joint-venture on the property. Under the LOI, the Company will option a 60% interest in the property to Yellowcake. In consideration for the option, Yellowcake will incur a total of US$7,500,000 in expenditures on the property under the following schedule:

a)

$2,500,000 on or before the first anniversary of closing;

b)

an additional $1,500,000 on or before the second anniversary of closing;

c)

an additional $1,500,000 on or before the third anniversary of closing;

d)

an additional $2,000,000 on or before the fourth anniversary of closing;

Yellowcake will have earned a 25% undivided interest in the property once Yellowcake has spend $2,500,000 of expenditures. Until Yellowcake has earned its 60% interest in the property, Strathmore will be the Operator of the property. Thereafter, Yellowcake would be the operator. Strathmore will retain a buy back right which allows Strathmore, up to 90 days after the date a Bankable Feasibility Study is delivered to Strathmore, to elect whether or not to retain or buy back an 11% undivided interest in the property by paying US$7,5000,000 to Yellowcake.

There is no assurance that a definitive agreement on a joint-venture will be finalized with Yellowcake on the property under the proposed terms, or at all.

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Planned Work Program by The Company:

In 2005, the Company acquired a significant database of prior exploration results conducted on the property. This information includes full-sized and mini gamma logs, drill-hole data sheets, drill-hole maps, lithologic descriptions and other information. In the summer of 2006, the Company began the pre-permit process for an in-situ leach operation, which will include exploration drilling, coring and baseline groundwater studies. In February 2007, the Company completed a technical report and initiated permitting activities on the project. In April, the Company obtained approvals from the Wyoming Department of Environmental Quality Land Division and the U.S. Bureau of Land Management to conduct drilling on the project, which commenced in May. The drilling will provide geo-technical data necessary for the preparation of its license application to conduct In-Situ Recovery operations on the property. The drilling will allow the Company to gather the required geologic, hydrologi c, and baseline water quality data to support its permit applications, facilitate well-field design, and evaluate additional property information.

The Company has budgeted approximately $2,330,000 for exploration on the Sky property during fiscal 2007. However, if the Letter of Intent with Yellowcake is converted to a definitive option agreement, Yellowcake will be responsible for funding exploration on the property for the remainder of fiscal 2007.

3.

Copper Mountain Property

The Copper Mountain Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Copper Mountain Property stemmed from earlier exploration work, as described below, that was done in the area.

Introduction

The Company acquired the Copper Mountain from David Miller for consideration of $24,000 cash and the issuance of 200,000 shares of common stock. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore.

Location

The Copper Mountain property is approximately 1,500 acres located in northern Fremont County, Wyoming.   Paved roads are nearby and good, year road access, dirt roads penetrate the property.

Land Position

The Company controls approximately 1500 acres of Federal minerals land administered by the U.S. Bureau of Land Management. The land position is made up of 77 unpatented mining claims located on Sections 27, 28, 29, 30, 33, 34, T.40N. R.92W. The claims were originally staked in the January through March, 2004 and have been continuously maintained.

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Geology and Uranium Mineralization

Uranium mineralization is hosted by fault controlled zones of shattered and brecciated Precambrian basement rocks.  The Precambrian rocks are Archean in age and consist of an assemblage of metasediments, metavolcanic and volcanoclastics; granites were intruded into this setting and later basaltic dikes.

The Copper Mountain Uranium Deposit occupies a major fold-thrust fault generated during the Laramide orogeny.  Displacement of the fault has been estimated at 3 miles.  This thrusting, uplifting and collapsing sequence created the shattered and brecciated zones that are host to the uranium mineralization. The source of the uranium was the granites themselves and the volumes of granite that were eroded away during and after the structural movements.

History and Previous Work

Historical exploration and evaluation work was performed by a number of operators since it was originally discovered by Utah International.  The most work was done in the 1970’s by Rocky Mountain Energy Corp., a subsidiary of Union Pacific Railroad.  Reports and records, in hand, indicate over 1850 drill holes and over 500,000 feet of drilling on or near the property, including 110 core holes. However, the prior exploration work was not sufficient to classify any of the mineralization as a reserve

Future Plans by the Company

The Company is acquiring and evaluating all the available data regarding prior exploration on the project. Management believes that the extent of the mineralization discovered by the prior operators is of large enough size to potentially support a conventional mine and mill or heap-leach operation. The Company has not budgeted any funds for exploration on the property in fiscal 2007.

4.

Gas Hills District Properties

The individual properties which make up the Company’s Gas Hills District properties are without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the properties stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired its interest in the various properties through staking.

Location:

The properties are located in the historic Gas Hills uranium district of central Wyoming in eastern Fremont County. The project area lies about 45 miles east of the city of Riverton.  Access to the properties within the Gas Hills district is excellent with nearby paved and gravel roads with year round access.

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Land Position

The Company currently has a total of approximately 14,400 acres in the Gas Hills district. These properties include previously discovered uranium ore bodies including Bullrush, Loco-Lee, and George-Ver: Fraizer-LeMac; and Beaver Rim.

Geology and Uranium Mineralization

The host for known mineralization in the district is the Eocene Wind River Formation.  The Wind River Formation is a fluvial deposit consisting of sandstones with lesser amounts of clay and siltstones, carbonaceous shale, and thin, discontinuous tuffaceous sandstones and tuff layers.  The mineralization is typical of the Wyoming roll-front deposit.

The known uranium deposits on the Bullrush, Loco-Lee, and George-Ver properties are shallow dipping and much of the uranium mineralization lies at depths of less than 100ft, accessible by open-pit mining methods.  Additional resources on these properties lie below the local water tables, possibly accessible by in-situ recovery.

The Beaver Rim claims lies in the southern extent of the main Gas Hills uranium trend, and mineralization has been noted at less than 1,200 feet.

Exploration History

The George-Ver, Bullrush and Loco-Lee deposits were extensively drilled in the 1970s and planned for open-pit development during the 1980s by Federal-American Partners (FAP).  FAP, by way of American Nuclear Corp., successfully mined and operated a mill that produced in excess of 20 million pounds uranium oxide.  Recently, the properties were held by Power Resources Inc (Cameco’s USA subsidiary) until dropped in the early 2000s.

The Beaver Rim deposit was formerly operated by Federal American Partners, Utah International, Power Resources, and others. Mineralization was noted in the area but was largely unexplored during the 1970’s as those operators focused on near-surface, open-pitable targets.

The Fraizer-LeMac deposit was formerly operated by Utah International which planned for open-pit development and had pit designs made before the decline in uranium commodity prices.

Future Plans by the Company

The Company is currently reviewing the historical information on these properties, including drilling databases and uncompleted mine plans. The properties will be evaluated for their potential for both open pit and in-situ recovery extraction. The Company has budgeted approximately $2,500,000 for exploration on the Gas Hills properties in fiscal 2007.

5.

Jeep Property

The Jeep Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Jeep Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the Jeep Property through staking of 98 Federal lode claims in 2006.

In April 2007, the Company signed a Letter of Intent with Yellowcake Mining Inc. where Yellowcake could earn a 60% interest in the Jeep Property by making US$10,000,000 in property expenditures over six years. Strathmore would retain a right to buy back an 11% interest in the property within 90 days of the delivery of a Bankable Feasibility Study by reimbursing Yellowcake’s expenditures on the property. Yellowcake is not considered to be arms length as David Miller, President of Strathmore, is a director of Yellowcake Mining.

Location:

The Property totals 2,025 acres is located in the southwestern extent of the Gas Hills Uranium District of central Wyoming. It is situated in eastern Fremont County, approximately 45 miles east of Riverton, Wyoming.  Access to the property is excellent with nearby paved and gravel roads with year round access.  Power lines and a natural gas pipeline cross the property boundary.

43

Geology and Uranium Mineralization

The host for known uranium mineralization at the Property is the Eocene Wind River Formation.  The Wind River Formation is a fluvial deposit consisting of sandstones with lesser amounts of clay and siltstones, carbonaceous shale, and thin, discontinuous tuffaceous sandstones and tuff layers.  The uranium deposits are sinuous in shape, lying in a north-south trend along the central portion of the Property.  The mineralization is typical of the Wyoming roll-front deposit.

The uranium deposits on the Jeep Property are shallow dipping and lie at depths of 280-320 feet from the surface, lying beneath the local water table.

Exploration History

The original Jeep claim group consisted of over 150 mining claims (Jeep, Col, Puff, Federal, Fox, Midco) staked by various mining companies and individual prospectors from the late 1950s to the early 1960s.  The claims were then conveyed to Federal American Partners on April 30, 1959.  In 1982, Federal American Partners conveyed Jeep claims #1-14 to the Tennessee Valley Authority (TVA).  In June of 1983, TVA entered into an operating agreement with American Nuclear Corporation (e.g. FAP), but the operating agreement was later transferred to United Nuclear Corporation.  In 1985, Pathfinder was hired by TVA to perform claim assessment drilling.  This drilling was carried out on the southern limit of the claimed area, and uranium mineralization was encountered.  Power Resources Inc. later purchased the Jeep claims sometime in 1990-1992 from TVA but released those claims which had no known reserves in 1992.  The claims that were retained cove red the known ore body.  Due to the continued decline in uranium prices, PRI dropped the remaining Jeep claims in 2000.  No assessment payments were filed in 2001 by PRI, and the claims were declared abandoned and void.  From 2001 until March 2006, the Jeep deposit was available for staking.  

The greater Jeep Property was extensively drilled and explored during the late 1960s through the early 1980s.  Federal American Partners (FAP) began drilling on and adjacent to the main Jeep Property in the 1960s.  By 1983, approximately 525 exploratory bore holes were drilled on and adjacent to the current Jeep Property.  In 1985, Pathfinder Mines Corp. drilled 17 bore holes for TVA as part of their 1985 claim assessment work.  This previous drilling occurred on mostly 35 and 50 foot centers along the main trend of the mineralization, with exterior drilling of 100 to 200 foot centers.  Uranium mineralization was encountered at depths of 280-320 feet, lying beneath the local water table.  

Joint Venture Letter of Intent

In April 2007, the Company signed a binding Letter of Intent (“LOI”) with Yellowcake Mining Inc. to form at joint-venture on the property. Under the LOI, Yellowcake has the right to earn a 60% interest in the property by making US$10,000,000 in expenditures on the property under the following schedule:

•

Spend US$500,000 on or before the first anniversary of closing;

•

An additional US$1,000,000 on or before the second anniversary of closing;

•

An additional US$1,500,000 on or before the third anniversary of closing;

•

An additional US$2,000,000 on or before the fourth anniversary of closing;

•

An additional US$2,000,000 on or before the fifth anniversary of closing;

•

An additional US$3,000,000 on or before the sixth anniversary of closing.

Yellowcake will have earned a 25% interest in the property once it has expended US$1,500,000 on the property. Strathmore will remain the operator until Yellowcake has completed its 60% earn-in commitment. Thereafter, Yellowcake will become the operator. Strathmore retains the right to earn back an additional 11% interest in the property up to 90 days after receiving a Bankable Feasibility Report by reimbursing Yellowcake’s expenditures on the property.

There is no assurance that a definitive agreement on a joint-venture will be finalized with Yellowcake on the property under the proposed terms, or at all.

Current and Anticipated Work

In April 2006, claims SC 1-30 were staked by Strathmore, covering the known extent of the Jeep orebody.  In October 2006, Strathmore staked an additional 68 claims (SC 31-98) to cover the possible trend of mineralization to the south, and to create a buffer for groundwater monitoring during future possible in-situ extraction activities. Floral and faunal resources studies were performed on the Jeep Property in the fall of 2006.

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In May 2007, the Company obtained approvals from the Wyoming Department of Environmental Quality Land Division and the U.S. Bureau of Land Management to conduct an exploration drill program on the project, which is expected to commence in July. Up to forty exploratory holes will be drilled to test if a known roll front extends into previously untested ground. The company has already completed the archaeological and cultural studies, as well as the flora and fauna surveys, required on the project.

The Company has budgeted approximately $350,000 for exploration on the Jeep property in fiscal 2007. However, if the LOI with Yellowcake is converted to a definitive option agreement, Yellowcake will be responsible for funding exploration on the property for the remainder of fiscal 2007.

6.

Ketchum Buttes Property

The Ketchum Buttes Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Ketchum Buttes Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the Ketchum Buttes through staking of 27 lode claims totaling 540 acres in 2006.

Location:

The Ketchum Buttes property is located in southern Carbon County, Wyoming, about 40 miles southwest of the city of Rawlins.  Access to the property is excellent with nearby paved and gravel roads with year round access.

Geology and Mineralization

The uranium deposits are located within the Miocene Browns Park Formation.  The Browns Park is divided into two distinct lithologies: a basal conglomerate member and a sandstone member, each of which contain uranium mineralization.  The basal conglomerate varies in thickness from 20 to 70 feet and consists of largely unaltered, poorly sorted cobles, gravel and coarse sands.  The sandstone unit regionally reaches 1,000 to 2,000 feet in thickness, but all but 100 feet or so has been lost to erosion.  Uranium ore is present in non-continuous lenses and layers which range in thickness from less than one to several tens of feet.  Depth to the mineralization averages 60 feet, readily accessible by open-pit extraction methods.

Exploration History

The Ketchum Buttes area was extensively explored by Pathfinder Mines during the 1970s and 1980s. On the present Ketchum Buttes property, approximately 300 exploratory bore holes were completed.

Current and Anticipated Exploration

The Company intends to review all historical information regarding the Ketchum Buttes Property that is available in order to evaluate the potential of the property as either an open pit, heap leach operation, or as an in-situ recovery project. The Company has not funded any funds for exploration on the Ketchum Buttes Property in fiscal 2007.

7.

Powder River Basin (“PRB”) Leases

The PRB Leases are without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the PRB Leases stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the PRB Leases from David Miller at a cost of 50,000 shares of common stock. The transaction is considered to be “non-arms length” as Mr. Miller currently serves as President, Chief Operating Officer and as a Director of Strathmore

Location

The property consists of 5 State of Wyoming uranium mineral leases in Campbell County, Wyoming. Access is excellent with paved roads nearby.  Year round operations are possible.

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Land Position

The Company controls approximately 3,200 acres of rights to explore for and mine uranium on the State of Wyoming mineral lands leased. Land position is made up of 5 uranium leases located in the Powder River Basin.  The leases were acquired on June 2, 2004 and can be renewed annually until June 1, 2014.

Geology and Uranium Mineralization

The host to the uranium mineralization is the Eocene age Wasatch Formation. This sandstone-bearing formation is known to occur throughout the region and has proven amenable to in-situ extraction methods.

History and Past Work

Previous operators on several tracts of land under Company control discovered uranium mineralization.

Future Plans by the Company

The Company plans to acquire and review all available information on the PRB Leases. They further plan to digitize all available information and, if mineralization is found from existing date, calculate resources and/or conduct additional drilling to expand the potential. The Company has budgeted no funds for exploration on these projects during fiscal 2007.

Other Wyoming Properties

The Company has several additional early-stage uranium exploration property interests in the State of Wyoming. These properties include the “Northeast Wyoming State Leases”, the “Pine Tree (PT) – Reno Creek Property”, the “Shirley Basin” property, the “Andria” property, and the “East Day Loma” property. None of these properties contain known reserves. The Company intends to review all available information of past exploration and then design and initiate exploration programs, if warranted.

In May 2007, the Company announced it had entered into a Letter of Intent with American Uranium Corporation Inc. (“AUC”) to explore and develop Strathmore’s Pine Tree-Reno Creek properties (the “Pine Tree” project). The project is located in Campbell County, Wyoming, in the central Powder River Basin, within the Pumpkin Buttes Uranium District. The total land package has combined several nearby properties and currently consists of approximately 16,000 acres. A portion of the land was previously explored by Utah International/Pathfinder, and uranium ore was identified. Ground water studies conducted in the 1980’s suggest this resource may be amenable to in-situ recovery methods.

Under the LOI, AUC will have the right to earn a 60% interest in the Pine Tree project under the following terms:

1)

AUC will reimburse Strathmore 100% of all reasonable expenditures incurred by Strathmore relating to the project, to a maximum of $300,000, plus any funds spent for the purpose of any additional property leases between the date of the agreement and the closing of the JV agreement;

2)

AUC will issue to Strathmore 6,000,000 common shares of AUC;

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3)

Once AUC has spent a total of US$5,000,000 in the first 3 years of the agreement, it will have earned an initial 22.5% interest in the project, and earned joint-venture partner status with Strathmore;

4)

To earn the full 60% interest, AUC will incur a total of $33,000,000 in expenditures on the Pine Tree project over a 6 year period, subject to the project having at least 13 million lbs of U₃O₈;

5.

Following the third anniversary of the closing date, Strathmore will retain an independent third party to calculate the resource. If the third party evaluation is less than 13 million lbs. U₃O_8, then the remaining US$28,000,000 AUC must spend on the project between the 3^rd and 6^th anniversary of closing will be reduced proportionally;

6.

Strathmore will remain operator of the project until AUC has completed its 60% earn-in commitment;

7.

Strathmore will retain the right to earn back 11% of the property within 90 days of the delivery of a Bankable Feasibility Study by paying AUC US$14,000,000.

There is no assurance that a definitive agreement on a joint-venture will be finalized with Yellowcake on the property under the proposed terms, or at all.

The Company has budgeted approximately $800,000 for exploration on the Pine-Tree Reno project in fiscal 2007. However, if the Letter of Intent with Yellowcake is converted to a definitive option agreement, Yellowcake will be responsible for funding exploration on the project for the remainder of fiscal 2007.

State of South Dakota Projects

The Chord Property

The Chord Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Chord Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the Chord Property from Platoro West Inc., an unaffiliated private company, in 1998. Platoro West was paid US$12,000 upon signing the sales agreement with the Company and has received annual payments of US$10,000 per year since that time. The sales agreement was amended in 2003 to allow payment of 50,000 common shares of the Company stock in lieu of the cash payment. A 2% gross royalty is retained by Platoro West, and is removed after Platoro West Inc. has received $1.1 million from the Company.

Location

The Chord property consists of 22 unpatented lode mining claims covering 440 total acres. It is located at the southern end of the Black Hills of South Dakota in Fall River County.

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Accessibility

The property is accessible year round by paved roads.

History and Previous Work

Exploration and evaluation work has been performed in the past by several operators, including Union Carbide and Tennessee Valley Authority. The uranium mineralization occurs within sandstones of the Chilson Member of the Cretaceous Lakota Formation. Depth to the mineralization is less than 300 ft. A vanadium credit of 1:1 to 1:2 parts uranium is present.

Exploration by the Company

The Company acquired and reviewed all available information on the Chord Property. The Company also acquired additional public and private land adjacent to the property. Since 2004, the Company has maintained its interest in the property by making the required annual payments to Platoro West of US$10,000 per year cash. The Company had budgeted no funds for exploration at Chord during fiscal 2007.

Canadian Exploration Properties

Under the proposed Plan of Arrangement, all of the Canadian properties and any agreements that include the Canadian properties will be spun-out to Fission Energy upon receipt of all required regulatory approvals.

Quebec Property

Dieter Lake Property

The Dieter Lake Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Dieter Lake Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company purchased the property for three hundred thousand shares of common stock of the Company. Two hundred thousand shares were issued upon regulatory acceptance and one hundred thousand on the first anniversary of regulatory acceptance, to Jeffery Reeder and Jody Dahrouge. If a resource of 60 million pounds of U₃O₈ is defined, an additional two hundred thousand common shares are to be issued.

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Location

The Dieter Lake Property encompasses approximately 52,000 acres in north central Quebec. The property is located about 150 km north of Hydro-Quebec Reservoir LG-4.

List of Mineral Claims, Dieter Lake Property

CLAIM NUMBERS	TOTAL CLAIMS	NTS	RECORD DATE	EXPIRY DATE	AREA (HA)	EXPENDITURE REQUIREMENTS*
0016999 to 0017124	126	23M/15	26 Mar 2004	25 Mar 2006>	6,079½	$17,010.00
0018450 to 0018479	30	23M/16	23 Apr 2004	22 Apr 2006>	1,447½	$4,050.00
0018480 to 0018491	12	23M/15	23 April 2004	22 Apr 2006>	579	$1,620.00
0080986 to 0081033	48	23M/15	29 Jun 2005	28 Jun 2007	2,316	$6,480.00
0092312 to 0092439	128	23M/15	07 Sep 2005	06 Sep 2007	6,176	$17,280.00
0092440 to 0092531	92	23M/16	07 Sep 2005	06 Sep 2007	4,439	$12,420.00
0095066 to 0095080	15	23M/16	20 Sep 2005	19 Sep 2007	724	$2,025.00
-	12	23M/15	03 Mar 2006’	-	579	$1,620.00
-	27	23M/16	03 Mar 2006’	-	1,206	$3,645.00
-	6	25D/02	03 Mar 2006’	-	289	$810.00
Total:	496				23,835	$66,960.00

* Expenditure requirements are for the current year.

‘ The date is the application date.
^> Updated applications in progress.

Accessibility, Climate, Infrastructure and Physiography

The Property is accessible by helicopter or fixed-wing aircraft only.  

At present there are no facilities or infrastructure on the Dieter Lake Property site.  Accommodations are available at Mirage Outfitters, which is located about 10 km east of the Hydro-Quebec Reservoir LG-4.  The Outfitters is an approximately 1.5 hour helicopter flight from the property.  Mirage provides all of the necessary supplies and services, including power, water and food.      

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The climate of the area ranges, reaching temperatures as low as –30°C and as high as 30°C.  Lake freezing in the area is usually in early October and ice break-up commonly occurs in mid to late May.

Geology and Mineralization

Uranium mineralization at Dieter Lake occurs within a Lower Proterozoic sedimentary basin, within the Superior Structural Province of the Precambrian Shield. The property covers the northern extent of a sedimentary outlier of the Proterozoic Sakami formation. Previous exploration at the Dieter Lake property identified a mineralized bed within Sakami formation sediments, generally ranging from 0.2 meter to three meters thick, but locally up to five meters in thickness. The sedimentary bed containing the uranium mineralization has been outlined over an east-west distance of five kilometers, and a north-south distance of about 2.5 kilometers.

History and Previous Work

The majority of previous exploration was conducted in the late 1970’s and early 1980’s by Uranerz Exploration and Mining Ltd., an unrelated private mining exploration company. The work included geological mapping, radiation surveys, various geochemical sampling programs, airborne and ground geophysics, and the completion of at least 145 diamond drill holes totaling 21,597 meters.

Current and Anticipated Work

During 2005, a summer exploration program was conducted for the Company by Dahrouge Geological Consulting Ltd. This work resulted in an updated structural and geologic map of the basin including north trending gabbroic dykes. Old core found at Dieter and Ranger lakes was relogged, and 204 samples were taken based on scintillometer readings. Results of the core sampling were used to verify historic data and to develop an updated resource model. A resource estimate was calculated using both 2005 sample data and historic data. A GEOTEM survey, including magnetic data, covered 977 line km over the Gayot Lake Basin.

The mineralization at Dieter Lake has been traced over an east-west distance of up to eight kilometers and a north-south distance of up to two kilometers. It remains open in most directions. Within the vicinity of the known mineralization are several northeast-trending structures and basement highs which provide attractive exploration targets for upgraded mineralization with potential for increased thickness and grades. For 2007, the Company intends to conduct a 5000 meter drill program during the Spring and Summer months. This program targets areas where known mineralization can be upgraded from the inferred resource category to the indicated resource category, and where additional mineralization is expected.

The Company had budgeted approximately $2,000,000 for exploration at Dieter Lake in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Dieter Lake, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

Saskatchewan Properties

1.

Athabaska Properties

Davy Lake, Hall Lake, and Virgin River projects

The Athabaska Properties are without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Athabaska Properties stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired an option to acquire a 100% interest in the initial portion of this property interest by paying $7,500 and incurring additional costs of $34,902. To earn its interest, the Company had to issue 200,000 common shares in stages to June 8, 2005. The property interest is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on any diamond production that occurs on the property.

During December 2004, the Company applied for an additional approximately 1.9 million acres of new exploration permits, covering lands within the Athabasca Basin. The company received these permits and the total amount of land under claim permit or permit application by the Company within the Athabasca Basin grew to 2.8 million acres. The new land encompasses the Davy Lake Project, which covers about 1.5 million acres and the Hall Lake Project, which covers about 400,000 acres. The Company also acquired by staking another area known as the Virgin River Property, which covers about 10,000 hectares.

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Location, Infrastructure and Climate

The Athabasca Property is located about 100 km northeast of Fort McKay, Alberta, Canada and extends into the province of Saskatchewan. It covers approximately 600,000 acres within the western part the Athabasca Basin; 1.5 million acres within the north central portion of the Athabasca Basin located in northern Saskatchewan; 400,000 acres located in the southern part of the Athabasca Basin; and, an additional 10,000 hectares located in the south-central part of the Athabasca Basin. The Company controls the area denoted in yellow on the above map.

The climate of the area ranges from below –40°C during winter months, to as high as 30°C during the summer.  Lake freeze-up in the area is usually in early October and ice break-up commonly occurs in mid to late May.

Davy Lake

The Davy Lake property is currently 1.5 million acres in size and lies along the northern portion of the Athabasca Basin in northwestern Saskatchewan.

Due to the large amount of lakes and streams, helicopters or fixed-wing aircrafts provide the only year-round access throughout the property area. Currently, there are no access roads on the property. The Cluff Lake Mine Road 955 comes to within about 50 km of the permits. Winter road 905, which leads from Points North Landing north to Stony Rapids, comes within 40 km of the permits. At present there are no facilities or infrastructure on the Davy Lake permit area. The majority of supplies and services are available in Uranium City, Stony Rapids or Fort McMurray.

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The area containing the property is underlain at depth by the Clearwater, Western Granulite and Tanto domains. The depth to the basement unconformity in much of the Davy Lake project has been poorly constrained by previous investigations. Recent interpretations suggest a variable basement topography consisting of troughs and regional highs that may bring the unconformity closer to the surface. Interpretation of regional aeromagnetic data indicates several major through-going structures that define boundaries of the basement domains.

Mineral prospecting permit applications were submitted December 1, 2004 with approval received January 18, 2005. 2005 exploration consisted of a property-wide airborne MegaTEM electro-magnetic survey. A highly conductive area has been defined that corresponds to a magnetic trend within the basement. In 2006, extensive geophysical programs were conducted, an a prominent EM geophysical conductor was identified over a length of 50 kilometers. Additional claims were staked over parts of the anomaly which extended off of the existing property boundary. Follow-up geology and gravity surveys have further defined the target for planned exploration in 2007.

The property’s size will be reduced in 2007, although the major anomalous areas that have been identified through the Company’s exploration programs will be retained.

The Company had budgeted approximately $2,470,000 for exploration at Davy Lake in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Davy Lake, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

Hall Lake

The Hall Lake property currently consists of about 400,000 acres along the south-central portion of the Athabasca Basin in northwestern Saskatchewan.

Due to the large amount of lakes and streams, helicopters or fixed-wing aircrafts provide the only year-round access throughout the property area. Currently, there are no access roads on the property. The Cluff Lake Mine Road 955 comes to within about 50 km of the western permit boundary. At present there are no facilities or infrastructure on the Hall Lake permit area. The majority of supplies and services are available in La Ronge or Fort McMurray.

Much of the Hall Lake project area is estimated to have a depth to the basement unconformity of less than 600 metres and is underlain at depth by the Western Granulite basement domain. An electromagnetic interpretation, flown by Questor Surveys Ltd. in 1979, suggests unaltered basement at depths ranging between 300 and 800 meters at the western margin of the property.

Mineral prospecting permit applications were submitted December 1, 2004 with approval received January 18, 2005. Exploration in 2005 consisted of a property-wide airborne MegaTEM electromagnetic survey. The southern portion of the property showed a number of anomalies worthy of follow-up, which was conducted in 2006. These ground geophysical surveys identified anomalous areas in the southeastern portion of the current property block. In 2007, the Company intends to reduce the size of the property to approximately 100,000 acres which will include the southeastern anomalous targets.

The Company had budgeted approximately $225,000 for exploration at Hall Lake in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Hall Lake, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

Virgin River

The Virgin River property covered approximately 24,673 acres within the south-central part the Athabasca Basin, northwestern Saskatchewan about 150 km north of the town of La Loche, The claims are at the southern edge of the Athabasca Basin, within the Virgin River Domain. Due to the large amount of lakes and streams, helicopters or fixed-wing aircrafts provide the only year-round access hroughout the property area.

Exploration of the area within and surrounding the Vrigin River began in the late 1960's. From 1976 to 1981 Marine Oil Corporation conducted lake sediment sampling, prospecting and mapping, as well as several ground and airborne EM surveys as well as magnetic surveys. In 1979 and 1980, Uranerz Exploration and Mining Ltd. completed geological mapping, lake sediment sampling, and ground EM, gravity and magnetic surveys within the area.

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After reviewing the available historical data on the property, management determined that there was insignificant potential on the property to justify exploration expenditures. Therefore, the claims were allowed to lapse in 2006, and the Company has no further interest in the Virgin River property.

2.

Duddridge Lake Property

The Duddridge Lake Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Duddridge Lake Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company acquired the Duddridge Lake Property, by staking on January 14, 2004. A finder’s fee in the amount of 200,000 common shares of the Company Minerals were issued to Jeffery Reeder and Jody Dahrouge for identifying this area.

Under an option agreement between the Company and Great Bear Resources Ltd. (“Great Bear”), Great Bear can earn a 60% interest in the property by completing $6,000,000 in exploration expenditures, paying $400,000 cash, and issuing 400,000 common shares under the following schedule:

Date	Cash	Common Shares of Great Bear	Minimum exploration commitments	Percent Interest earned by Great Bear
On signing	$150,000 plus additional staking costs up to $100,000	200,000
By March 31, 2008	$150,000	200,000	$750,000
By March 31, 2009			$1,000,000
By March 31, 2010			$1,000,000	35% interest earned
By March 31, 2011			$1,250,000	51% interest earned
By December 31, 2013			$2,000,000	60% interest earned
Total	$400,000	400,000	$6,000,000

Location

The property encompasses 26,888 acres and is located on the eastern side of the Wollaston Domain in northern Saskatchewan, approximately 77 km west-northwest of the town of La Ronge.

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Accessibility, Climate, Infrastructure

La Ronge is accessible from Prince Albert north along Highway 2.  Prior to reaching La Ronge, a secondary, all-weather road (165) branches northwest off Highway 2 to Besnard Lake and leads to a 16 km winter road that accesses Duddridge Lake. The property is also accessible by helicopter or fixed wing aircraft year round.

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At present there are no facilities or infrastructure at the Duddridge Lake site.  Power exists at Pinehouse Lake, a community about 23 km west of the Duddridge Lake Property.  The majority of supplies and services may be available from La Ronge.

Within the area temperatures range from as low as –30°C, to as high as 30°C.  Within the area lakes usually freeze-up in early October, while ice break-up commonly occurs in mid- to late-May.

History and Previous Work

The Duddridge Lake area was initially included in a regional reconnaissance-mapping project conducted by the Geological Survey of Canada in 1950. In 1965, the Saskatchewan Department of Mineral Resources included the area in a three year 1:63,360 mapping project.  

The area has been a target of uranium exploration since 1969, following an airborne radiometric and magnetic survey by Geo-X Surveys Ltd. The survey identified thirteen areas of anomalous radioactivity in the Duddridge Lake and Sandfly Lake areas. In 1970, Strato Geological Ltd. completed various geochemical sampling programs, a ground magnetometer survey, and a radiometric survey to test the identified anomalies at the southeast end of Sandfly Lake.

In 1974, Thor Explorations continued exploration in the Duddridge Lake area, which led to the discovery of uranium and copper mineralized boulders in the form of an approximately 1300 meter long, northeast trending boulder train along the west side of Duddridge Lake. Subsequent diamond drilling beneath the boulder train identified a stratabound sequence of Aphebian aged carbonaceous meta-sediments of the Myers Lake Group. Exploration determined that the uranium mineralization appears to be associated with zones of carbonaceous arkose that trend northeasterly and dip steeply to the west. A grid was established and used to complete an IP survey and limited hand trenching.

Current and Planned Work

During May and June, 2005 an 2005 exploration program consisting of assessment of  local property access and establishment of two local grids was conducted. Sediment and rock samples were also collected and analyzed. The sediment samples showed Uranium-Copper anomalies as well as elevated Arsenic, Nickel and Vanadium geochemistry, consistent with earlier studies. The rock samples were collected for background information and possibly as an aid in sediment sample result interpretations. In the 4^th Quarter of 2006, a VTEM survey was completed, and future exploration will follow-up previously defined anomalies.

The Company had budgeted approximately $313,000 for exploration at Duddridge Lake in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Duddridge Lake, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

3.

Waterbury Lake Property

The Waterbury Lake Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Waterbury Lake Property stemmed from earlier exploration work, as described below, that was done in the area.

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Acquisition of Interest

The Company acquired the 100,000 acre Waterbury Lake Property through staking during March and April 2004.

Location

The Waterbury Lake Property is about 700 km due north of Saskatoon, Saskatchewan and about 450 km by road, from LaRonge, Saskatchewan.

Accessibility, Climate, Infrastructure and Physiography

Points North Landing, located immediately southeast of the property, is accessible either by aircraft or by secondary roads 102 and 905 from La Ronge.  Access is either by aircraft or via the Athabasca Seasonal Road, which extends northwest from Points North Landing to the community of Stony Rapids. The road is maintained during the winter and is of marginal quality in the summer.

At present, there are no facilities or infrastructure on the Waterbury Lake Property; however, accommodations and groceries are available at Points North Landing.  The majority of supplies and services are derived from La Ronge.

The property is centered on Henday Lake and includes Waterbury Lake to the south, Murphy Lake to the west and McMahon Lakes to the east.  Temperature extremes are highly variable, with lows of –50°C in the winter and highs of 30°C or more in the summer.  The lakes usually freeze-up in early October, while ice break-up commonly occurs in mid to late May.

Geology and Mineralization

Historic exploration at the Waterbury Lake Property indicates that the depth to the basement unconformity varies between 200 meters and 500 meters. Of particular significance is a strong northeast trending conductor axis which flanks a fairly strong magnetic gradient, with the magnetic low on the down-dip side. This association suggests a relationship to a deep geologic feature. The conductor curves to the northwest, and has a total length of approximately 7.5 km.

History and Previous Work

The Waterbury Lake and Keefe-Henday Lakes area has a documented history of over 30 years.  In 1969, King Resources Company, an unaffiliated private company, conducted an extensive exploration program in the Waterbury Lake area.  McPhar Geophysics completed an airborne radiometric, magnetic and EM survey for King Resources. King Resources compiled exploration reports in 1969 and 1970.

Asamera Oil Corp., an unaffiliated public company, obtained claims in this area during the mid-1970s. Kenting Exploration Services conducted a regional radiometric and magnetic survey, which included the area owned by Asamera.  In 1977, Questor completed and interpreted an airborne EM (input) and magnetic survey.  Additional ground VLF-EM, magnetic, alphametric and radon surveys were completed in 1978, along with the production of a report and maps.  Asamera continued exploration with mapping and sampling programs in the 1980’s.  A small drill program was completed during 1980; as well as, a summary report in 1981 and geophysical interpretations in 1982.  

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Cogema, an unrelated private company, acquired claims in the Waterbury Lake and Henday Lake areas in the late-1980s.  An extensive exploration program involving geological mapping, sampling, drilling and geophysical programs, including airborne EM, magnetic, ground VLF-EM, and gravity surveys was carried out.  Cogema produced summary reports in 1989, 1990 and 1991.

Following work done by Cogema, Cameco, an unrelated public company, acquired property interests in the Waterbury Lake and McMahon Lakes areas.  Cameco completed geological mapping and sampling programs. Continued geophysical data was collected, including ground TDEM, magnetic, gravity and IP surveys.  Cameco conducted drilling programs in and around the Waterbury Lake area throughout the 1990s.

Current and Planned Work

In 2005, the Company completed a property-wide airborne MegaTEM electromagnetic survey. The survey was useful in confirming the existence of conductive units within the basement. In autumn 2005, a short boulder-sampling program was carried out in the area of two un-tested conductive areas. In total, 77 samples were taken, and analyzed for metal contents and clay mineralogy.  In May and June 2006, the Company completed a drill program on the property consisting of eight widely spaced holes totaling 2,686 meters. 5 target areas were selected based upon the MegaTEM survey and favorable areas identified by lithogeochemical sampling and historic exploration results. 3 holes were drilled into the highest priority target, known as the Murphy conductor, which lies on the northwest portion of the property. These 3 holes were spaced between 700 and 1000 meters apart. Hole W06-06 intersected 0.032% U3O8 across a short interval, while the other 2 hol es encountered anomalous uranium mineralization. The remaining 3 holes of the program were drilled in three separate locations tens of kilometers apart and were drilled to test lower-priority geophysical anomalies. All encountered various strengths of hematization, clay alteration, and local chloritiazation, and all targets require further exploration.

In 2007, the Company in planning additional exploration on the property, including an additional 3,000 meter drill program to further test anomalies at both the Murphy and Midwest conductors. The Company had budgeted approximately $850,000 for exploration at Waterbury in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Waterbury, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

4.

Patterson Lake Property

The Patterson Lake Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Patterson Lake Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of an Interest

The Company acquired the Patterson Lake Property through staking during the later part of June 2004.

Location

The Patterson Lake Property is located about 150 km north of the town of La Loche, Saskatchewan and comprises 9 claims totaling approximately 61,776 acres.  The claims encompass an area proximal to Cluff Lake Mine Road 955 from about 1¼ km south of Broach Lake to about 2 km south of the Douglas River-Road intersection.

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Accessibility, Climate and Infrastructure

The property can be accessed year round along the gravel Cluff Lake Mine Road from La Loche.  Due to the large amount of lakes and streams, helicopters or fixed-wing aircrafts provide excellent access throughout the property area.

At present there are no facilities or infrastructure on the Patterson Lake Property site. The majority of supplies and services are available in Buffalo Narrows, 100 km south of La Loche.

The climate of the area ranges from below –40°C during winter months, to as high as 30°C during the summer.  Lake freeze-up in the area is usually in early October and ice break-up commonly occurs in mid to late May.

History and Previous Work

Exploration of the area within and surrounding the Patterson Lake Property began in the late 1960’s.  Bow Valley Industries performed an airborne radiometric survey and a photo geologic evaluation in about 1969.  Taneloy Mines Ltd., an unrelated public company, also conducted work in 1969, including airborne, radiometric, geological and geochemical surveys.

In 1974, Uranerz Exploration and Mining Ltd., an unrelated public company, completed geological mapping, lake sediment sampling, and helicopter spectrometer surveys within the area.         

In 1977 Saskatchewan Mining Development Corporation (SMDC, now Cameco) obtained property in the area and completed an extensive exploration program. The program included geological mapping, lake sediment sampling and overburden sampling.  Geophysics included a ground VLF-EM survey, an airborne EM (input) survey, and magnetic survey.

Imperial Oil Limited, an unrelated public company, also conducted an exploration program in 1977, which included geological mapping, lake water and sediment sampling, an airborne radiometric survey, and ground VLF-EM surveys.

During the late 1970’s and early 1980’s, Hudson Bay Exploration and Development (an unrelated public company), SMDC, and Imperial Oil continued to explore the area, individually and jointly. Exploration included geological mapping, radiometric prospecting, scintillometer surveys, limited drilling, and extensive sampling programs, including lake sediment, stream sediment, soil, overburden and till sampling.  

In 1990, Amok Ltd., an unrelated public company, conducted an airborne EM and magnetic survey.

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Cogema Resources Inc., part of the AREVA Group, was created with a merger of Cogema S.A. and Framatome ANP as well as several other companies in 2001, staked claims in the area and completed a variety of geophysical surveys throughout the 1990’s, including ground UTEM, TDEM, gravity, magnetic, VLF-EM, and VLF-R surveys.   A number of conductive trends were identified, and drill tested with limited success.

Current and Anticipated Exploration

During 2005, the Company completed a property-wide AeroTEM airborne electromagnetic survey The results of this survey provided basement conductive areas that warranted follow-up. A ground geophysics program was completed late in 2006. This program confirmed north-south structures. A drill program was initiated, but was abandoned due to equipment problems on the first hole. During the third week of January 2007, drilling resumed on the property.

The Company had budgeted approximately $950,000 for exploration at Patterson Lake in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Patterson Lake, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

Alberta Properties

All of the Company’s Alberta properties are exploration-stage projects without known reserves. Current exploration is at the reconnaissance stage, and the Company anticipates continuing exploration to identify areas and priority targets within the projects for follow-up exploration.

1.

Fort McLeod Property

The Company has acquired approximately 917,000 acres of uranium mineral exploration properties near Fort McLeod, Alberta. Historical explora­tion during the 1980’s identified a number of sandstone hosted roll-front uranium occurrences within the region. Data of prior exploration in the area has been complied and is being reviewed. Exploration in 2006 included a review of the well logs, ground prospecting and sampling. Additional ground prospecting and an airborne radiometric survey are planned for early 2007.

The Company had budgeted approximately $805,000 for exploration at Fort McLeod in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Fort McLeod, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

2.

Athabasca North Shore

The Athabasca North Shore properties total 291,000 near the north shore of Lake Athabaska. Geophysical surveys were conducted during autumn 2006 and are currently continuing. Prospecting has identified several anomalous areas and geochemical analysis of grab samples have identified values ranging from zero up to 1% U3O8. Additional sample results are pending. Four permits were added to cover areas with potential for Beaverlodge-type uranium occurances and basement-hosted, sub-unconformity mineralization. For fiscal 2007, additional geophysics and ground work are planned to begin during the summer months.

In May 2007, the Company signed a Letter of Intent (“LOI”) with Tribune Resources Corp. (“Tribune”) to form at joint-venture on the property. Under the LOI, Tribune will have the right to earn a 60% interest in the property by issuing 600,000 common shares and incurring property expenditures of $10,000,000 over six years. If Tribune earns its 60% interest, the Company may buy back a 11% interest for $10,000,000. The Company will also hold an NSR on yellowcake produced from Tribune’s ownership portion of the property, which will vary depending upon the market price of yellowcake.

There is no assurance that a definitive agreement on a joint-venture will be finalized with Tribune on the property under the proposed terms, or at all.

The Company had budgeted approximately $378,000 for exploration at Athabasca North Shore in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Athabasca North Shore, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

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3.

Athabasca Basin South

The Athabasca South properties total 695,000 acres. Exploration during 2006 included Mega TEM/GeoTem Surveys which are currently being interpreted. A preliminary review of the TEM data has identified several bedrock conductors that warrant further exploration. For 2007 ground geophysical surveys will follow up on anomalous areas identified through the TEM survey.

The Company had budgeted approximately $450,000 for exploration at Athabasca Basin South in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Athabasca Basin South, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

British Columbia Property

1.

The Comstock Property

The Comstock Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Comstock Property stemmed from earlier exploration work, as described below, that was done in the area.

Acquisition of Interest

The Company purchased 100% of the property on November 25, 2003 from Jeffery Reeder, an unaffiliated party, for 300,000 common shares paid in three equal installments over 24 months.

Location

The property is a polymetalic exploration project and consists of three mineral claims totaling approximately 300 hectares. It is located at about 2103 meters elevation on the divide between Fennell and Silverton creeks. The town of Silverton is about 11½ kilometers to the northwest.

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Accessibility, Climate, Infrastructure and Physiography

The property is accessible by gravel road.  Silverton and New Denver, both small towns, have adequate supplies and lodging for field crews.

The climate of the area ranges from below –20°C during winter months to more than 30°C during the summer. Heavy snowfalls are common during winter months.

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History and Previous Work

The earliest recorded work was in 1898 and continued intermittently until 1920. Early workings consisted of nine adits totaling 853 meters length. A mill was constructed in the late 1890's but was used for only two months. No further work was recorded until 1970. Work in 1970 was conducted by R.H. Murphy and partners and included a small shipment of dump material to the smelter at Trail, B.C.  Further work was done in 1972 and 1973. In 1976, H.S. Murphy and R.H. Murphy conducted a geochemical survey, trenching and one 25-metre drill hole. In 1988, Dragoon Resources Ltd. custom smelted ore at a mill in Ainsworth, B.C.

Planned Work Program by The Company

The Company plans to compile and review all available historic exploration data to determine the next phase of exploration on the property.   The Company had budgeted approximately $17,500 for exploration at Comstock in fiscal 2007. However, if the spin-out of the Canadian exploration properties, including Comstock, into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

Peru Exploration Properties

1.

The Macusani Property (Peru)

The Macusani Property is without known reserves and the work being done by the Company is exploratory in nature. The Company’s interest in the Macusani Property stemmed from earlier exploration work, as described below, that was done in the area.

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Acquisition of Interest

Up to 2002, the Company through its 100% wholly owned Peruvian subsidiary Minera Peruran S.A. owned several concessions totaling 4200 hectares. However, in order to reduce holding costs the Company allowed the concessions to lapse. In March of 2003 and January 2004 the Company re-acquired four concessions totaling 2400 hectares.

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Location

The Macusani Property is located in south-central Peru, within the Puno district of Carabaya Province

Accessibility, Climate, Infrastructure and Physiography

The property is approximately 650 kilometers southeast of Lima and accessible by gravel roads from either Cusco or Juliaca.  The concessions are located in the heart of the 250 square-kilometer Macusani district.  The small village of Macusani is 50 kilometers to the southeast of the property, where adequate lodging and supplies are available. The trip from Macusani to the property takes approximately 2 hours.

History and Previous Work

The geology of the district is uraniferous (a uranium bearing variety of graphite) volcanic area deposited during the Tertiary period by thick outflows of tuffs and ignimbrites. The region was explored from August to October 1982 by a joint project of the Instituto Peruviano de Energia Nuclear (IPEN) and the IAEA.  A prospective area east of the village of Chapi was located and followed up by a radiometric survey (the process of determining the age of rocks from the decay of their radioactive elements) in 1984 and an emanometric survey (measuring uranium content) in 1986.  The area was later trenched in 1987.  Guido Arroyo, a geologist, carried out the work.

The Company employed Guido Arroyo as chief geologist and assisted in the staking of several concessions in the Macusani district in 1997 and 1998.  Mr. Arroyo carried surface mapping and access roads to the main uraniferous areas.  The Company contracted several locals to mine several hundred tones of Autunite ore (high grade uranium ore commonly referred as "yellowcake").  The ore was placed in sealed 55-gallon cylinders and is currently stored in a warehouse in the town of Macusani.

Planned Work Program by The Company

Additional exploration will consist both of geological mapping and radiometric surveys.  Every outcrop mapped will also be measured for radiation strength. The Company had budgeted approximately $465,000 for exploration at Macusani in fiscal 2007. However, if the spin-out of the property into Fission Energy is completed, Strathmore will have no further interest in the property and will fund no further exploration on the property.

ITEM 5.  OPERATING AND FINANCIAL REVIEW AND PROSPECTS

The following discussion for the fiscal years ended 12/31/2006, 12/31/2005, 12/31/2004, 12/31/2003, 12/31/2002, and 12/31/2001 and the three month periods ended 3/31/2007 and 3/31/2006 should be read in conjunction with the financial statements of the Company and the notes thereto.

The Company’s principal business is the acquisition and exploration of uranium exploration properties.  The Company is continually investigating new exploration opportunities, and exploration is carried out on property interests identified by management of the Company as having favorable exploration potential.  The Company advances its projects to varying degrees by prospecting, mapping, geophysics, geo-chemical, surveying, and drilling until it decides either that the property has limited exploration potential and should be abandoned or that work on the property has reached a stage where the expense and risk of further exploration and development dictate that the property should be optioned to a third party.  The resource exploration business is high risk and most exploration projects do not reach a commercial stage of operations.

There are no known proven reserves of minerals on the Company’s property interests.  The Company does not have any commercially producing mines or sites, nor is the Company in the process of developing any commercial mines or sites.  The Company has not reported any revenue from operations since incorporation.  As such, the Company is defined as an “exploration-stage company”.

Under the Plan of Arrangement approved by Shareholders, the Company intends to spin-out its Canadian and Peruvian exploration property assets into a separately traded public Company, Fission Energy. Of the Company’s assets as of December 31, 2006, $3,085,341 of the amount is Canadian property assets, $459,597 is assets located in Peru, and $500,000 is cash, all of which will be transferred to Fission if the spin-out receives all the required regulatory approvals.

If the Plan is completed, the Company’s past financial information will not be indicative of the Company’s future financial position and operating results. Strathmore intends to focus its operations on the exploration of its more advanced United States uranium exploration properties, both through funding its own exploration and through the joint-venture and option of properties to third-parties.

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Operating Results

The Three Months Ended 3/31/2007 versus the Three Months Ended 3/31/2006

For the three-month period ended March 31, 2007, the Company spent $2,731,461 on exploration and development as follows:

	Canada	USA	Peru	Total
Drilling	812	7,775	-	8,587
Engineering	-	279,305	-	279,305
Equipment & vehicle rental	267,882	349	-	268,231
Geology	563,878	16,390	-	580,268
Geophysics	483,250	-	-	483,250
General expenses	26,547	17,117	8,807	52,471
Property fees	102,133	42,385	-	144,518
Permitting/Regulatory	95,684	62,918	-	158,602
Personnel time	274,362	379,178	27,316	680,856
Travel	31,354	38,953	5,066	75,373
	1,845,902	844,370	41,189	2,731,461
Total as at March 31, 2007	$10,397,035	$ 3,849,234	$  431,206	$14,677,475

For the three-month period ended March 31, 2007, general and administrative expenses increased from $728,846 in 2006 to $1,599,616 in 2006, as the activity of the Company increased significantly with 3 full time offices open during the current period. Large increases in expenses occurred in Advertising and Promotion, which rose to $201,178 from $13,550, and Trade Shows and Conferences, which increased to $109,123 from $97,035 as the Company endeavored to increase awareness of the Company in the investment community; Consulting Fees, which increased to $403,970 from $195,517 as the Company’s increased mineral property exploration activity required additional work from outside consultants; Office and Miscellaneous, which rose to $117,564 from $19,454, and Rent, which increased to $38,466 from $12,749, as the Company opened additional offices in Wyoming and New Mexico to support is property exploration activities; Stock-based Compensation, wh ich increased to $247,021from $116,106 which was related to the granting of additional stock options during the current period; and Wages and Benefits, which increased to $201,547 from $88,457 as additional personnel was hired to support the Company’s higher level of mineral property exploration.

The Company expects general and administrative expenses to continue to increase as the Company becomes more active in all geographic regions and hires additional employees.

The other Items in the current 3-month period include Investment Income, which rose to $426,412 from Nil due to higher cash balances and short-term investments, and Miscellaneous income of $120,432 compared to $266,554.. In the 3-months ended March 31, 2005, the Company recorded an Allowance for decline in investments of ($38,488) compared to Nil in the current year’s period.

Fiscal 2006 Ended 12/31/2006 versus Fiscal 2005 Ended 12/31/2005

During the year ended December 31, 2006, the Company incurred $2,122,668 in property acquisition costs. These costs are summarized in the following table. The Company expects these costs to increase as it continues its program of staking and acquisitions.

US properties:	$ 1,521,929
Peru properties:	$            Nil
Canadian properties:	$    600,739

For the year ended December 31, 2006, the Company spent $8,375,024 on exploration and development as follows:

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	Canada	USA	Peru	Total
Airborne geophysics surveys	2,516,823	-	-	2,516,823
Camp costs	238,368	-	-	238,368
Claim fees	181,430	514,003	30,276	725,709
Geologists fees and supplies	1,743,786	1,582,897	131,355	3,458,038
General expenses	62,172	130,264	37,633	230,069
Travel	506,005	159,605	30,224	695,834
Helicopter rental and equipment fuel	424,851	494	-	425,345
Lab analysis and sampling	19,990	-	-	19,990
NI 43-101 reports	10,417	-	-	10,417
Report and map preparation	51,346	2,324	761	54,431
2006 exploration and development	5,755,188	2,389,587	230,249	8,375,024
Total as at December 31, 2006	$8,551,133	$3,004,864	$390,017	$11,946,014

During the year, the company advanced its Roca Honda property to the permit application stage, and additional claims were staked in New Mexico in the Crownpoint-Dalton Pass areas. In Wyoming, the Company acquired additional claims in both the Shirley Basin and Gas Hills uranium districts. In Canada, geophysical programs were carried out on the Davy Lake and Patterson Lake properties and a first phase drill program was completed at Waterbury Lake. A technical report was completed on the Dieter Lake project and, subsequent to the year-end, on the Sky (Cedar Rim claims), Wyoming.

General and administrative expenses increased from $2,360,139 in 2005 to $3,683,424 in 2006 as the activity of the Company increased as it expanded, as well as maintaining 3 full-time offices in Kelowna, Riverton, and Santa Fe. Large increases in expenses occurred in Consulting Fees, which rose to $819,123 from $654,100 due to the need for additional outside consultants to support the Company’s increased activities; Professional Fees, which rose to $370,419 from $132,637 due to fees on uncompleted financings and assistance with general corporate and permitting matters. Property Investigation costs, which was $126,289 compared to zero in the prior year, as management investigated the acquisition of interests in new properties; Short-term investment fees, which rose to $92,127 from $3,061 as the Company shifted higher amounts of its cash balances from demand accounts into short-term investments; Stock-based Compensation, which increased to $731,026 from $476,610 as the Company granted a higher number of stock options in the current year; Shareholder Communications, which increased to $47,287 from $9,329, and Trade Shows and Conferences, which rose to $379,389 from $229,792, as the Company increased its efforts to inform shareholders and the investment community of the Company and its activities; and Wages, which increased to $448,492 from $158,628 as additional personnel was hired during the year.

Other items included investment income of $1,393,310, which was higher than the $365,930 recorded in the prior fiscal year, due to higher cash balances during the current year. The Company also recorded an allowance of ($20,574) for the decline of value of its short-term investments.

Fiscal 2005 Ended 12/31/2005 versus Fiscal 2004 Ended 12/31/2004

During the year ended December 31, 2005, the Company incurred $2,891,050 in property acquisition costs. These costs are summarized in the following table. The Company expects these costs to increase as it continues its program of staking and acquisitions.

US properties:	$ 1,969,835
Peru properties:	$            Nil
Canadian properties:	$    921,214

For the year ended December 31, 2005, the Company spent $3,403,341 on exploration and development as follows:

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	Canada	USA	Peru	Total
Airborne geophysics surveys	1,497,325	-	-	1,497,325
Camp costs	41,534	-	4,573	46,107
Claim fees	38,178	168,188	22,165	228,531
Geologists fees and supplies	418,162	370,852	129,554	918,568
General expenses	16,326	8,074	1,861	26,261
Helicopter rental and equipment fuel	586,482	-	-	586,482
Lab analysis and sampling	38,802	-	-	38,802
NI 43-101 reports	21,334	3,841	-	25,175
Report/map preparation	33,869	606	1,615	36,090
2005 exploration and development	2,692,012	551,561	159,768	3,403,341
Total as at December 31, 2005	$2,795,945	$615,277	$159,768	$3,570,990

During the fourth quarter of 2005, the Company decided to advance exploration work programs for Athabasca basin properties ahead of the original planned schedule. Several airborne surveys originally budgeted for 2006 were completed in 2005. The increased number of airborne surveys account for increased Canadian expenditures compared to budget.

General and administrative expenses increased from $2,059,945 in 2004 to $2,360,139 in 2005. Higher expenses occurred in Investor Relations, which rose to $110,718 from zero, and Trade Shows and Conferences, which were $229,792 compared to zero in 2004, all of which were due to the Company working to increase investor awareness of the Company; Consulting Fees, which rose to $654,100 from $343,388, and Office and Miscellaneous rose to $206,323 from $123,378, as the Company hired additional consultants to support its higher level of corporate activity; Professional Fees, which increased to $89,210 from $77,002 as the Company obtained general professional geological consulting in addition to legal and accounting services; and Wages, which was $158,628 compared to zero in the prior year as new personnel was hired. Stock-based Compensation decreased to $476,610 from $962,297 as the Company granted fewer stock options in the current year. The Company expects general and administrative expenses to continue to increase as the Company becomes more active in all geographic regions and hires additional employees.

Other Items included Investment Income of $365,930, which was higher than the $65,735 in the prior year due to higher cash balances, and Allow for Decline in Short-term Investments of ($4,817).

Fiscal 2004 Ended 12/31/2004 versus Fiscal 2003 Ended 12/31/2003

During the previous year (2003) the price of uranium remained low. However, by September 2003 the price of uranium rebounded to over $12 US per pound. At that time management decided to aggressively pursue the acquisition of new uranium property interests in the United States and Canada. In addition to the Peru property and the Chord Project, the Company had acquired, or negotiated the right to acquire additional uranium property interests in New Mexico, Wyoming, Quebec, Alberta and Saskatchewan. At the time of writing, the spot uranium price is $24 US per pound.

During the fiscal year ended December 31, 2004, the Company incurred $2,541,745 in property acquisition costs. These costs are summarized in the following table. The Company expects these costs to increase as it continues its program of staking, acquisitions and development exploration.

US properties:	$1,115,449
Peru properties:	$     46,019
Canadian properties:	$1,380,277

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During 2004, general and administration expenses increased from $219,874 in 2003 to $1,097,648 in 2004. Large increases in expenses occurred in Business Development, which rose to $96,072 from zero as the Company investigated the acquisition of additional uranium exploration projects; Office and Miscellaneous, which increased to $123,378 from $28,460 as the Company had a higher level of activity in the current year; Consulting Fees, which rose to $343,338 from $86,591, due to the need for additional outside consulting work to support the higher level of corporate activity; Transfer Agent, which increased to $167,017 from $19,298, and Professional Fees, which rose to $75,578 from zero; and Stock-based Compensation, which totaled $962,297 compared to $221,994 as the Company granted additional stock options. Investment Income was $65,735 in the current year compared to zero in the prior year due to higher cash balances.

The Company expects general and administrative expenses to continue to increase as the Company becomes more active in all geographic regions. Investment income rose to $65,735 in fiscal 2004 compared to zero in the prior year as the Company maintained higher cash balances and short term investments in the current year.

Fiscal 2003 Ended 12/31/2003 versus Fiscal 2002

The Company had a net loss of $432,885 for the fiscal year ended 12/31/2003 as compared to a net loss of $1,158,900 for the fiscal year ended 12/31/2002. This represented a decrease of 167%. The loss was significantly less for the fiscal year ended 12/31/2003 as compared to the fiscal year ended 12/31/2002 because during Fiscal 2002 the Company wrote-off $215,315 in mineral property interests and $704,123 in deferred exploration costs.

During Fiscal 2002 the price of uranium remained low and the Company elected to reduce expenditures and conserve cash.  All exploration work was stopped during Fiscal 2002 and property interests, which were considered to be non-essential, were written-off during Fiscal 2002. By the third quarter of 2003, the price of uranium had increased to a point where management of the Company decided to pursue the acquisition of new uranium property interests in both the United States and Canada. In addition to the property in Peru and the Chord Project, the Company also acquired, or negotiated the right to acquire, additional property interests located in both the United States and Canada.

In order to finance these activities, the Company completed private placement financings during Fiscal 2003 and raised a total of $1,150,000. During the year, the Company utilized these funds to perform exploration work on its property interests, to acquire additional property interests and for general working capital purposes.

The mineral property interests written off during Fiscal 2002 were:

1.

All the Company’s mineral claims located in Peru were allowed to lapse during Fiscal 2002 and the related acquisition costs of $45,895 were written off during the year. The Company allowed these claims to lapse because it did not have adequate capital to absorb any expenses associated with this property. The associated expenditures associated with the mineral claims in Peru, which were written off, totaled $605,243.  

2.

The Company wrote off a 100% interest that it had in a property located in the state of Oregon because of poor exploration results. The related acquisition costs of $121,220 associated with this property were written-off to operations. The associated expenditures associated with this property, which was written off, totaled $98,880.

3.

During Fiscal 2002, the Company entered into letters of intent to acquire options on the Wemindji East and Portage West property interests located in Quebec, Canada.  The Company advanced $35,000 and issued 100,000 common shares pursuant to the agreements.  The Company also issued 60,000 common shares valued at $13,200 as a finder’s fee.  The option agreements did not complete and, accordingly, acquisition costs of $48,200 were written-off to operations in Fiscal 2002. The 100,000 common shares issued for the property were returned to treasury. The option agreements did not complete because management changed its opinion, and concluded the property was no longer an economically viable option.

No mineral property interests were written off during Fiscal 2003.

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During Fiscal 2003 management endeavored to reduce day-to-day expenses.  Large changes in expenses occurred in Professional Fees, which fell to zero from $32,468; Shareholder Communications, which decreased to $7,082 from $24,715; Travel, which fell to $6,836 from $15,146, and Amortization, which decreased to $1,821 from $27,331. Increases occurred in Consulting Fees, which rose to $86,591 from $54,551, and Regulatory Fees, which increased from $4,253 to $38,853, due to the regulatory requirements related to the acquisition of new properties. Overall expenses increased by $202,406.  This resulted from the fact that management elected to recognize the compensation cost on the fully vested 780,001 stock options granted to employees and non-employees during Fiscal 2003.  

Fiscal 2002 Ended 12/31/2002 versus Fiscal 2001 Ended 12/31/2001

The Company had a net loss of $1,158,900 for the fiscal year ended 12/31/2002 as compared to a net loss of $290,750 for the fiscal year ended 12/31/2001. This represented an increase of almost 300%. The increase was due to the fact that during Fiscal 2002 the Company wrote-off mineral property interests in the amount of $215,315 and deferred exploration costs in the amount of $704,123, which consisted of the Aurora Property in the United States and the Company’s properties in Peru.

General and administrative expenses were $239,462 for Fiscal 2002 and $290,750 for Fiscal 2001. The primary reason for the decreased in the amount of general and administrative expenses during Fiscal 2002 as compared to Fiscal 2001 was that the level of corporate activity remained low with only minimal exploration work occurring on the Company’s property interests. Large changes in expenses occurred in Amortization, which fell to $27,331 from $38,480; Management Fees, which fell to $14,979 from $74,937; Rent, which fell to $10,875 from $23,297; Trade Shows and Conferences, which rose to $17,431 from zero; and Travel and Promotion, which rose to $15,146 from $7,196.

During Fiscal 2001 the Company completed a share consolidation, as disclosed earlier, and changed its name. The Company also engaged in limited exploration work on its property interests during Fiscal 2001.

Fiscal 2001 Ended 1/31/2001 versus Fiscal 2000 Ended 12/31/2000

The Company had a net loss of $290,750 for the fiscal year ended 12/31/2001 as compared to a net loss of $399,262 for the fiscal year ended 12/31/2000. This represented a decrease of 27%. The decrease was due to the fact that during Fiscal 2000 the Company wrote-off mineral property interests in the amount of $93,181 and deferred exploration costs in the amount of $48,730. Partially offsetting these write-offs was a gain on sale of a mineral property in the amount of $15,000.

The Company had a 100% interest in various property interests that it had acquired by staking which were located in Utah, Wyoming, South Dakota and Peru.  During Fiscal 2000, the Company elected to write-off some of the property interests, which it had acquired by staking which were located in Utah, Wyoming and South Dakota. The reason for the write-offs was that, due to a lack of capital, management decided to retain only those property interests which they felt were the most promising based on prior exploration work.

The deferred exploration costs, which were written off, in the amount of $48,730, were all associated with the property interests, located in the U.S.A., which management decided to write-off.

The gain on the sale of mineral property interests was the result of the sale of property interests located in the U.S.A., which had been written-off during Fiscal 1999.

General and Administrative Expenses for fiscal 2001 were $290,750 compared to $272,351 in fiscal 2000. Large changes in expenses occurred in Management Fees, which rose to $74,937 from $43,280; Office and Miscellaneous, which rose to $18,411 from $7,476; Rent, which increased to $23,297 from $11,041; and Travel and Promotion, which fell to $7,196 from $24,477. There was no Other Items in the current year, compared to the prior year, which included Gain on the Sale of Mineral property of $15,000 and the Write-off of Mineral Property Interests of $93,181 and Write-off of Deferred Exploration Costs of $48,730.

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Fiscal 2000 Ended 12/31/2000 versus Fiscal 1999 Ended 12/31/1999

The Company had a net loss of $399,262 for the fiscal year ended 12/31/2000 as compared to a net loss of $1,680,211 for the fiscal year ended 12/31/1999. This represented a decrease of 77%. The decrease was due to the fact that Management elected to sharply reduce its expenditures and conserve cash during Fiscal 2000. The Company eliminated all exploration and pared back on the non-essential property interests decreasing the number of claims held in certain of its claim groups and thereby reducing the cost of holding its property interests with the resulting write-off of a number of its property interests. General and Administrative Expenses fell to $272,351 from $937,177 due to management’s decision to reduce exploration activity and conserve cash. Large changes in expenses occurred in Advertising, which fell to zero from $75,941; Consulting Fees, which fell to $44,476 from $368,390; Management Fees, which decreased to $43,280 from $73,371; Offic e and Miscellaneous, which fell to $7,476 from $22,768; Professional Fees, which fell to $12,436 from $86,707; Rent, which declined to $11,041 from $29,717; Salaries and Benefits, which fell to zero from $53,122; Shareholder Communication, which decreased to $30,668 from $85,879; and Trade Shows and Conferences, which fell to $13,276 from $26,414.

During Fiscal 2000 the Company incurred $26,292 in deferred exploration and development costs and wrote off expenditures of $141,911 relating to its staked USA property interests.

Fiscal 1999 Ended 12/31/1999 versus Fiscal 1998 Ended 12/31/1998

During Fiscal 1999 the price of Uranium was low and resulted in the Company having to decrease the number of claims held in certain of its claim groups and thereby reducing the cost of holding its property interests, which management felt had the potential of hosting uranium, with the resulting write-off of a number of these property interests.

During Fiscal 1999, the Company raised $609,620 by way of private placements and the exercise of previously issued warrants and stock options. During Fiscal 1998, the Company raised approximately $1,323,545 by way of private placements.

During Fiscal 1999, the Company incurred $22,218 in mineral property acquisition costs and $117,508 in deferred exploration and development costs compared to $88,435 in mineral property acquisition costs and $764,510 in deferred exploration costs in 1998.

General and administration expenses fluctuated over the past five fiscal years, being as low as $381,755 in Fiscal 1995 when the Company was relatively inactive. General and administrative expenses decreased from $1,347,104 in 1998 to $937,177 in 1999.  Large changes in expenses occurred in Advertising, which fell to $75,941 from $308,400; Consulting Fees, which rose to $368,390 from $261,636; Management Fees, which declined to $73,371 from $106,812; Office and Miscellaneous, which fell to $4,670 from $59,683; Rent, which rose to $53,122 from $26,006; Salaries and Benefits, which fell to $53,122 from $81,064; Shareholder Communications, which declined to $85,879 from $116,891; Travel, which fell to $10,869 from $43,323; and Trade Shows and Conferences, which fell to $26,414 from $130,336.

During Fiscal 1999, the Company paid Kenneth S. Freidman, Ph.D. the President of the Company, $73,371 in management fees and paid Devinder Randhawa, a director of the Company, consulting fees of $67,249.

During Fiscal 1999, the Company terminated the employment of David Miller, the Company's chief geologist. Included in consulting fees is the amount of $278,988 which includes salary payments and a termination settlement paid to Mr. Miller. Mr. Miller was not an officer or director of the Company.

In Fiscal 1999, the Company reduced its US property holdings significantly by dropping projects in Utah and Wyoming and by reducing the number of staked property interests it continued to hold in Utah, Wyoming and Oregon. In Fiscal 1999, the Company wrote-off acquisition and deferred exploration costs of $865,088 associated with its US property holdings.

In Fiscal 1998, the Company completed the acquisition of a significant number of property interests in Oregon, Wyoming, Arizona and Utah, which property interests were staked and negotiated during 1997. In fiscal 1997 the Company wrote-off acquisition costs and deferred exploration costs of $374,101 pertaining to the Rio Puerco mine in New Mexico and the Apex-Lowboy property interests in Nevada. No acquisition costs were written off in 1996 and in fiscal 1995 the Company wrote-off acquisition costs and deferred exploration costs of $164,160 pertaining to the Saskatchewan property claims.

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The Company had accumulated deferred exploration costs of $508,726 on its Peru project and $417,528 on its U.S. property interests during the year fiscal ended December 31, 1998. During 1999, the Company incurred exploration expenditures of $47,735 on its Peru property and $69,773 on its US property interests. The accumulated deferred exploration costs for the year ended December, 1999 for the US property interests was reduced by $324,867 after taking into account the write-off of numerous claim groups.

Fiscal 1998, Ended 12/31/1998 versus Fiscal 1997 Ended 12/31/1997

The Company had a net loss of ($1,315,239) for the fiscal year ended 12/31/1998 as compared to a net loss of $1,411,874 for the fiscal year ended 12/31/1997. This represented a decrease of 7%. The decrease was due primarily to the fact that in Fiscal 1997 the Company had a loss on mineral property interests in the amount of $374,101 compared to no loss during Fiscal 1998. The loss on mineral property interests consisted of the write off of the Rio Puerco, Apex-Lowboy property interests. These property interests were abandoned because of poor exploration results.

General and administration expenses were higher during Fiscal 1998 as compared to Fiscal 1997 in the amount of $288,758. Large changes in expenses occurred in Advertising, which rose to $308,400 from zero; Amortization, which increased to $58,909 from $31,161; Consulting Fees, which rose to $261,636 from $142,818; Professional Fees, which fell to $97,003 from $179,667; Property Investigation, which totaled zero compared to $60,545 in the prior year; Shareholder Communications, which rose to $116,891 from $95,120; and Travel, which fell to $43,323 from $82,836.

Fiscal 1997, Ended 12/31/1997 versus Fiscal 1996, Ended 12/31/1996

The Company had a net loss of $1,411,874 for the fiscal year ended 12/31/1997 as compared to a net loss of $690,215 for the fiscal year ended 12/31/1996. This represented an increase of 105%. The increase was due primarily to the fact that in Fiscal 1997 the Company experienced an increase in general and administrative expenses in the amount of $657,200. This was the result of a significant increase in business activity during Fiscal 1997 as compared to Fiscal 1996.

The Company significantly increased the number of mineral property interests in which it had an interest. This activity required additional consulting work in the area of mineral exploration, greater management fees because of the increased workload, greater professional fees because of the need for greater input from geologists, mining engineers and other related professions. Rent also increased because of the need for more office space. Shareholder communications increased because of the need of the Company to disseminate more news of developments to shareholders. Travel also increased significantly because of the greater number of visits to mineral property interests.

Liquidity and Capital Resources

As of December 31, 2006, the end of the Company’s most recent fiscal year, the Company had working capital of $32,426,935. During Fiscal 2007, the Company has budgeted that it might expend $3,000,000 on general/administrative expenses.  

The Company’s current property acquisition and exploration budget for fiscal 2007 is US$16,400,000 for its United States properties, and C$8,400,000 for its Canadian and Peruvian properties. However, if the spin-out of its Canadian and Peruvian property interests into Fission Energy is completed, Strathmore will provide C$500,000 cash to Fission but will have no current or future obligations to fund exploration on those properties. Additionally, Strathmore has recently signed an option agreement with a partner where the partner will fund the current exploration on a property, and has signed Letters of Intent with other potential partners on several additional properties. If these Letters of Intent are converted into definitive option agreements, current exploration on these properties will be funded by the optionees and the Company’s anticipated expenditures for the current year will be reduced.

Strathmore has sufficient funds on hand to fund all of its anticipated property expenditures for fiscal 2007. The amount of funds required for future periods is dependent upon the completion of the spin-out with Fission Energy, the success and advancement of its exploration programs, and the number and size of any option agreements on certain of its properties.

If the Company is unable to raise additional funds, it is likely that management will be forced to reduce exploration and/or property expenditures, which may include relinquishing property interests.

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March 31, 2007

As at March 31, 2007, the Company had working capital of $31,857,204 as compared to working capital of $28,137,382 at March 31, 2006. The increase in working capital was due to the private placement of 1,697,300 flow through shares completed in May 2006, as well as the proceeds from share issuances due to the exercise of stock options and warrants. Cash and cash equivalents of $4,705,862; short term investments in the amount of $27,576,248; receivables of $631,679; and prepaid expenses in the amount of $16,273 represented the current asset position at March 31, 2007.

During the 3 month period from January 1, 2007 thru March 31, 2007, a total of 1,522,139 common shares were issued. The Company received $2,824,831 from the exercise of common stock warrants, and $333,250 from the exercise of common stock options. The Company also issued 100,000 common shares pursuant to acquisition of mineral property interests at a value of $425,000.

Cash used for Operating Activities during the quarter was ($776,981) including the income for the fiscal period of $706,718. The significant adjustments in the category of items not affecting cash for the fiscal period were amortization in the amount of $30,950; future income tax recovery of $1,737,456, and stock based compensation in the amount of $247,021. Changes in non-cash working capital items were an increase in receivables in the amount of $223,768; an increase in short term investments of $151,535 a decrease in prepaid expenses of $14,320; increase in accounts payable and accrued liabilities of $155,823; and increase in due to related parties of $47,642.

Cash Used for Investing Activities during the quarter ended March 31, 2007 totaled $2,975,146 which consisted of exploration expenditures on the Company’s mineral property interests in the amount of $$2,731,461; Mineral Property interests of $8,295; equipment purchased in the amount of $172,070; and Deferred reorganization costs related to the proposed reorganization of the company of $63,320. Financing Activities provided cash of $3,158,081, with the entire amount from the issuance of common stock as described above.

The activities on the Company’s mineral property interests are described in ITEM 4. INFORMATION ON THE COMPANY and ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.

Fiscal 2006, Ended December 31, 2006

As at December 31, 2006, the Company had working capital of $32,426,935 compared to working capital of $21,226,133 at December 31, 2005. The increase of working capital was due to the issuance of 14,876,034 common shares during the period fore proceeds of $21,553,831. The current assets consisted of.Cash and cash equivalents of $5,299,908; receivables of $470,910; short term investments of $27,412,579; and prepaid expenses of $30,593. The short-term investments consisted of Canadian bond funds in the amount of $20,325,270 and a Canadian short-term investment fund in the amount of $7,087,309. The Company elected to place a portion of its cash, which was raised from private placements and not needed immediately for working capital, into these investment vehicles in order to potentially obtain a higher interest rate than in ordinary demand accounts.

During Fiscal 2006, a total of 14,876,034 common shares were issued. The Company raised $8,699,795 through the issuance of 3,265,950 common shares issued through a private placement; $11,610,850 was received from the issuance of 8,340,084 common shares pursuant to the exercise of common stock warrants; and 2,370,000 common shares were issued pursuant to the exercise of common stock options for proceeds of $1,930,800. The Company also issued 900,000 common shares pursuant to the acquisition of mineral property interests at a value of $2,207,000. These financings are disclosed in ITEM 4. INFORMATION ON THE COMPANY, Financings.

Cash used for Operating Activities during Fiscal 2006 was $19,929,948 including the net loss for the fiscal year of $2,310,688. Significant adjustments in the category of items not affecting cash for the fiscal year were stock-based compensation in the amount of $731,026, Amortization of $64,749, and Allowance for decline in investments of $20,574.

Significant changes in non-cash working capital items were an increase in receivables in the amount of $167,666, Increase in short-term investments of $18,432,089, increase in prepaid expenses of $3,942, increase in accounts payable of $40,641, and increase in due to related parties of $1,158.

Financing activities provided cash of $21,553,831, consisting of issuance of capital stock of $22,237,845 and share issuance costs of ($684,014).

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Cash Used for Investing Activities during Fiscal 2006 totaled $8,467,796 which consisted of $41,957 for Mineral Property Interests, $7,878,415 in deferred exploration costs, and $547,424 for the purchase of property and equipment.. The activities on the Company’s mineral property interests are described in ITEM 4. INFORMATION ON THE COMPANY and ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.

Fiscal 2005, Ended December 31, 2005

As at December 31, 2005, the Company had working capital of $21,226,133 as compared to working capital of $9,056,175 at December 31, 2004. The increase in working capital was due to the financings described earlier, which occurred during Fiscal 2005. Cash and cash equivalents of $12,143,821; receivables of $240,244; short term investments of $9,001,064 and prepaid expenses in the amount of $26,651 represented the current asset position at December 31, 2005.

The short-term investments consisted of Canadian bond funds in the amount of $2,986,357 and a Canadian short-term investment fund in the amount of $6,014,707. The Company elected to place a portion of its cash, which was raised from private placements and not needed immediately for working capital, into these investment vehicles instead of simply placing the funds into non-interest bearing demand accounts.

During Fiscal 2005, a total of 19,514,257 common shares were issued. The Company raised $15,258,501 through the issuance of 10,144,286 common shares issued through private placements; $3,405,238 was received from the issuance of 7,082,971 common shares pursuant to the exercise of common stock warrants; and 887,000 common shares were issued pursuant to the exercise of common stock options for proceeds of $296,699. The Company also issued 1,400,000 common shares pursuant to the acquisition of mineral property interests at a value of $2,377,750. These financings are disclosed in ITEM 4. INFORMATION ON THE COMPANY, Financings.

Cash used for Operating Activities during Fiscal 2005 was $10,708,351 including the net loss for the fiscal year of $1,622,502. Significant adjustments in the category of items not affecting cash for the fiscal year were stock-based compensation in the amount of $476,610 and a future income tax recovery in the amount of $326,524.

Stock based compensation in the amount of $476,610 resulted from the granting of 1,600,000 share purchase options to employees, consultants and directors.  Accordingly, using the Black-Scholes option pricing model, the stock options are recorded at fair value in the statement of operations. Total stock-based compensation recognized in the statement of operations during Fiscal 2005 was $476,610. This amount was also recorded as contributed surplus on the balance sheet.

The future income tax recovery in the amount of $376,524 resulted when the Company renounced certain deductions for Canadian exploration expenditures incurred on the Company’s resource properties resulting in a future income tax recovery of $376,524 and a charge against capital stock.

Significant changes in non-cash working capital items were an increase in receivables in the amount of $205,678 and an increase in short-term investments in the amount of $9,005,881.

The Company elected to put capital raised from financings and not needed in the short term into short-term investments instead of placing this capital into non-interest bearing accounts. Consequently, the category “Increase in short term investments” increased by $9,005,881 over the prior year.The increase in receivables resulted from goods and services tax credits and accrued interest receivable  on short term investments.

Cash Used for Investing Activities during Fiscal 2005 totaled $3,978,040 which consisted primarily of expenditures on the Company’s mineral property interests. The activities on the Company’s mineral property interests are described in ITEM 4. INFORMATION ON THE COMPANY and ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.

Fiscal 2004, Ended December 31, 2004

As at December 31, 2004, the Company had working capital of $9,056,175 as compared to a working capital deficiency of $1,029,867 at December 31, 2003. The increase in working capital was due to the financings described earlier, which occurred during Fiscal 2004. Cash and cash equivalents of $9,083,026, receivables of $34,566 and prepaid expenses in the amount of $13,316 represented the current asset position at December 31, 2004.

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In January 2004, the Company issued 4,767,444 units at $0.27 per unit consisting of one common share and one share purchase warrant for total proceeds of $1,287,210. Each warrant entitles the holder to acquire one additional common share at $0.36 per share expiring January 20, 2006. An estimated fair value of $417,712 was allocated to the warrants and is included in contributed surplus. The Company incurred finder’s fees of $23,490 on the private placement.

In February 2004, the Company issued 1,501,334 units at $0.60 per unit consisting of one common share and one share purchase warrant for total proceeds of $900,800. Each warrant entitles the holder to acquire one additional common share at $0.76 per share expiring February 23, 2006. An estimated fair value of $299,582 was allocated to the warrants and is included in contributed surplus.

In April 2004 the Company issued 3,436,167 units at $0.60 per unit consisting of one common share and one share purchase warrant for total proceeds of $2,061,700. Each warrant entitles the holder to acquire one additional common share at $0.76 per share expiring April 16, 2006 An estimated fair value of $626,385 was allocated to the warrants and is included in contributed surplus. The Company incurred finder’s fees of $132,803 on the private placement.

In September 2004, the Company issued 2,857,143 common shares at $0.70 per share for total proceeds of $2,000,000. The common shares issued are subject to a hold period that expires on January 27, 2005. The Company paid $150,000 and issued 142,857 share purchase warrants for finder’s fees. Each warrant entitled the holder to acquire one additional common share at $0.74 per share expiring September 27, 2005.

In November 2004, the Company issued 2,000,000 common shares at $1.00 per share for total proceeds of $2,000,000. The common shares issued were subject to a hold period that expired on March 1, 2005. The Company paid $120,000 and issued 120,000 share purchase warrants valued at $55,547 as finder’s fees. Each warrant entitled the holder to acquire one additional common share at $1.08 per share expiring October 29, 2006.

In December 2004, the Company issued 513,000 flow-through common shares at a price of $1.95 per share for total proceeds of $1,000,350. The Company incurred finder’s fees of $55,019 on the private placement.

The Company will use the proceeds for general working capital, the acquisition of additional uranium property interests and the exploration of the Company’s uranium property interests.

Cash used for Operating Activities during Fiscal 2004 was $967,990 including the net loss for the fiscal year of $1,994,210. The only significant adjustment in the category of items not affecting cash for the fiscal year was stock based compensation in the amount of $962,297. (Amortization in the amount of $8,432 was the only other item included in “Items not affecting cash”) Significant changes in non-cash balances relating to operations were an increase in accounts payable and accrued liabilities in the amount of $15,769 and a decrease in receivables in the amount of $40,470. The increase in the liabilities was due to the greater level of business activity described earlier in this document.

Cash Used for Investing Activities during Fiscal 2004 totaled $1,964,507 which consisted of expenditures on the Company’s mineral property interests. The activities on the Company’s mineral property interests are described in ITEM 4. INFORMATION ON THE COMPANY and ITEM 5. OPERATING AND FINANCIAL REVIEW AND PROSPECTS.

Cash Provided by Financing Activities during Fiscal 2004 was $11,025,244 and consisted of the cash received for the issuance of common shares as described earlier in this document in ITEM 4. INFORMATION ON THE COMPANY, Financings.

Fiscal 2003, Ended December 31, 2003

As at December 31, 2003, the Company had working capital of $1,029,867 as compared to a working capital deficiency of ($30,600) at December 31, 2002. The increase in working capital was due to the financings described earlier, which occurred during Fiscal 2003. Cash and cash equivalents of $990,279 receivables of $75,036 and prepaid expenses in the amount of $12,568 represented the current asset position at December 31, 2003.

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During Fiscal 2003, the Company issued 6,111,229 common shares for proceeds of $1,326,850. 5,222,229 of these common shares were issued pursuant to private placements which took place in November and December; 454,000 of these shares were issued pursuant to the exercise of share purchase options; and, 435,000 of these common shares were issued pursuant to the exercise of share purchase warrants associated with earlier private placements.  The Company also issued 100,000 common shares pursuant to the Acquisition of Mineral Property Interests at a value of $56,000, while 100,000 common shares that had been issued in fiscal 2002 pursuant to a property option agreement that was not completed were returned to the treasury in the current fiscal year.

Cash used for Operating Activities during Fiscal 2003 was $252,365 including the net loss for the fiscal year of $432,855. The only adjustment in the category of items not affecting cash for the fiscal year was stock based compensation in the amount of $221,994. (Amortization in the amount of $1,821 was the only other item included in “Items not affecting cash”) Significant changes in non-cash balances relating to operations were an increase in prepaid expenses in the amount of $9,638; an increase in accounts payable and accrued liabilities in the amount of $36,436; and, an increase in receivables in the amount of $70,123. The asset increase was the result of a stronger cash position and a higher level of business activity. The increase in the liability was due to the greater level of business activity described earlier in this document.

Cash Used for Investing Activities during Fiscal 2003 totaled $42,343 which consisted of expenditures on the Company’s mineral property interests.

Cash Provided by Financing Activities during Fiscal 2003 was $1,273,203 and consisted of the cash received for the issuance of common shares as described earlier in this document.

Fiscal 2002, Ended 12/31/2002

The Company was relatively inactive during fiscal 2002 as described above.

As at December 31, 2002, the Company had a working capital deficiency of $30,600. Of this amount, cash represented only $11,784.

During this fiscal year the Company issued 2,085,000 common shares for proceeds of $417,000 pursuant to the private placement. The Company also issued 60,000 common shares as a Finder’s Fee on Mineral Property Acquisition at a value of $13,200.

Cash Used for Operating Activities during Fiscal 2002 was $213,735 including the net loss for the fiscal year of $1,158,900. The Company wrote off mineral property interests in the amount of $215,315 and the associated deferred exploration costs in the amount of $704,123. (The property interests written off included the Aurora Property located in Oregon, U.S.A. and all the property interests in Peru which were acquired by staking.)  Significant other adjustments included amortization in the amount of $27,331. Changes in non-cash working capital items were less that $10,000 in total and included a slight increase in receivables $3,171; a slight increase in prepaid expenses $2,399; and, a slight increase in accounts payable and accrued liabilities in the amount of $3,966.

The Company incurred mineral property acquisition costs in the amount of $35,000 and deferred exploration costs in the amount of $3,819. These costs related to the Wemindji East and Portage West property interests, which were optioned during the year. In the interest of preserving capital The Company management subsequently elected to not complete these option agreements.

Fiscal 2001, Ended 12/31/2001

The Company was relatively inactive during Fiscal 2001 as described above.

As at December 31, 2001, the Company had a working capital deficiency of $86,650. Of this amount, cash represented only $4,338.

During this fiscal year the Company issued 1,620,000 units pursuant to private placements; 1,300,000 at $0.25 and 320,000 at $0.28 per unit. Each unit consisted of one common share and one share purchase warrant. Each warrant entitled the holder to acquire one additional common share at $0.30 for the $0.25 private placement and $0.38 for the $0.28 private placement until 1/31/2003. The Company also issued 32,000 common shares as a Finder’s Fee for a Private Placement.

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Cash Used for Operating Activities during Fiscal 2001 was $254,802 including the net loss for the fiscal year of ($290,750). The only significant item not affecting cash during this fiscal period was amortization in the amount of $38,480.

Cash used in investing activities during Fiscal 2001 was $102,701 and consisted entirely of deferred exploration costs and capital spent on mineral property interests. $23,405 was spent on the Aurora property for acquisition costs and $15,200 was spent on the Chord property for acquisition costs.

Fiscal 2000, Ended 12/31/2000

The Company was relatively inactive during Fiscal 2000 as described above.

As at 12/31/2000, the Company had working capital in the amount of $68,721. Of this amount cash represented $119,207.

Cash used in operating activities was $224,004 including the net loss for the fiscal year in the amount of $399,262. Items not affecting cash included the following three items: amortization, the write-off of mineral property interests and the write-off of deferred exploration costs. As described above in Results of Operations Fiscal 2000 versus Fiscal 1999, the Company elected to sharply reduce expenses and conserve cash. The property interests that were written off during Fiscal 2000 were considered by management to be non-essential because of poor exploration results achieved earlier.

During Fiscal 2000, the Company issued 160,000 common shares in a private placement to insiders of the company raising $120,000.

The Company spent $48,992 on investing activities during Fiscal 2000. These funds were spent exclusively on mineral property interests and on deferred exploration costs. Of this amount, $22,700 was spent on the Aurora property in acquisition costs. The balance $12,436 was spent on maintenance and claim fees on the Chord and Aurora property interests in the United States and $13,856 on the Staked property interests located in Peru.

Fiscal 1999, Ended 12/31/1999

As was the case from Fiscal 2000 through the end of Fiscal 2002, the Company was relatively inactive during Fiscal 1999 as described above.

As at 12/31/1999, the Company had a working capital deficiency in the amount of $118,268. At this date, the Company had only $681 in cash.

Cash used in operating activities was $884,592 including the net loss for the fiscal year in the amount of $1,680,211. Items not affecting cash included amortization in the amount of $49,701, gain the settlement of debt in the amount of $99,672, write-off of mineral property interests in the amount of $540,221, and write-off of deferred exploration costs in the amount of $324,867.

The amortization was for office equipment, computer equipment and vehicles.

The settlement of debt was pursuant to an agreement reached between the Company and an unaffiliated creditor.

The mineral property interests which were written off were the San Rafael River property interests and the Hot Rock property interests, both located in the United States. In an effort to conserve capital, the Company elected to write-off all mineral property interests which management deemed to be non-essential to the company. A property was deemed “non-essential” based on exploration results achieved to date. In the case of the San Rafael River property and the Hot Rock property interests, the exploration results were inferior to those associated with the Aurora property and the Staked property interests and so they were written off. The associated deferred exploration expenditures were also written off.

During Fiscal 1999, the Company issued a total of 574,000 common shares. 262,400 common shares were issued pursuant to a private placement for proceeds of $262,400; 60,400 common shares were issued pursuant to the exercise of common stock options for proceeds of $63,420; and 251,200 common shares were issued pursuant to the exercise of common stock warrants for proceeds of $283,800. From the proceeds of these share sales, the Company repaid a note payable in the amount of $185,421 and long-term debt in the amount of $1,863.

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The Company spent $142,132 on investing activities during Fiscal 1999, the majority of which was devoted to mineral property interests. The Company did spend $2,406 on capital assets consisting of office equipment and computer equipment; and, the balance of $139,726 was spent on mineral property interests.

The Company spent $22,218 on acquisition costs associated with the Aurora property and $69,773 in deferred exploration costs associated with the Aurora property. These costs were geological consulting fees, maintenance and claim fees and general exploration expenditures. The balance of the deferred exploration costs in the amount of $47,735 were spent on geological consulting fees and general exploration expenditures on the Staked property interests in Peru.

Fiscal 1998, Ended 12/31/1998

As at 12/31/1998, the Company had working capital of $174,885. Of this amount, cash represented $508,978.

Cash used in operating activities was $1,149,187 including the loss for the fiscal year in the amount of $1,315,239. Items not affecting cash included amortization in the amount of $58,909. The amortization was associated  with office and computer equipment and vehicles.

The Company experienced an increase in the amount of $90,324 in accounts payable and accrued liabilities over the prior fiscal year. This increase was attributable to the higher level of business activity in Fiscal 1998 as compared to Fiscal 1997.

The Company also experienced an increase in a loan payable in the amount of $185,421. The loan payable was to the Riverton State Bank in the state of Wyoming and was secured by the Company’s bank accounts at that institution. The loan was paid off during Fiscal 1999 as described above.

A total of 870,331 common shares were issued during the year. 731,091 were issued in private placements for cash of $1,187,045; 130,000 common shares were issued pursuant to the exercise of common stock warrants for proceeds of $136,500; and 9,240 common shares were issued for mineral properties at a value of $39,100.

Cash used in investing activities during this fiscal period was $965,600 and consisted of funds spent on capital assets, mineral property interests and other assets.

The Company spent $70,935 on capital assets during Fiscal 1998. These assets consisted of office equipment, computer equipment, computer software and vehicles.

In the category of “other assets” the Company spent $41,720. These funds were used to purchase a database, which contained exploration findings on mineral property interests.

The Company spent $88,435 in cash on acquisition costs associated with mineral property interests. These property interests were the San Rafael River property, the Hot Rock property interests, the Aurora property and the Staked property interests. Of the total amount spent on these property interests during Fiscal 1998 $127,535, $39,100 was paid by the issuance of common shares as described above.

Deferred exploration costs were $764,510 during Fiscal 1998. The majority of these funds $508,726 were spent on the property interests in Peru on exploration work. This work consisted of geological consulting fees, accommodation and camp costs, geological consulting fees, legal fees, maintenance and claim fees, report and map preparation, sampling work, transportation and travel. $43,200 of the total amount was spent on management fees. The Company spent $255,784 in deferred exploration costs on the property interests located in the United States. The majority $131,145 was spent on maintenance and claim fees followed by geological consulting fees $96,978, surveying $13,349, general expenditures and travel $14,312.

Fiscal 1997, Ended 12/31/1997

As at 12/31/1997, the Company had working capital of $1,079,914. Of this amount, cash represented $1,120,870.

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Cash used in operating activities was $1,076,529 including the net loss for the fiscal year in the amount of $1,411,874. Items not affecting cash included depreciation in the amount of $31,161 and loss on mineral property interests in the amount of $374,101. The amortization was associated with office and computer equipment and vehicles. The loss on mineral property interests resulted from a management decision to abandon the Rio Puerco, Apex-Lowboy property interests. (All related costs were written off.)

The Company experienced an decrease in the amount of $1,481 in accounts receivable. This decrease was attributable to the higher level of cash available in Fiscal 1997 as compared to Fiscal 1996. Prepaid expenses also increased by $21,693 and accounts payable and accrued liabilities both decreased, in total, by $49,705. These decreases were also due to the higher level of cash available in Fiscal 1997 as compared to Fiscal 1996.

The Company issued a total of 1,057,437 common shares during fiscal 1997. 100,000 common shares were issued in private placements for proceeds of $803,000; 660,000 common shares were issued for special warrants for proceeds of $1,369,836; 27,170 were issued as agents’ special warrants for proceeds of $61,750; 41,400 common shares were issued for agents’ warrants; 4,600 common shares were issued as a finders’ fee at a value of $14,950; 45,712 common shares were issued for mineral properties at a value of $225,250; 118,055 common shares were issued pursuant to the exercise of warrants for cash of $300,737; and 60,500 common shares were issued pursuant to the exercise of options for cash of $198,925. These share issuances are described above in Item 4.A. History and Development of the Company, Financings.

Cash used in investing activities during this fiscal period was $879,173 and consisted of funds spent on capital assets, mineral property interests and other assets.

The Company spent $100,653 on capital assets during Fiscal 1997. These assets consisted of office equipment, computer equipment, computer software and vehicles.

In the category of “other assets” the Company spent $67,850. These funds were used to purchase a database, which contained exploration findings on mineral property interests.

The Company spent $533,449 in cash on acquisition costs associated with mineral property interests. These property interests were the San Rafael River property, the Hot Rock property interests the Staked property interests and the Rio Puerco, Apex-Lowboy property interests. Of the total amount spent on these property interests during Fiscal 1997, $225,250 was paid by the issuance of common shares as described above.

Deferred exploration costs were $177,221 during Fiscal 1997 and of this amount $17,947 was spent on renewal fees and general expenditures on the property interests located in Utah; $15,477 was spent on the Rio Puerco Apex-Lowboy Property interests on a combination of renewal fees and report preparation; and, $143,797 was spent on the Staked property interests located in both the United States and Peru. These costs included consulting fees, general expenditures, renewal fees, report preparation and travel.

US GAAP Reconciliation

The Company’s consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”).  Material variations in the accounting principles, practices and methods used in preparing these consolidated financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) are described below.

Stock-based compensation

Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) recommended, but did not require, companies to establish a fair market value based method of accounting for stock-based compensation plans. The Company has elected to follow the recommendations of SFAS 123 and has chosen to account for stock-based compensation using the fair value based method.

New accounting and disclosure standards were introduced under Canadian GAAP for the fiscal year ending December 31, 2002.  During the year ended December 31, 2003, under Canadian GAAP, the Company adopted, on a prospective basis, the fair value based method of accounting for all stock-based compensation.  Accordingly, there is no difference between Canadian GAAP and United States GAAP in the accounting for stock-based compensation for the years ended December 31, 2005, 2004 and, 2003.

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Mineral property interests and deferred exploration costs

Under Canadian GAAP, the Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests have significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future; or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  As at December 31, 2005, 2004 and 2003, management believes that no impairment relating to the mineral property interests and deferred exploration costs was required.

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the value of share considerations issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

For United States GAAP purposes, effective until fiscal 2003, the Company expensed, as incurred, the acquisition and exploration costs relating to unproven mineral property interests. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $98,343 for fiscal 2003. When proven and probable reserves are determined for a property and a feasibility study prepared, then subsequent development costs of the property are capitalized.  The capitalized costs of such properties are to be amortized using the unit of production method over the estimated life of the ore body based on proven and probable reserves and would be measured periodically for recoverability of carrying values.

Effective for fiscal 2004, the Company has adopted the provisions of EITF 04-02 “Whether Mineral Rights are Tangible or Intangible Assets” which concluded that mineral rights are tangible assets.  Accordingly, the Company capitalizes certain costs related to the acquisition of mineral property interests.  Under United States GAAP, exploration costs on mineral properties prior to the establishment of proven or probable reserves continue to be expensed as incurred. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $3,794,539 for fiscal 2005 and $1,627,429 for fiscal 2004.

Flow-through shares

Under Canadian income tax legislation, the Company is permitted to issue shares whereby the Company agrees to incur qualifying expenditures (as defined under the Income Tax Act of Canada) and renounce the related income tax deductions to the investors.  Under Canadian GAAP, flow-through shares are accounted for as described in Note 2.  Under United States GAAP, any difference between the fair value of the non flow-through shares and the fair value of the flow-through shares must be recorded as a liability if a premium is paid by investors for the flow-through shares.  The liability is charged to income as the flow-through share proceeds are expended on qualifying expenditures and the related income tax deductions are renounced to investors.

During fiscal 2005, the Company issued 30,000 flow-through shares for total proceeds of $58,500.  As the value of the compensation received for the flow-through shares issued during fiscal 2005 exceeded the fair value of the non-flow through shares on the date issued, the Company recorded a difference in capital stock and related income tax expenses of $11,699 on renunciation during fiscal 2005.   

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During fiscal 2004, the Company issued 513,000 flow-through shares for total proceeds of $1,000,350.  As the value of the compensation received for the flow-through shares issued during fiscal 2004 exceeded the fair value of the non-flow through shares on the date issued, the Company recorded a difference in capital stock and related income tax liability of $271,890 during fiscal 2004. On renunciation in fiscal 2005, the Company recorded a difference in capital stock and related income tax expenses of $84,235.  

During fiscal 2003, the Company issued 400,000 flow-through shares for total proceeds of $100,000.  As the value of the compensation received for the flow-through shares issued during fiscal 2003 was equal to the fair value of non-flow through shares on the date issued, there is no difference for U.S. GAAP purposes.  

Short Term investments

Under Canadian GAAP, temporary investments are carried at the lower of aggregate cost or current market value.

Under United States GAAP, SFAS 115 requires that certain debt and equity investments must be classified into available-for-sale or trading securities and stated at fair market values.  Any unrealized holding gains or losses are reported as a separate component of shareholders’ equity until realized for available-for-sale securities, and included in earnings for trading securities.  For United States GAAP purposes, the Company's investment in debt securities have been classified as trading securities.  Under SFAS 115, for the 2005 fiscal year there was no difference under Canadian GAAP or United States GAAP as these debt securities have been written down to their fair market value, with an unrealized loss of $4,817 included in the consolidated statement of operations.

Loss per share

Under both Canadian GAAP and United States GAAP, basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

Under United States GAAP, the weighted average number of common shares outstanding excludes any shares that remain in escrow, but may be earned out based on the Company incurring a certain amount of exploration and development expenditures.  The weighted average number of shares outstanding under United States GAAP for the years ended December 31, 2005, 2004 and 2003 were 53,475,088, 26,065,368 and 8,271,374, respectively.  

New accounting pronouncements

In September 2006, the FASB issued SFAS No. 157 (“FAS 157”), “Fair Value Measurements.” Among other requirements, FAS 157 defines fair value and establishes a framework for measuring fair value and also expands disclosure about the use of fair value to measure assets and liabilities. FAS 157 is effective beginning the first fiscal year that begins after November 15, 2007. The Company is currently evaluating the impact of FAS 157 on its financial position and results of operations.

In July 2006, the FASB issued Financial Interpretation No. 48, “Accounting for Uncertainty in Income Taxes-an interpretation of FASB Statement No. 109” (“FIN 48”), which is a change in accounting for income taxes. FIN 48 specifies how tax benefits for uncertain tax positions are to be recognized, measured, and derecognized in financial statements; requires certain disclosures of uncertain tax matters; specifies how reserves for uncertain tax positions should be classified on the balance sheet; and provides transition and interim period guidance, among other provisions. FIN 48 is effective for fiscal years beginning after December 15, 2006. The Company does not expect the adoption of FIN 48 will have a material impact on its financial position or results of operations.

In February, 2006, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 155 “Accounting for Certain Hybrid Financial Instruments” and in March 2006, the FASB issued SFAS No. 156 “Accounting for Servicing of Financial Assets”, but they will not have any relationship to the operations of the Company. Therefore a description and its impact for each on the Company’s operations and financial position have not been disclosed.

In May 2005, the Financial Accounting Standards Board (FASB) issued SFAS No. 154, “Accounting Changes and Error Corrections – A Replacement of APB Opinion No. 20 and SFAS No. 3”. SFAS 154 changes the requirements for the accounting for and reporting of a change in accounting principle and applies to all voluntary changes in accounting principle. It also applies to changes required by an accounting pronouncement in the unusual instance that the pronouncement does not include specific transition provisions. SFAS 154 requires retrospective application to prior periods’ financial statements of changes in accounting principle, unless it is impracticable to determine either the period-specific effects or the cumulative effect of the change. The provisions of SFAS No. 154 are effective for accounting changes and correction of errors made in fiscal years beginning after December 15, 2005. The adoption of this standard is not expected to have a material effect o n the Company’s results of operations or financial position.

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In March 2005, the EITF issued EITF 04-6, "Accounting for Stripping Costs in the Mining Industry".  The consensus indicated that costs of removing overburden and waste materials ("stripping costs") after production begins, represent variable production costs and should be considered a component of mineral inventory cost subject to the guidance in Chapter 4 of Accounting Research Bulletin No. 43, "Restatement and Revision of Accounting Research Bulletins".  EITF 04-6 is effective for fiscal years beginning after December 15, 2005 and upon adoption, can be applied by either retroactively restating prior periods or using a cumulative catch-up adjustment.  The Company believes this Statement will have no impact on the financial statements of the Company once adopted.

In December 2004, the FASB issued SFAS No. 153, “Exchanges of Nonmonetary Assets - An Amendment of APB Opinion No. 29”. The guidance in APB Opinion No. 29, “Accounting for Nonmonetary Transactions”, is based on the principle that exchanges of nonmonetary assets should be measured based on the fair value of the assets exchanged. The guidance in that Opinion, however, included certain exceptions to that principle. SFAS No. 153 amends Opinion No. 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 provisions of SFAS No. 153 are effective for nonmonetary asset exchanges occurring in fiscal periods beginning after June 15, 2005. Early application is permitte d and companies must apply the standard prospectively. The adoption of this standard did not have a material effect on the Company’s results of operations or financial position.

FASB has also issued SFAS No. 151 and No. 152 but they will not have any relationship to the operations of the Company therefore a description and its impact for each on the Company’s operations and financial position have not been disclosed.

Critical Accounting Policies

Management is required to make judgments, estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the consolidated financial statements and the reported amounts of revenues and expenses during the reporting period.  On a regular basis, we evaluate our estimates and assumptions.  We base our estimates on historical experience and on various other assumptions that are believed to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities that are not readily apparent from other sources.  Actual results may differ from these estimates under different assumptions or conditions.

5.C.  Research and development, patents and licenses, etc.

The Company has no research and development operations, and does not have, nor is dependent upon, any patents or licenses.

5.D.  Trends

Management is not currently aware of any trends which is likely to materially affect the Company’s operations.

5.E.  Off-Balance Sheet Arrangements.

5.F.  Tabular disclosure of contractual obligations.

5.G.  Safe harbor.

      --- No Disclosure Necessary ---

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ITEM 6.  DIRECTORS, SENIOR MANAGEMENT, AND EMPLOYEES

6.A.  Directors and Senior Management

Table No. 7

Senior Management and Directors

______________________________________________________________________________

______________________________________________________________________________

Name	Age	Date First Elected of Appointed
Devinder Randhawa, Director, Chairman and Chief Executive Officer	45	October 10, 1998 (Director) November 25, 2005 (CEO & Chairman)
David Raymond Miller, President and Chief Operating Officer	54	October 26, 2005
Bob Hemmerling, Corporate Secretary (1)	46	January 23, 2004
Patrick Groening, Chief Financial Officer	35	April 27, 2005
Stephen Khan, Executive Vice President	49	November 25, 2003
John De Joia, Vice President of Technical Services	58	March 15, 2005
Juan Velasquez, Vice President of environmental and Regulatory Affairs	56	March 15, 2005
Michael Halvorson, Director	57	December 23, 1996
Dr. Dieter Krewedl, Director	62	January 14, 2005
Ray Larson, Director	67	December 20, 2006

Devinder Randhawa, the Chairman and Chief Executive Officer, is founder and President of RD Capital Inc., a privately held consulting firm providing venture capital and corporate finance services to emerging companies in the resources and non-resource sectors both in Canada and the US. Prior to founding RD Capital Inc., Mr. Randhawa was in the brokerage industry for 6 years as an investment advisor and corporate finance analyst. Mr. Randhawa received a Bachelors Degree in Business Administration with Honors from Trinity Western College of Langley, British Columbia in 1983 and received his Masters in Business Administration from the University of British Columbia in 1985. Mr. Randhawa was formerly the President of Lariat Capital Inc. which merged with Medicure in November 1999 and was the founder and former President and CEO of Royal County Minerals Corp. from 1998 to 2003 which was taken over by Canadian Gold Hunter (formerly International Curator) in July 20 03. Mr. Randhawa also founded Predator Capital Inc. which became Predator Exploration. Currently Mr. Randhawa is Chairman and CEO of Strathmore, which he founded in 1998. He also is CEO and President of Jalna Minerals Ltd., CEO and Chairman of Pacific Asia China Energy Ind., CEO and Director of Ballyliffin Capital Corp., and CEO and Director of Sernova Corp, all of which are public companies traded on the TSX Venture Exchange. He is also a Director of Knowledge Plus Multimedia Publishing, an inactive company. He will also serve as CEO and a Director of Fission Energy. Mr. Randhawa spends approximately 60% of his time on the affairs of the Company.

David Raymond Miller has been the President of the Company since October 26, 2005. Mr. Miller, is a minerals industry expert in exploration, acquisition and operations. His primary focus has been on uranium, coal bed methane and gold. David worked with Cogema, the second largest producer of uranium in the world, including 4 years as its chief geologist for in-situ operations in the US. Mr. Miller has over 25 years of experience in exploration and acquisition of uranium properties. Mr. Miller has consulted in uranium exploration, deposits, mining, and "in-situ" recovery for the IAEA. Since 2001, Mr. Miller has served as an elected member of the House of the State of Wyoming from the 55^th District, where his committee assignments include Minerals and the Energy Council. He will also serve as President of Fission Energy. Mr. Miller spends approximately 50% of his time on the Company’s affairs.

Michael Halvorson, a Director of the Company is President of Halcorp Capital Ltd., a private investment company.  He has 35 years of experience in the financial markets.  In addition to his directorship with the Company, he is currently a director of several other publicly traded Canadian natural resource companies including Radiant Resources, Orezone Resources Inc., NovaGold Resources, Pediment Exploration Ltd., Esperanza Silver and Gentry Resources Ltd. Mr. Halvorson will also serve as a director for Fission Energy. Mr. Halvorson devotes approximately 10% of his time to the Company’s affairs.

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Ray Larson, a Director of the Company. He was appointed to the Advisory Board on July 15, 2004. Prior to his retirement in 1994 he was President and CEO of Uranium Resources, Inc. (“URI”), a uranium exploration and production company specializing in in-situ leach technology which he founded in 1977. URI pioneered the exploration, development and production of uranium ore bodies using in-situ recovery (ISR) technology, and was a founding member of the Uranium Producers of America Association. Mr. Larson has developed ISR extraction plants in the United States as well as negotiated multiple long-term uranium sales contracts with United States and European utilities. Besides his service as a Director of Strathmore, Mr. Larson will serve as a Director of Fission Energy. He devotes approximately 5% of his time to the Company’s affairs.

Bob Hemmerling, Corporate Secretary of the Company is a businessman and was a director of the Company until January 21, 2004. Mr. Hemmerling, has provided communication and investor relation services for the Company since September 1996. Prior to that time Mr. Hemmerling was employed as an electrician with Concord Electric, Kelowna, British Columbia. He devotes 100% of his time to the Company’s affairs.

Dr. Dieter Krewedl has been a member of the Board of Directors since January 14, 2005. Dr. Krewedl received his Ph.D. degree in Geology from the University of Arizona in 1973. Dr. Krewedl was with Pathfinder Mines Corporation, a wholly owned subsidiary of the French uranium company Cogema, for 23 years and was Pathfinder’s Vice President, Exploration from 1990 to 1995. Following Pathfinder, Dr. Krewedl joined Echo Bay Mines and became its Vice President, Exploration from 1996 to 1997 where he managed an aggressive domestic and international gold exploration program. Following Echo Bay, Dr. Krewedl held the position of Senior Vice President, Exploration for Idaho based Coeur d’Alene Mines from 1998 through 2003. Dr. Krewedl retired from Coeur at the beginning of 2004 and is a past President of the Geological Society of Nevada. He currently serves as a director of AuEx Ventures Inc and Kilgore Minerals Ltd., public companies which are traded on the TS X Venture Exchange. He will also serve as a director of Fission Energy. Dr. Krewedl devotes less than 10% of his time to the Company’s affairs.

Stephen Khan, is currently Executive Vice President and a former Director of the Company. He currently consults for private and public early stage growth companies in all sectors of industry. He spent close to twenty years in all aspects of the investment industry, including retail, institutional, corporate finance, capital markets, and investment banking areas. Mr. Khan has held senior management roles including serving as President, Chief Executive Officer, and Chairman of a number of regional and national Canadian investment brokerage houses. He has raised funds for a variety of companies, with a focus on the natural resource sector. Mr. Khan completed his Bachelor of Science and Master of Business degrees at the University of British Columbia before entering the investment industry. He is a Fellow of the Canadian Securities Institute, holds a Chartered Financial Analyst designation, and is a member of the CFA Institute. Mr. Khan currently serves a directo r of Pacific Asia China Energy Inc., a director of Jalna Minerals, and as Corporate Secretary of Ballyliffin Capital Corp., public companies traded on the TSX Venture Exchange. He will also serve as an officer of Fission Energy. Mr. Kahn devotes approximately 20% of his time to the Company’s affairs.

Mr. John De Joia has been a Vice President of the Company since March 15, 2005. He is a graduate of the University of Wyoming and has over 30 years of technical experience that includes underground, open pit and in-situ uranium mining. His Wyoming mining experience includes the Shirley Basin and Big Eagle uranium mines with Utah International, Development Geologist for Pathfinder Exploration Corporation, Chief Geologist for Federal American Partners in the Gas Hills District, and Director of Technical Services for American Nuclear Corporation. His extensive management experience includes work for Morrison-Knudsen, Inc. at the Idaho National Engineering Laboratory and Manager of the Washington Group projects at Los Alamos National Laboratory. His experience includes feasibility studies and start-up of new mines; permitting, mining and mapping of ore bodies in new mines; closure evaluations for uranium mine and mill tailings facilities and mixed waste facilitie s. He is a Registered Geologist in the State of Wyoming.

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Mr. Juan Velasquez has been a Vice President of the Company since March 15, 2005. He is in charge of environmental and regulatory affairs for the Company. He is a graduate of the University of New Mexico with an undergraduate Bachelor of Science degree in biology and an MBA. He has over 30 years of experience including 7 years with Phillips Uranium Corporation, a subsidiary of Phillips Petroleum Company (now ConocoPhillips) as Manager of Environmental, Health, and Safety Affairs and 15 years with United Nuclear Corporation as President of the Minerals Division and Corporate Manager of Environmental Affairs. He has consulted to private, federal and state clients in the nuclear remediation industry. He has permitted several major uranium mining and milling operations, including Phillips Nose Rock mine/mill complex and the United Nuclear Church Rock mill tailings disposal facility. He has managed a variety of environmental project developments, operations, and c losure activities for Phillips, UNC, and his clients at locations throughout the United States, working closely with federal and state regulatory agencies to obtain the required approvals. He is a past Chairman of the New Mexico Mining Association Uranium Environmental Committee and has been active in various other state and national mining associations and organizations.

Patrick Groening has been the Chief Financial Officer since April 27, 2005. Mr. Groening obtained his Chartered Accountant designation in 1999 and is a member of the Institute of Chartered Accountants of British Columbia. He also holds a professional accounting designation as a Certified Public Accountant and is member of the Illinois Board of Examiners in the United States. In addition to being an auditor for several years, Mr. Groening has provided business advisory, information technology, and financial accounting services. Mr. Groening is a general auditor registered in Bermuda, is the former CFO of Wolf Capital Corporation, a capital pool company traded on the TSX Venture Exchange, and is currently Chief Financial Officer of Sernova Corp, a public medical technologies company traded on the TSX Venture Exchange, and as Chief Financial Officer of Jalna Minerals, a mineral exploration company traded on the TSX Venture Exchange. He will also serve as Chief F inancial Officer of Fission Energy. Mr. Groening devotes approximately 40% of his time to the Company’s affairs..

Advisory Board

Robert A. Quartermain is a member of the Advisory Board of the Company. He is the President and a director of Silver Standard Resources Inc., an unrelated public company. From 1976 to 1982, he worked for the Geological Survey of Canada and in private industry on mapping and exploration programs.  Mr. Quartermain also worked for Teck Corp, an unrelated public company, before becoming president of Silver Standard Resources Inc. in 1985. Since 1985, Mr. Quartermain has been involved as a director and/or officer of a number of public resource companies including currently Iamgold Corporation, Esperanza silver and Western Copper Mining Corporation, both unrelated public companies. He graduated in 1977 from the University of New Brunswick with a B.Sc. in geology, and from Queen’s University in 1981 with an M.Sc. in mineral exploration.

Dr. Hans von Michaelis is a member of the Advisory Board of the Company. He was appointed to the Advisory Board on September 8, 2004. He graduated from the University of Cape Town with a Ph.D. in Geochemistry in 1970. He has served as the President of Randol International Ltd., a private company, which he founded in 1977. Since 2000, Randol has provided corporate development, business development and financial services to companies in the mining industry.

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

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

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

There are no family relationships between any two or more Directors or Senior Management.  

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

6.B.  Compensation

Cash Compensation. Total compensation accrued and/or paid (directly and/or indirectly) to all Directors/Senior Management during Fiscal 2006 ended 12/31/2006 was CDN$697,030. $164,081 was paid to Devinder Randhawa, the Chief Executive Officer of the Company; $168,534 to David Miller, the President of the Company; $84,000 was paid to Patrick Groening, the Chief Financial Officer of the Company; $84,000 was paid to Bob Hemmerling, Corporate Secretary; $29,000 was paid to Dieter Krewedl, director; $31,000 was paid to Michael Halvorson, director; $14,000 was paid to Steven Kahn, Vice-President and Director; and $122,415 was paid to Sona Capital, a Company controlled by Stephen Khan, Vice-President.

Director Compensation.  Directors, for their service in their capacity as Directors, receive $24,000 per year plus an additional $2,000 per year for each committee on which they serve.  Directors are entitled to reimbursement for reasonable travel and other out-of-pocket expenses incurred in connection with attendance at meetings of the Board of Directors.  The Board of Directors may award special remuneration to any Director undertaking any special services on behalf of the Company other than services ordinarily required of a Director.  

Stock Options. The Company may grant stock options to Directors, Senior Management, and employees/consultants.  Refer to ITEM #6.E., "Share Ownership" and Table #7 and #8 for information about stock options granted and outstanding.

During fiscal 2006, 2,370,000 stock options were exercised by officers, consultants and employees, and 163,000 expired unexercised or were cancelled. 2,840,000 stock options were granted during the year.  No SARs (stock appreciation rights) were granted or exercised during this period.

During the first quarter of Fiscal 2007, March 31, 2007, 290,000 stock options were exercised by directors, officers and employees.

Change of Control Remuneration.  The Company has no plans or arrangements in respect of remuneration received or that may be received by Executive Officers of the Company in Fiscal 2006 to compensate such officers in the event of termination of employment (as a result of resignation, retirement, change of control) or a change of responsibilities following a change of control, where the value of such compensation exceeds US$60,000 per Senior Management.  

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

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

Pension/Retirement Benefits.  No funds were set aside or accrued by the Company during Fiscal 2005 to provide pension, retirement or similar benefits for Directors or Senior Management.  

6.C.  Board Practices

Pursuant to the British Columbia Corporations Act, or the Act, and the articles of the Company, all directors hold office until the next meeting of the shareholders of the Company unless they resign or are removed in accordance with the Company’s Articles.  Officers are appointed to serve at the discretion of the Board of Directors.  The Board of Directors and Committees of the Board schedule regular meetings over the course of the year.

The fundamental objective of the Board is to ensure that it operates in a fashion that maximizes shareholder value over the long term.  The Board’s duties and responsibilities are all carried out in a manner consistent with that fundamental objective.   The principal duty and responsibility of the Board is to oversee the management and operations of the Company, with the day-to-day management of the business and affairs of the Company delegated by the Board to the President (the “CEO”) and other Senior Management.

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The Board’s responsibilities include overseeing the conduct of the Company’s business, providing leadership and direction to its management, and setting policies.  Strategic direction for the Company is developed through the Board’s annual planning process.  Through this process, the Board adopts the operating plan for the coming year, and monitors management’s progress relative to that plan through a regular reporting and review process.

The Board has delegated to the CEO and Senior Management responsibility for the day-to-day management of the business of the Company.  Matters of policy and issues outside the normal course of business are brought before the Board for its review and approval, along with all matters dictated by statute and legislation requiring Board review and approval.  The CEO and Senior Management review the Company’s progress in relation to the current operating plan at in-person Board meetings.  The Board meets on a regular basis with and without management present.  Financial, operational and strategic issues facing the Company are reviewed, monitored and approved at the Board meetings.

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

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

6.C.3.  Board of Director Committees.

The Company has an Audit Committee, which recommends to the Board of Directors the engagement of the independent auditors of the Company and reviews with the independent auditors the scope and results of the Company’s audits, the Company’s internal accounting controls, and the professional services furnished by the independent auditors to the Company.  The current members of the Audit Committee are: Michael Halvorson, Devinder Randhawa and Dr. Dieter Krewedl. The Audit Committee met four times during Fiscal 2006.

6.D.  Employees

As of 5/31/2007, the Company had 7 employees, excluding the Senior Management.  2 of the employees are employed at the Company’s headquarters in Kelowna as Bookkeeper and Administrative Assistant, and 5 are employed as geologists in the Riverton, Wyoming office. None of the Company's employees are covered by collective bargaining agreements.

6.E.  Share Ownership

Table No. 8 lists, as of 5/31/2007, Directors and Senior Management who beneficially own the Company's voting securities, consisting solely of common share, and the amount of the Company's voting securities owned by the Directors and Senior Management as a group.  

Table No. 8

Shareholdings of Directors and Senior Management

Title of Class	Name of Beneficial Owner	Amount and Nature of Beneficial Ownership	Percent of Class
Common	Devinder Randhawa    (1)	2,041,338	2.81%
Common	David Miller (2)	2,315,430	3.18%
Common	Michael Halvorson    (3)	836,111	1.15%
Common	Steven Khan          (4)	410,700	0.57%
Common	Dieter Krewedl   (5)	365,700	0.50%
Common	Robert Hemmerling       (6)	607,160	0.84%
Common	Ray Larson  (7)	325,000	0.45%
Common	Patrick Groening (8)	285,000	0.39%
	Total Directors/Management 5% Holders	7,186,439	9.64%

(1)

Of these shares 485,000 are represented by currently exercisable share purchase options.

(2)

Of these shares 485,000 are represented by currently exercisable share purchase options.

(3)

Of these shares 225,000 are represented by currently exercisable share purchase options.

(4)

Of these shares 310,000 are represented by currently exercisable share purchase options.

(5)

Of these shares 225,000 are represented by currently exercisable share purchase options.

(6)

Of these shares 190,000 are represented by currently exercisable share purchase options.

(7)

Of these shares 220,000 are represented by currently exercisable share purchase options.

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(8)

Of these shares 190,000 are represented by currently exercisable share purchase options.

# Based on 72,213,911 common shares outstanding as of 5/31/2007 and share options and share purchase warrants held by each individual which are exercisable within sixty days.

Stock Options.  The terms of incentive options grantable by the Company are done in accordance with the rules and policies of the TSX Venture Exchange and the British Columbia Securities Commission, including the number of common shares under option, the exercise price and expiry date of such options, and any amendments thereto.  The Company adopted a formal written stock option plan (the Stock Option Plan") on 5/17/05, and it was reaffirmed by the shareholders at the Company’s annual general meeting held on May 29, 2006.

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

The Stock Option Plan provides that stock options may be granted to directors, senior officers, employees and consultants of the Company and management company employees.  For the purposes of the Stock Option Plan, the terms “employees”, “consultants” and “management company employees” have the meanings set out in TSX Venture Exchange Policy 4.4.  In addition, the term “director” is defined in TSX Venture Exchange Policy 4.4 to include directors, senior officers and management company employees.

Under the Stock Option Plan, the Company’s board of directors (the “Board”) may, from time to time, designate a director or other senior officer or employee of the Company as administrator (the “Administrator”) for the purposes of administering the Plan.  Currently, the Administrator is the Corporate Secretary of the Company.

The Plan provides for the issuance of stock options to acquire at any time up to a maximum of 10% of the issued and outstanding common shares of the Company (subject to standard anti-dilution adjustments).  If a stock option expires or otherwise terminates for any reason without having been exercised in full, the number of common shares reserved for issuance under that expired or terminated stock option shall again be available for the purposes of the Plan.  Any stock option outstanding when the Plan is terminated will remain in effect until it is exercised or it expires.  The Plan provides that it is solely within the discretion of the Board to determine who should receive stock options and in what amounts, subject to the following conditions:

(a)

options will be non-assignable and non-transferable except that they will be exercisable by the personal representative of the option holder in the event of the option holder’s death;

(b)

options may be exercisable for a maximum of five years from grant date;

(c)

options to acquire no more than 5% of the issued shares of the Company may be granted to any one individual in any 12 month period;

(d)

options to acquire no more than 2% of the issued shares of the Company may be granted to any one consultant in any 12 month period;

(e)

options to acquire no more than an aggregate of 2% of the issued shares of the Company may be granted to an employee conducting investor relations activities (as defined in TSX Venture Exchange Policy 1.1), in any 12 month period;

(f)

options held by an option holder who is a director, employee, consultant or management company employee must expire within 90 days after the option holder ceases to be a director, employee, consultant or management company employee;

(g)

options held by an option holder who is engaged in investor relations activities must expire within 30 days after the option holder ceases to be employed by the Company to provide investor relations activities; and

(h)

in the event of an option holder’s death, the option holder’s personal representative may exercise any portion of the option holder’s vested outstanding options for a period of one year following the option holder’s death.

87

The Stock Option Plan provides that other terms and conditions may be attached to a particular stock option, such terms and conditions to be referred to in a schedule attached to the option certificate.  Stock options granted to directors, senior officers, employees or consultants will vest when granted unless otherwise determined by the Board on a case by case basis, other than stock options granted to consultants performing investor relations activities, which will vest in stages over 12 months with no more than one-fourth of the options vesting in any three month period.

In addition, under the Stock Option Plan a stock option will expire immediately in the event a director or senior officer ceases to be a director or senior officer of the Company as a result of (i) ceasing to meet the qualifications under the Company Act (British Columbia), (ii) the passing of a special resolution by the shareholders or (iii) an order made by a regulatory authority. A stock option will also expire immediately in the event an employee ceases to be an employee as a result of termination for cause or an employee or consultant ceases to be an employee or consultant as a result of an order made by a regulatory authority.

The price at which an option holder may purchase a common share upon the exercise of a stock option will be as set forth in the option certificate issued in respect of such option and in any event will not be less than the discounted market price of the Company’s common shares as of the date of the grant of the stock option (the “Award Date”).  The market price of the Company’s common shares for a particular Award Date will typically be the closing trading price of the Company’s common shares on the day immediately preceding the Award Date, or otherwise in accordance with the terms of the Stock Option Plan.  Discounted market price means the market price less a discount of up to 25% if the market price is $0.50 or less; up to 20% if the market price is between $2.00 and $0.51; and up to 15% if the market price is greater than $2.00.

In no case will a stock option be exercisable at a price less than the minimum prescribed by each of the organized trading facilities or the applicable regulatory authorities that would apply to the award of the stock option in question.

The Stock Option Plan also provides that (a) disinterested shareholder approval will be obtained for any reduction in the exercise price of an option held by an insider of the Company and (b) options cannot be granted to employees, consultants or management company employees that are not bona fide employees, consultants or management company employees, as the case may be.

Common shares will not be issued pursuant to stock options granted under the Stock Option Plan until they have been fully paid for by the option holder.  The Company will not provide financial assistance to option holders to assist them in exercising their stock options.

The names and titles of the Directors/Senior Management of the Company to whom outstanding stock options have been granted and the number of common shares subject to such options are set forth in Table No. 9 as of 5/31/2007, as well as the number of options granted to Directors/Senior Management and all employees as a group.  Although the Company has the right to create a multi-year vesting schedule, except as noted below all existing granted stock options were vested upon granting.

Table No. 9

Stock Options Outstanding

Name	Number of Shares of Common Stock	Exercise Price	Grant Date	Expiration Date
Officers/Directors:
Michael Halvorson	50,000	1.50	Oct 6, 2005	Oct 10, 2010
	125,000	1.70	Aug 31, 2006	Aug 31, 2011
	50,000	2.10	Oct 27, 2006	Oct 27, 2011
David Miller	100,000	1.50	Oct 6, 2005	Oct 10, 2010
	275,000	1.70	Aug 31, 2006	Aug 31, 2011
	100,000	2.10	Oct 27, 2006	Oct 27, 2011

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Devinder Randhawa	100,000	1.50	Oct 6, 2005	Oct 10, 2010
	275,000	1.70	Aug 31, 2006	Aug 31, 2011
	100,000	2.10	Oct 27, 2006	Oct 27, 2011
Steven Khan	100,000	1.50	Oct 6, 2005	Oct 10, 2010
	150,000	1.70	Aug 31, 2006	Aug 31, 2011
	60,000	2.10	Oct 27, 2006	Oct 27, 2011
Dieter Krewedl	50,000	1.50	Oct 6, 2005	Oct 10, 2010
	125,000	1.70	Aug 31, 2006	Aug 31, 2011
	50,000	2.10	Oct 27, 2006	Oct 27, 2011
Ray Larson	50,000	1.50	Oct 6, 2005	Oct 10, 2010
	100,000	3.00	Dec 15, 2006	Dec 15, 2010
	50,000	1.70	Aug 31, 2006	Aug 31, 2011
	20,000	2.10	Oct 27, 2006	Oct 27, 2011
Robert Hemmerling	50,000	1.50	Oct 6, 2005	Oct 10, 2010
	100,000	1.70	Aug 31, 2006	Aug 31, 2011
	40,000	2.10	Oct 27, 2006	Oct 27, 2011
Patrick Groening	50,000	1.50	Oct 6, 2005	Oct 10, 2010
	100,000	1.70	Aug 31, 2006	Aug 31, 2011
	40,000	2.10	Oct 27, 2006	Oct 27, 2011
Employees/Consultants	5,000	2.25	Feb 8, 2005	Feb 8, 2008
	300,000	2.20	Apr 29, 2005	Apr 29, 2008
	315,000	1.50	Oct 6, 2005	Oct 10, 2010
	125,000	2.50	Apr 13, 2006	Apr 13, 2009
	600,000	1.70	Aug 31, 2006	Aug 31, 2011
	237,500	2.10	Oct 27, 2006	Oct 27, 2011

Total Officers/Directors	2,310,000
Total Employees/Consultants	1,582,500
Total Options Outstanding	3,892,500

ITEM 7.  MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

7.A.  Major Shareholders.

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

The Company is aware of one person/company who beneficially owns 5% or more of the Registrant's voting securities. Table No. 10 lists as of 5/31/2007, persons and/or companies holding 5% or more beneficial interest in the Company’s outstanding common stock.

Table No. 10

5% or Greater Shareholders

Title of Class	Name of Owner	Amount and Nature of Beneficial Ownership	Percent of Class
Common	Sprott Asset Management (1)	13,725,300	18.89%

(1)

Includes 442,000 currently exercisable stock purchase warrants.

Based on 72,213,911 shares outstanding as of 5/31/2007 and stock purchase warrants held by each 5% or greater shareholder exercisable within sixty days.

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No shareholders of the Company have different voting rights from any other shareholder.

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

The participation in private placements of equity by the Company, the exercise of stock options/share purchase warrants, and sales by the individuals has lead over the last several years to some significant changes in the holdings of major shareholders (5%); the table reflects direct/indirect holdings of common shares, refer to Tables #8, #9, #10 for additional information.

Name	Shares Owned 12/31/2006	Shares Owned 12/31/2005	Shares Owned 12/31/2004	Shares Owned 12/31/2003
Devinder Randhawa Sprott Asset Management	1,743,338 13,283,300	1,318,223 12,574,300	1,777,619 7,537,143	3,250,974 NIL

	Shares Owned 12/31/2002	Shares Owned 12/31/2001	Shares Owned 12/31/2000	Shares Owned 12/31/1999
Devinder Randhawa Sprott Asset Management	1,959,918 NIL	988,148 NIL	229,418 NIL	787,093 NIL

	Shares Owned 12/31/1998	Shares Owned 12/31/1997
Devinder Randhawa Sprott Asset Management	1,093,625 NIL	189,331 NIL

______________________________________________________________________________

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

7.A.2.  Share Ownership.  

On 1/31/2007, the Company’s shareholders’ list showed 71,024,380 common shares outstanding, with 158 registered shareholders, including depositories.  60 registered shareholders were resident in Canada, holding 61,302,281 common shares representing about 86.31% of the issued and outstanding common shares; 95 of these shareholders were resident in the United States, holding 9,712,163 common shares representing about 13.67% of the issued and outstanding common shares; and 3 registered shareholders were resident in countries other than Canada and the United States, holding 10,000 common shares representing about 0.01% of the issued and outstanding common shares.

The Company has researched the indirect holding by depository institutions and other financial institutions; based on this research and other research into the indirect holdings of other institutions, the Company believes that it has approximately 2,910 beneficial owners of its common shares.

7.A.3.  Control of Company.  The Company is a publicly owned Canadian corporation, the shares of which are owned by U.S. residents, Canadian residents and other foreign residents.  The Company is not controlled by any foreign government or other person(s) except as described in ITEM #4.A., “History and Growth of the Company”, and ITEM #6.E., “Share Ownership”.

7.A.4.  Change of Control of Company Arrangements.   

No Disclosure Necessary

7.B.  Related Party Transactions

During the three most recent fiscal years, the Company entered into transactions with related parties as follows:  

Consulting fees of $135,581 (2005 - $121,600; 2004 - $62,455; 2003 - $67,689) were paid or accrued to RD Capital Inc., a company controlled by Devinder Randhawa, an officer and director of the Company. Mr. Randhawa also received $28,500 (2005 – Nil; 2004 – Nil; 2003 – Nil) for Director’s Fees.

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Consulting fees of $155,034 (2005 - $69,189) were paid to David Miller, an officer and director of the Company. Mr. Miller also received $13,500 (2005 – Nil) for Director’s Fees. Mr. Miller also received a total of 500,000 common shares of the Company over the last 3 years pursuant to the acquisition of property interests by the Company from Mr. Miller.

Consulting fees of $122,415 (2005 - $103,998; 2004 - $39,632; 2003 – Nil) were paid or accrued to Sona Capital Inc., a company controlled by Stephen Khan, an officer and former director of the Company. Mr. Khan also received $14,000 (2005 – Nil; 2004 – Nil; 2003 – Nil) for Director’s Fees.

Consulting fees of $84,000 (2005 - $76,495; 2004 - $46,250) were paid or accrued to Robert Hemmerling, an officer of the Company.

Consulting fees of $84,000 (2005 - $80,000) were paid to Patrick Groening, an officer of the Company.

These transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Amounts due to related parties are due to directors and companies controlled by directors and are unsecured, non-interest bearing and have no specific repayment terms.

Management believes the transactions referenced above were on terms at least as favorable to the Company as the Company could have obtained from unaffiliated parties.  

7.C.  Interests of Experts and Counsel   

       --- No Disclosure Necessary ---

ITEM 8.  FINANCIAL INFORMATION

8.A.  Statements and Other Financial Information

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

The financial statements as required under ITEM #17 are attached hereto and found immediately following the text of this Registration Statement.  The audit report of Davidson & Company, independent Chartered Accountants, is included herein immediately preceding the financial statements.

Audited Financial Statements:

Fiscal 2006/2005/2004/2003/2002/2001/2000/1999/1998/1997 Ended December 31st

Unaudited Interim Financial Statements

Three Months Ended March 31, 2007/2006

8.A.7.  Legal/Arbitration Proceedings

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

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

8.B.  Significant Changes

No significant change has occurred in the Company’s financial condition since the date of the most recent interim financial statements.  

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ITEM 9.  THE OFFER AND LISTING

9.A.  Common Share Trading Information

The Company's common shares began trading on the TSX Venture Exchange in Vancouver, British Columbia, Canada, on 9/26/1989. The stock symbol is “STM”.  The CUSIP number is #863077-10-3.

Table No. 11 lists the volume of trading and high and low sales prices for the Company's common shares, by month, for the last fourteen months, the last fourteen fiscal quarters, and the last ten fiscal years.  

Table No. 11

TSX Venture Exchange

Common Shares Trading Activity

	High	Low
Monthly
June 2007	$5.01	$3.98
May 2007	$5.40	$4.00
April 2007	$5.50	$4.30
March 2007	$4.98	$3.31
February 2007	$5.40	$3.87
January 2007	$4.20	$2.87
December 2006	$3.50	$2.87
November 2006	$3.11	$2.35
October 2006	$2.66	$1.76
September 2006	$2.20	$1.74
August 2006	$1.98	$1.49
July 2006	$2.03	$1.71
June 2006	$2.07	$1.62
May 2006	$2.51	$1.85
Quarterly
June 2007	$5.50	$3.98
March 2007	$5.40	$2.87
December 2006	$3.50	$1.76
September 2006	$2.20	$1.49
June 2006	$2.84	$1.62
March 2006	$3.00	$1.79
December 2005	$1.90	$1.14
September 2005	$1.73	$1.18
June 2005	$2.51	$1.49
March 2005	$2.95	$1.56
December 2004	$1.84	$1.12
September 2004	$1.50	$0.60
June 2004	$1.00	$0.36
March 2004	$1.07	$0.55

Yearly
Fiscal 2006 (December 31st)	$3.50	$1.49
Fiscal 2005 (December 31st)	$2.95	$1.14
Fiscal 2004 (December 31st)	$1.84	$0.36
Fiscal 2003 (December 31st)	$0.90	$0.075
Fiscal 2002 (December 31st)	$0.30	$0.08
Fiscal 2001 (December 31st)	$0.55	$0.18
Fiscal 2000 (December 31st)	$0.50	$0.30
Fiscal 1999 (December 31st)	$0.25	$0.23
Fiscal 1998 (December 31st)	$0.30	$0.23
Fiscal 1997 (December 31st)	$0.28	$0.19

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The TSX Venture Exchange

The TSX Venture Exchange (“TSX-V”) is a result of the acquisition of the Canadian Venture Exchange by the Toronto Stock Exchange.  

The Canadian Venture Exchange was a result of the merger between the Vancouver Stock Exchange and the Alberta Stock Exchange which took place on November 29, 1999. On August 1, 2001, the Toronto Stock Exchange completed its purchase of the Canadian Venture Exchange from its member firms and renamed the Exchange the TSX Venture Exchange. The TSX-V currently operates as a complementary but independent exchange from its parent.

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

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

The TSX-V is a self-regulating organization owned and operated by the TSX Group.  It is governed by representatives of its member firms and the public.

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

Regulation of the TSX Venture Exchange, its member firms and its listed companies is the responsibility of Market Regulation Services Inc. (“RS”) which was created as a joint initiative of The Toronto Stock Exchange Inc. and the Investment Dealers Association of Canada.

RS is recognized as a self-regulatory entity in the provinces of British Columbia, Alberta, Manitoba, Ontario and Quebec. As a Regulation Service Provider, RS provides independent regulation services to marketplaces (existing exchanges, quotation and trade reporting systems (QTRSs) and alternative trading systems (ATSs) and their participants in Canada that contract with RS Inc. for the provision of regulation services. As a national regulator for the Canadian marketplace, it is the first independent regulator of its kind for the Canadian securities market.

RS administers, oversees and enforces the Universal Market Integrity Rules (“UMIR”). To ensure compliance with UMIR, RS monitors real-time trading operations and market-related activities of marketplaces and participants. RS also enforces compliance with UMIR by investigating alleged rule violations and administering any settlements and hearings that may arise in respect of such violations.

RS's areas of responsibility include Market Surveillance; Operations and General Counsel (Market Policy); and Investigations and Enforcement. The Market Surveillance division monitors all securities trading for compliance with the Universal Market Integrity Rules and marketplace specific rules. Market Surveillance also investigates irregularities and complaints relating to trading on marketplaces for which RS acts as regulation services provider to ensure a fair and orderly marketplace for all participants. This division is responsible for market supervision, which includes monitoring trading activity and timely disclosure, as well as preliminary investigations and trade desk compliance.

The market surveillance department issues TSX-V notices to inform the public of halts, suspensions, delistings, and other enforcement actions.  All TSX-V notices can be found on the TSE/TSX website at www.tse.com.  In the public interest, trading halts or suspensions are maintained until the surveillance department is satisfied that there is adequate disclosure of the company’s affairs and a level playing field for investors. By Exchange policy, the department also reviews and approves certain types of transactions for all TSX listed companies. These types of transactions includes option grants, private placements and other share issuances, mergers and acquisitions, property-asset acquisitions and dispositions, loans, bonuses and finder’s fees, changes of business, name changes, stock splits, and related party transactions. If the Exchange’s review of such transactions finds them to be contrary to the public interest or is in violation of policy, a pproval for the transaction will be denied and any action taken by the company towards the completion of the transaction must be reversed.   

93

The Operations and General Counsel division is responsible for the development and  implementation UMIR as well as providing interpretations of, or exemptions from, UMIR with the goal of promoting market integrity. This division also coordinates all operational activities of RS including strategic planning and overall organizational matters. Finally, the General Counsel's office of this division is responsible for all legal services and matters relating to RS's Board of Directors.

The Investigation and Enforcement division is responsible for conducting investigations and prosecutions of violations of the UMIR and Policies and market integrity and market quality rules specific to the TSX Venture Exchange. Functions of this division include Investigations, Enforcement and Investigative Research.

a) Investigations

Investigations focus on activities that may be in breach of the UMIR and/or the rules of the TSX Venture Exchange. The types of violations frequently investigated include high closings, market manipulation, client priority trading violations, unapproved trading, trading in restricted securities and conduct inconsistent with the just and equitable principles of trade.

Requests for investigations come primarily from the Market Surveillance division of RS. Other sources include the provincial securities commissions, the Operations and General Counsel division, marketplaces, and in some instances, the general public. Investigators also lend assistance to investigations conducted by provincial securities commissions.

b) Enforcement

Once an investigation is complete and a decision has been made to proceed with a prosecution a statement of allegations is served upon the concerned party which references the rule or rules alleged to have been in violation. An Offer of Settlement is also presented to the concerned party, who can either accept or reject the Offer of Settlement. If accepted, the Offer of Settlement must be approved by a hearing panel of RS. The hearing panel may accept the Offer of Settlement or reject it. If the Offer of Settlement is rejected by either the concerned party or by a settlement hearing panel, a Notice of Hearing is issued and served upon the concerned party and the matter proceeds to a hearing before a hearing panel. If the hearing panel determines that an applicable requirement has been violated, it may impose a range of penalties, including a reprimand, a fine, or the restriction, suspension or revocation of access to a marketplace. After all hearings, there is an official public notification concerning the outcome of the hearing and the penalty or remedy imposed.

c) Investigative Research

The Investigative Research Division performs in-depth corporate research relating to officers, directors, and significant shareholders of organizations applying to list securities on the TSX Venture Exchange, or applying to obtain access to the marketplace's trading systems. Due diligence is a major function of the Enforcement division. The overall goal is to improve communication and to raise the standards of compliance in the securities trading industry.

Investors in Canada are protected by the Canadian Investor Protection Fund (“CIPF”). The CIPF is a private trust fund established to protect customers in the event of the insolvency of a member of any of the following Self-Regulatory Organizations: the TSX Venture Exchange, the Montreal Exchange, the Toronto Stock Exchange, the Toronto Futures Exchange and the Investment Dealers Association of Canada.

9.A.5.  Common Share Description

Registrar/Common Shares Outstanding/Shareholders

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

Common Share Description

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

94

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

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

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

•

Transferring the Company’s jurisdiction from British Columbia to another jurisdiction;

•

Giving financial assistance under certain circumstances;

•

Certain conflicts of interest by Directors;

•

Disposing of all/substantially all of Company’s undertakings;

•

Removing Director before expiration of his term of office;

•

Certain alterations of share capital;

•

Changing the Company name;

•

Altering any restrictions on the Company’s business; and

•

Certain reorganizations of the Company.

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

Stock Options

Refer to ITEM 6.E. and Tables #7 and #8 for additional information.

Warrants

Table No. 12 lists, as of 5/31/2007, share purchase warrants outstanding, the date the share purchase warrants were issued, the exercise price, and the expiration date of the share purchase warrants.  

Table No. 12

Share Purchase Warrants Outstanding

Effective Date of Issuance	Number of Share Purchase Warrants Currently Outstanding	Exercise Price	Expiration Date of Share Purchase Warrants
May 9, 2006	541,324	$3.25	Nov 9, 2007

Flow-Through Common Shares

The Company has historically funded a portion of its mineral exploration activities within Canada through the issuance of Flow-Through Common Shares. Section 66 of the Income Tax Act of Canada allows for investment tax credits, at a rate of 15%, applicable to certain mining exploration expenses in Canada pursuant to a Flow-through share issuance agreement. Common shares of exploration companies which are issued under the program are known as “Flow-Through” shares as the Company making the qualified expenditures flow-through such tax credits received to the purchasers of these specific common shares. A Flow-through share investor could apply this tax credit to reduce his or her Canadian Federal income tax payable. In order to apply for the credits, the flow-through shareholder must be resident in Canada and subject to Canada Federal Income Tax for the taxation year in which the credit is being claimed.

95

The mining exploration expenses that qualify for the investment tax credit under the Flow-through program must be incurred in the scope of mining exploration activities conducted from or above the ground surface in order to determine the existence or location of mineral materials. These minerals include the deposit of common metals or the deposit of minerals for which the Minister of Natural Resources has stated that the principal mineral extract is an industrial mineral contained in a non-stratified deposit. The mining exploration activities that qualify include expenses incurred in order to determine the existence, location, extent, or quality of a mineral resource in Canada, including the prospector costs, the geological, geophysical or geochemical study costs, the costs of steelhead or diamond drilling, by hammering or other methods, and the costs of digging trenches. It is not intended for expenses related to existing mines.

The Company has made the following Flow-Through Common Share issuances:

Fiscal Year	Amount of Flow-Through Common Shares Issued	Proceeds from Sale of Flow-Through Common Shares
1997	None	None
1998	None	None
1999	None	None
2000	None	None
2001	None	None
2002	None	None
2003	396,000	$99,000
2004	513,000	$1,000,350
2005	30,000	$58,500
2006	1,697,300	$5,091,900

Escrowed Common Shares

          ---No Disclosure Necessary---

9.A.6.  Differing Rights

9.A.7.a.  Subscription Warrants/Right

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

          --- No Disclosure Necessary ---

9.C.  Stock Exchanges Identified

The common shares trade on the TSX Venture Exchange in Toronto, Ontario.

Refer to ITEM #9.A.4.

ITEM 10.  ADDITIONAL INFORMATION

10.A.  Share Capital

10.A.1.  Authorized/Issued Capital.  

As of 12/31/2006 and 12/31/2005, there was an unlimited number of common shares without par value authorized. As of 12/31/2004, 12/31/2003, 12/31/2002, and 12/31/2001, there were 100,000,000 common shares without par value authorized. At 12/31/2006, there were 70,631,548 common shares issued and outstanding. At 12/31/2005 there were 55,755,514 common shares issued and outstanding.  At 12/31/2004 there were 36,241,257 common shares issued and outstanding.  At 12/31/2003, there were 14,157,777 common shares issued and outstanding.  As of 12/31/2002 and 12/31/2001 there were 8,046,548 and 5,801,548 common shares issued and outstanding respectively. As of March 31, 2007, the latest period for which financial statements are available, there were 72,153,687 common issued and outstanding.

During the last five years, less than 10% of the capital has been “paid for” with assets other than cash.

10.A.2.  Shares Not Representing Capital.

10.A.3.  Shares Held By Company.

--- No Disclosure Necessary ---

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

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

--- Refer to Table No. 8 and Table No. 10

10.A.6.  History of Share Capital

The Company has financed its operations through funds raised in public and private placements of common shares and the exercise of stock options.

Fiscal Year	Nature of Share Issuance	Number of Shares	Capital
1997	Exercise of share purchase options	60,500	$198,925
	Exercise of share purchase warrants	118,055	$300,737
	Private Placement	80,000	$740,000
	Private Placement	20,000	$63,000
	Exercise of Agent’s Special Warrants	27,170	$61,750
	Mineral Property Purchases	45,712	$225,250
	Payment of Finder’s Fees	4,600	$14,950
	Exercise of Special Warrants	660,000	$1,369,836
	Exercise of Agent’s Warrants	41,400	Nil
1998	Private Placement	431,091	$916,072
	Private Placement	300,000	$337,500
	Exercise of share purchase options	130,000	$136,500
	Mineral Property Purchase	9,240	$39,100
1999	Private Placement	262,400	$262,400
	Exercise of share purchase options	60,400	$63,420
	Exercise of share purchase warrants	251,200	$283,800

2000	Private Placement	160,000	$120,000
2001	Private Placements	1,620,000	$414,600
2002	Private Placements	550,000	$110,000
	Private Placements	1,535,000	307,000
	Finder’s Fee on Mineral Property Acquisition	60,000	$13,200
2003	Private Placement	2,222,229	$400,000
	Private Placement	3,000,000	$750,000
	Exercise of share purchase options	454,000	$68,100
	Exercise of share purchase warrants	435,000	$108,750
	Acquisition of mineral property	100,000	$56,000
2004	Private Placement	4,767,444	$1,287,210
	Private Placement	1,501,334	$900,800
	Private Placement	3,436,167	$2,061,700
	Private Placement	2,857,143	$2,000,000
	Private Placement	2,000,000	$2.000,000
	Exercise of share purchase warrants	6,208,392	$2,656,557
	Exercise of share purchase options	250,000	$79,698
	Acquisition of mineral property interests	550,000	$757,500
2005	Private Placement	543,000	$1,058,850
	Private Placement	10,000,000	$15,000,000
	Private Placement	114,286	$200,000
	Exercise of share purchase warrants	7,082,971	$4,280,507
	Exercise of share purchase options	887,000	$466,080
	Acquisition of mineral property interests	1,400,000	$2,377,750
2006	Exercise of share purchase warrants	8,340,084	$11,610,850
	Exercise of share purchase options	2,370,000	$1,930,800
	Private Placement	3,265,950	$8,699,795
	Acquisition of mineral property interests	900,000	$2,207,000
2007	Exercise of share purchase warrants	1,179,363	$2,945,252
to date	Exercise of share purchase options	302,500	$354,500
	Acquisition of mineral property interests	100,000	$425,000

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10.A.7.  Resolutions/Authorizations/Approvals

--- No Disclosure Necessary ---

10.B.  Memorandum and Articles of Association

Objects and Purposes

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

Disclosure of Interest of Directors,

Part 15 of the Articles

15.1 A Director who is, in any way, directly or indirectly interested in a proposed contract or transaction with the Company or who holds any office or possesses any property whereby, directly or indirectly, a duty or interest might be created to conflict with his duty or interest as a Director shall declare the nature and extent of his interest in such contract or transaction or of the conflict or potential conflict with his duty and interest as a Director, as the case may be, in accordance with the provisions of the Company Act.

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

15.3 A Director may hold any office or place of profit with the Company (other than the office of auditor or the Company) in conjunction with his office of Director for such period and on such terms (as to remuneration or otherwise) as the Directors may determine and no Director or intended Director shall be disqualified by his office from contracting with the Company either with regard to his tenure of any such other office or place of profit or as vendor, purchaser or otherwise, and, subject to compliance with the provisions of the Company Act, no contract or transaction entered into by or on behalf of the Company in which a Director is in any way interested shall be liable to be voided by reason thereof.

15.4 Subject to compliance with the provisions of the Company Act, a Director or his firm may act in a professional capacity for the Company (except as auditor of the Company) and he or his firm shall be entitled to remuneration for professional services as if he were not a Director.

15.5 A Director may be or become a director or other officer or employee of, or otherwise interested in, any corporation or firm in which the Company may be interested as a shareholder or otherwise, and, subject to compliance with the provisions of the Company Act, such Director shall not be accountable to the Company for any remuneration or other benefits received by him as director, officer or employee of, or from his interest in, such other corporation or firm, unless the Company in general meeting otherwise directs.

Powers and Duties of Directors

Remuneration of Directors

Part 14 of the Articles

14.1. The directors shall manage or supervise the management of the affairs and business of the company and shall have the authority to exercise all such powers of the company as are not, by the Company Act or by the memorandum or these articles, required to be exercised by the company in general meeting.

14.2. The directors may from time to time, by power of attorney, appoint any person to be the attorney of the company for such purposes, and with such powers, authorities and discretion (not exceeding those vested in or exercisable by the directors under these articles and excepting the powers of the directors relating to the constitution of the Board and of any of its committees and the appointment or removal of officers and the power to declare dividends) and for such period, with such remuneration and subject to such conditions as the directors may think fit, and any such appointment may be made in favor of any of the directors or any of the members of the company or in favor of any corporation, or of any of the members, directors, nominees or managers of any corporation, firm or joint venture and any such power of attorney may contain such provisions for the protection or convenience of persons dealing with such attorney as the directors think fit.  Any such attor ney may be authorized by the directors to sub-delegate all or any of the powers, authorities and discretion for the time being vested in him.

98

Borrowing Powers of Directors,

Part 8 of the Articles

8.1. The directors may from time to time authorize the company to:

(a)

borrow money in such manner and amount, on such security, from such sources and upon such terms and conditions as they in their absolute discretion think fit;

(b)

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

(c)

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

8.2. Any bonds, debentures or other debt obligations of the company may be issued at a discount, premium or otherwise, and with any special privileges as to redemption, surrender, drawing, allotment of or conversion into or exchange for shares or other securities, attending and voting at general meetings of the company, appointment of directors or otherwise and may by their terms be assignable free from any equities between the company and the person to whom they were issued or any subsequent holder thereof, all as the directors may determine.

8.3. Every bond, debenture or other debt obligation of the Company shall be signed manually by at least one Director of officer of the Company or by or on behalf of a trustee, registrar, branch registrar, transfer agent or branch transfer agents for the bond, debenture or other debt obligation appointed by the Company under  which the bond, debenture or other debt obligation is issued or by or on behalf of a trustee who certifies it in accordance with a trust indenture and any additional signatures may be printed or otherwise mechanically reproduced thereon and, in such event, a bond, debenture or other debt obligation so signed is as valid as if signed manually notwithstanding that the person whose signature is so printed or mechanically reproduced shall have ceased to hold the office that he is stated on such bond, debenture or other debt obligation to hold at the date of the issue thereof.

8.4 If the Company is or becomes a reporting company, the Company shall keep or cause to be kept a register of its indebtedness to every Director or Officer of the Company or an associate of any of them in accordance with the provisions of The Act.

Remuneration of Directors

Part 12.2 of the Articles

12.2. The remuneration of the directors as such may from time to time be determined by the directors or if the directors shall so decide, by the members. Such remuneration may be in addition to any salary or other remuneration paid to any officer or employee of the company as such who is also a director. The directors shall be repaid such reasonable traveling, hotel and other expenses as they incur in and about the business of the company    and if any director shall perform any professional or other services for the company that in the opinion of the directors are outside the ordinary duties of a director or shall otherwise be specially occupied in or about the Company's business, he may be paid a remuneration to be fixed by the Board, or, at the option of such director, by the company in general meeting, and such remuneration may be either in addition to, or in substitution for any other remuneration that he may be entitled to receive.  The directors, on behalf of the company. unless otherwise determined by ordinary resolution, may pay a gratuity, pension or allowance on retirement to any director who has held any salaried office or place of profit with the company or to his spouse or dependants and may make contributions to any fund and pay premiums for the purchase or provision of any such gratuity, pension or allowance.

Required Ownership of Capital by Directors

Part 12.3 of the Articles

12.3. A director shall not be required to hold a share in the capital of the company as qualification for his directorship.

Dividend Rights

Part 20 of the Articles

99

20.1  The Directors may from time to time declare and authorize payment of such dividends, if any, as they may deem advisable and need not give notice of such declaration to any member.  No dividend shall be paid otherwise than out of funds and/or assets by the Directors as to the amount of such funds or a declaration by the Directors as to the amount of such funds or assets available for dividends shall be conclusive.  The Company may pay any such dividend wholly or in part by the distribution of specific assets and in particular by paid up shares, bonds, debentures or other securities of the Company or any other corporation or in any one or more such ways as may be authorized by the Company or the Directors and where any difficulty arises with regard to such a distribution by the Directors may settle the same as they think expedient, and in particular may fix the value for distribution of such specific assets or any part thereof, and may determine that cas h payments in substitution for all or any part of the specific assets to which any members are entitled shall be made to any members on the basis of th value so fixed in order to adjust the rights of all parties and may vest any such specific assets in trustees for the persons entitled to the dividend as may seem expedient to the Directors.

20.2  Any dividend declared on shares of any class by the Directors may be made payable on such date as is fixed by the Directors.

20.3  Subject to the rights of members (if any) holding shares with special rights as to dividends, all dividends on shares of any class shall be declared and paid according to the number of such shares held.

20.4  The Directors may, before declaring any dividend, set aside out of the funds properly available for the payment of dividends such sums as they think proper as a reserve or reserves, which shall, at the discretion of the Directors, be applicable for meeting contingencies, or for equalizing dividends, or for any other purpose to which such funds of the Company may be properly applied, and pending such application may, at the like discretion, either be employed in the business of the Company or be invested in such investments as the Directors may from time to time think fit.  The Directors may also, without placing the same in reserve, carry forward such funds, which they think prudent not to divide.

20.5  If several persons are registered as joint holders of any share, any one of them may be given an effective receipt for any dividend, bonuses or other moneys payable in respect of the share.

20.6  No dividend shall bear interest against the Company. Where the dividend to which a member is entitled includes a fraction of a cent, such fraction shall be disregarded in making payment thereof and such payment shall be deemed to be payment in full.

20.7  Any dividend, bonuses or other moneys payable in cash in respect of shares may be paid by cheque or warrant sent through the post directed to the registered address of the holder, or in the case of joint holders, to the registered address of that one of the joint holders who is first named on the register, or to such person and to such address as the holder or joint holders may direct in writing.  Every such cheque or warrant shall be made payable to the order of the person to whom it is sent.  The mailing of such cheque or warrant shall, to the extent of the sum represented thereby (plus the amount of any tax required by law to be deducted) discharge all liability for the dividend, unless such cheque or warrant shall not be paid on presentation or the amount of tax so deducted shall not be paid to the appropriate taxing authority.

20.8    Notwithstanding anything contained in these Articles the Directors may from time to time capitalize any undistributed surplus on hand of the Companys and may from time to time issue as fully paid and non-assessable any unissued shares, or any bonds, debentures or debt obligations of the Company as a dividend representing such undistributed surplus on hand or any part thereof.

Rights/Privileges, Restrictions/Conditions.

Shareholders have no specified rights to share in the profits of the Company and there are no sinking fund provisions or shareholder liability to further capital calls by the Company.

There are no provisions discriminating against any existing or prospective holder of securities as a result of such shareholder owning a substantial number of shares.

The rights of holders of the Company’s stock can only be altered by a Special Shareholders’ meeting.

100

Rules pertaining to annual general meetings and extraordinary general meetings of shareholders are described in Sections Nine and Ten of the Company’s Articles. These rules are summarized as follows:

9.1 Subject to any extensions of time permitted pursuant to the Company Act, the first annual general meeting of the Company shall be held within fifteen months from the date of amalgamation, or the effective date of a certificate of continuation, and thereafter an annual general meeting shall be held once in every calendar year at such time (not being more than thirteen months after the date that the last annual general meeting was held or deemed to have been held) and place as may be determined by the Directors.

9.2 If the Company is, or becomes, a company which is not a reporting company and all the members entitled to attend and vote at an annual general meeting consent in writing to all the business which is required or desired to be transacted at the meeting, the meeting need not be held.

9.3 All general meetings other than annual general meetings are herein referred to as and may be called extraordinary general meetings.

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

9.5 If the Company is or becomes a reporting company, advance notice of any general meeting at which any general meeting at which any Director is to be elected shall be published in the manner required by the Company Act.

9.6 A notice convening a general meeting specifying the place, the date, and the hour of the meeting, and, in case of special business, the general nature of that business, shall be given as provided in the Company Act and in the manner hereinafter in these Articles mentioned, or in such other manner (if any) as may be prescribed by ordinary resolution, whether previous notice thereof has been given or not, to such persons as are entitled by law or under these Articles to receive such notice from the Company.  Accidental omission to give notice of a meeting to, or the non-receipt of notice of a meeting, by any member shall not invalidate the proceedings at that meeting.

Proceedings at General Meetings

10.1 All business shall be deemed special business, which is transacted at:

a.

an extraordinary general meeting other than the conduct of, and voting at, such meeting; and,

b.

an annual general meeting, with the exception of the conduct of, and voting at, such meeting, the consideration of the financial statements and of the respective reports of the Directors and Auditor, fixing or changing the number of directors, the election of Directors, the appointment of the Auditor, the fixing of the remuneration of the Auditor and of the directors and such other business as by these Articles or the Company Act may be transacted at a general meeting without prior notice thereof being given to the members or any business which is brought under consideration by the report of the Directors.

10.2 No business, other than election of the chairman or the adjournment of the meeting, shall be transacted at any general meeting unless a quorum of members, entitled to attend and vote, is present at the commencement of the meeting, but the quorum need not be present throughout the meeting.

10.3 Save as herein otherwise provided, a quorum for the transaction of business at a general meeting shall be two persons present and being, or representing by proxy, members holding not less than one-twentieth of the issued shares entitled to be voted at the meeting.  If there is only one member the quorum is one person present and being, or representing by proxy, such member.  The Directors, the Secretary or, in his absence, an Assistant Secretary, and the solicitor of the Company shall be entitled to attend at any general meeting but no such person shall be counted in the quorum or be entitled to vote at any general meeting unless he shall be a member of proxy holder entitled to vote thereat.

101

10.4 If within half an hour from the time appointed for a general meeting, a quorum is not present, the meeting, if convened by requisition of the members, shall be dissolved; but otherwise it shall stand adjourned to a place on a date and at a time to be fixed by the chairman of the meeting before the adjournment, which shall be not more than two weeks following the date for which the meeting was called, or failing such designation then to the same day in the second week following the meeting at the same time and place, in either case without giving further notice.  If at such adjourned meeting, a quorum is not present within half an hour from the time appointed, the person or persons present and being, or representing by proxy, a member or members entitled to attend and vote at the meeting, shall be a quorum.

10.5 The Chairman of the Board, if any, or in his absence the President of the Company or in his absence a Vice-President of the Company, if any, shall be entitled to preside as chairman at every general meeting of the Company.

10.6 If at any general meeting neither the Chairman of the Board nor President nor a Vice-President is present within fifteen minutes after the time appointed for holding the meeting or is willing to act as chairman, the Directors present shall choose some one of their number to be chairman or if all the Directors present decline to take the chair or shall fail to so choose or if no Director be present, the members present shall choose one of their number to be chairman.

10.7 The Chairman may and shall, if so directed by the meeting, adjourn the meeting from time to time and from place to place, but no business shall be transacted at any adjourned meeting other than the business left unfinished at the meeting from which the adjournment took place.  When a meeting is adjourned for thirty days or more, notice, but no “advance notice”, of the adjourned meeting shall be given as in the case of an original meeting or if so determined by the Directors, by an advertisement published at least once in a daily newspaper in Vancouver, British Columbia, or in the city where the meeting commenced.  Save as aforesaid, it shall not be necessary to give any notice of an adjourned meeting or of the business to be transacted at an adjourned meeting.

10.8 The chairman may propose or second a motion.

10.9 Subject to the provisions of the Company Act, at any meeting a resolution put to the vote of the meeting shall be decided on a show of hands, unless (before or on the declaration  of the result of the show of hands) a poll is directed by the chairman or demanded by at least one member entitled to vote who is present in person or by proxy.  The chairman shall declare to the meeting the decision on every question in accordance with the result of the show of hands or the poll, and such decision shall be entered in the book of proceedings of the Company.  A declaration by the chairman that a resolution has been carried, or carried unanimously, or by a particular majority, or lost or not carried by a particular majority and an entry to that effect in the book of the proceedings of the Company shall be conclusive evidence of the fact, without proof of the number or proportion of the votes recorded in favor of, or against, that resolution.

10.10 In the case of an equality of votes, whether on a show of hands or on a poll, the chairman of the meeting at which the show of hands takes place or at which the poll is demanded shall not be entitled to a second or casting vote.

10.11 No poll may be demanded on the election of a chairman.  A poll demanded on a question of adjournment shall be taken forthwith.  A poll demanded on any other question shall be taken as soon as, in the opinion of the chairman, is reasonably convenient, but in no event later than seven days after the meeting and at such time and place and in such manner as the chairman of the meeting directs.  The result of the poll shall be deemed to be the resolution of and passed at the meeting at which the poll was demanded.  Any business other than that upon which the poll has been demanded may be proceeded with pending the taking of the poll.  A demand for a poll may be withdrawn.  In any dispute as to the admission or rejection of a vote the decision of the chairman made in good faith shall be final and conclusive.

10.12 Every ballot cast upon a poll and every proxy appointing a proxy holder who casts a ballot upon a poll shall be retained by the Secretary for such period and be subject to such inspection as the Company Act may provide.

10.13 On a poll a person entitled to cast more than one vote need not, if he votes, use all his votes or cast all the votes he uses in the same way.

10.14 Unless the Company Act, the Memorandum or these Articles otherwise provide, any action to be taken by a resolution of the members may be taken by an ordinary resolution.

102

There are no limitations on the rights to own securities.

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

Although not expressly enumerated in the Articles, pursuant to Canadian regulations, shareholder ownership must be disclosed by any shareholder who owns more than 10% of the Company’s common stock.

Other Issues

Neither the Company’s memorandum/articles/by-laws nor British Columbia law permit: staggered terms for Directors; cumulative voting; shareholder approval of corporate matter by written consent; the adoption of various “poison pill” measures precluding shareholders from realizing a potential premium over the market value of their shares.  Neither the Company’s memorandum/articles/by-laws nor British Columbia law require retirement or non-retirement of directors under an age limit requirement.

There are no limitations on the rights to own securities.

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

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

10.C.  Material Contracts

The following are contracts currently in effect which management considers to be material.

1.

Agreement between the Company and Platoro West Inc. dated April 4, 2003 regarding the Chord property. The agreement amends the original option agreement on the property to allow the Company  to issue to Platoro 50,000 common shares of the Company stock in lieu of the required $10,000 annual cash payment.

2.

Agreement between the Company, Jody Dahrouge, and Dahrouge Geological Consulting Ltd. dated January 8, 2004 regarding the Athabasca property. The agreement allows the Company to purchase a 100% interest in a uranium property located in Alberta, Canada, by paying $7,500 and incurring additional costs of $34,902. To earn its interest, the Company is required to issue 200,000 common shares in stages to June 8, 2005. The property is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property. Although the final agreement is dated January 8, 2004, the negotiations to acquire the property were substantially completed, and the payment of $7,500 made, in December 2003.

3.

Agreement between the Company and Jeff Reeder dated November 25, 2003 regarding the Comstock property. The agreement grants to the Company the option to purchase a 100% interest in certain claims located in British Columbia, Canada. To earn its interest, the Company is required to issue 300,000 common shares in stages to November 25, 2005.

4.

Agreement between the Company, Jody Dahrouge and Jeff Reeder dated January 14, 2004 regarding the Duddridge Lake property. The agreement grants the Company an option to purchase a 100% interest in a certain claims located in Saskatchewan, Canada. To earn its interest, the Company is required to issue 200,000 common shares in stages over two years. Although the agreement is dated January 14, 2004, negotiations are prolonged and the final agreement was not completed until the second quarter of fiscal 2004.

5.

Agreement between the Company and Jody Dahrouge and Jeff Reeder dated February 13, 2004 regarding the Dieter Lake property. The agreement grants to the Company the option to purchase a 100% interest in the property by issuing 300,000 to the vendors.

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6.

Agreement between the Company and David Miller dated March 15, 2004 regarding the Roco Honda and Ram Claims. The agreement grants the Company an option to purchase a 100% interest in the claims located in New Mexico by paying US$150,000 and incurring additional costs. To earn its interest, the Company is required to issue 300,000 common shares in stages over two years.

7.

Agreement between the Company and David Miller dated June 17, 2004 regarding the Copper Mountain property. Under the agreement the Company was granted an option to purchase a 100% interest in the property located in Wyoming. To earn its interest, the Company is required to issue 200,000 common shares in stages over two years.

8.

Agreement between the Company and David Miller dated August 17, 2004 regarding the Cedar Rim, Northeast, and PRB leases. Under the agreement the Company was granted an option to purchase a 100% interest in the claims located in Wyoming. To earn its interest, the Company is required to issue 150,000 common shares in stages over two years.

9.

Agreement between the Company and David Miller dated November 24, 2004 regarding the PT Claims. Under the agreement, the Company was granted the option to purchase a 100% interest in the claims located in Wyoming. To earn its interest, the Company is required to issue 200,000 common shares in stages over two years.

10.

Agreement between the Company and David Miller dated December 14, 2004 regarding the Nose Rock Lease. Under the agreement, the Company was granted an option to purchase a 100% interest in the lease located in New Mexico. To earn its interest, the Company is required to pay US$30,000 cash and issue 300,000 common shares in stages over two years.

11.

Agreement between the Company and David Miller dated February 3, 2005 regarding the Red Creek Claims. Under the agreement, the Company could acquire a 100% interest in the claims located in Wyoming by issuing to David Miller 200,000 common shares in two stages, with 100,000 shares due within 21 days of the Completion date and 100,000 on the first anniversary date.

12.

Employment Agreement dated March 1, 2005 between the Company and Robert Hemmerling. Under the agreement, Mr. Hemmerling agrees to serve the Company as Corporate Secretary for $7,000 per month, for a period of three years.

13.

Employment Agreement dated March 1, 2005 between the Company and Patrick Groening. Under the agreement, Mr. Groening agrees to serve the Company as Corporate Secretary for $7,000 per month, for a period of three years.

14.

Agreement between the Company and David Miller dated March 3, 2005 regarding the Wyoming State leases. Under the agreement, the Company could acquire a 100% interest in the claims located in Wyoming by paying David Miller US$30,000 and issuing a total of 300,000 common shares to Mr. Miller consisting of an initial 50,000 shares due with 21 days of the Completion date, and 50,000 shares on every 6 month anniversary of the completion date thereafter until a total of 300,000 common shares have been issued.

15.

Agreement between the Company and Jody Dahrouge dated February 27, 2006 regarding the Fort McLeod Property. Under the agreement, the Company could acquire a 100% interest in the property located in Alberta by issuing to Jody Dahrouge 200,000 common shares in two stages, with 100,000 shares due within 21 days of the Completion date and 100,000 on the first anniversary date.

16.

Letter of Intent between the Company and Yellowcake Mining Ltd. regarding the joint-venture of the Baggs/Juniper Ridge project in Wyoming dated January 29, 2007. Under the LOI, the Company will option an 80% interest in the Baggs properties to Yellowcake. In consideration for the option, Yellowcake will:

•

Issue nine million shares of Yellowcake to Strathmore upon closing;

•

Pay Strathmore US$100,000 upon closing, and pay US$100,000 on each anniversary date of the closing for a total of US$500,000;

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•

Spend US$1.6 million per year for a period of 5 years for a total of US$8 million. Upon expending half of these funds (US$4 million), Yellowcake will have earned 50% of the optioned interest, and upon the expenditure of the additional US$4 million, will earn the additional 50% of the optioned interest (80% total).

•

Pay an NSR of 3% on the optioned portion on all future production.

Yellowcake also agreed that in consideration for an initial payment of US$25,000 upon closing, and a commitment for Yellowcake to spend US$440,000 for a minimum period of one year, Yellowcake will finance the evaluation of Strathmore’s database regarding uranium prospects in Texas. If a suitable target is identified, Yellowcake will be required to spend the necessary funds to acquire land leases, and Strathmore and Yellowcake will be 50-50 partners in the development of the identified targets resulting from the database evaluation

Copies of each of these material agreements has been filed as an exhibit to this Registration Statement

10.D.  Exchange Controls

Canada has no system of exchange controls.  There are no Canadian restrictions on the repatriation of capital or earnings of a Canadian public company to non-resident investors.  There are no laws in Canada or exchange restrictions affecting the remittance of dividends, profits, interest, royalties and other payments to non-resident holders of the Company's securities, except as discussed in ITEM 10, “Taxation” below.

Restrictions on Share Ownership by Non-Canadians

There are no limitations under the laws of Canada or in the organizing documents of the Company on the right of foreigners to hold or vote securities of the Company, except that the Investment Canada Act may require review and approval by the Minister of Industry (Canada) of certain acquisitions of "control" of the Company by a "non-Canadian".  The threshold for acquisitions of control is generally defined as being one-third or more of the voting shares of the Company.  "Non-Canadian" generally means an individual who is not a Canadian citizen, or a corporation, partnership, trust or joint venture that is ultimately controlled by non-Canadians.

10.E  Taxation

The following summary of the material Canadian federal income tax consequences are stated in general terms and are not intended to be advice to any particular shareholder. Each prospective investor is urged to consult his or her own tax advisor regarding the tax consequences of his or her purchase, ownership and disposition of shares of Common Stock. The tax consequences to any particular holder of common stock will vary according to the status of that holder as an individual, trust, corporation or member of a partnership, the jurisdiction in which that holder is subject to taxation, the place where that holder is resident and, generally, according to that holder’s particular circumstances.  This summary is applicable only to holders who are resident in the United States, have never been resident in Canada, deal at arm’s length with the Company, hold their common stock as capital property and who will not use or hold the common stock in carrying on business in Canada.  Special rules, which are not discussed in this summary, may apply to a United States holder that is an issuer that carries on business in Canada and elsewhere.

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

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

CANADIAN INCOME TAX CONSEQUENCES

Disposition of Common Stock.

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

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Dividends

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

Disposition of Common Shares

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

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

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

UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

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

The following discussion is based upon the sections of the Internal Revenue Code of 1986, as amended (“the Code”), Treasury Regulations, published Internal Revenue Service (“IRS) rulings, published administrative positions of the IRS and court decisions that are currently applicable, any or all of which could be materially and adversely changed, possible on a retroactive basis, at any time.  In addition, the discussion does not consider the potential effects, both adverse and beneficial, or recently proposed legislation which, if enacted, could be applied, possibly on a retroactive basis, at any time. The discussion is not intended to be, nor should it be construed to be, legal or tax advice to any holder or prospective holder of common shares of the Company. Each holder and prospective holder of common shares of the Company is advised to consult their own tax advisors about the federal, state, local, and foreign tax consequences of purchasing, owning a nd disposing of common shares of the Company applicable to their own particular circumstances.

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U.S. Holders

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

Distribution on Common Shares of the Company

U.S. Holders receiving dividend distributions (including constructive dividends) with respect to common shares of the Company are required to include in gross income for United States Federal income tax purposes the gross amount of such distributions equal to the U.S. dollar value of such distributions on the date of receipt (based on the exchange rate on such date), to the extent that the Company has current or accumulated earnings and profits, without reduction for any Canadian income tax withheld from such distributions.  Such Canadian tax withheld may be credited, subject to certain limitations, against the U.S. Holder’s United States Federal Income tax liability or, alternatively, individuals may be deducted in computing the U.S. Holder’s United States Federal taxable income by those individuals who itemize deductions.  (See more detailed discussion at “Foreign Tax Credit” below).  

To the extent that distributions exceed current or accumulated earnings and profits of the Company, they will be treated first as a return of capital up to the U.S. Holder’s adjusted basis in the common shares and thereafter as gain from the sale or exchange of the common shares. Dividend income will be taxed at marginal tax rates applicable to ordinary income while preferential tax rates for long-term capital gains are applicable to a U.S. Holder which is an individual, estate or trust.  There are currently no preferential tax rates for long-term capital gains for a U.S. Holder which is a corporation.

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

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

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

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Foreign Tax Credit

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

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

Disposition of Common Shares of the Company

A U.S. Holder will recognize gain or loss upon the sale of common shares of the Company equal to the difference, if any, between (I) the amount of cash plus the fair market value of any property received, and (ii) the shareholder’s tax basis in the common shares of the Company.  Preferential tax rates apply to long-term capital gains of U.S. Holders, which are individuals, estates or trusts. This gain or loss will be capital gain or loss if the common shares are capital assets in the hands of the U.S. Holder, which will be a short-term or long-term capital gain or loss depending upon the holding period of the U.S. Holder.  Gains and losses are netted and combined according to special rules in arriving at the overall capital gain or loss for a particular tax year.  Deductions for net capital losses are subject to significant limitations.  For U.S. Holders, which are not corporations, any unused portion of such net capital loss may be carried over to be used in later tax years until such net capital loss is thereby exhausted, but individuals may not carry back capital losses. For U.S. Holders, which are corporations (other than corporations subject to Subchapter S of the Code), an unused net capital loss may be carried back three years from the loss year and carried forward five years from the loss year to be offset against capital gains until such net capital loss is thereby exhausted.

Other Considerations

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

Foreign Personal Holding Company

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

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

108

Foreign Investment Company

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

Passive Foreign Investment Company

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

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

Controlled Foreign Corporation

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

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

109

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

10.F.  Dividends and Paying Agents

The Company has not declared any dividends on its common shares for the last five years 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 operations and the expansion of its business.

Notwithstanding the aforementioned: the Company is unaware of any dividend restrictions; has no specific procedure for the setting of the date of dividend entitlement; but might expect to set a record date for stock ownership to determine entitlement; has no specific procedures for non-resident holders to claim dividends, but might expect to mail their dividends in the same manner as resident holders.  The Company has not nominated any financial institutions to be the potential paying agents for dividends in the United States.

10.G.  Statement by Experts  

The Company’s auditors for its consolidated financial statements for each of the preceding ten years was Davidson & Company LLP, Chartered Accountants. They are members of the British Columbia Institute of Chartered Accountants.  Their audit reports for the Fiscal years 1997-2006 are included with the related consolidated financial statements in this Registration Statement with their consent

10.H.  Documents on Display

The documents included and/or referenced within this document are on display at the Company’s offices located at 700 – 1620 Dickson Avenue, Kelowna, British Columbia, Canada.

ITEM 11.  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

          --- No Disclosure Necessary ---

ITEM 12.  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

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

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

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

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

PART II

ITEM 13.  

DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

          --- No Disclosure Necessary ---

ITEM 14.  

MATERIAL MODIFICATIONS TO THE RIGHTS OF SECURITY HOLDERS AND USE OF PROCEEDS   

          --- No Disclosure Necessary ---

ITEM 15.  

CONTROLS AND PROCEDURES  

The Company carried out an evaluation, under the supervision and with the participation of the Company’s management, including the Company’s President and Chief Financial Officer, of the effectiveness of the design and operation of the Company’s “disclosure controls and procedures” [as defined in the Exchange Act Rule 13a-15(e)] as of the end of the period covered by this report.  Based upon that evaluation, the President and Chief Financial Officer concluded that the Company’s disclosure controls and procedures are effective in timely alerting them to material information relating to the Company (including its consolidated subsidiaries) required to be included in the Company’s periodic SEC filings, and that information is recorded, processed, summarized and reported as and when required.

110

There are inherent limitations to the effectiveness of any system of disclosure controls and procedures, including the possibility of human error and the circumvention or overriding of the controls and procedures.  Accordingly, even effective disclosure controls and procedures can only provide reasonable assurance of achieving their control objectives.

There were no changes in the Company’s internal control over financial reporting that occurred during the Company’s most recently completed fiscal year ended 12/31/2006 that has materially affected, or is reasonably likely to materially affect, the Company’s internal control over financial reporting.  Nor were there any significant deficiencies or material weaknesses in the Company's internal controls requiring corrective actions.

ITEM 16.  RESERVED

ITEM 16A. AUDIT COMMITTEE FINANCIAL EXPERT

ITEM 16B. CODE OF ETHICS

ITEM 16C. PRINCIPAL ACCOUNTIING FEES AND SERVICES

ITEM 16D. EXEMPTIONS FROM THE LISTING STANDARDS FOR AUDIT COMMITTEES

ITEM 16E. PURCHASES OF EQUITY SECURITIES BY THE COMPANY/AFFILIATED PURCHASERS

          --- Not Applicable ---

PART III

ITEM 17.  FINANCIAL STATEMENTS

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

The financial statements as required under ITEM #17 are attached hereto and found immediately following the text of this Registration Statement.  The audit report of Davidson & Company LLP, independent Chartered Accountants, is included herein immediately preceding the audited financial statements.

Audited Consolidated Financial Statements

Fiscal 2006/2005/2004/2003/2002/2001/2000/1999/1998/1997

Unaudited Interim Financial Statements

Three Months Ended 3/31/2007

ITEM 18.  FINANCIAL STATEMENTS

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

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ITEM 19.  EXHIBITS

1. Certificate of Incorporation, Certificates of Name Change, Articles of Incorporation, Articles of Amalgamation and By-Laws

2. Instruments defining the rights of holders of the securities being registered

***See Exhibit Number 1***

3. Voting Trust Agreements – N/A

4. Material Contracts:

1.

Agreement between the Company and Platoro West Inc. dated April 4, 2003 regarding the Chord property.

2.

Agreement between the Company, Jody Dahrouge, and Dahrouge Geological Consulting Ltd. dated January 8, 2004 regarding the Athabasca property.

3.

Agreement between the Company and Jeff Reeder dated November 25, 2003 regarding the Comstock property.

4.

Agreement between the Company, Jody Dahrouge and Jeff Reeder dated January 14, 2004 regarding the Duddridge Lake property.

5.

Agreement between the Company and Jody Dahrouge and Jeff Reeder dated February 13, 2004 regarding the Dieter Lake property. The agreement grants to the Company the option to purchase a 100% interest in the property by issuing 300,000 to the vendors.

6.

Agreement between the Company and David Miller dated March 15, 2004 regarding the Roco Honda and Ram Claims.

7.

Agreement between the Company and David Miller dated June 17, 2004 regarding the Copper Mountain property.

8.

Agreement between the Company and David Miller dated August 17, 2004 regarding the Cedar Rim, Northeast, and PRB leases.

9.

Agreement between the Company and David Miller dated November 24, 2004 regarding the PT Claims.

10.

Agreement between the Company and David Miller dated December 14, 2004 regarding the Nose Rock Lease.

11.     Agreement between the Company and David Miller dated February 3, 2005 regarding the Red Creek claims.

12.    Agreement between the Company and Robert Hemmerling, dated March 1, 2005 regarding employment as Corporate Secretary.

13.     Agreement between the Company and Patrick Groening dated March 1, 2006 regarding employment as Chief Financial Officer.

14.     Agreement between the Company and David Miller dated March 3, 2006 regarding the Wyoming State Leases.

15.     Agreement between the Company and Jody Dahrouge dated February 27, 2006 regarding the Fort Mcleod property.

16.

Letter of Intent between the Company and Yellowcake Mining Ltd. regarding the joint-venture of the Baggs/Juniper Ridge project in Wyoming dated January 29, 2007

5. List of Foreign Patents – N/A

6. Calculation of earnings per share – N/A

7. Explanation of calculation of ratios – N/A

8. List of Subsidiaries – N/A

9. Statement pursuant to the instructions to Item 8.A.4, regarding the financial statements filed in registration statements for initial public offerings of securities – N/A

10.Other documents:

1.

Management Information Circular and Form of Proxy for the Annual General Meeting held on May 29, 2006. (previously filed)

2.

Management Information Circular for the Annual and Special Meeting of Securityholders held on June 19, 2007

3.

Form of Proxy for the Annual and Special Meeting of Securityholders held on June 19, 2007.

4.

Voting Results of the Annual and Special Meeting.

5.

Consent of David C. Fitch regarding the summary of his technical reports on the Roca Honda and Church Rock properties.

6.

Auditors Consent from Davidson & Company LLC dated July 12, 2007

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STRATHMORE MINERALS CORP.

CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

113

Unaudited Interim Financial Statements

Notice

In accordance with National Instrument 51-102 released by the Canadian Securities Administrators, the Company discloses that its auditors have not reviewed the unaudited financial statements for the period ended March 31, 2007.

114

#

STRATHMORE MINERALS CORP.

CONSOLIDATED BALANCE SHEETS

(Unaudited)

	March 31, 2007	December 31, 2006
ASSETS
Current
Cash and equivalents	$ 4,705,862	$ 5,299,908
Short term investments (Note 9)	27,576,248	27,412,579
Receivables	631,679	407,910
Prepaid expenses	16,273	30,593
	32,930,062	33,150,990
Equipment	832,024	690,904
Mineral property interests (Note 3)	8,135,741	7,828,735
Deferred exploration costs (Note 4)	14,677,475	11,946,014
Deferred reorganization costs (Note 5)	63,320	-
	$ 56,638,622	$ 53,616,643
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$ 864,429	$ 708,606
Due to related parties (Note 8)	63,091	15,449
Deferred revenue	145,338	-
	1,072,858	724,055
Shareholders' equity
Capital stock (Note 6)	70,292,831	68,447,106
Contributed surplus (Note 6)	2,452,961	2,205,940
Deficit	(17,180,028)	(17,760,458)
	55,565,764	52,892,588
	$ 56,638,622	$ 53,616,643

Subsequent events (Note 11)

On behalf of the Board:
“Dev Randhawa”	Director	“Michael Halvorson”	Director

The accompanying notes are an integral part of these consolidated financial statements.

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#

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT

 (Unaudited)

THREE MONTH PERIOD ENDED MARCH 31	2007	2006
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and promotion	$ 201,178	$ 13,550
Amortization	30,950	12,645
Business development	32,576	15,646
Consulting fees	403,970	195,517
Investors Relations	1,950	-
Office and miscellaneous	117,564	19,454
Professional fees	127,605	91,762
Regulatory fees	29,800	31,144
Rent	38,466	12,749
Shareholder communications	6,798	4,057
Short term investment fees	26,133	-
Stock-based compensation  (Note 6)	247,021	116,106
Telephone	13,325	10,543
Trade shows and conferences	109,123	97,035
Transfer agent	2,344	6,097
Travel	9,266	14,084
Wages and benefits	201,547	88,457
Loss before other item	(1,599,616)	(728,846)
OTHER ITEM
Interest income	436,412	-
Miscellaneous income	120,432	266,554
Unrealized income (loss) on investments	12,134	(38,488)
	568,978	228,066
Loss before income taxes	(1,030,638)	(500,780)
Future income tax recovery	1,737,356	-
Income (loss) for the period	706,718	(500,780)
Deficit, beginning of period	(17,886,746)	(15,576,059)
Deficit, end of period	$ (17,180,028)	$ (16,076,839)
Basic and diluted income (loss) per common share	$ 0.01	$ (0.01)
Weighted average number of common shares outstanding: Basic Diluted	71,433,811 74,362,998	58,891,391 58,891,391

The accompanying notes are an integral part of these consolidated financial statements.

116

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENT OF CASH FLOWS

 (Unaudited)

THREE MONTH PERIOD ENDED MARCH 31	2007		2006
CASH FLOWS FROM OPERATING ACTIVITIES
Income (loss) for the period		$ 706,718		$ (500,780)
Items not affecting cash
Amortization		30,950		12,645
Unrealized (income) loss on investments		(12,134)		38,488
Stock-based compensation		247,021		116,106
Future income tax recovery		(1,737,356)		-
Changes in non-cash working capital items:
Increase in deferred revenue		145,338		-
(Increase) decrease in receivables		(223,768)		144,667
Increase in short term investments		(151,535)		(4,363,407)
(Increase) decrease in prepaid expenses		14,320		7,580
Increase in accounts payable and accrued liabilities		155,823		41,464
Increase in due to related parties		47,642		29,270
Cash used in operating activities		(776,981)		(4,473,967)
CASH FLOWS FROM INVESTING ACTIVITIES
Deferred exploration costs		(2,731,461)		(811,554)
Deferred reorganization costs		(63,320)		-
Equipment purchased		(172,070)		(7,256)
Mineral property interests		(8,295)		(7,609)
Cash used in investing activities		(2,975,146)		(826,419)
CASH FLOWS FROM FINANCING ACTIVITIES
Share issuance costs		-		(5,299)
Capital stock issued		3,158,081		8,114,997
Cash provided by financing activities		3,158,081		8,109,698
Change in cash and equivalents during the period		(594,046)		2,809,312
Cash and equivalents, beginning of period		5,299,908		12,143,821
Cash and equivalents, end of period		$ 4,705,862		$ 14,953,133

Supplemental disclosure with respect to cash flows (Note 7)

The accompanying notes are an integral part of these consolidated financial statements.

117

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

1.

BASIS OF PRESENTATION

The consolidated financial statements contained herein include the accounts of Strathmore Minerals Corp. (the “Company”) and its wholly owned subsidiaries, Minera Peruran S.A., and Strathmore Resources (US) Ltd.  Significant inter-company balances and transactions are eliminated on consolidation.

The interim period consolidated financial statements have been prepared by the Company in accordance with Canadian generally accepted accounting principles.  All financial summaries included are presented on a comparative and consistent basis showing the figures for the corresponding period in the preceding year with the exception of the accounting policy regarding the financial instruments and comprehensive income as disclosed in Note 9.  The preparation of financial data is based on accounting principles and practices consistent with those used in the preparation of annual consolidated financial statements.  Certain information and footnote disclosure normally included in financial statements prepared in accordance with Canadian generally accepted accounting principles has been condensed or omitted.  These interim period statements should be read together with the audited consolidated financial statements and the accompanying notes included in the Company's latest annual filing.  In the opinion of the Company, its unaudited interim consolidated financial statements contain all adjustments necessary in order to present a fair statement of the results of the interim periods presented.

2.

NATURE OF OPERATIONS

The Company's principal business activity is the acquisition and exploration of mineral property interests.

3.

MINERAL PROPERTY INTERESTS

	March 31, 2007	December 31, 2006
Athabasca property, Canada	$ 459,702	$ 459,702
Chord property, USA	137,282	137,282
Comstock property, Canada	494,271	494,271
Dieter Lake property, Canada	618,792	618,792
Duddridge Lake property, Canada	382,245	382,245
Fort Mcleod property, Canada	724,070	299,071
New Mexico properties, USA	1,722,326	1,720,833
Staked properties, Canada	831,260	831,260
Staked properties, Peru	69,580	69,580
Wyoming properties, USA	2,696,213	2,689,410
	$ 8,135,741	$ 7,702,446

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

118

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

3.

MINERAL PROPERTY INTERESTS (cont’d…)

Athabasca property, Canada

The Company acquired a 100% interest in a uranium property located in Alberta, Canada, by paying $98,192, incurring additional costs of $29,510 and issuing 200,000 common shares valued at $332,000. The property is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property.

Chord property, USA

The Company acquired a 100% interest in a uranium property located in South Dakota, USA, by paying $48,640.  During fiscal 2003, the Company amended the terms of the lease agreement for consideration of 100,000 shares of the Company valued at $56,000 and incurred additional fees of $6,468.  To earn its interest, the Company is required to make annual payments of either 50,000 common shares or US$10,000 per year to July 1, 2009. In fiscal 2005, the Company paid $12,558 (US$10,000), 2004 - $13,616 (US$10,000).  The property is subject to a 2% gross royalty.

Comstock property, Canada

The Company acquired a 100% interest in certain claims located in British Columbia, Canada by issuing 300,000 common shares valued at $491,000 and incurring additional fees of $3,271.

Dieter Lake property, Canada

The Company acquired a 100% interest in certain claims located in Quebec, Canada by issuing 300,000 common shares valued at $603,000 and incurring additional costs of $15,792. An additional 200,000 shares

will be issued in the event a resource of more than 60 million pounds containing U₃O₈ (Uranium) is confirmed at the property.

Duddridge Lake property, Canada

The Company acquired a 100% interest in certain claims located in Saskatchewan, Canada by issuing 200,000 common shares valued at $344,000 and incurring additional fees of $38,245.

Fort Mcleod property, Canada

The company acquired a 100% interest in certain claims located in Alberta, Canada, by paying $34,070 for staking costs and issuing 200,000 shares valued at $690,000.

New Mexico properties, USA

The Company acquired a 100% interest in certain claims located in New Mexico, USA, by paying $293,752, incurring additional costs of $320,074 and issuing 600,000 common shares valued at $1,108,500. Certain claims are subject to a 1% royalty.

119

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

3.

MINERAL PROPERTY INTERESTS (cont’d…)

Staked properties, Canada

The Company acquired, by staking, a 100% interest in the following uranium properties located in north-central Saskatchewan: Davy Lake, Hall Lake, Patterson Lake, and Waterbury Lake.

Staked properties, Peru

The Company acquired, by staking, a 100% interest in certain uranium properties located in Peru.

Wyoming properties, USA

The Company acquired a 100% interest in a certain claims located in Wyoming, USA by paying $87,560, incurring additional costs of $409,903 and issuing 1,150,000 common shares valued at $2,198,750. To earn its interest, the Company is required to issue an additional 100,000 common shares in stages over two years.

The Company has granted an option for a 80% interest in its Red Creek property. In return for the option, the Company will receive US$ 8,000,000 over 5 years to fund the property’s exploration.

4.

DEFERRED EXPLORATION COSTS

	Canada	USA	Peru	Total
As at December 31, 2005	$ 2,795,945	$ 615,277	$ 159,768	$ 3,570,990
Geology	714,566	2,819	761	718,146
Geophysics	2,527,239	-	-	2,527,239
General expenses	62,172	130,263	37,633	230,068
Lab analysis & sampling	19,990	-	-	19,990
Property fees	181,430	514,003	30,276	725,709
Personnel time	1,743,786	1,582,897	131,355	3,458,038
Travel	506,005	159,605	30,224	695,834
As at December 31, 2006	$ 8,551,133	$ 3,004,864	$ 390,017	$ 11,946,014
Drilling	812	7,775	-	8,587
Engineering	-	279,305	-	279,305
Equipment & vehicle rental	267,882	349	-	268,231
Geology	563,878	16,390	-	580,268
Geophysics	483,250	-	-	483,250
General expenses	26,547	17,117	8,807	52,471
Property fees	102,133	42,385	-	144,518
Permitting/Regulatory	95,684	62,918	-	158,602
Personnel time	274,362	379,178	27,316	680,856
Travel	31,354	38,953	5,066	75,373
As at March 31, 2007	$ 10,397,035	$ 3,849,234	$ 431,206	$ 14,677,475

120

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

5.

DEFERRED REORGANIZATION COSTS

Subject to shareholder and regulatory approval, the Company intends to proceed with a reorganization which will have the result of dividing its present mineral assets into two separate companies. The spin-off company, Fission Energy Corp. (“Fission”), will hold the Canadian and Peruvian properties upon implementation of a Plan of Arrangement, and Strathmore Minerals Corp. will continue to hold the remaining mineral properties. All costs and revenues associated with the reorganization of the Company will be deferred until the transaction is complete.

6.

CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Number of Shares	Capital Stock	Contributed Surplus
Authorized
Unlimited number of common shares, without par value
Issued
As at December 31, 2005	55,755,514	$ 41,299,968	$ 4,857,621
Private placements	3,265,950	8,699,795	-
Exercise of options	2,370,000	2,377,598	(446,798)
Exercise of warrants	8,340,084	14,546,759	(2,935,909)
Acquisition of mineral property interests	900,000	2,207,000	-
Stock-based compensation	-	-	731,026
Share issuance costs	-	(684,014)	-
As at December 31, 2006	70,631,548	68,447,106	2,205,940
Exercise of options	290,000	333,250	-
Exercise of warrants	1,132,139	2,824,831	-
Acquisition of mineral property interests	100,000	425,000	-
Tax benefits renounced to flow through share subscribers	-	(1,737,356)	-
Stock-based compensation	-	-	247,021
As at March 31, 2007	72,153,687	$ 70,292,831	$ 2,452,961

Included in issued capital stock are 75,000 common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

In May, 2006, the Company issued 1,697,300 flow-through shares at $3.00 per share and 1,568,650 units at $2.30 per unit for total proceeds of $8,699,795. Each unit consists of one common share and one half of one share purchase warrant. One whole warrant is exercisable at $3.25 and expires November 9, 2007. In connection with the placement, the Company paid commissions of $521,988 in cash and issued 195,957 Agents’ options. Each option entitles the Agent to purchase one common share at $2.55 per share and expires May 9, 2007.

121

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

6.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Stock options and warrants

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of 5 years.

Stock option and share purchase warrant transactions are summarized as follows:

	Warrants		Stock Options
	Number	Weighted Average Exercise Price	Number	Weighted Average Exercise Price
Outstanding, December 31, 2005	9,082,990	$ 1.37	3,888,000	$ 1.16
Granted	980,282	3.11	2,840,000	1.89
Exercised	(8,340,084)	1.39	(2,370,000)	0.81
Expired/cancelled	(2,500)	0.76	(163,000)	1.91
Outstanding, December 31, 2006	1,720,689	$ 2.63	4,195,000	$ 2.18
Exercised	(1,132,140)	1.21	(290,000)	1.75
Outstanding, March 31, 2007	588,549	$ 3.19	3,905,000	$ 1.82
Number currently exercisable	588,549	$ 3.19	798,000	$ 1.92

As at March 31, 2007, incentive stock options and share purchase warrants were outstanding as follows:

	Number of Shares	Exercise Price	Expiry Date
Options	5,000	2.25	February 8, 2008
	300,000	2.20	April 29, 2007
	125,000	2.50	April 13, 2009
	920,000	1.50	October 6, 2010
	100,000	3.00	December 15, 2010
	1,755,000	1.70	August 31, 2011
	700,000	2.10	October 27, 2011
Total	3,905,000
-Continued-

122

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

6.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Stock options and warrants (cont’d…)

	Number of Shares	Exercise Price	Expiry Date
Cont’d…
Warrants	47,224	2.55	May 9, 2007
	541,325	3.25	November 9, 2007
Total	588,549

Stock-based compensation

During the period ended March 31, 2007, the Company granted Nil (2006 – 100,000) options to employees, consultants and directors. Pursuant to the vesting of options issued in the prior fiscal year, total stock-based compensation recognized in the statement of operations during the first quarter of 2007 was $247,021 (2005 - $116,106).  This amount was also recorded as contributed surplus on the balance sheet.  All options are recorded at fair value using the Black-Scholes option pricing model.   

The following assumptions were used for the valuation of stock options and warrants:

Three month period ended March 31,	2007	2006
Risk-free interest rate	-	4.02%
Expected life	-	3 years
Annualized volatility	-	40%
Dividend rate	-	0.00%

7.

SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

Three month period ended March 31,	2007	2006
Cash paid during the period for interest	$ -	$ -

During the three month period ended March 31, 2007 the Company issued 100,000 (2006 – 650,000) common shares valued at $425,000 (2006 -$1,575,500) pursuant to the acquisition of mineral property interests.

123

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

8.

RELATED PARTY TRANSACTIONS

The Company paid or accrued the following amounts to related parties:

Three month period ended March 31,	2007	2006
Directors’ fees	$ 37,000	$ -
Consulting fees	174,612	144,606
Total	$ 211,612	$ 144,606

These transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Amounts due to related parties are due to directors and companies controlled by directors and are unsecured, non-interest bearing and have no specific repayment terms.

9.

FINANCIAL INSTRUMENTS AND COMPREHENSIVE INCOME

Effective January 1, 2007, the Company adopted CICA Handbook Section 1530, Comprehensive Income, CICA Handbook Section 3855, Financial Instruments – Recognition and Measurement and CICA Handbook Section 3865, Hedges. These new handbook sections provide the requirements for the recognition of financial instruments, as well as standards on when and how hedge accounting may be applied. As of March 31, 2007, the Company has not assigned any derivatives as hedging instruments.

Introduced in Handbook Section 1530 is a new component of equity called comprehensive income that allows investments to be carried at market value, cost, or amortized cost. If an investment is classified as “available-for-sale” any unrealized gains and losses are accumulated on the balance sheet and shown as a separate line item in equity. Once these items are realized they are transferred to the income statement. The Company has assigned all short-term investments, as shown on the balance sheet, as held-for-trading.

10.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests and considers its loss from operations for the three months ended March 31, 2007 and 2006 to relate to this segment.

The Company has mineral property interests located in the USA, Canada and Peru and conducts administrative activities from Canada.  The total amount of capital assets attributable to Canada is $14,432,645 (2006 - $11,979,000), Peru is $500,787 (2006 - $459,597) and the USA is $8,775,128 (2006 - $7,900,767).

124

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Unaudited)

MARCH 31, 2007

11.

SUBSEQUENT EVENTS

a)

Pursuant to the exercise of stock options, the Company issued 12,500 common shares for proceeds of $21,250.

b)

Pursuant to the exercise of share purchase warrants the Company issued 47,224 common shares for proceeds of $120,421.

c)

On April 10, 2007, entered into a letter of intent with Yellowcake Minerals Inc. to finance the development of the Company’s Sky project. Pursuant to the LOI, Yellowcake will provide US$7,500,000 in development expenditures to earn a 60% interest in the Sky project over a period of 4 years.

d)

On April 19, 2007, entered into a binding letter of intent with Yellowcake Minerals Inc. to form a joint venture to explore and develop the Company’s Jeep property. Yellowcake will be granted the exclusive right to earn a 60% interest in the Jeep property upon spending US$10,000,000 in stages on expenditures towards the project. Pursuant to the completion of Yellowcake’s required expenditures, the Company will hand over all operating rights to Yellowcake; however, the Company will retain the right to earn back an additional 11% undivided interest in the property up to 90 days after receiving a Bankable Feasibility Report by reimbursing Yellowcake’s expenditures on the property.

125

STRATHMORE MINERALS CORP.

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

126

REPORT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

To the Shareholders of

Strathmore Minerals Corp.

We have audited the consolidated balance sheets of Strathmore Minerals Corp. as at December 31, 2006, 2005, 2004, 2003, 2002, 2001, 2000, 1999, 1998 and 1997 and the consolidated statements of operations and deficit and cash flows for the years then ended.  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 audits.

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

In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2006, 2005, 2004, 2003, 2002, 2001, 2000, 1999, 1998 and 1997 and the results of its operations and its cash flows for the years then ended in accordance with Canadian generally accepted accounting principles.

"DAVIDSON & COMPANY LLP"

Vancouver, Canada	Chartered Accountants
February 16, 2007

A Member of SC INTERNATIONAL

1200 - 609 Granville Street, P.O. Box 10372, Pacific Centre, Vancouver, BC, Canada, V7Y 1G6

Telephone (604) 687-0947  Fax (604) 687-6172

127

STRATHMORE MINERALS CORP.

CONSOLIDATED BALANCE SHEETS

YEARS ENDED DECEMBER 31

	2006	2005	2004	2003
ASSETS
Current
Cash and equivalents	$5,299,908	$12,143,821	$9,083,026	$990,279
Short term investments (Note 3)	27,412,579	9,001,064	-	-
Receivables	407,910	240,244	34,566	75,036
Prepaid expenses	30,593	26,651	13,316	12,568
	33,150,990	21,411,780	9,130,908	1,077,883
Property and equipment (Note 4)	690,904	208,229	70,058	5,869
Mineral property interests (Note 5)	7,702,446	5,579,778	2,688,728	146,983
Deferred exploration costs (Note 6)	11,946,014	3,570,990	167,649	60,008
	$ 53,490,354	$30,770,777	$12,057,343	$1,290,743
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$      708,606	$171,356	$    63,785	$    48,016
Due to related parties (Note 9)	15,449	14,291	10,948	-
	724,055	185,647	74,733	48,016
Shareholders' equity
Capital stock (Note 7)	69,061,053	41,299,968	23,457,405	12,624,793
Subscriptions received in advance	-	3,600	58,500	-
Contributed surplus (Note 7)	1,591,993	4,857,621	2,420,262	577,281
Deficit	(17,886,747)	(15,576,059)	(13,953,557)	(11,959,347)
	52,766,299	30,585,130	11,982,610	1,242,727
	$53,490,354	$30,770,777	$12,057,343	$1,290,743

Nature of operations (Note 1)

Subsequent events (Note 13)

On behalf of the Board:
“Dev Randhawa”	Director	“Michael Halvorson”	Director

The accompanying notes are an integral part of these consolidated financial statements.

128

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

YEARS ENDED DECEMBER 31

	2006	2005	2004	2003
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and promotion	$90,532	$70,154	$            -	$         -
Amortization	64,749	43,046	8,432	1,821
Business development	111,876	96,636	96,072	-
Consulting fees	819,123	654,100	343,388	86,591
Investor relations	24,858	110,718	-	-
Office and miscellaneous	171,744	222,318	123,378	28,460
Professional fees	370,419	132,637	77,002	-
Property investigation costs	126,289	-	75,578	-
Regulatory fees	37,958	16,384	65,589	38,853
Rent	60,706	47,581	17,767	15,155
Shareholder communications	47,287	9,329	26,059	7,082
Short term investment fees	92,127	3,061	-	2,808
Stock-based compensation  (Note 7)	731,026	476,610	962,297	221,994
Telephone	41,414	37,031	29,283	4,372
Transfer agent	17,791	16,105	167,017	19,298
Trade shows and conferences	379,389	229,792	14,975	8,598
Travel	47,644	36,009	53,108	6,836
Wages and benefits	448,492	158,628	-	-
Loss before other items	(3,683,424)	(2,360,139)	(2,059,945)	(441,868)
OTHER ITEMS
Investment income	1,393,310	365,930	65,735	-
Costs recovered	-	-	-	9,013
Allowance for decline in investments (Note 3)	(20,574)	(4,817)	-	-
Loss before income taxes	(2,310,688)	(1,999,026)	(1,994,210)	(432,855)
Future income tax recovery (Note 10)	-	376,524	-	-
Loss for the year	(2,310,688)	(1,622,502)	(1,994,210)	(432,855)
Deficit, beginning of year	(15,576,059)	(13,953,557)	(11,959,347)	(11,526,492)
Deficit, end of year	$(17,886,747)	$(15,576,059)	$(13,953,557)	$(11,959,347)
Basic and diluted loss per common share	$ (0.03)	$ (0.03)	$ (0.08)	$       (0.05)
Weighted average number of common shares outstanding	66,314,107	53,550,088	26,140,368	8,346,374

The accompanying notes are an integral part of these consolidated financial statements.

129

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENTS OF CASH FLOWS

YEARS ENDED DECEMBER 31

	2006	2005	2004	2003
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$(2,310,688)	$(1,622,502)	$(1,994,210)	$(432,855)
Items not affecting cash
Amortization	64,749	43,046	8,432	1,821
Allowance for decline in investments	20,574	4,817	-	-
Stock-based compensation	731,026	476,610	962,297	221,994
Future income taxes	-	(376,524)	-	-
Property investigation costs	126,289	-	-	-
Changes in non-cash working capital items:
Increase (decrease) in receivables	(167,666)	(205,678)	40,470	(70,123)
Increase in short term investments	(18,432,089)	(9,005,881)	-	-
Increase in prepaid expenses	(3,942)	(13,335)	(748)	(9,638)
(Decrease) increase in accounts payable and accrued liabilities	40,641	(12,247)	15,769	36,436
Increase in due to related parties	1,158	3,343	-	-
Cash used in operating activities	(19,929,948)	(10,708,351)	(967,990)	(252,365)
CASH FLOWS FROM INVESTING ACTIVITIES
Deferred exploration costs	(7,878,415)	(3,283,523)	(107,641)	-
Property and equipment purchased	(547,424)	(181,217)	(72,621)	-
Mineral property interests	(41,957)	(513,300)	(1,784,245)	(42,343)
Cash used in investing activities	(8,467,796)	(3,978,040)	(1,964,507)	(42,343)
CASH FLOWS FROM FINANCING ACTIVITIES
Subscriptions received in advance	-	3,600	58,500	-
Increase (decrease) in due to related parties	-	-	10,948	(38,647)
Share issuance costs	(684,014)	(1,158,352)	(517,591)	(15,000)
Capital stock issued	22,237,845	18,901,938	11,473,387	1,326,850
Cash provided by financing activities	21,553,831	17,747,186	11,025,244	1,273,203
Change in cash and equivalents during the year	(6,843,913)	3,060,795	8,092,747	978,495
Cash and equivalents, beginning of year	12,143,821	9,083,026	990,279	11,784
Cash and equivalents, end of year	$5,299,908	$12,143,821	$9,083,026	$990,279

Supplemental disclosure with respect to cash flows (Note 8)

The accompanying notes are an integral part of these consolidated financial statements.

130

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

1.

NATURE OF OPERATIONS

Strathmore Minerals Corp. (the “Company”) is incorporated under the laws of the Province of British Columbia and is considered to be in the exploration stage.

The Company is in the process of exploring its mineral property interests and has not yet determined whether these properties contain ore reserves that are economically recoverable.  The recoverability of the amounts shown for mineral property interests and related deferred exploration costs is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete their development and upon future profitable production.

2.

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Minera Peruran S.A. (incorporated under the laws of Peru), and Strathmore Resources (US) Ltd. (incorporated under the laws of Nevada, USA).  Significant inter-company balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period.  Actual results could differ from these estimates.

Cash and equivalents

Cash is comprised of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Short term investments

Short term investments are recorded at the lower of cost or market value on an aggregate basis.

Property and equipment

Property and equipment is recorded at cost and amortization is calculated using the declining-balance method, unless otherwise noted, at the following annual rates:

Office equipment	20%
Geological equipment	20%
Leasehold improvements	5 year straight-line
Computer equipment	30%
Computer software	50%

131

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

2.

SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

Mineral property interests and deferred exploration costs

The Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests have significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  As at December 31, 2006, 2005, 2004, and 2003, management believes that no impairment relating to the mineral property interests and deferred exploration costs was required.

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the value of share considerations issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

Foreign currency translation

The Company’s subsidiaries are integrated foreign operations and are translated into the Canadian dollar equivalent using the temporal method.  The monetary assets and liabilities of the Company that are denominated in foreign currencies are translated at the rate of exchange at the balance sheet date and non-monetary items are translated at historical rates.  Revenues and expenses are translated at rates approximating those in effect at the time of the transaction.  Exchange gains and losses arising on translation are included in the statement of operations.

Flow-through common shares

Resource expenditure deductions for income tax purposes related to exploration activities funded by flow-through share arrangements are renounced to investors in accordance with Canadian income tax legislation. Effective March 19, 2004, the Company adopted EIC 146, “Flow-Through Shares” that dictates the accounting treatment on renunciation of the tax liability of the qualifying expenditures that give rise to taxable temporary differences. The change in accounting policy was applied prospectively.

When the Company renounces flow-through expenditures, a portion of the Company’s future income tax assets that were not recognized in previous years, due to the recording of a valuation allowance, will be recognized as a recovery of income taxes in the statement of operations.

132

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd...)

Asset retirement obligations

An asset retirement obligation is a legal obligation associated with the retirement of tangible long-lived assets that the Company is required to settle.  The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made.  The carrying amount of the related long-lived asset is increased by the same amount as the liability.  

Stock-based compensation

The Company uses the fair value method whereby the Company recognizes compensation costs over the vesting period for the granting of all stock options and direct awards of stock.  Any consideration paid by the option holders to purchase shares is credited to capital stock.

Income taxes

Income taxes are recorded using the asset and liability method whereby future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Future tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled.  The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.  To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess.

Loss per share

The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on earnings per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period.  For the years presented, this calculation proved to be anti-dilutive.

Basic loss per share is calculated using the weighted average number of shares outstanding during the year.

Comparative figures

Certain comparative figures have been reclassified to conform with the current year’s presentation.

133

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

3.

SHORT TERM INVESTMENTS

Short term investments are comprised of the following:

	2006	2005	2004	2003
Canadian bond funds	$ 20,325,270	$ 2,986,357	$ -	$ -
Canadian short term investment fund	7,087,309	6,014,707	-	-
	$ 27,412,579	$ 9,001,064	$ -	$ -

As at December 31, 2006, short term investments have an aggregate market value of $27,412,579 (2005 -$9,001,064; 2004 and 2003 - $Nil).  During fiscal 2006, the Company recorded an allowance for a decline in value of $20,574 (2005 - $4,817; 2004 and 2003 - $Nil) to reflect the market value of the investments.

4.

PROPERTY AND EQUIPMENT

		2006			2005
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$108,821	$38,371	$70,450	$91,121	$24,142	$66,979
Geological equipment	132,430	19,090	113,340	43,276	7,471	35,805
Leasehold improvements	65,114	17,413	47,701	55,817	5,936	49,881
Land	370,703	-	370,703	-	-	-
Computer equipment	105,239	55,092	50,147	88,758	35,783	52,975
Computer software	48,343	9,780	38,563	4,254	1,665	2,589
	$830,650	$139,746	$690,904	$283,226	$74,997	$208,229

		2004			2003
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$  48,254	$ 12,651	$ 35,603	$ 13,555	$   9,661	$  3,894
Computer equipment	52,003	19,166	32,837	15,833	13,858	1,975
Computer software	1,752	134	1,618	-	-	-
Leasehold improvements	-	-	-	-	-	-
	$102,009	$ 31,951	$ 70,058	$ 29,388	$ 23,519	$  5,869

134

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

5.

MINERAL PROPERTY INTERESTS

	2006	2005	2004	2003
Athabasca property, Canada	$ 459,702	$ 459,702	$            256,702	$          9,090
Chord property, USA	137,282	137,282	124,724	111,108
Comstock property, Canada	494,271	297,271	130,699	1,612
Dieter Lake property, Canada	618,792	421,792	15,792	-
Duddridge Lake property, Canada	382,245	191,245	191,245	-
Fort Mcleod property, Canada	299,071	34,070	-	-
New Mexico properties, USA	1,720,833	1,272,616	618,265	-
Staked properties, Canada	831,260	798,153	798,153	-
Staked properties, Peru	69,580	69,580	69,580	23,561
Wyoming properties, USA	2,689,410	1,615,698	327,516	-
Pre-acquisition property costs	-	282,369	156,052	1,612
	$ 7,702,446	$ 5,579,778	$        2,688,728	$         146,983

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

Athabasca property, Canada

Pursuant to an agreement dated January 8, 2004, t he Company acquired a 100% interest in a uranium property located in Alberta, Canada, by paying $98,192, incurring additional costs of $29,510 and issuing 200,000 common shares valued at $332,000. The property is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property.

Chord property, USA

On April 4, 2003, t he Company acquired a 100% interest in a uranium property located in South Dakota, USA, by paying $48,640.  During fiscal 2003, the Company amended the terms of the lease agreement for consideration of 100,000 shares of the Company valued at $56,000 and incurred additional fees of $6,468.  To earn its interest, the Company is required to make annual payments of either 50,000 common shares or US$10,000 per year to July 1, 2009. In fiscal 2006, the Company paid $14,381 (US$10,000) (2005 - $12,558 (US$10,000) 2004 - $13,616 (US$10,000)).  The property is subject to a 2% gross royalty.

Comstock property, Canada

On November 25, 2003, t he Company acquired a 100% interest in certain claims located in British Columbia, Canada by issuing 300,000 common shares valued at $491,000 and incurring additional fees of $3,271.

Dieter Lake property, Canada

On February 13, 2004, t he Company acquired a 100% interest in certain claims located in Quebec, Canada by issuing 300,000 common shares valued at $603,000 and incurring additional costs of $15,792. An additional 200,000 shares will be issued in the event a resource of more than 60 million pounds containing U₃O₈ (Uranium) is confirmed at the property.

135

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

5.

MINERAL PROPERTY INTERESTS (cont’d…)

Duddridge Lake property, Canada

On January 14, 2004, t he Company acquired a 100% interest in certain claims located in Saskatchewan, Canada by issuing 200,000 common shares valued at $344,000 and incurring additional fees of $38,245.

Fort Mcleod property, Canada

On February 27, 2006, the Company acquired an option to purchase a 100% interest in certain claims located in Alberta, Canada, by paying $34,071 for staking costs and issuing 100,000 shares valued at $265,000. To earn its interest, the Company is required to issue an additional 100,000 common shares by March, 2007.

New Mexico properties, USA

On March 15, 2004 and December 14, 2004, t he Company acquired options to purchase a 100% interest in certain claims located in New Mexico, USA . The Company has now earned its interest by paying $293,752, incurring additional costs of $318,581 and issuing 600,000 common shares valued at $1,108,500. Certain claims are subject to a 1% royalty.

Staked properties, Canada

The Company acquired, by staking, a 100% interest in the following uranium properties located in north-central Saskatchewan: Davy Lake, Hall Lake, Patterson Lake, and Waterbury Lake.

Staked properties, Peru

The Company acquired, by staking, a 100% interest in certain uranium properties located in Peru.

Wyoming properties, USA

On June 17, 2004, August 17, 2004, November 24, 2004, and February 3, 2005, t he Company acquired options to purchase a 100% interest in certain claims located in Wyoming, USA .  The Company has now earned its interest by paying $87,560, incurring additional costs of $403,100 and issuing 1,150,000 common shares valued at $2,198,750.

Pre-acquisition property costs

The pre-acquisition property costs represent expenditures related to mineral property interests prior to implementation of the acquisition.  These costs will be added to the mineral property interest costs to which they relate on completion of the acquisition or written-off to operations should the acquisition not proceed.

136

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

6.

DEFERRED EXPLORATION COSTS

	Canada	USA	Peru	Total
As at December 31, 2003 and 2002	$           -	$60,008	$-	$60,008
General expenditures	103,933	3,708	-	107,641
As at December 31, 2004	103,933	63,716	-	167,649
Airborne geophysics surveys	1,497,325	-	-	1,497,325
Camp costs	41,534	-	4,573	46,107
Claim fees	38,178	168,188	22,165	228,531
Geologists fees and supplies	418,162	370,852	129,554	918,568
General expenses	16,326	8,074	1,861	26,261
Helicopter rental and equipment fuel	586,482	-	-	586,482
Lab analysis and sampling	38,802	-	-	38,802
NI 43-101 reports	21,334	3,841	-	25,175
Report/map preparation	33,869	606	1,615	36,090
As at December 31, 2005	2,795,945	615,277	159,768	3,570,990
Airborne geophysics surveys	2,516,823	-	-	2,516,823
Camp costs	238,368	-	-	238,368
Claim fees	181,430	514,003	30,276	725,709
Geologists fees and supplies	1,743,786	1,582,897	131,355	3,458,038
General expenses	62,172	130,264	37,633	230,069
Travel	506,005	159,605	30,224	695,834
Helicopter rental and equipment fuel	424,851	494	-	425,345
Lab analysis and sampling	19,990	-	-	19,990
NI 43-101 reports	10,417	-	-	10,417
Report and map preparation	51,346	2,324	761	54,431
As at December 31, 2006	$8,551,133	$3,004,864	$390,017	$11,946,014

137

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Number of Shares	Capital Stock	Contributed Surplus
Authorized
Unlimited number of common shares, without par value
Issued
As at December 31, 2002	8,046,548	$11,612,230	$           -
Shares issued on mineral property acquisition returned to treasury	(100,000)	-	-
Private placements	5,222,229	734,278	415,722
Exercise of options	454,000	123,125	(55,025)
Exercise of warrants	435,000	108,750	-
Acquisition of mineral property interest	100,000	56,000	-
Stock-based compensation	-	-	221,994
Share issuance costs	-	(9,590)	(5,410)
As at December 31, 2003	14,157,777	12,624,793	577,281
Private placements	15,075,088	7,906,381	1,343,679
Exercise of options	250,000	79,698	(36,698)
Exercise of warrants	6,208,392	2,656,557	(476,230)
Agents’ warrants	-	-	97,904
Acquisition of mineral property interests	550,000	757,500	-
Stock-based compensation	-	-	962,297
Share issuance costs	-	(567,524)	(47,971)
As at December 31, 2004	36,241,257	23,457,405	2,420,262
Private placements	10,144,286	12,752,584	2,505,917
Exercise of options	887,000	466,080	(169,381)
Exercise of warrants	7,082,971	4,280,507	(875,269)
Acquisition of mineral property interests	1,400,000	2,377,750	-
Stock-based compensation	-	-	476,610
Share issuance costs	-	(1,657,834)	499,482
Tax benefits renounced to flow through share subscribers	-	(376,524)
As at December 31, 2005	55,755,514	41,299,968	4,857,621
Private placements	3,265,950	8,699,795	-
Exercise of options	2,370,000	2,815,678	(884,878)
Exercise of warrants	8,340,084	14,809,977	(3,199,127)
Acquisition of mineral property interests	900,000	2,207,000	-
Stock-based compensation	-	-	731,026
Share issuance costs	-	(771,365)	87,351
As at December 31, 2006	70,631,548	$69,061,053	$1,591,993

Included in issued capital stock are 75,000 common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

138

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Private placements

In November, 2003, the Company issued 2,222,229 units at $0.18 per unit consisting of one common share and one share purchase warrant for total proceeds of $400,000.  Each warrant entitles the holder to acquire one additional common share at $0.25 expiring November 24, 2005.  An estimated fair value of $140,918 was allocated to the warrants and included in contributed surplus.  The Company incurred finder’s fees of $7,000 on the private placement.

In December, 2003, the Company issued 3,000,000 units at a price of $0.25 per unit comprised of 400,000 flow-through units and 2,600,000 non-flow-through units for total proceeds of $750,000.  Each unit consisted of one flow-through or non-flow-through common share and one share purchase warrant.  Each share purchase warrant is exercisable into an additional common share at $0.35 expiring December 17, 2005.  An estimated fair value of $274,804 was allocated to the warrants and included in contributed surplus.  The Company incurred finder’s fees of $8,000 on the private placement.

In January, 2004, the Company issued 4,767,444 units at $0.27 per unit consisting of one common share and one share purchase warrant for total proceeds of $1,287,210.  Each warrant entitles the holder to acquire one additional common share at $0.36 expiring January 20, 2006.  An estimated fair value of $417,712 was allocated to the warrants and included in contributed surplus.  The Company incurred finder’s fees of $23,490 on the private placement.

In February, 2004, the Company issued 1,501,334 units at $0.60 per unit consisting of one common share and one share purchase warrant for total proceeds of $900,800.  Each warrant entitles the holder to acquire one additional common share at $0.76 expiring February 23, 2006.  An estimated fair value of $299,582 was allocated to the warrants and included in contributed surplus.

In April, 2004, the Company issued 3,436,167 units at $0.60 per unit consisting of one common share and one share purchase warrant for total proceeds of $2,061,700.  Each warrant entitles the holder to acquire one additional common share at $0.76 expiring April 16, 2006.  An estimated fair value of $626,385 was allocated to the warrants and included in contributed surplus. The Company incurred finder’s fees of $132,803 on the private placement.

In September, 2004, the Company issued 2,857,143 common shares at $0.70 per share for total proceeds of $2,000,000. The Company paid $150,000 and issued 142,857 share purchase warrants valued at $42,357 as finder’s fees. Each warrant entitles the holder to acquire one additional common share at $0.74 expiring September 27, 2005.

In November, 2004, the Company issued 2,000,000 common shares at $1.00 per share for total proceeds of $2,000,000. The Company paid $120,000 and issued 120,000 share purchase warrants valued at $55,547 as finder’s fees. Each warrant entitles the holder to acquire one additional common share at $1.08 expiring October 29, 2006.

In December, 2004, the Company issued 513,000 flow-through common shares at a price of $1.95 per share for total proceeds of $1,000,350. The Company incurred finder’s fees of $55,019 on the private placement.

In January, 2005, the Company issued 30,000 flow-through common shares at a price of $1.95 per share for proceeds of $58,500 which were received in fiscal 2004.

139

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Private placements (continued)

In February, 2005, the Company issued 10,000,000 units at $1.50 per unit for gross proceeds of $15,000,000. Each unit consists of one common share and one half of one share purchase warrant. One whole warrant is exercisable at $1.75 until February 21, 2006 and thereafter at $2.00 expiring February 21, 2007. An estimated fair value of $2,480,945 was allocated to the warrants and is included in contributed surplus. In connection with the placement the Company issued agents’ warrants to purchase 1,027,180 common shares at a price of $1.75 per share in the first year and $2.00 per share in the second year and paid commissions of $1,027,180, of which $169,892 was allocated to the commissions on the warrants and is included in contributed surplus.  The fair value of the agents warrants, being $802,026, was determined using the Black-Scholes option pricing model with a volatility of 62%, risk-free interest rate of 2.92%, expected life of 2 years, and a dividend rate of 0%.

In October 2005, the Company issued 114,286 units at $1.75 per unit for gross proceeds of $200,001.  Each unit consists of one common share and one half of one share purchase warrant exercisable at $2.00 per share until October 26, 2007.  An estimated fair value of $24,972 was allocated to the warrants and is included in contributed surplus.

In May, 2006, the Company issued 1,697,300 flow-through shares at $3.00 per share and 1,568,650 units at $2.30 per unit for total proceeds of $8,699,795. Each unit consists of one common share and one half of one share purchase warrant. One whole warrant is exercisable at $3.25 and expires November 9, 2007. In connection with the placement, the Company paid commissions of $521,988 in cash and issued 195,957 agents’ warrants. Each warrant entitles the Agent to purchase one common share at $2.55 per share and expires May 9, 2007. The fair value of the agents’ warrants, being $87,351, was determined using the Black-Scholes option pricing model with a volatility of 53%, risk-free interest rate of 4.26%, expected life of 1 year, and a dividend rate of 0%.

140

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Stock options and warrants

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of five years with vesting provisions determined by the Board of Directors.

Stock option and share purchase warrant transactions are summarized as follows:

	Warrants		Stock Options
	Number	Weighted Average Exercise Price	Number	Weighted Average Exercise Price
Outstanding, December 31, 2002	1,535,000	$ 0.25	550,000	$  0.25
Granted	5,222,229	0.31	1,304,000	0.19
Exercised	(435,000)	0.25	(454,000)	0.15
Expired/cancelled	-	-	(550,000)	0.25
Outstanding, December 31, 2003	6,322,229	0.30	850,000	0.21
Granted	9,967,801	0.56	2,675,000	0.78
Exercised	(6,208,392)	0.35	(250,000)	0.17
Expired/cancelled	-	-	-	-
Outstanding, December 31, 2004	10,081,638	0.54	3,275,000	0.68
Granted	6,084,323	1.75	1,600,000	1.69
Exercised	(7,082,971)	0.48	(887,000)	0.33
Expired/cancelled	-	-	(100,000)	1.44
Outstanding, December 31, 2005	9,082,990	1.39	3,888,000	1.16
Granted	980,282	3.11	2,840,000	1.89
Exercised	(8,340,084)	1.39	(2,370,000)	0.81
Expired/cancelled	(2,500)	0.76	(163,000)	1.91
Outstanding, December 31, 2006	1,720,688	$ 2.53	4,195,000	$ 1.82
Number currently exercisable	1,720,688	$ 2.53	1,063,000	$ 1.89

141

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

Stock options and warrants (continued)

As at December 31, 2006, stock options and share purchase warrants were outstanding as follows:

	Number of Shares	Exercise Price	Expiry Date
Options	190,000	$  1.75	January 14, 2007
	20,000	2.25	February 8, 2007
	300,000	2.20	April 29, 2007
	125,000	2.50	April 13, 2009
	945,000	1.50	October 6, 2010
	50,000	1.75	June 14, 2011
	1,765,000	1.70	August 31, 2011
	700,000	2.10	October 27, 2011
	100,000	3.00	December 15, 2010
Total	4,195,000
Warrants	683,263	2.00	February 21, 2007
	195,957	2.55	May 9, 2007
	57,143	2.00	October 26, 2007
	784,325	3.25	November 9, 2007
Total	1,720,688

Stock-based compensation

During fiscal 2006, the Company granted 2,840,000 (2005 – 1,600,000: 2004 – 2,675,000: 2003 – 1,304,000) options to employees, consultants and directors.  Accordingly, using the Black-Scholes option pricing model, the stock options are recorded at fair value in the statement of operations.  Total stock-based compensation recognized in the statement of operations during fiscal 2006 was $731,026 (2005 - $476,610; 2004 - $962,297; 2003 – $221,994) as a result of options granted and vested.  This amount was also recorded as contributed surplus on the balance sheet.  The weighted average fair value of options granted was $1.09 (2005 - $0.62; 2004 - $0.36; 2003 - $0.17) per option.  

The following assumptions were used for the valuation of stock options:

	2006	2005	2004	2003
Risk-free interest rate	4.02%	3.00%	2.76%	3.02%
Expected life	3.6 years	2.3 years	1.4 years	2 years
Annualized volatility	79%	60%	96%	133%
Dividend rate	0.00%	0.00%	0.00%	0.00%

142

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

8.

SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

	2006	2005	2004	2003
Cash paid during the year for interest	$             -	$           -	$             -	$              -
Cash paid during the year for income taxes	$             -	$           -	$             -	$              -
Cash and equivalents:
Cash balances	$5,189,185	$12,032,505	$9,083,026	$  990,279
Term deposits	110,723	111,316	-	-
	$5,299,908	$12,143,821	$9,083,026	$  990,279

Significant non-cash transactions during the year ended December 31, 2006 included:

a)

Issuing 900,000 (2005 – 1,400,000) common shares valued at $2,207,000 (2005 – $2,377,750) pursuant to the acquisition of mineral property interests and issuing 195,957 (2005 – 1,027,180) agents’ warrants valued at $87,351 (2005 – $802,026) as finders’ fees on private placements.

b)

Accruing deferred exploration costs in accounts payable and accrued liabilities of $616,427 (2005 – $119,818) at December 31, 2006.

c)

Issuing 10,000 (2005 – 30,000) common shares for proceeds of $3,600 (2005 – $58,500) received in the prior year.

During the year ended December 31, 2004, the Company issued 550,000 common shares valued at $757,500 pursuant to the acquisition of mineral property interests and issued 262,857 warrants valued at $97,904 as finders’ fees on private placements.

During the year ended December 31, 2003, the Company issued 100,000 common shares valued at $56,000 pursuant to the acquisition of mineral property interests.

9.

RELATED PARTY TRANSACTIONS

The Company entered into transactions with related parties as follows:

a)

Paid or accrued $290,615 (2005 - $225,598; 2004 - $102,087; 2003 - $77,689) for consulting fees to a director and a company controlled by a director.

b)

Paid or accrued $290,415 (2005 - $225,684; 2004 - $46,250; 2003 - $1,661) for consulting fees to officers of the Company.

c)

Pursuant to private placements, issued NIL (2005 – NIL; 2004 – 200,000; 2003 – 1,213,779) common shares to directors and a company controlled by a director for total proceeds of $NIL (2005 – NIL; 2004 - $54,000; 2003 – $259,000).

d)

Paid or accrued $116,000 (2005 - $NIL; 2004 - $Nil; 2003 - $813) for director’s fees, included in wages, to directors.

.

143

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

9.

RELATED PARTY TRANSACTIONS (cont’d…)

These transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Amounts due to related parties are due to directors and companies controlled by directors and are unsecured, non-interest bearing and have no specific repayment terms.

10.

INCOME TAXES

A reconciliation of current income taxes at statutory rates with the reported income taxes is as follows:

	2006	2005	2004	2003
Loss before income taxes	$(2,310,688)	$(1,999,026)	$(1,994,210)	$ (432,855)
Expected income tax recovery	$834,621	$697,061	$709,939	$   162,754
Other items  not deductible for income tax purposes	(343,052)	(229,573)	(238,476)	(3,622)
Stock-based compensation not deductible for income tax purposes	(264,047)	(166,194)	(342,578)	(83,470)
Recognized (unrecognized) benefits of non-capital losses	(227,522)	75,230	(128,885)	(75,662)
Future income tax recovery	$      -	$    376,524	$                -	$               -

The significant components of the Company’s future income tax assets are as follows:

	2006	2005	2004	2003
Future income tax assets:
Equipment	$ 61,021	$ 45,074	$   31,704	$ 28,702
Mineral property interests and related exploration expenditures	1,102,853	888,852	735,372	834,152
Other assets	360,987	434,843	21,360	21,360
Non-capital losses available for future periods	859,747	1,001,692	1,181,641	1,396,764
	2,384,608	2,370,461	1,970,077	2,280,978
Valuation allowance	(2,384,608)	(2,370,461)	(1,970,077)	(2,280,978)
Net future income tax asset	$ -	$ -	$              -	$          -

The Company has available approximately $2,773,000 of non-capital losses which, if unutilized, will expire through 2026.  Subject to certain restrictions, the Company also has capital losses of $367,000 and resource exploration expenditures of approximately $23,332,338 available to reduce taxable income of future years.   Future tax benefits which may arise as a result of these losses and resource deductions have not been recognized in these financial statements, and have been offset by a valuation allowance.

During fiscal 2005, the Company renounced certain deductions for Canadian exploration expenditures incurred on the Company’s resource properties resulting in a future income tax recovery of $376,524 and a charge against capital stock.

144

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

11.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests and considers its loss from operations for fiscal years 2006, 2005, 2004 and 2003 to relate to this segment.

The Company has mineral property interests located in the USA, Canada and Peru and conducts administrative activities from Canada.  The total amount of capital assets attributable to Canada is $11,979,000 (2005 - $5,172,337; 2004 - $1,566,582; 2003 - $16,571), Peru is $459,597 (2005 - $229,348; 2004 - $69,580; 2003 - $23,561) and the USA is $7,900,767 (2005 - $3,957,312; 2004 - $1,290,273; 2003 - $172,728).

12.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash and equivalents, short term investments, receivables, accounts payable and accrued liabilities and amounts due to related parties. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.  The fair value of these financial instruments approximates their carrying value, unless otherwise noted. The Company is subject to financial risk arising from fluctuations in foreign currency exchange rates. The Company does not use any derivative instruments to reduce its exposure to fluctuations in foreign currency exchange rates.

13.

SUBSEQUENT EVENTS

Subsequent to December 31, 2006, the Company:

a)

Issued 1,434,075 common shares for proceeds of $3,609,318 pursuant to the exercise of stock options and warrants.

b)

Issued 100,000 common shares pursuant to the acquisition of mineral property interests.

c)

Entered into a letter of intent (“LOI”) with Yellowcake Minerals Inc.  (“Yellowcake”) to option an 80% interest in the Company’s Red Creek property included in the Wyoming properties.  Pursuant to the LOI, the Company will receive 9,000,000 common shares of Yellowcake, US$500,000 in cash over five years, and Yellowcake will incur a total of US$8,000,000 in exploration expenditures over five years on the property.  Upon spending US$4,000,000 in exploration expenditures, Yellowcake will have earned a 40% interest.  The Company will maintain a 3% NSR on the optioned portion on all future production.  Further, the Company agreed to option a 50% interest in their Texas database to Yellowcake for consideration of US$25,000, Yellowcake incurring US$440,000 evaluating the database, and if a suitable target is identified, Yellowcake will incur the first US$500,000 in costs to acquire any&n bsp;mining leases.

d)

On February 14, 2007, granted an exclusive right to an undisclosed corporation to negotiate a joint venture agreement to develop its Roca Honda project included in the New Mexico properties, and construct a uranium mill in the Grants Mineral Belt of New Mexico. Pursuant to the Exclusivity Agreement, the undisclosed party paid US$100,000 and has 90 days to negotiate a joint venture agreement with the Company.

145

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”).  Material variations in the accounting principles, practices and methods used in preparing these consolidated financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) are described and quantified below.

Stock-based compensation

Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) recommended, but did not require, companies to establish a fair market value based method of accounting for stock-based compensation plans.  For the years ended December 31, 2005, 2004 and 2003 the Company has elected to follow the recommendations of SFAS 123 and has chosen to account for stock-based compensation using the fair value based method.

Effective January 1, 2006, the Company adopted SFAS No. 123(revised), “Share-Based Payment: (“SFAS 123(R)”) utilizing the modified prospective approach. The impact of adoption of the standard did not materially affect the Company’s financial position, results of operations, or cash flows because the Company previously adopted the fair value based method of accounting for stock options prescribed by SFAS 123, ”Accounting for Stock-Based Compensation”.

New accounting and disclosure standards were introduced under Canadian GAAP (Note 2) for the fiscal year ending December 31, 2002.  During the year ended December 31, 2003, under Canadian GAAP, the Company adopted, on a prospective basis, the fair value based method of accounting for all stock-based compensation.  Accordingly, there is no difference between Canadian GAAP and United States GAAP in the accounting for stock-based compensation for the years ended December 31, 2006, 2005, 2004 and, 2003.

Mineral property interests and deferred exploration costs

Mineral property costs and related exploration expenditures are accounted for in accordance with Canadian GAAP as disclosed in Note 2.  

For United States GAAP purposes, effective until fiscal 2003, the Company expensed, as incurred, the acquisition and exploration costs relating to unproven mineral property interests. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $98,343 for fiscal 2003. When proven and probable reserves are determined for a property and a feasibility study prepared, then subsequent development costs of the property are capitalized.  The capitalized costs of such properties are to be amortized using the unit of production method over the estimated life of the ore body based on proven and probable reserves and would be measured periodically for recoverability of carrying values.

Effective for fiscal 2004, the Company has adopted the provisions of EITF 04-02 “Whether Mineral Rights are Tangible or Intangible Assets” which concluded that mineral rights are tangible assets.  Accordingly, the Company capitalizes certain costs related to the acquisition of mineral property interests.  Under United States GAAP, exploration costs on mineral properties prior to the establishment of proven or probable reserves continue to be expensed as incurred. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $8,290,692 for fiscal 2006, $3,794,539 for fiscal 2005 and $1,627,429 for fiscal 2004.

146

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

Mineral property interests and deferred exploration costs (cont’d…)

In accordance with US GAAP, capitalized mineral property interests are summarized as follows:

Property name	December 31, 2003	December 31, 2004	December 31, 2005	December 31, 2006
Athabasca	$             -	$129,000	$332,000	$332,000
Chord	-	13,616	26,174	26,174
Comstock	-	129,000	294,000	491,000
Dieter Lake	-	-	406,000	603,000
Duddridge Lake	-	153,000	153,000	344,000
Fort McLeod	-	-	-	265,000
New Mexico	-	394,125	956,825	1,381,325
Wyoming	-	203,216	1,353,810	2,286,310
Capitalized mineral property interests	$              -	$1,021,957	$3,521,809	$5,728,809

Flow-through shares

Under Canadian income tax legislation, the Company is permitted to issue shares whereby the Company agrees to incur qualifying expenditures (as defined under the Income Tax Act of Canada) and renounce the related income tax deductions to the investors.  Under Canadian GAAP, flow-through shares are accounted for as described in Note 2.  Under United States GAAP, any difference between the fair value of the non flow-through shares and the fair value of the flow-through shares must be recorded as a liability if a premium is paid by investors for the flow-through shares.  To the extent there are unrecognized future income tax assets, the liability is charged to income as the flow-through share proceeds are expended on qualifying expenditures and the related income tax deductions are renounced to investors.

During fiscal 2006, the Company issued 1,697,300 flow-through shares for total proceeds of $5,091,900. The Company has recorded a liability of $1,137,191 under US GAAP for the premium received on the flow-through shares. The liability will be charged to income as the flow-through share proceeds are expensed on qualifying expenditures and the related income tax deductions are renounced to investors.

During fiscal 2005, the Company issued 30,000 flow-through shares for total proceeds of $58,500.  As the value of the compensation received for the flow-through shares issued during fiscal 2005 exceeded the fair value of the non-flow through shares on the date issued, the Company recorded a difference in capital stock and related income tax expenses of $11,699 on renunciation during fiscal 2005.   

During fiscal 2004, the Company issued 513,000 flow-through shares for total proceeds of $1,000,350.  As the value of the compensation received for the flow-through shares issued during fiscal 2004 exceeded the fair value of the non-flow through shares on the date issued, the Company recorded a difference in capital stock and related income tax liability of $271,890 during fiscal 2004. On renunciation in fiscal 2005, the Company recorded a difference in capital stock and related income tax expenses of $84,235.  

During fiscal 2003, the Company issued 400,000 flow-through shares for total proceeds of $100,000.  As the value of the compensation received for the flow-through shares issued during fiscal 2003 was equal to the fair value of non-flow through shares on the date issued, there is no difference for U.S. GAAP purposes.  

147

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

Short Term investments

Under Canadian GAAP, short term investments are carried at the lower of aggregate cost or current market value.

Under United States GAAP, SFAS 115 requires that certain debt and equity investments must be classified into available-for-sale or trading securities and stated at fair market values.  Any unrealized holding gains or losses are reported as a separate component of shareholders’ equity until realized for available-for-sale securities, and included in earnings for trading securities.  For United States GAAP purposes, the Company's investment in debt securities has been classified as trading securities.  Under SFAS 115, for the year ended December 31, 2006 and 2005, there was no difference under Canadian GAAP or United States GAAP as these debt securities have been stated at their fair market value, with an unrealized loss of $20,574 (2005 - $4,817) included in the consolidated statement of operations.

Loss per share

Under both Canadian GAAP and United States GAAP, basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

Under United States GAAP, the weighted average number of common shares outstanding excludes any shares that remain in escrow, but may be earned out based on the Company incurring a certain amount of exploration and development expenditures.  The weighted average number of shares outstanding under United States GAAP for the years ended December 31, 2006, 2005, 2004 and 2003 were 66,239,107, 53,475,088, 26,065,368 and 8,271,374, respectively.  

New accounting pronouncements

In February 2007, the Financial Accounting Standards Board (FASB) issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115”.  This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of SFAS No. 159 apply only to entities that elect the fair value option. However, the amendment to SFAS No. 115 “Accounting for Certain Investments in Debt and Equity Securities” applies to all entities with available-for-sale and trading securities. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provision of SFAS No. 157, “Fair V alue Measurements”. The adoption of this statement is not expected to have a material effect on the Company's financial statements.

In September 2006, the SEC issued Staff Accounting Bulletin (“SAB”) No. 108, “Considering the Effects of Prior Year Misstatements when Quantifying Misstatements in Current Year Financial Statements.” SAB No. 108 addresses how the effects of prior year uncorrected misstatements should be considered when quantifying misstatements in current year financial statements. SAB No. 108 requires companies to quantify misstatements using a balance sheet and income statement approach and to evaluate whether either approach results in quantifying an error that is material in light of relevant quantitative and qualitative factors. SAB No. 108 is effective for periods ending after November 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's financial statements.

148

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

New accounting pronouncements (cont’d…)

In September 2006, the FASB issued SFAS No. 158, “Employers’ Accounting for Defined Benefit Pension and Other Postretirement Plans – an amendment of FASB Statements No. 87, 88, 106, and 132(R)”. This statement requires employers to recognize the overfunded or underfunded status of a defined benefit postretirement plan (other than a multiemployer plan) as an asset or liability in its statement of financial position and to recognize changes in that funded status in the year in which the changes occur through comprehensive income of a business entity or changes in unrestricted net assets of a not-for-profit organization.  This statement also requires an employer to measure the funded status of a plan as of the date of its year-end statement of financial position, with limited exceptions. The provisions of SFAS No. 158 are effective for employers with publicly traded equity securities as of the end of the fiscal year ending after December 15, 2006. The adoption of this statement did not have a material effect on the Company's reported financial position or results of operations.

In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. The objective of SFAS No. 157 is to increase consistency and comparability in fair value measurements and to expand disclosures about fair value measurements.  SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS No. 157 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair value measurements. The provisions of SFAS No. 157 are effective for fair value measurements made in fiscal years beginning after November 15, 2007. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

In June 2006, the FASB issued FASB Interpretation No. 48, “Accounting for Uncertainty in Income Taxes, an interpretation of FASB Statements No. 109”. FIN 48 clarifies the accounting for uncertainty in income taxes by prescribing a two-step method of first evaluating whether a tax position has met a more likely than not recognition threshold and second, measuring that tax position to determine the amount of benefit to be recognized in the financial statements. FIN 48 provides guidance on the presentation of such positions within a classified statement of financial position as well as on derecognition, interest and penalties, accounting in interim periods, disclosure, and transition. FIN 48 is effective for fiscal years beginning after December 15, 2006. The adoption of this statement is not expected to have a material effect on the Company's future reported financial position or results of operations.

149

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

New accounting pronouncements (cont’d…)

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated balance sheets would be as follows:

	December 31, 2006
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$ 33,150,990	$                    -	$ 33,150,990
Equipment	690,904	-	690,904
Mineral property   interests	7,702,446	(1,973,637)	5,728,809
Deferred exploration   costs	11,946,014	(11,946,014)	-
	$ 53,490,354	$ (13,919,651)	$ 39,570,703
Total liabilities	$      724,055	$      1,137,191	$   1,861,246
Capital stock	69,061,053	(1,041,257)	68,019,796
Contributed surplus (Additional paid-in capital)	1,591,993	673,800	2,265,793
Deficit	(17,886,747)	(14,689,385)	(32,576,132)
Shareholders' equity	52,766,299	(15,056,842)	37,709,457
	$ 53,490,354	$ (13,919,651)	$ 39,570,703

150

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

	December 31, 2005
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$21,411,780	$                 -	$21,411,780
Property and equipment	208,229	-	208,229
Mineral property interests	5,579,778	(2,057,969)	3,521,809
Deferred exploration costs	3,570,990	(3,570,990)	-
	$30,770,777	$ (5,628,959)	$25,141,818
Total liabilities	$185,647	$                -	$185,647
Capital stock	41,299,968	95,934	41,395,902
Subscriptions received	3,600	-	3,600
Contributed surplus (Additional paid-in capital)	4,857,621	673,800	5,531,421
Deficit	(15,576,059)	(6,398,693)	(21,974,752)
Shareholders’ equity	30,585,130	(5,628,959)	24,956,171
	$30,770,777	$(5,628,959)	$25,141,818

	December 31, 2004
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$9,130,908	$             -	$9,130,908
Property and equipment	70,058	-	70,058
Mineral property interests	2,688,728	(1,666,771)	1,021,957
Deferred exploration costs	167,649	(167,649)	-
	$12,057,343	$(1,834,420)	$10,222,923
Total liabilities	$74,733	$271,890	$335,675
Capital stock	23,457,405	(271,890)	23,185,515
Subscriptions received	58,500	-	58,500
Contributed surplus (Additional paid-in capital)	2,420,262	673,800	3,094,062
Deficit	(13,953,557)	(2,508,220)	(16,461,777)
Shareholders’ equity	11,982,610	(2,106,310)	10,148,190
	$12,059,343	$(1,834,420)	$10,222,923

151

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

	December 31, 2003
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$1,077,883	$             -	$1,077,883
Property and equipment	5,869	-	5,869
Mineral property interests	146,983	(146,983)	-
Deferred exploration costs	60,008	(60,008)	-
	$1,290,743	$(206,991)	$1,083,752
Total liabilities	$48,016	$             -	$48,016
Capital stock	12,624,793	-	12,624,793
Subscriptions received	-	-	-
Contributed surplus (Additional paid-in capital)	577,281	673,800	1,251,081
Deficit	(11,959,347)	(880,791)	(12,840,138)
Shareholders’ equity	1,242,727	(206,991)	1,035,736
	$1,290,743	$(206,991)	$1,083,752

152

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated statements of operations would be as follows:

	2006	2005	2004	2003
Loss for the year, Canadian GAAP	$(2,310,688)	$(1,622,502)	$(1,994,210)	$  (432,855)
Adjustments:
Mineral property interests	84,332	(391,198)	(1,519,788)	(98,343)
Deferred exploration costs	(8,375,024)	(3,403,341)	(107,641)	-
Renunciation of flow-through shares	-	(95,934)	-	-
Loss for the year, United States GAAP	$(10,601,380)	$(5,512,975)	$(3,621,639)	$(531,198)
Basic and diluted loss per share, United States GAAP	$           (0.16)	$         (0.10)	$       (0.14)	$      (0.06)
Weighted average number of common shares outstanding, United States GAAP	66,239,107	53,475,088	26,065,368	8,271,374

The impact of the differences between Canadian GAAP and United States GAAP on the statements of cash flows would be as follows:

	2006	2005	2004	2003
Cash flows used in operating activities,      Canadian GAAP	$(19,929,948)	$(10,708,351)	$(967,990)	$(252,365)
Mineral property interests	(41,957)	(391,198)	(1,519,788)	(42,343)
Deferred exploration costs	(7,878,415)	(3,283,523)	(107,641)	-
Cash flows used in operating activities, United States GAAP	(27,850,320)	(14,383,072)	(2,595,419)	(294,708)
Cash flows used in investing activities, Canadian GAAP	(8,467,796)	(3,978,040)	(1,964,507)	(42,343)
Mineral property interests	41,957	391,198	1,519,788	42,343
Deferred exploration costs	7,878,415	3,283,523	107,641	-
Cash flows used in investing activities, United States GAAP	(547,424)	(303,319)	(337,078)	-
Cash flows provided by financing activities, Canadian GAAP and United States GAAP	21,553,831	17,747,186	11,025,244	1,273,203
Change in cash and equivalents and during the year	(6,843,913)	3,060,795	8,092,747	978,495
Cash and equivalents, beginning of year	12,143,821	9,083,026	990,279	11,784
Cash and equivalents, end of year	$5,299,908	$12,143,821	$ 9,083,026	$  990,279

153

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

154

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(Expressed in Canadian Dollars)

AS AT DECEMBER 31

	2002	2001
ASSETS
Current
Cash	$ 11,784	$ 4,388
Receivables	4,913	1,742
Prepaid expenses	2,930	531
Total current assets	19,627	6,661
Property and equipment (Note 3)	7,690	26,677
Mineral property interests (Note 4)	48,640	215,755
Deferred exploration costs (Note 5)	60,008	760,312
Other assets (Note 6)	-	8,344
Total assets	$ 135,965	$ 1,017,749
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$ 11,580	$ 7,614
Due to related parties (Note 9)	38,647	85,697
Total liabilities	50,227	93,311
Shareholders' equity
Capital stock (Note 7)
Authorized
Unlimited common shares without par value
Issued and outstanding
8,046,548 common shares (2001 – 5,801,548)	11,612,230	11,182,030
Subscription received in advance	-	110,000
Deficit	(11,526,492)	(10,367,592)
Total shareholders’ equity	85,738	924,438
Total liabilities and shareholders’ equity	$ 135,965	$ 1,017,749

Nature and continuance of operations (Note 1)

On behalf of the Board:
“Devinder Randhawa”	Director	“Robert Hemmerling”	Director

The accompanying notes are an integral part of these consolidated financial statements.

155

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	2002	2001
GENERAL AND ADMINISTRATIVE EXPENSES
Amortization	$ 27,331	$ 38,480
Consulting fees (Note 9)	54,551	46,311
Management fees (Note 9)	14,979	74,937
Office and miscellaneous	26,624	18,411
Professional fees (Note 9)	32,468	37,797
Regulatory fees	4,253	7,771
Rent (Note 9)	10,875	23,297
Shareholder communications (Note 9)	24,715	24,427
Telephone	7,160	5,744
Trade shows and conferences	17,431	-
Transfer agent	3,929	6,379
Travel and promotion	15,146	7,196
Loss before other items	(239,462)	(290,750)
OTHER ITEMS
Write-off of mineral property interests (Note 4)	(215,315)	-
Write-off of deferred exploration costs (Note 5)	(704,123)	-
Total of other items	(919,438)	-
Loss for the year	(1,158,900)	(290,750)
Deficit, beginning of year	(10,367,592)	(10,076,842)
Deficit, end of year	$ (11,526,492)	$ (10,367,592)
Basic and diluted loss per share	$ (0.17)	$ (0.05)
Weighted average number of shares outstanding	6,961,127	5,629,559

The accompanying notes are an integral part of these consolidated financial statements.

156

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	2002	2001
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$ (1,158,900)	$ (290,750)
Items not affecting cash:
Amortization	27,331	38,480
Write-off of mineral property interests	215,315	-
Write-off of deferred exploration costs	704,123	-
Changes in non-cash working capital items:
Increase in receivables	(3,171)	(332)
Increase in prepaid expenses	(2,399)	(240)
Increase (decrease) in accounts payable and accrued liabilities	3,966	(1,960)
Net cash used in operating activities	(213,735)	(254,802)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment	-	(241)
Mineral property costs	(35,000)	(38,605)
Deferred exploration costs	(3,819)	(63,855)
Net cash used in investing activities	(38,819)	(102,701)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in due to related parties	(47,050)	43,084
Capital stock issued, net of share issuance costs	307,000	89,600
Subscriptions received in advance	-	110,000
Net cash provided by financing activities	259,950	242,684
Change in cash during the year	7,396	(114,819)
Cash, beginning of year	4,388	119,207
Cash, end of year	$ 11,784	$ 4,388

Supplemental disclosure with respect to cash flows (Note 8)

The accompanying notes are an integral part of these consolidated financial statements.

157

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

1.

NATURE AND CONTINUANCE OF OPERATIONS

Strathmore Minerals Corp. (the “Company”) is an exploration stage company incorporated under the laws of the Province of British Columbia.

The Company is in the process of exploring its mineral property interests and has not yet determined whether these properties contain ore reserves that are economically recoverable.  The recoverability of the amounts shown for mineral property interests and related deferred exploration costs is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete their development and upon future profitable production.

2.

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Minera Peruran S.A. (incorporated under the laws of Peru), and Strathmore Resources (US) Ltd. (incorporated under the laws of Nevada, USA).  Significant inter-company balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period.  Actual results could differ from these estimates.

Cash and equivalents

Cash is comprised of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Foreign currency translation

The Company’s subsidiaries are integrated foreign operations and are translated into Canadian dollar equivalents  using the temporal method.  The monetary assets and liabilities of the Company that are denominated in foreign currencies are translated at the rate of exchange at the balance sheet date and non-monetary items are translated at historical rates.  Revenues and expenses are translated at rates approximating those in effect at the time of the transaction.  Exchange gains and losses arising on translation are included in the statement of operations.

158

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd...)

Property and equipment

Property and equipment is recorded at cost and amortization is calculated using the declining-balance method at the following annual rates:

Office equipment	20%
Computer equipment	30%
Vehicles	30%

Other assets

Other assets, being geological databases, are recorded at cost and are being amortized over five years using the straight-line method.

Mineral property interests and deferred exploration costs

The Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests has significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  As at December 31, 2002 and 2001, management believes that, other than amounts disclosed, no impairment relating to the mineral property interests and deferred exploration costs was required.

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the assigned value of share consideration issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

Asset retirement obligations

An asset retirement obligation is a legal obligation associated with the retirement of tangible long-lived assets that the Company is required to settle.  The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made.  The carrying amount of the related long-lived asset is increased by the same amount as the liability.  

159

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd...)

Flow-through common shares

The resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with Canadian income tax legislation.  Future income taxes related to temporary differences arising on renunciation of expenditures to subscribers are offset against future income tax assets and the difference, if any, is charged to capital stock.

Stock-based compensation

Effective January 1, 2002, the Company adopted the new CICA Handbook Section 3870, "Stock-Based Compensation and Other Stock-Based Payments", which recommends that stock options granted to employees and non-employees be accounted for at fair value.  This section also permits, and the Company adopted, the use of the intrinsic value-based method for valuing stock options granted to employees.  Under this method, compensation cost for options granted to employees is recognized only when the market price exceeds the exercise price at date of grant.  However, pro-forma disclosure of loss per share as if the fair value method had been adopted is required.

Income taxes

Income taxes are recorded using the asset and liability method whereby future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Future tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled.  The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.  To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess.

Loss per share

The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on earnings per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period.  For the years presented, this calculation proved to be anti-dilutive.

Basic loss per share is calculated using the weighted average number of shares outstanding during the year.

160

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

3.

PROPERTY AND EQUIPMENT

		2002			2001
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$ 13,555	$ 8,688	$ 4,867	$ 13,555	$ 7,471	$ 6,084
Computer equipment	15,833	13,010	2,823	15,833	11,800	4,033
Vehicles	56,800	56,800	-	56,800	40,240	16,560
	$ 86,188	$ 78,498	$ 7,690	$ 86,188	$ 59,511	$ 26,677

4.

MINERAL PROPERTY INTERESTS

	2002	2001
Aurora property, USA	$            -	$ 121,220
Chord property, USA	48,640	48,640
Staked properties, Peru	-	45,895
	$  48,640	$ 215,755

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

Aurora property, USA

The Company acquired an option to purchase a 100% interest in a uranium property located in Oregon, USA, by paying $117,120 and issuing 10,000 commons shares valued at $4,100.  To earn its interest, the Company is required to pay an additional US$30,000 and issue an additional 10,000 common shares by October 16, 2003.  The property is subject to a 2% yellowcake royalty.  During fiscal 2002, the property was abandoned and all related costs were written-off.

Chord property, USA

The Company acquired an option to purchase a 100% interest in a uranium property located in South Dakota, USA, by paying $48,640.  To earn its interest, the Company is required to pay an additional US$80,000 (US$10,000 per year until July 1, 2009).  Subsequent to the year ended December 31, 2002, the Company amended the option agreement to allow the Company to issue 50,000 common shares per year or pay cash of US$10,000 per year to earn the interest.  The property is subject to a 2% gross royalty.

161

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

4.

MINERAL PROPERTY INTERESTS (cont’d…)

Staked properties, Peru

The Company acquired, by staking, a 100% interest in certain uranium properties in Peru.  During fiscal 2002, the claims were allowed to lapse and all related costs were written-off.

Wemindji East and Portage West properties, Canada

During fiscal 2002, the Company entered into letters of intent to acquire options on the Wemindji East and Portage West properties located in Quebec, Canada. The Company advanced $35,000 and issued 100,000 common shares pursuant to the agreements.  The Company also issued 60,000 common shares valued at $13,200 as a finder’s fee. The option agreements did not complete and, accordingly, acquisition costs of $48,200 were written-off to operations in fiscal 2002. The 100,000 common shares issued for the property were returned to treasury in fiscal 2003 (Note 7).

5.

DEFERRED EXPLORATION COSTS

		2002			2001
	USA	Peru	Total	USA	Peru	Total
Balance, beginning
of year	$ 155,069	$ 605,243	$ 760,312	$ 126,140	$ 570,317	$ 696,457
General expenditures	3,819	-	3,819	-	4,992	4,992
Maintenance and claim fees	-	-	-	28,929	29,934	58,863
	3,819	-	3,819	28,929	34,926	63,855
Write-offs	(98,880)	(605,243)	(704,123)	-	-	-
	(95,061)	(605,243)	(700,304)	28,929	34,926	63,855
Balance, end of year	$ 60,008	$ -	$ 60,008	$ 155,069	$ 605,243	$ 760,312

6.

OTHER ASSETS

	2002			2001
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Database	$ 41,720	41,720	$ -	$ 41,720	$ 33,376	$ 8,344

162

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

7.

CAPITAL STOCK

	Number of Shares	Amount
Issued
As at December 31, 2000	4,149,548	$ 10,767,430
Private placements	1,620,000	414,600
Finder’s fee for private placement	32,000	-
As at December 31, 2001	5,801,548	11,182,030
Private placements	2,085,000	417,000
Finder’s fee on mineral property acquisition	60,000	13,200
	7,946,548	11,612,230
Shares issued on mineral property acquisition
To be returned to treasury (Note 4)	100,000	-
As at December 31, 2002	8,046,548	$ 11,612,230

During fiscal 2002, the Company issued 550,000 common shares pursuant to a private placement and reclassified the proceeds of $110,000, which had been received during fiscal 2001, into capital stock.

Included in issued capital stock are 75,000 split-adjusted common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

Stock options

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of five years with vesting provisions determined by the Board of Directors.

As at December 31, 2002, the following incentive stock options and warrants were outstanding:

	Number of Shares	Exercise Price	Expiry Date
Options	550,000	$  0.25	March 20, 2003
Warrants	1,535,000	0.25	June 3, 2004

163

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

7.

CAPITAL STOCK (cont’d…)

Stock options (cont’d…)

Stock option transactions are summarized as follows:

	Number Of Options	Weighted Average Exercise Price
Outstanding, December 31, 2000	-	$           -
Granted	550,000	0.25
Outstanding, December 31, 2002 and 2001	550,000	$     0.25
Number of options currently exercisable	550,000	$     0.25

Warrants

Warrant transactions and the number of warrants outstanding are summarized as follows:

	Number of Warrants	Weighted Average Exercise Price
Outstanding, December 31, 2000	-	$        -
Granted	1,652,000	0.32
Exercised	-	-
Expired/cancelled	-	-
Outstanding, December 31, 2001	1,652,000	0.32
Granted	1,535,000	0.25
Exercised	-	-
Expired/cancelled	(1,652,000)	0.32
Outstanding, December 31, 2002	1,535,000	$   0.25
Number of warrants currently exercisable	1,535,000	$   0.25

164

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

8.

SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

	2002	2001
Cash paid during the year for interest	$ 743	$ -
Cash paid during the year for income taxes	$ -	$ -

During the year ended December 31, 2002, the Company issued 60,000 common shares valued at $13,200 as a finder’s fee on the acquisition of mineral property interests and issued 550,000 common shares pursuant to a private placement for proceeds of $110,000 which were received in fiscal 2001.

During the year ended December 31, 2001, the Company issued 32,000 common shares as a finder’s fee payment on a private placement.

9.

RELATED PARTY TRANSACTIONS

The Company entered into transactions with related parties as follows:

a)

Paid or accrued $14,979 (2001 - $74,937) for management services to a director.

b)

Paid or accrued $47,115 (2001 - $46,311) for consulting fees to a company controlled by a director.

c)

Paid or accrued $3,829 (2001 - $17,273) for rent to a director.

d)

Paid or accrued $18,992 (2001 - $14,000) for shareholder communications to a director.

e)

Paid or accrued $743 (2001 - $Nil) in interest to a company controlled by a director.

f)  Paid or accrued $1,608 (2001 - $Nil) for professional fees to the secretary of the Company.

g)

Pursuant to private placements, 1,000,000 (2001 – 1,050,000) common shares were issued to directors and a company controlled by a director for total proceeds of  $200,000 (2001 - $272,100).

Amounts due to related parties are, non-interest bearing and have no specific repayment terms.

These transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

165

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

10.

INCOME TAXES

A reconciliation of current income taxes at statutory rates with the reported income taxes is as follows:

	2002	2001
Loss for the year	$ (1,158,900)	$ (290,750)
Expected income tax recovery	$ 458,924	$ 129,675
Other items for non-deductible income tax purposes	(10,823)	(17,162)
Write-down of mineral property interests and deferred   exploration	(364,098)	-
Unrecognized benefits of non-capital losses	(84,003)	(112,513)
Future income tax recovery	$ -	$ -

The significant components of the Company’s future income tax assets are as follows:

	2002	2001
Future income tax assets:
Equipment	$ 29,630	$ 38,273
Mineral property interests and related   exploration expenditures	926,726	689,186
Other assets	22,560	23,039
Non-capital losses available for future periods	1,545,563	1,900,776
	2,524,479	2,651,274
Valuation allowance	(2,524,479)	(2,651,274)
Net future income tax asset	$ -	$ -

The Company has incurred approximately $4,110,000 of non-capital losses which, if unutilized, will expire through 2009.  Subject to certain restrictions, the Company also has capital losses of $368,000 and resource exploration expenditures of approximately $2,573,000 available to reduce taxable income for future years.  Future tax benefits which may arise as a result of these losses and resources deductions have not been recognized in these financial statements and have been offset by a valuation allowance.

11.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests, and considers its loss from operations for fiscal years 2002 and 2001 to relate to this segment.

166

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

11.

SEGMENTED INFORMATION (cont’d…)

The Company has mineral property interests located in the United States and conducts administrative activities from Canada.  During the prior year, the Company had a mineral property interest located in Peru.  The total amount of capital assets attributable to Canada is $7,690 (2001 - $10,117), Peru is $Nil (2001 - $667,698) and the USA is $108,648 (2001 - $324,929).

12.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash, receivables, accounts payable and accrued liabilities and due to related parties.  Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.  The fair value of these financial instruments approximates their carrying value, unless otherwise noted.

13.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”).  Material variations in the accounting principles, practices and methods used in preparing these consolidated financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) are described and quantified below.

Stock-based compensation

Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) recommended, but did not require, companies to establish a fair market value based method of accounting for stock-based compensation plans. The Company has elected to follow the recommendations of SFAS 123 and has chosen to account for stock-based compensation using the fair value based method.

.

Under Canadian GAAP, the reporting of stock-based compensation expense in the Company’s financial statements was not required for the year ended December 31, 2001.  New accounting and disclosure standards were introduced under Canadian GAAP (Note 2) for fiscal 2002, however, there were no options granted during fiscal 2002. Accordingly, there is no difference between Canadian GAAP and United States GAAP in the accounting for stock-based compensation for the year ended December 31, 2002.

To determine the additional compensation expense that would have resulted from compliance with SFAS No. 123 for the fiscal year ended December 31, 2001, the Company uses the Black Scholes Option Pricing Model.  During the year ended December 31, 2001, the Company granted 550,000 options to employees, consultants and directors.  Total stock-based compensation recognized under US GAAP in the statement of operations during the year was $104,181.  This amount was recorded as additional paid-in capital on the balance sheet under US GAAP. In determining the fair value of the Company's incentive stock options, the following assumptions were used:

167

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

13.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

Stock-based compensation (cont’d…)

	2002	2001
Risk free interest rate	-	4.54%
Expected life	-	2 years
Expected volatility	-	90.97%
Expected dividends	-	-

Mineral properties

Mineral property costs and related exploration expenditures are accounted for in accordance with Canadian GAAP as disclosed in Note 2.

For United States GAAP purposes, effective until fiscal 2003, the Company expensed, as incurred, the acquisition and exploration costs relating to unproven mineral property interests. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $52,019 for fiscal 2002 and $102,460 for fiscal 2001. When proven and probable reserves are determined for a property and a feasibility study prepared, subsequent development costs of the property are capitalized.  The capitalized costs of such properties are to be amortized using the unit of production method over the estimated life of the ore body based on proven and probable reserves and are measured periodically for recoverability of carrying values.

Effective for fiscal 2004, the Company has adopted the provisions of EITF 04-02 “Whether Mineral Rights are Tangible or Intangible Assets” which concluded that mineral rights are tangible assets.  Accordingly, the Company capitalizes certain costs related to the acquisition of mineral property interests.  Under United States GAAP, exploration costs on mineral properties prior to the establishment of proven or probable reserves continue to be expensed as incurred.

Loss per share

Under both Canadian GAAP and United States GAAP, basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

Under United States GAAP, the weighted average number of common shares outstanding excludes any shares that remain in escrow, but may be earned out based on the Company incurring a certain amount of exploration and development expenditures.  The weighted average number of shares outstanding under United States GAAP for the years ended December 31, 2002 and 2001 were 6,886,127 and 5,554,559, respectively.  

168

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

13.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated balance sheets would be as follows:

	2002			2001
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$   19,627	$           -	$   19,627	$      6,661	$            -	$      6,661
Property and equipment	7,690	-	7,690	26,677	-	26,677
Mineral property interests	48,640	(48,640)	-	215,755	(215,755)	-
Deferred exploration costs	60,008	(60,008)	-	760,312	(760,312)	-
Other	-	-	-	8,344	-	8,344
	$  135,965	$(108,648)	$   27,317	$1,017,749	$(976,067)	$     41,682
Total liabilities	$    50,227	$            -	$   50,227	$     93,311	$           -	$     93,311
Capital stock	11,612,230	-	11,612,230	11,182,030	-	11,182,030
Subscriptions received	-	-	-	110,000	-	110,000
Additional paid-in capital	-	673,800	673,800	-	673,800	673,800
Deficit	(11,526,492)	(782,448)	(12,308,940)	(10,367,592)	(1,649,867)	(12,017,459)
Shareholders' equity (deficiency)	85,738	(108,648)	(22,910)	924,438	(976,067)	(51,629)
	$ 135,965	$(108,648)	$  27,317	$1,017,749	$(976,067)	$     41,682

169

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2002

13.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated statements of operations would be as follows:

	2002	2001
Loss for the year, Canadian GAAP	$(1,158,900)	$(290,750)
Adjustments:
Stock-based compensation	-	(104,181)
Mineral property interests	(48,200)	(38,605)
Deferred exploration costs	(3,819)	(63,855)
Write-off of mineral property interests, expensed in prior years for United States GAAP	215,315	-
Write-off of deferred exploration costs, expensed in prior years for United States GAAP	704,123	-
Loss for the year, United States GAAP	$(291,481)	$(497,391)
Basic and diluted loss per share, United States GAAP	$   (0.04)	$   (0.09)
Weighted average number of common shares outstanding, United States GAAP	6,886,127	5,554,559

The impact of the differences between Canadian GAAP and United States GAAP on the statements of cash flows would be as follows:

	2002	2001
Cash flows used in operating activities,
Canadian GAAP	$(213,735)	$(254,802)
Mineral property interests	(35,000)	(38,605)
Deferred exploration costs	(3,819)	(63,855)
Cash flows used in operating activities, United States GAAP	(252,554)	(357,262)
Cash flows used in investing activities, Canadian GAAP	(38,819)	(102,701)
Mineral property interests	35,000	38,605
Deferred exploration costs	3,819	63,855
Cash flows used in investing activities, United States GAAP	-	(241)
Cash flows provided by financing activities, Canadian
GAAP and United States GAAP	259,950	242,684
Change in cash during the year	7,396	(114,819)
Cash, beginning of year	4,388	119,207
Cash, end of year	$   11,784	$      4,388

170

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

171

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(Expressed in Canadian Dollars)

AS AT DECEMBER 31

	2000	1999
ASSETS
Current
Cash and equivalents	$ 119,207	$ 681
Receivables	1,410	2,402
Prepaid expenses	291	1,023
Total current assets	120,908	4,106
Property and equipment (Note 3)	43,002	69,420
Mineral property interests (Note 4)	177,150	247,631
Deferred exploration costs (Note 5)	696,457	718,895
Other assets (Note 6)	30,258	52,172
Total assets	$ 1,067,775	$ 1,092,224
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$ 9,574	$ 26,283
Due to related parties	42,613	96,091
Total current liabilities	52,187	122,374
Total liabilities	52,187	122,374
Shareholders' equity
Capital stock (Note 7)
Authorized
Unlimited common shares without par value
Issued
4,149,548 common shares (1999 – 3,989,548)	10,767,430	10,647,430
Subscriptions received in advance (Note 7)	325,000	-
Deficit	(10,076,842)	(9,677,580)
Total shareholders’ equity	1,015,588	969,850
Total liabilities and shareholders’ equity	$ 1,067,775	$ 1,092,224

Nature and continuance of operations (Note 1)

On behalf of the Board:
“Devinder Randhawa”	Director	“Robert Hemmerling”	Director

The accompanying notes are an integral part of these consolidated financial statements.

172

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS AND DEFICIT

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	2000	1999
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising	$ -	$ 75,941
Amortization	48,332	49,701
Consulting fees	44,476	368,390
Interest and bank charges	16,556	9,531
Management fees	43,280	73,371
Office and miscellaneous	7,476	22,768
Printing	-	4,670
Professional fees	12,436	86,707
Regulatory fees	5,242	12,221
Rent	11,041	29,717
Salaries and benefits	-	53,122
Shareholder communications	30,668	85,879
Telephone	7,575	19,547
Trade shows and conferences	13,276	26,414
Transfer agent	7,516	8,329
Travel and promotion	24,477	10,869
Loss before other items	(272,351)	(937,177)
OTHER ITEMS
Interest income	-	22,382
Gain on sale of mineral property (Note 4)	15,000	-
Gain on settlement of debt	-	99,672
Write-off of mineral property interests (Note 4)	(93,181)	(540,221)
Write-off of deferred exploration costs (Note 5)	(48,730)	(324,867)
Total of other items	(126,911)	(743,034)
Loss for the year	(399,262)	(1,680,211)
Deficit, beginning of year	(9,677,580)	(7,997,369)
Deficit, end of year	$(10,076,842)	$ (9,677,580)
Basic and diluted loss per share	$ (0.10)	$ (0.47)
Weighted average number of split-adjusted common shares outstanding	4,082,882	3,609,368

The accompanying notes are an integral part of these consolidated financial statements.

173

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	2000	1999
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$ (399,262)	$ (1,680,211)
Items not affecting cash
Amortization	48,332	49,701
Gain on settlement of debt	-	(99,672)
Write-off of mineral property interests	93,181	540,221
Write-off of deferred exploration costs	48,730	324,867
Changes in non-cash working capital items
Decrease in accounts receivable	992	2,220
Decrease in prepaid expenses	732	10,149
Decrease in accounts payable and accrued liabilities	(16,709)	(31,867)
Net cash used in operating activities	(224,004)	(884,592)
CASH FLOWS FROM INVESTING ACTIVITIES
Acquisition of property and equipment	-	(2,406)
Mineral property interests	(22,700)	(22,218)
Deferred exploration costs	(26,292)	(117,508)
Net cash used in investing activities	(48,992)	(142,132)
CASH FLOWS FROM FINANCING ACTIVITIES
Increase (decrease) in due to related parties	(53,478)	96,091
Note payable (repayment)	-	(185,421)
Long-term debt (repayment)	-	(1,863)
Subscriptions received in advance	325,000	-
Capital stock issued	120,000	609,620
Net cash provided by financing activities	391,522	518,427
Change in cash and equivalents during the year	118,526	(508,297)
Cash and equivalents, beginning of year	681	508,978
Cash and equivalents, end of year	$ 119,207	$ 681

Supplemental disclosures with respect to cash flows (Note 9)

The accompanying notes are an integral part of these consolidated financial statements.

174

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

1.

NATURE AND CONTINUANCE OF OPERATIONS

Strathmore Minerals Corp. (the “Company”) is an exploration stage company incorporated under the laws of the Province of British Columbia. During fiscal 2000, the Company changed its name from Strathmore Resources Ltd. to Strathmore Minerals Corp. and completed a reverse stock split on the basis of 1 new share of common stock for every 5 old shares of common stock outstanding. All share and per share amounts have been retroactively restated to reflect the reverse stock split.

The Company is in the process of exploring its mineral property interests and has not yet determined whether these properties contain ore reserves that are economically recoverable.  The recoverability of the amounts shown for mineral properties and related deferred exploration costs is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete their development and upon future profitable production.

2.

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Minera Peruran S.A. (incorporated under the laws of Peru), and Strathmore Resources (US) Ltd. (incorporated under the laws of Nevada, USA).  Significant inter-company balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of financial statements in conformity with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period.  Actual results could differ from these estimates.

Cash and equivalents

Cash is comprised of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Foreign currency translation

The Company’s subsidiaries are integrated foreign operations and are translated into Canadian dollar equivalents  using the temporal method.  The monetary assets and liabilities of the Company that are denominated in foreign currencies are translated at the rate of exchange at the balance sheet date and non-monetary items are translated at historical rates.  Revenues and expenses are translated at rates approximating those in effect at the time of the transaction.  Exchange gains and losses arising on translation are included in the statement of operations.

175

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

2.

SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

Property and equipment

Property and equipment is recorded at cost and amortization is calculated using the declining-balance method at the following annual rates:

Office equipment	20%
Computer equipment	30%
Vehicles	30%

Other assets

Other assets, being geological databases, are recorded at cost and are being amortized over five years using the straight-line method.

Mineral property interests and deferred exploration costs

The Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests has significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future; or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  As at December 31, 2000 and 1999, management believes that, other than amounts disclosed, no impairment relating to the mineral property interests and deferred exploration costs was required.

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the assigned value of share consideration issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

Asset retirement obligations

An asset retirement obligation is a legal obligation associated with the retirement of tangible long-lived assets that the Company is required to settle.  The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made.  The carrying amount of the related long-lived asset is increased by the same amount as the liability.  

176

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

2.

SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

Flow-through common shares

The resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with Canadian income tax legislation.  Future income taxes related to temporary differences arising on renunciation of expenditures to subscribers are offset against future income tax assets and the difference, if any, is charged to capital stock.

Stock-based compensation

The Company has a stock-based compensation plan which is described in Note 8.  No compensation expense is recognized for this plan when stock or stock options are issued to employees.  Any consideration paid by employees on exercise of stock options is credited to capital stock.

Income taxes

Income taxes are recorded using the asset and liability method whereby future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Future tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled.  The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.  To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess.

Loss per share

The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on earnings per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period.  For the years presented, this calculation proved to be anti-dilutive.

Basic loss per share is calculated using the split-adjusted weighted average number of shares outstanding during the year.

Comparative figures

Certain of the prior years’ comparative figures have been reclassified to conform to the financial statement presentation adopted in the current year.

177

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

3.

PROPERTY AND EQUIPMENT

	2000			1999
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$ 19,634	$ 9,387	$ 10,247	$ 25,820	$ 9,447	$ 16,373
Computer equipment	27,278	18,180	9,098	42,125	22,874	19,251
Vehicles	56,800	33,143	23,657	56,800	23,004	33,796
	$ 103,712	$ 60,710	$ 43,002	$ 124,745	$ 55,325	$ 69,420

4.

MINERAL PROPERTY INTERESTS

	2000	1999
Aurora property	$ 97,815	$ 75,115
Chord property	33,440	33,440
Staked properties, U.S.A.	-	93,181
Staked properties, Peru	45,895	45,895
	$ 177,150	$ 247,631

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

Aurora property

The Company acquired an option to purchase a 100% interest in a uranium property in Oregon, paying $93,715 and issuing 2,000 split-adjusted common shares valued at $4,100. To earn its interest the Company is required to pay an additional U.S.$45,000 and to issue an additional 2,000 split-adjusted common shares by October 16, 2003.  The property is subject to a 2% yellowcake royalty.

Chord property

The Company acquired an option to purchase a 100% interest in a uranium property in South Dakota, U.S.A., paying $33,440.  To earn its interest, the Company is required to pay an additional U.S.$90,000 (U.S.$10,000 per year until July 1, 2009).  The property is subject to a 2% gross royalty.

178

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

4.

MINERAL PROPERTY INTERESTS (cont’d…)

Staked properties

The Company acquired by staking, a 100% interest in certain uranium properties in Utah, Wyoming, South Dakota and Oregon in the U.S.A. and in Peru.  During the prior and current years, the Company abandoned its staked U.S.A. properties and all related costs were written-off.

Gain on sale of mineral property

During the current year, the Company received $15,000 for the sale of staked claims in the U.S.A. which had been written-off in 1999.

5.

DEFERRED EXPLORATION COSTS

	2000			1999
	USA	Peru	Total	USA	Peru	Total
Balance, beginning
of year	$ 162,434	$ 556,461	$ 718,895	$ 417,528	$ 508,726	$ 926,254
Geological consulting	-	-	-	26,961	40,000	66,961
General expenditures	-	12,355	12,355	5,271	7,735	13,006
Maintenance and claim fees	12,436	1,501	13,937	37,541	-	37,541
Expenditures during  the year	12,436	13,856	26,292	69,773	47,735	117,508
Write-offs	(48,730)	-	(48,730)	(324,867)	-	(324,867)
	(36,294)	13,856	(22,438)	(255,094)	47,735	(207,359)
Balance, end of year	$ 126,140	$ 570,317	$ 696,457	$ 162,434	$ 556,461	$ 718,895

6.

OTHER ASSETS

		Accumulated	Net Book Value
	Cost	Amortization	2000	1999
Geological databases	$ 109,570	$ 79,312	$ 30,258	$ 52,172

179

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

7.

CAPITAL STOCK

During the year ended December 31, 2000, the Company completed a reverse stock split on the basis of 1 new share of common stock for every 5 old shares of common stock outstanding. All share and per share amounts have been retroactively restated to reflect the reverse stock split.

	Number of Shares	Amount
Issued
As at December 31, 1998	3,415,548	$ 10,037,810
For cash – private placement	262,400	262,400
For cash – stock options	60,400	63,420
For cash – warrants	251,200	283,800
As at December 31, 1999	3,989,548	10,647,430
For cash – private placement	160,000	120,000
As at December 31, 2000	4,149,548	$ 10,767,430

Included in issued capital stock are 75,000 split-adjusted common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

Subscriptions received in advance

Subsequent to December 31, 2000, the Company issued 1,620,000 units for total proceeds of $414,600 ($325,000 received prior to year end) pursuant to a private placement.  Each unit consisted of one common share and one share purchase warrant.  Of the warrants, 1,300,000 enable the holders to acquire 1,300,000 additional common shares at $0.30 per share for two years and 320,000 enable the holders to acquire 320,000 additional common shares at $0.38 per share for two years.  A finder's fee of 32,000 units was paid.  Each unit consisted of one common share and one share purchase warrant enabling the holder to acquire one additional common share at $0.38 per share for two years.

8.

STOCK OPTIONS AND WARRANTS

Stock options

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of five years with vesting provisions determined by the Board of Directors.

180

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

8.

STOCK OPTIONS AND WARRANTS (cont’d…)

Stock options (cont’d…)

Split-adjusted stock option transactions and the number of split-adjusted stock options outstanding are summarized as follows:

	Number of Options	Weighted Average Exercise Price
Outstanding, December 31, 1998	174,400	$     1.10
Granted	258,000	1.10
Exercised	(60,400)	1.05
Expired/cancelled	-	-
Outstanding, December 31, 1999	372,000	1.10
Granted	-	-
Exercised	-	-
Expired/cancelled	(372,000)	1.10
Outstanding, December 31, 2000	-	-
Number of options currently exercisable	-	$       -

Warrants

Warrant transactions and the number of split-adjusted warrants outstanding are summarized as follows:

	Number of Warrants	Weighted Average Exercise Price
Outstanding, December 31, 1998	794,202	$    2.08
Granted	-	-
Exercised	(251,200)	1.10
Expired/cancelled	(20,000)	3.65
Outstanding, December 31, 1999	523,002	2.40
Granted	-	-
Exercised	-	-
Expired/cancelled	(523,002)	2.40
Outstanding, December 31, 2000	-	$      -
Number of warrants currently exercisable	-	$      -

181

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

9.

SUPPLEMENTAL DISCLOSURES WITH RESPECT TO CASH FLOWS

	2000	1999
Cash paid during the period for
Interest	$ 15,143	$ 6,282
Income taxes	-	-

There were no significant non-cash transactions during the year ended December 31, 2000.

During the year ended December 31, 1999, the Company settled long-term debt totalling $28,451 by assigning a Company vehicle.

10.

RELATED PARTY TRANSACTIONS

The financial statements include transactions with related parties as follows:

a)

The Company paid or accrued $43,280 (1999 - $73,371) for management services to a director.

b)

The Company paid or accrued $44,476 (1999 - $67,249) for consulting fees to a director or a company controlled by a director.

c)

Pursuant to a private placement, the Company issued 160,000 split-adjusted common shares to a director and a company controlled by a director for total proceeds of $120,000.

These transactions are in the normal course of operations and are measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Amounts due to related parties are unsecured, non-interest bearing and have no specific repayment terms.

11.

INCOME TAXES

A reconciliation of current income taxes at statutory rates with the reported income taxes is as follows:

	2000	1999
Loss for the year	$ (399,262)	$ (1,680,211)
Expected income tax recovery	$ 182,143	$ 766,512
Write-down of mineral property interests and deferred   exploration	(57,897)	(394,653)
Unrecognized benefits of non-capital losses	(124,246)	(371,859)
Future income tax recovery	$ -	$ -

182

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

11.

INCOME TAXES (cont’d…)

The significant components of the Company’s future income tax assets are as follows:

	2000	1999
Future income tax assets:
Equipment	$ 65,779	$ 53,727
Mineral property interests and related   exploration expenditures	475,765	411,025
Other assets	38,561	53,557
Operating losses available for future periods	2,270,186	2,284,181
Capital losses available	125,730	125,730
	2,976,021	2,928,220
Valuation allowance	(2,976,021)	(2,928,220)
Net future income tax asset	$ -	$ -

The Company has incurred approximately $5,000,000 of operating losses which, if unutilized, will expire through 2007.  Subject to certain restrictions, the Company also has capital losses and resource exploration expenditures available to reduce taxable income of future years.  Future tax benefits which may arise as a result of these losses and resource deductions have not been recognized in these financial statements, as their realization is not judged likely to occur.

12.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests, and considers its loss from operations for fiscal years 2000 and 1999 to relate to this segment.

The Company has mineral property interests located in the USA and Peru and conducts administrative activities from Canada.  The total amount of capital assets attributable to Canada is $19,345 (1999 - $35,624), Peru is $639,869 (1999 - $636,152) and the USA is $257,395 (1999 - $364,170).

13.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash and equivalents, receivables, due to related parties, accounts payable and accrued liabilities.  Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest, currency or credit risks arising from these financial instruments.  The fair value of these financial instruments approximates their carrying values, unless otherwise noted.

183

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”).  Material variations in the accounting principles, practices and methods used in preparing these consolidated financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) are described and quantified below.

Stock-based compensation

Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) recommended, but did not require, companies to establish a fair market value based method of accounting for stock-based compensation plans. The Company has elected to follow the recommendations of SFAS 123 and has chosen to account for stock-based compensation using the fair value based method.

To determine the additional compensation expense that would have resulted from compliance with SFAS No. 123, the Company uses the Black Scholes Option Pricing Model. During fiscal 2000, the Company granted Nil (199 9 – 258,000 ) options to employees, consultants and directors. Total stock-based compensation recognized under United States GAAP in the statement of operations during fiscal 2000 was $ Nil (199 9 – $ 101,569 ). This amount was recorded as additional paid-in capital on the balance sheet under United States GAAP. In determining the fair value of the Company's incentive stock options, the following assumptions were used:

	2000	1999
Risk free interest rate	-	5.6%
Expected life	-	2 years
Expected volatility	-	67%
Expected dividends	-	-

Mineral properties

Mineral property costs and related exploration expenditures are accounted for in accordance with Canadian GAAP as disclosed in Note 2.

For United States GAAP purposes, effective until fiscal 2003, the Company expensed, as incurred, the acquisition and exploration costs relating to unproven mineral property interests. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $892,045 for fiscal 1998 and $576,769 for fiscal 1997. When proven and probable reserves are determined for a property and a feasibility study prepared, subsequent development costs of the property are capitalized.  The capitalized costs of such properties are to be amortized using the unit of production method over the estimated life of the ore body based on proven and probable reserves and are measured periodically for recoverability of carrying values.

Effective for fiscal 2004, the Company has adopted the provisions of EITF 04-02 “Whether Mineral Rights are Tangible or Intangible Assets” which concluded that mineral rights are tangible assets.  Accordingly, the Company capitalizes certain costs related to the acquisition of mineral property interests.  Under United States GAAP, exploration costs on mineral properties prior to the establishment of proven or probable reserves continue to be expensed as incurred.

184

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

Loss per share

Under both Canadian GAAP and United States GAAP, basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

Under United States GAAP, the weighted average number of common shares outstanding excludes any shares that remain in escrow, but may be earned out based on the Company incurring a certain amount of exploration and development expenditures.  The weighted average number of shares outstanding under United States GAAP for the years ended December 31, 2000 and 1999 were 4,007,882 and 3,534,368, respectively.  Accordingly, the loss per share for the years ended December 31, 2000 and 1999 was $(0.08) and $(0.30), respectively.

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated balance sheets would be as follows:

	2000			1999
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$120,908	$             -	$120,908	$    4,106	$             -	$4,106
Property and equipment	43,002	-	43,002	69,420	-	69,420
Mineral property interests	177,150	(177,150)	-	247,631	(247,631)	-
Deferred exploration costs	696,457	(696,457)	-	718,895	(718,895)	-
Other assets	30,258	-	30,258	52,172	-	52,172
	$1,067,775	$(873,607)	$194,168	$1,092,224	$(966,526)	$125,698
Total liabilities	$52,187	$              -	$52,187	$122,374	$              -	$122,374
Capital stock	10,767,430	-	10,767,430	10,647,430	-	10,647,430
Subscriptions received	325,000	-	325,000	-	-	-
Additional paid-in capital	-	569,619	569,619	-	569,619	569,619
Deficit	(10,076,842)	(1,443,226)	(11,520,068)	(9,677,580)	(1,536,145)	(11,213,725)
Shareholders' equity	1,015,588	(873,607)	141,981	969,850	(966,526)	3,324
	$1,067,775	$(873,607)	$194,168	$1,092,224	$(966,526)	$125,698

185

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 2000

14.

DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GENERALLY ACCEPTED

ACCOUNTING PRINCIPLES (cont’d…)

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated statements of operations would be as follows:

	2000	1999
Loss for the year, Canadian GAAP	$(399,262)	$(1,680,211)
Adjustments:
Stock-based compensation	-	(101,569)
Mineral property interests	(22,700)	(22,218)
Deferred exploration costs	(26,292)	(117,508)
Write-off of mineral property interests, expensed in prior years for United States GAAP	93,181	540,221
Write-off of deferred exploration costs, expensed in prior years for United States GAAP	48,730	324,867
Loss for the year, United States GAAP	$(306,343)	$(1,056,418)
Basic and diluted loss per share, United States GAAP	$      (0.08)	$         (0.30)
Weighted average number of common shares outstanding, United States GAAP	4,007,882	3,534,368

The impact of the differences between Canadian GAAP and United States GAAP on the consolidated statements of cash flows would be as follows:

	2000	1999
Cash flows used in operating activities, Canadian GAAP	$ (224,004)	$(884,592)
Mineral property interests	(22,700)	(22,218)
Deferred exploration costs	(26,292)	(117,508)
Cash flows used in operating activities, United States GAAP	(272,996)	(1,024,318)
Cash flows used in investing activities, Canadian GAAP	(48,992)	(142,132)
Mineral property interests	22,700	22,218
Deferred exploration costs	26,292	117,508
Cash flows used in investing activities, United States GAAP	-	(2,406)
Cash flows provided by financing activities, Canadian GAAP
and United States GAAP	391,522	518,427
Change in cash and equivalents during the year	118,526	(508,297)
Cash and equivalents, beginning of year	681	508,978
Cash and equivalents, end of year	$  119,207	$          681

186

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

187

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED BALANCE SHEETS

(Expressed in Canadian Dollars)

AS AT DECEMBER 31

		1998	1997
ASSETS
Current
Cash and equivalents		$508,978	$1,120,870
Receivables		4,622	9,419
Prepaid expenses		11,172	23,194
Total current assets		524,772	1,153,483
Property and equipment (Note 3)		123,252	89,312
Mineral properties (Note 4)		765,634	638,099
Deferred exploration costs (Note 5)		926,254	161,744
Other assets (Note 6)		74,086	54,280
Total assets		$2,413,998	$2,096,918
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities		$157,822	$67,498
Note payable (Note 7)		185,421	-
Current portion of long-term debt		6,644	6,071
Total current liabilities		349,887	73,569
Long-term debt (Note 8)		23,670	30,314
Total liabilities		373,557	103,883
Shareholders' equity
Capital stock (Note 9)
Authorized
Unlimited	common shares without par value
Issued
3,415,548	split-adjusted common shares (1997 – 2,545,217)	10,037,810	8,675,165
Deficit		(7,997,369)	(6,682,130)
Total shareholders’ equity		2,040,441	1,993,035
Total liabilities and shareholders’ equity		$ 2,413,998	$ 2,096,918

Nature and continuance of operations (Note 1)

On behalf of the Board:
“Devinder Randhawa”	Director	“Scott Mundell”	Director

The accompanying notes are an integral part of these consolidated financial statements.

188

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF OPERATIONS

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	1998	1997
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising	$ 308,400	$ -
Amortization	58,909	31,161
Consulting fees	261,636	142,818
Interest on long-term debt	2,896	-
Management fees	106,812	100,779
Office and miscellaneous	59,683	52,988
Printing	4,865	4,360
Professional fees	97,003	179,667
Promotion	13,648	15,387
Property investigation	-	60,545
Regulatory fees	11,636	12,215
Rent	26,006	21,285
Salaries and benefits	81,064	71,246
Shareholder communications	116,891	95,120
Telephone	21,924	35,719
Trade shows and conferences	130,336	144,078
Transfer agent	2,072	8,142
Travel	43,323	82,836
	(1,347,104)	(1,058,346)
Interest income	31,865	20,573
Write-off of mineral property interests	-	(374,101)
Loss for the year	(1,315,239)	(1,411,874)
Deficit, beginning of year	(6,682,130)	(5,270,256)
Deficit, end of year	$ (7,997,369)	$ (6,682,130)
Basic and diluted loss per share	$ (0.44)	$ (0.70)
Weighted average number of split-adjusted shares outstanding	2,980,383	2,016,498

The accompanying notes are an integral part of these consolidated financial statements.

189

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

CONSOLIDATED STATEMENTS OF CASH FLOWS

(Expressed in Canadian Dollars)

YEAR ENDED DECEMBER 31

	1998	1997
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$ (1,315,239)	$ (1,411,874)
Items not affecting cash:
Amortization	58,909	31,161
Write-off of mineral property interests	-	374,101
Changes in non-cash working capital items:
Decrease in receivables	4,797	1,481
(Increase) decrease in prepaid expenses	12,022	(21,693)
Increase (decrease) in accounts payable and accrued liabilities	90,324	(49,705)
Net cash used in operating activities	(1,149,187)	(1,076,529)
CASH FLOWS FROM INVESTING ACTIVITIES
Property and equipment	(70,935)	(100,653)
Mineral properties	(88,435)	(533,449)
Deferred exploration costs	(764,510)	(177,221)
Other assets	(41,720)	(67,850)
Net cash used in investing activities	(965,600)	(879,173)

CASH FLOWS FROM FINANCING ACTIVITIES
Special warrants	-	(1,425,913)
Capital stock issued	1,323,545	2,734,248
Increase  in loan payable	185,421	-
Loan proceeds (net)	(6,071)	36,385
Net cash provided by financing activities	1,502,895	1,344,720
Change in cash and equivalents during the year	(611,892)	(610,982)
Cash and equivalents, beginning of year	1,120,870	1,731,852
Cash and equivalents, end of year	$ 508,978	$ 1,120,870
Supplemental disclosure with respect to cash flows
Issuance of capital stock for mineral properties	$ 39,100	$ 240,200
Cash paid during the year for
Interest	$ 2,896	$ -
Income taxes	-	-

The accompanying notes are an integral part of these consolidated financial statements.

190

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

1.

NATURE AND CONTINUANCE OF OPERATIONS

Strathmore Minerals Corp. (the “Company”) is an exploration stage company incorporated under the laws of the Province of British Columbia.

The Company is in the process of exploring its mineral properties and has not yet determined whether these properties contain ore reserves that are economically recoverable.  The recoverability of the amounts shown for mineral properties and related deferred exploration costs is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete their development and upon future profitable production.

2.

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Minera Peruran S.A. (incorporated under the laws of Peru), and Strathmore Resources (US) Ltd. (incorporated under the laws of Nevada, USA).  Significant inter-company balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period.  Actual results could differ from these estimates.

Cash and equivalents

Cash is comprised of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Foreign currency translation

The Company’s subsidiaries are integrated foreign operations and are translated into Canadian dollar equivalents  using the temporal method.  The monetary assets and liabilities of the Company that are denominated in foreign currencies are translated at the rate of exchange at the balance sheet date and non-monetary items are translated at historical rates.  Revenues and expenses are translated at rates approximating those in effect at the time of the transaction.  Exchange gains and losses arising on translation are included in the statement of operations.

Property and equipment

Property and equipment are recorded at cost and amortization is calculated using the declining-balance method at the following annual rates:

Office equipment	20%
Computer equipment	30%
Computer software	50%
Vehicles	30%

191

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd…)

Other assets

Other assets, being geological databases, are recorded at cost and are being amortized over five years using the straight-line method.

Mineral property interests and deferred exploration costs

The Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests have significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the value of share considerations issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

Asset retirement obligations

An asset retirement obligation is a legal obligation associated with the retirement of tangible long-lived assets that the Company is required to settle.  The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made.  The carrying amount of the related long-lived asset is increased by the same amount as the liability.  

Flow-through common shares

The resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with Canadian income tax legislation.  Future income taxes related to temporary differences arising on renunciation of expenditures to subscribers are offset against future income tax assets and the difference, if any, is charged to capital stock.

192

#

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd…)

Stock-based compensation

The Company has a stock-based compensation plan which is described in Note 10.  No compensation expense is recognized for this plan when stock or stock options are issued to employees.  Any consideration paid by employees on exercise of stock options is credited to capital stock.

Income taxes

Income taxes are recorded using the asset and liability method whereby future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Future tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled.  The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.  To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess.

Loss per share

The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on earnings per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period.  For the years presented, this calculation proved to be anti-dilutive.

Basic loss per share is calculated using the split-adjusted weighted average number of shares outstanding during the year.

3.

PROPERTY AND EQUIPMENT

	1998			1997
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$ 34,524	$ 11,496	$ 23,028	$ 24,102	$ 7,042	$ 17,060
Computer equipment	44,212	18,531	25,681	40,499	8,320	32,179
Computer software	5,109	5,109	-	5,109	2,555	2,554
Vehicles	100,940	26,397	74,543	44,140	6,621	37,519
	$ 184,785	$ 61,533	$ 123,252	$ 113,850	$ 24,538	$ 89,312

193

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

4.

MINERAL PROPERTIES

	1998	1997
San Rafael River properties	$ 232,500	$ 197,125
Hot Rock properties	135,204	100,204
Aurora property	52,897	-
Staked properties	345,033	340,770
	$ 765,634	$ 638,099

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

San Rafael River properties

The Company acquired a 100% interest in certain uranium properties in the San Rafael River area of the Green River District, Utah by paying $141,500 (U.S.$100,000) and issuing 14,000 split-adjusted common shares valued at $91,000.  A 5% royalty is payable on all uranium sales.

Hot Rock properties

The Company acquired a 100% interest in certain uranium properties in the White Canyon District, Utah by  paying $30,954 (U.S.$25,000) and issuing 18,952 split-adjusted common shares valued at $104,250 (U.S.$75,000).  The properties are subject to a 4% yellowcake royalty.

Aurora property

The Company acquired an option to purchase a 100% interest in a uranium property in Oregon, paying $48,797 (U.S. $30,000) and issuing 2,000 split-adjusted common shares valued at $4,100. To earn its interest the Company is required to pay an additional U.S.$75,000 by October 16, 2003 and to issue an additional 2,000 split-adjusted common shares by October 16, 2000.  The property is subject to a 2% yellowcake royalty.

Staked properties

The Company acquired, by staking, a 100% interest in certain uranium properties in Utah, Wyoming, South Dakota and Oregon in the U.S.A., and in Peru. During fiscal 1997, the Company abandoned certain staked properties and recorded a loss of $55,600.

194

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

4.

MINERAL PROPERTIES (cont’d…)

Rio Puerco, Apex - Lowboy properties

During fiscal 1996, the Company acquired an option to purchase a 100% interest in certain uranium properties located in the Rio Puerco area of Sandoval County, New Mexico and in Ladner County, Nevada and, pursuant to the agreement, paid $101,925, issued 20,000 split-adjusted common shares valued at $65,000 and issued 5,000 split-adjusted common shares valued at $16,250 as a finder's fee. During fiscal 1997, the Company issued an additional 20,000 split-adjusted common shares valued at $65,000 and issued 4,600 split-adjusted common shares valued at $14,950 as a finder’s fee. During fiscal 1997 these properties were abandoned and all related costs totalling $318,501, including deferred exploration costs of $55,376, were written-off.

5.

DEFERRED EXPLORATION COSTS

			Total
	U.S.A.	Peru	1998	1997
Balance, beginning of year	$ 161,744	$ -	$ 161,744	$ 39,899
Accommodation and camp costs	-	26,338	26,338	-
Communications	-	16,257	16,257	-
Geological consulting fees	96,978	166,695	263,673	60,356
General expenditures	9,110	42,386	51,496	48,785
Legal fees	-	29,700	29,700	-
Maintenance and claim fees	131,145	16,444	147,589	26,962
Management fees	-	43,200	43,200	-
Report and map preparation	-	14,663	14,663	22,969
Samples	-	73,482	73,482	-
Survey	13,349	-	13,349	-
Transportation	-	33,719	33,719	-
Travel	5,202	45,842	51,044	18,149
Expenditures during the year	255,784	508,726	764,510	177,221
Written-off (Note 4)	-	-	-	(55,376)
	255,784	508,726	764,510	121,845
Balance, end of year	$ 417,528	$ 508,726	$ 926,254	$ 161,744

195

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

6.

OTHER ASSETS

			Net Book Value
	Cost	Accumulated Amortization	1998	1997
Geological databases	$ 109,570	$ 35,484	$ 74,086	$ 54,280

7.

NOTE PAYABLE

The note is for U.S.$118,309 and is due to the Riverton State Bank in Wyoming, U.S.A.  It is secured by the Company's bank accounts at the Riverton State Bank, bears interest at 8% per annum and is due on January 15, 1999.

8.

LONG-TERM DEBT

	1998	1997
Loan bearing interest at 8½% per annum; principal and interest payments of U.S. $532 per month; secured by a Company vehicle.	$ 30,314	$ 36,385
Less:  current portion	(6,644)	(6,071)
	$ 23,670	$ 30,314

9.

CAPITAL STOCK

During the year ended December 31, 2000, the Company completed a reverse stock split on the basis of 1 new share of common stock for every 5 old shares of common stock outstanding. All per share amounts have been retroactively restated to reflect the reverse stock split.

196

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

9.

CAPITAL STOCK (cont’d…)

	Number of Shares	Amount
Issued
As at December 31, 1996	1,487,780	$ 5,700,717
For cash – options	60,500	198,925
For cash – warrants	118,055	300,737
For cash – private placements	100,000	803,000
For cash – agents' special warrants	27,170	61,750
For mineral properties	45,712	225,250
For finder's fee	4,600	14,950
For special warrants	660,000	1,369,836
For agents' warrants	41,400	-
As at December 31, 1997	2,545,217	8,675,165
For cash – private placements	731,091	1,187,045
For cash – options	130,000	136,500
For mineral properties	9,240	39,100
As at December 31, 1998	3,415,548	$ 10,037,810

Included in issued capital stock are 75,000 split-adjusted common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

10.

STOCK OPTIONS AND WARRANTS

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of five years with vesting provisions determined by the Board of Directors.

197

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

10.

STOCK OPTIONS AND WARRANTS (cont’d…)

Split-adjusted stock option and share purchase warrant transactions are summarized as follows:

	Warrants		Stock Options
	Number	Weighted Average Exercise Price	Number	Weighted Average Exercise Price
Outstanding, December 31, 1996	95,455	$    2.50	96,500	$   3.70
Granted	760,000	3.74	160,000	3.50
Exercised	(145,225)	1.81	(60,500)	3.30
Outstanding, December 31, 1997	710,230	3.80	196,000	3.50
Granted	774,202	2.04	148,400	1.40
Exercised	-	-	(130,000)	1.05
Expired/cancelled	(690,230)	3.80	(40,000)	1.05
Outstanding, December 31, 1998	794,202	$    2.08	174,400	$   1.10
Number currently exercisable	794,202	$    2.08	174,400	$   1.10

As at December 31, 1998, the following incentive split-adjusted stock options were outstanding:

Number  of Shares	Exercise Price	Expiry Date
128,400	$ 1.05	August 19, 2000
6,000	2.00	December 11, 2000
40,000	1.05	June 27, 2002

As at December 31, 1998, the following split-adjusted share purchase warrants were outstanding:

Number  of Shares		Exercise Price	Expiry Date
300,000		$ 1.30	November 18, 2000
20,000		3.65	August 13, 1999
474,202		2.13	September 18, 1999
	if not exercised, then at	2.50	September 18, 2000

198

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

11.

INCOME TAXES

A reconciliation of current income taxes at statutory rates with the reported income taxes is as follows:

	1998	1997
Loss for the year	$ (1,315,239)	$ (1,411,874)
Expected income tax recovery	$ 600,012	$ 644,097
Other items not deductible for income tax purposes	(29,987)	(17,726)
Property investigation	(19,033)	(170,665)
Write-down of mineral property interests and deferred exploration	-	(27,621)
Share issue costs	11,876	11,876
Unrecognized benefits of non-capital losses	(562,868)	(439,961)
Future income tax recovery	$ -	$ -

The significant components of the Company’s future income tax assets are as follows:

	1998	1997
Future income tax assets:
Equipment	$    4,058	$     4,058
Mineral property interests and related exploration expenditures	304,128	304,128
Share issuance costs	28,869	40,745
Non-capital losses available for future periods	1,546,252	1,546,252
	1,883,307	1,895,183
Valuation allowance	(1,883,307)	(1,895,183)
Net future income tax asset	$           -	$            -

The Company has incurred approximately $4,300,000 of operating losses which, if unutilized, will expire through 2005.  Subject to certain restrictions, the Company also has capital losses and resource exploration expenditures available to reduce taxable income of future years.  Future tax benefits which may arise as a result of these losses and resource deductions have not been recognized in these financial statements, as their realization is not judged likely to occur.

199

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

12.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests, and considers its loss from operations to relate to this segment.

The Company has mineral property interests located in the USA and Peru and conducts administrative activities from Canada.  The total amount of capital assets attributable to Canada is $48,709 (1997 - $51,793), Peru is $629,164   (1997 - $83,414) and the USA is $1,137,267 (1997 - $753,948).

13.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash and equivalents, receivables, accounts payable and accrued liabilities, note payable and long-term debt. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.  The fair value of these financial instruments approximates their carrying value, unless otherwise noted. The Company is subject to financial risk arising from fluctuations in foreign currency exchange rates. The Company does not use any derivative instruments to reduce its exposure to fluctuations in foreign currency exchange rates.

14.

UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES

These consolidated financial statements have been prepared in accordance with generally accepted accounting principles in Canada (“Canadian GAAP”).  Material variations in the accounting principles, practices and methods used in preparing these consolidated financial statements from principles, practices and methods accepted in the United States (“United States GAAP”) are described and quantified below.

Stock-based compensation

Under United States GAAP, Statements of Financial Accounting Standards No. 123, “Accounting for Stock-based Compensation” (“SFAS 123”) recommended, but did not require, companies to establish a fair market value based method of accounting for stock-based compensation plans. The Company has elected to follow the recommendations of SFAS 123 and has chosen to account for stock-based compensation using the fair value based method.

To determine the additional compensation expense that would have resulted from compliance with SFAS No. 123, the Company uses the Black Scholes Option Pricing Model. During fiscal 1998, the Company granted 148,400 (1997 – 160,000) options to employees, consultants and directors. Total stock-based compensation recognized under United States GAAP in the statement of operations during fiscal 1998 was $172,411 (1997 – $238,215). This amount was recorded as additional paid-in capital on the balance sheet under United States GAAP. In determining the fair value of the Company's incentive stock options, the following assumptions were used:

	1998	1997
Risk free interest rate	5.89%	6.08%
Expected life	2 years	2 years
Expected volatility	148.31%	96.5%
Expected dividends	-	-

200

#

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

14.

UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont’d…)

Stock-based compensation (cont’d…)

The weighted average fair value of stock options granted during fiscal 1998 was $1.16 (1997 - $1.48)

Mineral properties

Mineral property costs and related exploration expenditures are accounted for in accordance with Canadian GAAP as disclosed in Note 2.

For United States GAAP purposes, effective until fiscal 2003, the Company expensed, as incurred, the acquisition and exploration costs relating to unproven mineral property interests. This resulted in a decrease in mineral property interests and deferred exploration costs and a corresponding increase in loss for the year of $892,045 for fiscal 1998 and $576,769 for fiscal 1997. When proven and probable reserves are determined for a property and a feasibility study prepared, subsequent development costs of the property are capitalized.  The capitalized costs of such properties are to be amortized using the unit of production method over the estimated life of the ore body based on proven and probable reserves and are measured periodically for recoverability of carrying values.

Effective for fiscal 2004, the Company has adopted the provisions of EITF 04-02 “Whether Mineral Rights are Tangible or Intangible Assets” which concluded that mineral rights are tangible assets.  Accordingly, the Company capitalizes certain costs related to the acquisition of mineral property interests.  Under United States GAAP, exploration costs on mineral properties prior to the establishment of proven or probable reserves continue to be expensed as incurred.

Loss per share

Under both Canadian GAAP and United States GAAP, basic loss per share is calculated using the weighted average number of common shares outstanding during the year.

Under United States GAAP, the weighted average number of common shares outstanding excludes any shares that remain in escrow, but may be earned out based on the Company incurring a certain amount of exploration and development expenditures.  The weighted average number of shares outstanding under United States GAAP for the years ended December 31, 1998 and 1997 were split-adjusted 2,905,383 and 1,941,498, respectively.  Accordingly, the loss per share for the years ended December 31, 1998 and 1997 was $(0.82) and $(1.15), respectively.

201

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

(Expressed in Canadian Dollars)

DECEMBER 31, 1998

14.

UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd…)

The impact of the above differences between Canadian GAAP and United States GAAP on loss for the year would be as follows:

	Year Ended December 31,
	1998	1997
Loss for the year as reported, Canadian GAAP	$(1,315,239)	$(1,411,874)
Less: Stock-based compensation	(172,411)	(238,215)
Mineral property acquisition costs	(127,535)	(454,924)
Deferred exploration costs	(764,510)	(121,845)
Loss for the year in accordance with United States GAAP	$(2,379,695)	$(2,226,858)
Basic and diluted loss per share, United States GAAP	$        (0.82)	$        (1.15)
Weighted average number of common shares outstanding, United States GAAP	2,905,383	1,941,498

The impact of the above differences between Canadian GAAP and United States GAAP on the balance sheets would be as follows:

	December 31, 1998			December 31, 1997
	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP	Balance, Canadian GAAP	Adjustments	Balance, United States GAAP
Current assets	$524,772	$             -	$524,772	$1,153,483	$           -	$1,153,483
Property and equipment	123,252	-	123,252	89,312	-	89,312
Mineral property   interests	765,634	(765,634)	-	638,099	(638,099)	-
Deferred exploration   costs	926,254	(926,254)	-	161,744	(161,744)	-
Other assets	74,086	-	74,086	54,280	-	54,280
	$2,413,998	$(1,691,888)	$722,110	$2,096,918	$(799,843)	$1,297,075
Total liabilities	$373,557	$             -	$373,557	$103,883	$              -	$103,883
Capital stock	10,037,810	-	10,037,810	8,675,165	-	8,675,165
Additional paid-in Capital	-	468,050	468,050	-	295,639	295,639
Deficit	(7,997,369)	(2,159,938)	(10,157,307)	(6,682,130)	(1,095,482)	(7,777,612)
Shareholders' equity	2,040,441	(1,691,888)	348,553	1,993,035	(799,843)	1,193,192
	$2,413,998	$(1,691,888)	$722,110	$2,096,918	$(799,843)	$1,297,075

202

STRATHMORE MINERALS CORP.

(An Exploration Stage Company)

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

 (Expressed in Canadian Dollars)

DECEMBER 31, 1998

14.

UNITED STATES GENERALLY ACCEPTED ACCOUNTING PRINCIPLES (cont'd…)

The impact of the differences between Canadian GAAP and United States GAAP on the statements of cash flows would be as follows:

	1998	1997
Cash flows used in operating activities,
Canadian GAAP	$(1,149,187)	$(1,076,529)
Mineral property interests	(88,435)	(533,449)
Deferred exploration costs	(764,510)	(177,221)
Cash flows used in operating activities, United States GAAP	(2,002,132)	(1,787,199)
Cash flows used in investing activities, Canadian GAAP	(965,600)	(879,173)
Mineral property interests	88,435	533,449
Deferred exploration costs	764,510	177,221
Cash flows used in investing activities, United States GAAP	(112,655)	(168,503)
Cash flows provided by financing activities, Canadian GAAP
and United States GAAP	1,502,895	1,344,720
Change in cash and equivalents during the year	(611,892)	(610,982)
Cash and equivalents, beginning of year	1,120,870	1,731,852
Cash and equivalents, end of year	$    508,978	$1,120,870

15.

RELATED PARTY TRANSACTIONS

The financial statements include transactions with related parties as follows:

a)

The Company paid $106,812 (1997 - $100,779) for management services to a director.

b)

The Company paid $80,554 (1997 - $75,463) for consulting fees to a director or a company controlled by a director.

c)

The Company paid $6,000 (1997 - $32,250) for consulting fees to an officer.

d)

During fiscal 1998, the Company issued Nil (1997 - 4,600) split-adjusted common shares valued at $Nil (1997 - $3.25) per share as a finder's fee, to a director of the Company.

203

Signature Page

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

Strathmore Minerals Corp.

Registrant

Dated:  July 12, 2007	Signed: /s/  Devinder Randhawa
	Devinder Randhawa Chairman and CEO

204

#

EX-10.1

THIS AGREEMENT is dated March 1, 2005

BETWEEN: Patrick Groening

  ("the Consultant")

AND: Strathmore Minerals Corp.

  ("the Company")

W H E R E A S:

A. Mr. Patrick Groening has agreed to be the Chief Financial Officer of the Company on a full-time basis on the understanding and agreement that he will be paid for his services at the rate of $7,000 per month.

B. The Company requires a Chief Financial Officer to perform those duties as more particularly set forth in this Agreement;

C. The parties desire to enter into this Agreement to confirm the appointment of the Chief Financial Officer of the Company, and to set forth their respective rights and obligations,

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual covenants and premises set forth herein, and for other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged) the parties hereto agree as follows:

1.

APPOINTMENT AND AUTHORITY OF THE CONSULTANT

1.1

The Company hereby appoints the Consultant as Chief Financial Officer of the Company to perform certain services for the benefit of the Company as herein set forth, and the Company hereby authorizes the Consultant to exercise such powers as provided under this Agreement, and the Consultant accepts such appointment and authority on the terms and conditions herein set forth.

1.2

The Consultant shall have no right or authority, express or implied, to commit or otherwise obligate the Company in any manner whatsoever except to the extent specifically provided herein or specifically authorized in writing by the Company.

2.

TERM

2.1

The Consultant's term of appointment and engagement shall be for a period of three years commencing on the date first above written (the "Commencement Date"), subject to earlier termination as herein provided.

2.2

The term of the Consultant's appointment and engagement may be extended for such periods of time and on such terms and conditions as may be mutually agreed upon by the parties.

3.

REMUNERATION

3.1

During the term of his engagement, the Consultant shall receive an amount of $7,000 per month, payable on the first of each and every month.

4.

BOARD APPROVAL

4.1

The parties acknowledge that, notwithstanding Mr. Groening is at arm's length to the Company; this agreement is subject to the approval of the Board of Directors of the Company and may be subject to the approval of the TSX Venture Exchange.

5.

CONSULTANT'S DUTIES AND RESPONSIBILITIES

5.1

The Consultant, at the expense of and on behalf of the Company, shall:

(a)

make and implement or cause to be implemented all decisions of the President and Board of Directors of the Company in accordance with and as limited by this Agreement; and

(b)

at all times be subject to the direction of the President and Board of Directors of the Company and shall keep the President and the Board informed as to all material matters concerning the Consultant's activities.

5.2

In carrying out his obligations under this Agreement, the Consultant shall, subject to paragraph 5.1:

(a)

establish budgets, financial plans and financial controls with respect to the operations of the Company or assist the Company in obtaining the same,

(b)

undertake long term planning; and establish business objectives, including strategic business plans, financial and other business objectives, and

(c)

prepare the financial statements for the Company in accordance with all regulatory requirements.

5.3

The Consultant shall report to the President and Board of Directors of the Company or such committee as the Board of Directors of the Company may direct.

5.4

The Consultant shall well and faithfully serve the Company and shall use his best efforts to promote the interests thereof.  Unless prevented by ill health or other cause acceptable to the Company, the Consultant shall, during the term of his engagement, devote as much of his time, attention and ability to the business of the Company as is necessary to carry out his obligations hereunder.

5.5

The Consultant shall not, either during the term of his engagement with the Company or at any time thereafter, directly or indirectly, divulge, publish or disclose the affairs or business of the Company or its affiliates or any secrets thereof to any person other than the Directors of the Company without the prior consent of the Company other than as required by law and shall not use for his own purposes, or for any other purposes other than those of the Company, any information he may acquire with respect to its affairs, business or research.

5.6

Any inventions, discoveries, developments, modifications, procedures, innovations, systems, programs, know-how, confidential information or designs developed by the Consultant during his engagement with the Company shall be the property of the Company without further act or assignment or notice and the Consultant shall execute applications for patents or copyrights thereon to the extent requested by the Company and such documents as the Company may reasonably require to document the transfer and assignment of the same to the Company.

6.

COMPANY'S AGREEMENTS

6.1

The Company shall make available to the Consultant such information and data and shall permit the Consultant, to have access to such documents or premises as are reasonably necessary to enable him to perform the services provided for under this Agreement.

6.2

Notwithstanding anything in this Agreement, the Consultant shall not be required to expend his own money or to incur any liabilities, obligations, costs, dues or debts and all money required by the Consultant to carry out his duties under this Agreement shall be provided by the Company to the Consultant forthwith upon the Consultant's request.

6.3

The Company agrees to indemnify, defend and hold harmless the Consultant from and against any and all claims, demands, losses, actions, lawsuits and other proceedings, judgments and awards, and costs and expenses (including reasonable legal fees), arising directly or indirectly, in whole or in part, out of any matter relating to any action taken by the Consultant within the scope of his duties or authority hereunder, excluding only such of the foregoing as arise from the fraudulent, negligent, or willful act or omission of the Consultant, and the provisions hereof shall survive termination of this Agreement.

7.

TERMINATION OF SERVICE

7.1

The Company shall only be entitled to terminate the appointment and employment of the Consultant without notice by reason of:

(a)

his dishonesty in dealings with the Company, its customers, suppliers, officers or shareholders;

(b)

his conduct if detrimental to the Company or which materially and adversely affects his ability to perform his duties hereunder, including excessive use of alcohol or drugs, excessive absences without justification, immoral or improper behaviour, or refusal to comply with the reasonable policies or procedures established by the Company;

(c)

his inability for any reason to perform his duties hereunder for a continuous period of three months during the term of his employment;

(d)

his failure to carry out the provisions of this Agreement insofar as the same relate to services and duties to be performed by him;

(e)

his failure due to incompetence or negligence to perform assigned duties in a manner acceptable to the Company, which failure is not fully remedied by the Consultant within ten days after notice in writing thereof has been given by the Company to the Consultant;

(f)

his bankruptcy or insolvency or his voluntary assignment for the benefit of his creditors;

(g)

his indictment for a criminal offence; or

(h)

other just cause.

7.2

The Consultant shall be entitled to terminate his appointment and engagement with the Company provided he gives 120 days prior written notice, such termination to be effective upon the expiry of the said 120 day period.

7.3

If the Consultant's engagement with the Company is terminated for any reason, the Consultant shall be entitled to receive his full salary until the effective date of such termination.

7.4

Upon termination of this Agreement for any reason, the Consultant shall promptly deliver the following in accordance with the directions of the Company:

(a)

a final accounting, reflecting the balance of expenses incurred by him on behalf of the Company as of the date of termination;

(b)

all documents pertaining to the Company or this Agreement, including but not limited to all books of account, correspondence and contracts provided that the Consultant shall be entitled thereafter to inspect, examine and copy all of the documents which he delivers in accordance with this provision at all reasonable times upon three days' notice to the Company.

8.

GENERAL

8.1

If the Consultant dies during the term of his employment then the remuneration and other benefits payable to him as hereinbefore provided shall cease on the last day of the month in which his death shall occur.

8.2

This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns as the case may be.

8.3

Each provision and paragraph of this Agreement is declared to constitute a separate and distinct covenant and to be severable from all other such separate and distinct covenants.  If any covenant or provision herein contained is determined to be void or unenforceable in whole or in part, such determination shall not affect or impair the validity or enforceability of any other covenant or provision contained in this Agreement and the remaining provisions of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

8.4

The parties hereto recognize that a breach by the Consultant of any of the covenants or terms herein contained would result in damages to the Company and that the Company could not be adequately compensated for such damages by a monetary award.  Accordingly, the Consultant agrees that in the event of any such breach, in addition to all other remedies available to the Company at law or in equity, the Company shall be entitled as a matter of right to apply to a court of competent equitable jurisdiction for such relief by way of restraining order, injunction, decree or otherwise, as may be appropriate to ensure compliance with the provisions of this Agreement.

8.5

This Agreement may not be assigned by the Consultant without the prior written consent of the Company, which consent shall be at the sole discretion of the Company.

8.6

This Agreement replaces, supersedes and cancels all prior agreements, representations and understandings between the Company and the Consultant in respect of the subject matter of this Agreement.

8.7

The provisions of this Agreement and the relationship between the parties shall be construed in accordance with and governed by the laws of the Province of British Columbia, Canada.  The parties hereby attorn to the jurisdiction of the courts of the said Province.

8.8

All reference to currency herein are references to Canadian dollars.

8.9

All notices, requests and communications required or permitted hereunder shall be in writing and shall be sufficiently given and deemed to have been received upon personal delivery or, if mailed, upon the first to occur of actual receipt or forty-eight (48) hours after being placed in the mail in Canada, postage prepaid, registered or certified mail, return receipt requested, respectively addressed to the Company or the Consultant at the addresses set forth above, or to such other address as may be furnished in writing by such party.   

8.10

The parties will execute and deliver all such further documents and instruments and do all such further acts and things as may be required to carry out the full intent and meaning of this Agreement and to effect the transactions contemplated hereby.

8.11

This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which together will constitute one and the same instrument.

IN WITNESS WHEREOF the parties hereto have duly executed this Agreement on the date first above written.

STRATHMORE MINERALS CORP.

EX-10.2

THIS AGREEMENT is dated March 1, 2005

BETWEEN: Robert Hemmerling

  ("the Consultant")

AND: Strathmore Minerals Corp.

  ("the Company")

W H E R E A S:

A.

Mr. Robert Hemmerling has agreed to be the Corporate Secretary for the Company on a full-time basis on the understanding and agreement that he will be paid for his services at the rate of $7,000 per month.

B.

The Company requires a Corporate Secretary to perform those duties as more particularly set forth in this Agreement;

C.

The parties desire to enter into this Agreement to confirm the appointment of the Corporate Secretary of the Company, and to set forth their respective rights and obligations,

NOW THEREFORE THIS AGREEMENT WITNESSES that in consideration of the mutual covenants and premises set forth herein, and for other good and valuable consideration (the receipt and sufficiency of which is hereby acknowledged) the parties hereto agree as follows:

1.

APPOINTMENT AND AUTHORITY OF THE CONSULTANT

1.1

The Company hereby appoints the Consultant as Corporate Secretary to perform certain services for the benefit of the Company as herein set forth, and the Company hereby authorizes the Consultant to exercise such powers as provided under this Agreement, and the Consultant accepts such appointment and authority on the terms and conditions herein set forth.

1.2

The Consultant shall have no right or authority, express or implied, to commit or otherwise obligate the Company in any manner whatsoever except to the extent specifically provided herein or specifically authorized in writing by the Company.

2.

TERM

2.1

The Consultant's term of appointment and engagement shall be for a period of three years commencing on the date first above written (the "Commencement Date"), subject to earlier termination as herein provided.

2.2

The term of the Consultant's appointment and engagement may be extended for such periods of time and on such terms and conditions as may be mutually agreed upon by the parties.

3.

REMUNERATION

3.1

During the term of his engagement, the Consultant shall receive an amount of $7,000 per month, payable on the first of each and every month.

4.

BOARD APPROVAL

4.1

The parties acknowledge that this agreement is subject to the approval of the Board of Directors of the Company and may be subject to the approval of the TSX Venture Exchange.

5.

CONSULTANT'S DUTIES AND RESPONSIBILITIES

5.1

The Consultant, at the expense of and on behalf of the Company, shall:

(a)

make and implement or cause to be implemented all decisions of the President and Board of Directors of the Company in accordance with and as limited by this Agreement; and

(b)

at all times be subject to the direction of the President and Board of Directors of the Company and shall keep the President and the Board informed as to all material matters concerning the Consultant's activities.

5.2

In carrying out his obligations under this Agreement, the Consultant shall, subject to paragraph 5.1:

(a)

maintain the corporate books and records of the Company;

(b)

make and file or cause to be made all forms, notices and declarations with the TSX Venture Exchange and other regulatory bodies regarding the affairs of the Company, and;

(c)

perform any other duties required to be performed by the Corporate secretary and as requested by the President and the Board of Directors.

5.3

The Consultant shall report to the President and Board of Directors of the Company or such committee as the Board of Directors of the Company may direct.

5.4

The Consultant shall well and faithfully serve the Company and shall use his best efforts to promote the interests thereof.  Unless prevented by ill health or other cause acceptable to the Company, the Consultant shall, during the term of his engagement, devote as much of his time, attention and ability to the business of the Company as is necessary to carry out his obligations hereunder.

5.5

The Consultant shall not, either during the term of his engagement with the Company or at any time thereafter, directly or indirectly, divulge, publish or disclose the affairs or business of the Company or its affiliates or any secrets thereof to any person other than the Directors of the Company without the prior consent of the Company other than as required by law and shall not use for his own purposes, or for any other purposes other than those of the Company, any information he may acquire with respect to its affairs, business or research.

5.6

Any inventions, discoveries, developments, modifications, procedures, innovations, systems, programs, know-how, confidential information or designs developed by the Consultant during his engagement with the Company shall be the property of the Company without further act or assignment or notice and the Consultant shall execute applications for patents or copyrights thereon to the extent requested by the Company and such documents as the Company may reasonably require to document the transfer and assignment of the same to the Company.

6.

COMPANY'S AGREEMENTS

6.1

The Company shall make available to the Consultant such information and data and shall permit the Consultant, to have access to such documents or premises as are reasonably necessary to enable him to perform the services provided for under this Agreement.

6.2

Notwithstanding anything in this Agreement, the Consultant shall not be required to expend his own money or to incur any liabilities, obligations, costs, dues or debts and all money required by the Consultant to carry out his duties under this Agreement shall be provided by the Company to the Consultant forthwith upon the Consultant's request.

6.3

The Company agrees to indemnify, defend and hold harmless the Consultant from and against any and all claims, demands, losses, actions, lawsuits and other proceedings, judgments and awards, and costs and expenses (including reasonable legal fees), arising directly or indirectly, in whole or in part, out of any matter relating to any action taken by the Consultant within the scope of his duties or authority hereunder, excluding only such of the foregoing as arise from the fraudulent, negligent, or willful act or omission of the Consultant, and the provisions hereof shall survive termination of this Agreement.

7.

TERMINATION OF SERVICE

7.1

The Company shall only be entitled to terminate the appointment and employment of the Consultant without notice by reason of:

(a)

his dishonesty in dealings with the Company, its customers, suppliers, officers or shareholders;

(b)

his conduct if detrimental to the Company or which materially and adversely affects his ability to perform his duties hereunder, including excessive use of alcohol or drugs, excessive absences without justification, immoral or improper behavior, or refusal to comply with the reasonable policies or procedures established by the Company;

(c)

his inability for any reason to perform his duties hereunder for a continuous period of three months during the term of his employment;

(d)

his failure to carry out the provisions of this Agreement insofar as the same relate to services and duties to be performed by him;

(e)

his failure due to incompetence or negligence to perform assigned duties in a manner acceptable to the Company, which failure is not fully remedied by the Consultant within ten days after notice in writing thereof has been given by the Company to the Consultant;

(f)

his bankruptcy or insolvency or his voluntary assignment for the benefit of his creditors;

(g)

his indictment for a criminal offence; or

(h)

other just cause.

7.2

The Consultant shall be entitled to terminate his appointment and engagement with the Company provided he gives 120 days prior written notice, such termination to be effective upon the expiry of the said 120 day period.

7.3

If the Consultant's engagement with the Company is terminated for any reason, the Consultant shall be entitled to receive his full salary until the effective date of such termination.

7.4

Upon termination of this Agreement for any reason, the Consultant shall promptly deliver the following in accordance with the directions of the Company:

(a)

a final accounting, reflecting the balance of expenses incurred by him on behalf of the Company as of the date of termination;

(b)

all documents pertaining to the Company or this Agreement, including but not limited to all books of account, correspondence and contracts provided that the Consultant shall be entitled thereafter to inspect, examine and copy all of the documents which he delivers in accordance with this provision at all reasonable times upon three days' notice to the Company.

8.

GENERAL

8.1

If the Consultant dies during the term of his employment then the remuneration and other benefits payable to him as hereinbefore provided shall cease on the last day of the month in which his death shall occur.

8.2

This Agreement shall enure to the benefit of and be binding upon the parties hereto and their respective successors and permitted assigns as the case may be.

8.3

Each provision and paragraph of this Agreement is declared to constitute a separate and distinct covenant and to be severable from all other such separate and distinct covenants.  If any covenant or provision herein contained is determined to be void or unenforceable in whole or in part, such determination shall not affect or impair the validity or enforceability of any other covenant or provision contained in this Agreement and the remaining provisions of this Agreement shall be valid and enforceable to the fullest extent permitted by law.

8.4

The parties hereto recognize that a breach by the Consultant of any of the covenants or terms herein contained would result in damages to the Company and that the Company could not be adequately compensated for such damages by a monetary award.  Accordingly, the Consultant agrees that in the event of any such breach, in addition to all other remedies available to the Company at law or in equity, the Company shall be entitled as a matter of right to apply to a court of competent equitable jurisdiction for such relief by way of restraining order, injunction, decree or otherwise, as may be appropriate to ensure compliance with the provisions of this Agreement.

8.5

This Agreement may not be assigned by the Consultant without the prior written consent of the Company, which consent shall be at the sole discretion of the Company.

8.6

This Agreement replaces, supersedes and cancels all prior agreements, representations and understandings between the Company and the Consultant in respect of the subject matter of this Agreement.

8.7

The provisions of this Agreement and the relationship between the parties shall be construed in accordance with and governed by the laws of the Province of British Columbia, Canada.  The parties hereby attorn to the jurisdiction of the courts of the said Province.

8.8

All reference to currency herein are references to Canadian dollars.

8.9

All notices, requests and communications required or permitted hereunder shall be in writing and shall be sufficiently given and deemed to have been received upon personal delivery or, if mailed, upon the first to occur of actual receipt or forty-eight (48) hours after being placed in the mail in Canada, postage prepaid, registered or certified mail, return receipt requested, respectively addressed to the Company or the Consultant at the addresses set forth above, or to such other address as may be furnished in writing by such party.   

8.10

The parties will execute and deliver all such further documents and instruments and do all such further acts and things as may be required to carry out the full intent and meaning of this Agreement and to effect the transactions contemplated hereby.

8.11

This Agreement may be executed in several counterparts, each of which will be deemed to be an original and all of which together will constitute one and the same instrument.

IN WITNESS WHEREOF the parties hereto have duly executed this Agreement on the date first above written.

STRATHMORE MINERALS CORP.

EX-10.3

CLAIM PURCHASE AGREEMENT

THIS AGREEMENT made as of  February 27, 2006

BETWEEN:

Jody Dahrouge, Geologist,

having an office at 18-10509 81^st Ave.,

Edmonton, Alberta T6E 1X7

(hereinafter called the "Vendor")

- and -

Strathmore Minerals Corp.

having its registered and records office located at

700 – 595 Howe Street, Vancouver,

British Columbia V6C

(hereinafter called the "Purchaser")

WHEREAS the Vendor has identified and has the full right to deal with the Fort McLeod Property (the "Property") and has agreed to assist the  Company in locating, staking or acquiring the right to explore and develop the Property (hereinafter collectively called the "Claims") as listed on Schedule A attached hereto;

NOW THEREFORE the parties covenant and agree as follows:

1.

Purchase and Sale

(a)

The Vendor hereby sells, assigns and transfers the Claims and all his interest therein to the Purchaser and the Purchaser hereby purchases from the Vendor, free and clear of all liens, encumbrances and adverse claims of any nature whatsoever, the Claims.

(b)

The sale of the Claims is conditional upon such sale being approved by the board of directors of the Purchaser and by the TSX Venture Exchange (the “Exchange”).

2.

Purchase Price

To purchase the Claims, the Purchaser shall make the following payments to the Vendor:

(a)

within 21 days of the Completion Date, the issuance to the Vendor of 100,000 common shares of the Purchaser; and

(b)

on the first anniversary of the Completion Date, the issuance to the Vendor of 100,000 common shares of the Purchaser.

3.

Title to Vest

Full right, title and interest in the Claims shall vest in the Purchaser upon the making of the aforesaid payment of 100,000 common shares under subparagraph 2(a). In the event that the Purchaser does not fully exercise the option, the Purchaser shall deliver to the Vendor duly executed conveyances of all right, title and interest of the Purchaser in the Claims.

4.

Representations and Warranties of the Vendor

The Vendor represents and warrants to the Purchaser that:

(a)

the Vendor has the right to enter into this Agreement to sell and assign an undivided 100% interest in the Claims absolutely in accordance with the terms of this Agreement;

(b)

the Claims have been properly recorded in compliance with the laws of Saskatchewan and there are no disputes over the title, staking or recording of such mineral claims;

(c)

the Claims are in good standing and to the best knowledge of the Vendor are free and clear of any liens or charges of any nature or kind whatsoever except for any royalties or reservations under applicable laws or regulations in favour of the governmental authority or authorities granting the mineral claims; and

(d)

the Vendor has not done anything whereby the Claims may be in any way encumbered.

5.

Representations and Warranties of the Purchaser

The Purchaser represents and warrants to the Vendor that:

(a)

it has full corporate power and authority to enter into this Agreement and the entering into of this Agreement does not conflict with any applicable laws or with the charter documents of the Purchaser or any contract or other commitment to which the Purchaser is party; and

(b)

the execution of this Agreement and the performance of its terms have been duly authorized by all necessary corporate actions of the Purchaser.

6.

Covenants of Vendor

The Vendor, prior to the Completion Date, shall cause the Claims to be duly registered in the name of the Purchaser and shall provide the Purchaser with documentation regarding the due registration of title to the Claims in the name of the purchaser.

7.

Covenants of Purchaser

The Purchaser, prior to the Completion Date, shall pay all costs associated with the registration and holding of the Claims.

8.

Completion Date

The Completion Date shall be the later of the day that the Purchaser has obtained Exchange approval to the purchase and the day the Vendor has delivered to the Purchaser a geological summary of the Claims and documentation regarding the due registration of title to the Claims in the name of the purchaser.

9.

Option and Abandonment of Claims

The Purchaser shall have the right at any time and from time to time to abandon the purchase of the Claims and in such event will be under no further obligation to the Vendor, except upon such abandonment, the Purchaser shall deliver to the Vendor duly executed conveyances of all right, title and interest of the Purchaser in the Claims.

10.

Claims in Good Standing

Any Claims reconveyed to the Vendor shall be in good standing for 30 days after such reconveyance.

11.

Notices

Any notice or communication or payment to the parties under this Agreement may be given or made by mailing the same by prepaid, registered mail to such party, addressed as follows:

To the Vendor:

To the Purchaser:

Jody Dahrouge

Strathmore Minerals Corp.

18-10509 81^st Ave.,

Suite 810 – 1708 Dolphin Ave

Edmonton, Alberta

Kelowna, BC

T6E 1X7

V1Y 9S4

Fax:

Fax: (250) 868-8493

or to such address as either party may designate for itself or himself from time to time, and such notice or communication or payment shall be deemed to have been received at the latest on the fifth business day following the mailing thereof.

12.

Confidentiality

The Vendor shall not, without the express written consent of the Purchaser, disclose to any third party any information concerning the Claims or any operations thereon, nor shall the Vendor buy, sell or otherwise deal in the shares of the Company while any material, confidential information in the possession of the Vendor relating to this Agreement or the Claims remains undisclosed to the general public.

13.

Regulatory Approval

This Agreement is subject to the prior approval of the Exchange.  The parties shall use their best efforts to obtain such approval as soon as reasonably possible after execution.

14.

Further Acts

The Parties shall do all such acts and execute all such transfers and any other documents as required by the Purchaser to carry out the intent of this Agreement.

15.

Assignment

The Vendor may not assign this Agreement or pledge or encumber any part of his interest in it without the prior written consent of the Purchaser which shall not be unreasonably withheld.

16.

Entire Agreement

This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter of this Agreement and supersedes all prior oral or written understandings, agreements or contracts with respect thereto. No changes, alterations or modifications of this Agreement shall be binding upon either party until and unless a memorandum in writing to such effect shall have been signed by all parties hereto.

17.

Counterparts

This agreement may be signed by the parties in as many counterparts as may be necessary and by facsimile, each of which so signed shall be deemed to be an original, and such counterparts together shall constitute one and the same instrument and notwithstanding the date of execution, shall be deemed to bear the date as set forth below.

IN WITNESS WHEREOF the parties have duly executed this Agreement as of the date first above written.

SIGNED, SEALED and DELIVERED

)

in the presence of:

)

)

Name

)

Jody Dahrouge

)

Address

)

)

STRATHMORE MINERALS CORP.

By its Authorized Signatory:

Schedule A

EX-10.4

CLAIM PURCHASE AGREEMENT

THIS AGREEMENT made as of March 3, 2005

BETWEEN:

David Miller

131 Davis Lane

Riverton, Wyoming 82501

(hereinafter called the "Vendor")

- and -

Strathmore Resources (US) Ltd.

a wholly owned subsidiary of

Strathmore Minerals Corp.

a British Columbia Corporation

(hereinafter called the "Purchaser")

WHEREAS the Vendor is the recorded and beneficial owner of and has the full right to deal with Wyoming state leases located in the Shirley Basin, Great Divide Basin, and  Powder River Basin of Wyoming (hereinafter collectively called the "Claims") as listed on Schedule A attached hereto;

AND WHEREAS the parties hereto have agreed that the Purchaser shall purchase the Claims from the Vendor and the Vendor shall sell the Claims to the Purchaser upon the terms hereinafter set out;

NOW THEREFORE the parties covenant and agree as follows:

1.

Purchase and Sale

(a)

The Vendor hereby sells, assigns and transfers the Claims and all his interest therein to the Purchaser and the Purchaser hereby purchases from the Vendor the Claims.

(b)

The sale and purchase of the Claims is conditional upon such purchase being approved by the board of directors of the Purchaser and the TSX Venture Exchange (the “Exchange”).

2.

Purchase Price

To purchase the Claims, the Purchaser shall make the following payments to the Vendor:

(a)

within 21 days of the Completion Date, a cash payment of US$30,000 and the issuance to the Vendor of  50,000 common shares of the Purchaser and

(b)

every 6 months after the Completion Date, the issuance to the Vendor of 50,000 common shares of the Purchaser to total 250,000. (Total (a) and (b) shares:300,000)

3.

Title to Vest

Full right, title and interest in the Claims shall vest in the Purchaser upon the making of the aforesaid payment of 50,000 common shares under subparagraph 2(a).

4.

Representations and Warranties of the Vendor

The Vendor represents and warrants to the Purchaser that:

(a)

the Vendor has the right to enter into this Agreement to sell and assign an undivided 100% interest in the Claims absolutely in accordance with the terms of this Agreement;

(b)

the Claims, to the best knowledge of the Vendor, have been properly recorded in compliance with the laws of the State of New Mexico and to the best knowledge of the Vendor there are no disputes over the title, staking or recording of such mineral claims;

(c)

the Claims, to the best knowledge of the Vendor, are in good standing and are free and clear of any liens or charges of any nature or kind whatsoever except for any royalties or reservations under applicable laws or regulations in favour of the governmental authority or authorities granting the mineral claims; and save and except as list on Schedule B attached hereto;

(d)

the Vendor has not done anything whereby the Claims may be in any way encumbered.

5.

Representations and Warranties of the Purchaser

The Purchaser represents and warrants to the Vendor that:

(a)

it has full corporate power and authority to enter into this Agreement and the entering into of this Agreement does not conflict with any applicable laws or with the charter documents of the Purchaser or any contract or other commitment to which the Purchaser is party; and

(b)

the execution of this Agreement and the performance of its terms have been duly authorized by all necessary corporate actions of the Purchaser.

6.

Covenants of Vendor

The Vendor, concurrent with the issuance of the shares under paragraph 2(a), shall cause the Claims to be duly registered in the name of the Purchaser and the Vendor shall provide the Purchaser with evidence of such registration to the Purchaser.

7.

Covenants of Purchaser

The Purchaser, prior to the Completion Date, shall pay all costs associated with the registration and holding of the Claims and any costs to defend title to the Claims in the event that a dispute arises with a third party over the title, staking or recording of such mineral claims.

8.

Completion Date

The Completion Date shall be the day that the Purchaser has obtained Exchange approval to the purchase.

9.

Option and Abandonment of Claims

The Purchaser shall have the right at any time and from time to time to abandon the purchase of the Claims and in such event will have no further obligations to the Vendor including those under section 2 hereof, except upon such abandonment, the Purchaser shall deliver to the Vendor duly executed conveyances of all right, title and interest of the Purchaser in the Claims.

10.

Claims in Good Standing

Any Claims reconveyed to the Vendor shall be in good standing for 90 days after such reconveyance.

11.

Notices

Any notice or communication or payment to the parties under this Agreement may be given or made by mailing the same by prepaid, registered mail to such party, addressed as follows:

To the Vendor:

David Miller

131 Davis Lane

Riverton, Wyoming 82501

To the Purchaser:

Strathmore Minerals Corp.

Suite 810 – 1708 Dolphin Ave

Kelowna, BC V1Y 9S4

or to such address as either party may designate for itself or himself from time to time, and such notice or communication or payment shall be deemed to have been received at the latest on the fifth business day following the mailing thereof.

12.

Confidentiality

The Vendor shall not, without the consent of the Purchaser, disclose to any third party any information undisclosed to the general public concerning the Claims or any operations thereon, nor shall the Vendor buy, sell or otherwise deal in the shares of the Company while any new, material, confidential information in the possession of the Vendor relating to this Agreement or the Claims remains undisclosed to the general public.

13.

Regulatory Approval

This Agreement is subject to the prior approval of the Exchange and the parties agree to use their best efforts to obtain such approval as soon as reasonably possible after the due execution of this agreement.

14.

Further Acts

The Vendor shall do all such acts and execute all such transfers and any other documents as required by the Purchaser to carry out the intent of this Agreement, as requested by the Purchaser.

15.

Assignment

The Vendor may not assign this Agreement or pledge or encumber any part of his interest in it without the prior written consent of the Purchaser which shall not be unreasonably withheld.

16.

Entire Agreement

This Agreement constitutes the entire agreement between the parties hereto with respect to the subject matter of this Agreement and supersedes all prior oral or written understandings, agreements or contracts with respect thereto. No changes, alterations or modifications of this Agreement shall be binding upon either party until and unless a memorandum in writing to such effect shall have been signed by all parties hereto.

17.

Counterparts

This agreement may be signed by the parties in as many counterparts as may be necessary and by facsimile, each of which so signed shall be deemed to be an original, and such counterparts together shall constitute one and the same instrument and notwithstanding the date of execution, shall be deemed to bear the date as set forth below.

IN WITNESS WHEREOF the parties have duly executed this Agreement as of the date first above written.

SIGNED, SEALED and DELIVERED

)

in the presence of:

)

)

Name

)

David Miller

)

Address

)

)

STRATHMORE RESOURCES (US) LTD.

By its Authorized Signatory:

Schedule A

Wyoming basin’s Uranium leases located in the Shirley Basin, Great Divide Basin, Powder River Basin of New Mexico as follows:

Schedule B

EX-20

ARRANGEMENT INVOLVING
STRATHMORE MINERALS CORP.,
ITS SECURITYHOLDERS
AND
FISSION ENERGY CORP.

ANNUAL AND SPECIAL MEETING
OF SECURITYHOLDERS OF STRATHMORE MINERALS CORP.
TO BE HELD ON JUNE 19, 2007

NOTICE OF ANNUAL AND SPECIAL MEETING
AND
MANAGEMENT INFORMATION CIRCULAR

May 8, 2007

Neither the TSX Venture Exchange Inc. nor any securities regulatory authority has in any way
passed upon the merits of the transaction described in this Information Circular.

May 8, 2007

Dear Strathmore Securityholder:

The Board of Directors of Strathmore Minerals Corp. (“Strathmore”) invites you to attend an annual and special meeting of securityholders (the “Meeting”) of Strathmore on Tuesday, June 19, 2007, at 2nd Floor, Metropolitan Hotel, 645 Howe Street, Vancouver, British Columbia at 11:00 a.m. (local time in Vancouver).

At the Meeting, holders of Strathmore’s common shares (“Common Shareholders”) will be asked to participate in the following annual general meeting business matters:

(a)

receiving and considering the audited financial statements of Strathmore for the fiscal year ended December 31, 2006 and the report of the auditors thereon;

(b)

electing directors of Strathmore for the ensuing year;

(c)

appointing auditors of Strathmore for the ensuing year and authorizing the directors to fix their remuneration;

(d)

considering and, if deemed appropriate, approving with or without amendment the ordinary resolution approving Strathmore’s stock option plan and the granting of options under such plan;

(e)

subject to the approval of the plan of arrangement referred to below (the “Arrangement”), considering and, if deemed appropriate, approving with or without amendment the ordinary resolution approving the organization of Fission Energy Corp. (“Fission Energy”) and Fission Energy’s stock option plan; and

(f)

transacting such other business as may properly come before the said meeting or any adjournment thereof.

In addition, holders of Strathmore’s warrants to purchase common shares (“Warrantholders”), holders of options to purchase common shares (“Optionholders”) and Common Shareholders will collectively be asked to consider and, if deemed appropriate, approve with or without amendment the special resolution approving and adopting the Arrangement between Strathmore and Fission Energy, which is discussed in more detail in the attached management information and proxy circular (the “Information Circular”).

In order to become effective, the Arrangement must be approved by at least 66 2/3% of the votes cast at the Meeting by the Common Shareholders, Warrantholders and Optionholders voting together as a single class, as well as by at least a simple majority of the votes cast by the Common Shareholders.  All other matters will be considered and voted on by the Common Shareholders only.

It is a condition to the completion of the Arrangement that the common shares of Fission Energy will be listed on the TSX Venture Exchange concurrently with the closing of the Arrangement.  The listing of such securities on the TSX Venture Exchange is subject to, among other things, meeting minimum listing requirements, and the Exchange’s approval.

The directors of Strathmore believe that the creation of two separate public companies dedicated to the pursuit of their respective businesses will focus the efforts of each company, and provide Strathmore’s securityholders with additional investment choices and enhanced flexibility.

After careful consideration, the Board of Directors has unanimously determined that the Arrangement is fair to Strathmore’s securityholders and is in the best interests of Strathmore.  A description of the various factors considered by the Board of Directors in arriving at this determination is contained in the enclosed Information Circular.  The Board of Directors of Strathmore unanimously recommends that Strathmore’s securityholders vote in favour of the Arrangement.

The attached Notice of Annual and Special Meeting and Information Circular contain a detailed description of the business to be transacted at the Meeting and include certain other information to assist you in considering the matters to be voted upon.  You are urged to read this material carefully and, if you require assistance, to consult your financial or other professional advisors.  As explained more fully in the attached Information Circular, in addition to approval by Strathmore’s securityholders, completion of the Arrangement is subject to certain conditions and receipt of all applicable regulatory and court approvals.

If you are a registered securityholder and unable to be present at the Meeting in person, we encourage you to vote by completing the applicable enclosed form(s) of proxy.  Your vote is important regardless of the number of securities you own.  You should specify your choice by marking the box on the applicable enclosed form(s) of proxy and by dating, signing and returning the applicable form(s) of proxy in the appropriate return envelope addressed to CIBC Mellon Trust Company to be received by 10:00 a.m. (local time in Vancouver) on June 15, 2007.  Please do this as soon as possible.  Voting by proxy will not prevent you from voting in person if you attend the Meeting, but will ensure that your vote will be counted if you are unable to attend.

If you are a non-registered securityholder of Strathmore and received these materials through your broker or another intermediary, please complete and return the materials in accordance with the instructions provided to you by your broker or such other intermediary.

We consider the Arrangement an important step in Strathmore’s growth and hope you will be able to attend the Meeting.

Yours truly,

(signed) DEVINDER RANDHAWA

Devinder Randhawa

Chairman and Chief Executive Officer

NOTICE OF ANNUAL AND SPECIAL MEETING OF SECURITYHOLDERS

NOTICE IS HEREBY GIVEN that an annual and special meeting (the “Meeting”) of holders of common shares, warrants and options (collectively, the “Securityholders”) of Strathmore Minerals Corp. (“Strathmore”) will be held on Tuesday, June 19, 2007 at 2nd Floor, Metropolitan Hotel, 645 Howe Street, Vancouver, British Columbia at 11:00 a.m. (local time in Vancouver).

At the Meeting, holders of Strathmore’s common shares (“Common Shareholders”) will be asked to participate in the following annual general meeting business matters:

(a)

receiving and considering the audited financial statements of Strathmore for the fiscal year ended December 31, 2006 and the report of the auditors thereon;

(b)

electing directors of Strathmore for the ensuing year;

(c)

appointing auditors of Strathmore for the ensuing year and authorizing the directors to fix their remuneration;

(d)

considering and, if deemed appropriate, approving with or without amendment the ordinary resolution approving Strathmore’s stock option plan and the granting of options under such plan;

(e)

subject to the approval of the plan of arrangement referred to below (the “Arrangement”), considering and, if deemed appropriate, approving with or without amendment the ordinary resolution approving the organization of Fission Energy Corp. (“Fission Energy”) and Fission Energy’s stock option plan; and

(f)

transacting such other business as may properly come before the said meeting or any adjournment thereof.

In addition, holders of Strathmore’s warrants to purchase common shares (“Warrantholders”), holders of options to purchase common shares (“Optionholders”) and Common Shareholders will collectively be asked to consider and, if deemed appropriate, approve with or without amendment the special resolution approving and adopting the Arrangement between Strathmore and Fission Energy, which is discussed in more detail in the attached management information and proxy circular (the “Information Circular”).

Only Securityholders of record at the close of business on May 7, 2007, the record date for the Meeting, will be entitled to notice of, to attend and to vote at, the Meeting and postponement(s) or adjournment(s) thereof in respect of the relevant resolutions(s), except to the extent that a Securityholder has transferred any securities of Strathmore subsequent to the record date and the new holder of such securities establishes proper ownership and requests, not less than 10 days before the date of the Meeting, to be included in the list of Securityholders eligible to vote at the Meeting in respect of the relevant resolution(s).

Whether or not you intend to attend the Meeting, you are requested to complete the applicable enclosed form(s) of proxy (printed on blue paper for Shareholders, on green paper for Warrantholders and on yellow paper for Optionholders) in accordance with the instructions set out therein and in the Information Circular and return the form(s) of proxy in the envelope provided for that purpose.  To be effective, proxies must be received either by mail or delivery addressed to CIBC Mellon Trust Company at 1066 West Hastings Street, Vancouver, British Columbia, V6E 3X1 or by facsimile at (604) 688-4301, in each case prior to 11:00 a.m. (Vancouver time) on June 15, 2007 or, if the Meeting is adjourned or postponed, not less than 48 hours (excluding Saturdays, Sundays and holidays) before the time the adjourned Meeting is reconvened or the postponed Meeting is convened.  In certain circumstances, proxies may also be deposited with the scrutineers of the Meeting, to the attention of the chair of the Meeting, at or immediately prior to the commencement of the Meeting or any postponement(s) or adjournment(s) thereof.

DATED at Vancouver, British Columbia this 8^th day of May, 2007.

BY ORDER OF THE BOARD OF DIRECTORS

(signed) DEVINDER RANDHAWA

Devinder Randhawa
Chairman and Chief Executive Officer

TABLE OF CONTENTS

FORWARD-LOOKING STATEMENTS

i

SUMMARY

1

GENERAL PROXY INFORMATION

1

Solicitation of Proxies by Management

1

Appointment and Revocation of Proxies

1

Signature of Proxy

1

Voting of Proxies

2

Exercise of Discretion by Proxies

2

Voting Securities

2

INFORMATION CONCERNING STRATHMORE

3

Strathmore’s Year-End Audited Financial Statements

3

Principal Shareholders

3

Executive Compensation

3

Long-Term Incentive Plan Awards

4

Stock Appreciation Rights

4

Stock Option Grants During 2006

4

Termination of Employment, Change in Responsibilities and Employment Contracts

5

Compensation of Directors of the Company

5

Securities Authorized for Issuance under Equity Compensation Plans

5

Indebtedness of Directors, Executive Officers And Senior Officers

6

Interest of Informed Persons In Material Transactions

6

Management Contracts

7

Interest of Certain Persons In Matters To Be Acted Upon

7

Audit Committee

7

Audit Committee Charter

7

Responsibilities of the Audit Committee

7

Venture Issuer Exemption

9

Corporate Governance

9

Board of Directors

9

Directorship

9

Orientation and Continuing Education

10

Ethical Business Conduct

10

Nomination of Directors

10

Compensation Committee

10

Board Review Process

11

Other Board Committees

11

Additional Information

11

THE ARRANGEMENT

11

General

11

Reasons for the Arrangement

12

Recommendation of Directors

12

Fairness of the Arrangement

12

Details of the Arrangement

13

Authority of Board of Directors of Strathmore

15

Conditions to the Arrangement

16

Securityholder Approval

17

Court Approval of the Arrangement

17

Proposed Timetable for Arrangement

18

Fission Energy Share Certificates and Certificates for Strathmore New Shares

18

Relationship Between Strathmore and Fission Energy after the Arrangement

19

Effect of Arrangement on Outstanding Stock Options and Share Purchase Warrants

19

Resale of Strathmore New Shares and Fission Energy Shares

20

Expenses of Arrangement

22

INCOME TAX CONSIDERATIONS

22

Certain Canadian Federal Income Tax Considerations

22

U.S. Federal Income Tax Considerations

29

RIGHTS OF DISSENT

35

RISK FACTORS

36

LEGAL PROCEEDINGS

43

EXPERTS

43

AUDITORS, TRANSFER AGENT AND REGISTRAR

44

MATERIAL CONTRACTS

44

Financial Statements

45

Election of Directors

45

Appointment of Auditors

46

Approval of the Arrangement

47

Approval of Organization of Fission Energy and the Fission Energy Stock Option Plan

47

Other Business

47

INFORMATION CONCERNING STRATHMORE POST-ARRANGEMENT

47

Selected Unaudited Pro Forma Consolidated Financial Information

47

Mineral Properties to be Held Following the Arrangement

48

Roca Honda Property

49

Church Rock Property

61

The Chord Property, USA

74

The Wyoming Properties, USA

74

INFORMATION CONCERNING FISSION ENERGY POST-ARRANGEMENT

74

Name and Incorporation

74

Business History

74

General Development of the Business

75

Description of Assets of Fission Energy

75

Summary of Property Commitments

75

Principal Properties

75

Dieter Lake Property

76

Duddridge Lake Property

85

Description of the Securities

92

Selected Unaudited Pro Forma Financial Information and Management’s Discussion and Analysis

92

Pro Forma Consolidated Capitalization of Fission Energy

93

Fully Diluted Share Capital of Fission Energy

93

Available Funds

94

Principal Purposes for Available Funds

94

Administration Expenses

94

Dividends

95

Prior Sales of Securities of Fission Energy

95

Principal Shareholders of Fission Energy

95

Other Reporting Issuers

97

Promoter of Fission Energy

99

Corporate Cease Trade Orders or Bankruptcies

99

Penalties or Sanctions

100

Conflicts of Interest

100

Proposed Executive Compensation of Fission Energy

101

Indebtedness of Directors and Executive Officers of Fission Energy

101

Investor Relations Arrangements

102

Options and Warrants

102

Auditors, Transfer Agent and Registrar

102

Sponsorship

102

GLOSSARY OF TERMS

102

GLOSSARY OF TERMS

103

AUDITORS’ CONSENTS

108

DIRECTORS’ APPROVAL

109

CERTIFICATE

110

SCHEDULE A THE ARRANGEMENT RESOLUTION

A-1

SCHEDULE B ARRANGEMENT AGREEMENT AND PLAN OF ARRANGEMENT

B-1

SCHEDULE C FISSION ENERGY STOCK OPTION PLAN RESOLUTION

C-1

SCHEDULE D FISSION ENERGY STOCK OPTION PLAN

D-1

SCHEDULE E INTERIM ORDER AND NOTICE OF APPLICATION

E-1

SCHEDULE F DISSENT RIGHTS UNDER THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)

F-1

SCHEDULE G STRATHMORE CONSOLIDATED FINANCIAL STATEMENTS FOR 2005 AND 2006

G-1

SCHEDULE H UNAUDITED PRO FORMA BALANCE SHEETS OF STRATHMORE AND FISSION ENERGY

H-1

FORWARD-LOOKING STATEMENTS

Certain information in this Information Circular and the documents incorporated by reference herein constitute “forward-looking statements”.  All statements, other than statements of historical facts, included herein and in press releases and public statements by our officers or representatives, that address activities, events or developments that management of Strathmore expects or anticipates will or may occur in the future, including such things as future business strategy, competitive strengths, goals, expansion and growth of each of Strathmore’s and Fission Energy’s business, legal proceedings, estimated completion dates, estimated exploration expenditures, operations, mineral resources, current working capital, cash operating costs, plans and other such matters, as well as statements made concerning plans and anticipated effects of the Arrangement are forward-looking statements.  The words “estimate”, “plan”, “anticipate”, “expect”, “intend”, “believe”, “target”, “budget”, “may”, “schedule” and similar words or expressions identify forward-looking statements.  These statements involve known and unknown risks, uncertainties, assumptions and other factors which may cause the actual results, performance or achievements of Strathmore or Fission Energy, including anticipated consequences of the Arrangement, to be materially different from any results, performance or achievements expressed or implied by such forward-looking statements.  These factors include, without limitation, risks related to the Arrangement, including possible non-completion of the Arrangement and the risk that the market price of Strathmore Shares could decrease following the Arrangement.  These factors also include risks related to the businesses of Strathmore and Fission Energy, includ ing risks that Strathmore’s or Fission Energy’s acquisition, exploration and property advancement efforts will not be commercially successful; risks relating to the uranium industry, the inherently hazardous nature of mining-related activities, uncertainties concerning mineral resource estimates, risks relating to intense competition within the mining industry; dilution caused by future fund raising activities and uncertainties regarding such fund raising activities, the potential success of such activities, the risk that the companies’ directors may have conflicts of interest through their involvement in other natural resource companies, potential challenges to title in the companies’ mineral properties, potential effects on Strathmore’s or Fission Energy’s operations of environmental and other regulations in the countries in which it operates; risks due to legal proceedings; uncertainty of being able to raise capital on favourable terms or at all; and risks that may affect Str athmore’s ability to complete the proposed Arrangement including risks that Strathmore may be unable to obtain required securityholder or court approvals.  Additional risks for Fission Energy include, as a newly formed independent company, its lack of operating history; the risk that it may lose key personnel or fail to attract and retain personnel; the risk that Fission Energy may experience difficulty in growth and managing its growth; the potential lack of adequate liquidity for its shares; and the risks inherent in accurately valuing Fission Energy Shares.  Please see “Risk Factors” below for more information about these and other risks.  Securityholders are cautioned against attributing undue certainty to forward looking statements.  Although Strathmore has attempted to identify important factors that could cause actual results to differ materially from those described in forward-looking statements, there may be other factors that cause results not to be as anticipated , estimated or intended.  There can be no assurance that these statements will prove to be accurate as actual results and future events could differ materially from those anticipated in the statements.  Strathmore assumes no obligation to publicly update any forward-looking statements, whether as a result of new information, future events or otherwise.

NOTICE TO UNITED STATES SECURITYHOLDERS

Strathmore and Fission Energy are corporations existing under the laws of British Columbia and Canada, respectively.  The information in this Information Circular relating to Strathmore and Fission Energy has been prepared in accordance with the disclosure requirements of Canadian corporate and securities laws.  The financial statements of Strathmore included herein or incorporated by reference in this Information Circular, as well as the financial information related to Fission Energy, have been prepared in Canadian dollars and in accordance with Canadian GAAP, are subject to Canadian auditing and auditor independence standards, and thus may not be comparable in all respects to financial statements of U.S. companies whose financial statements are prepared in accordance with U.S. GAAP.  Likewise, information concerning the properties and operations of Strathmore and Fission Energy ha s been prepared in accordance with Canadian disclosure standards, which are not comparable in all respects to disclosure standards applicable in the United States.

Mineral resource estimates included and incorporated by reference in this Information Circular were prepared in accordance with the Canadian Securities Administrators’ National Instrument 43-101, which established Canadian standards for public disclosure of scientific and technical information concerning mineral projects.  The requirements of National Instrument 43-101 differ from those of the SEC in a number of material respects, and information concerning descriptions of deposits included and incorporated by reference in this Information Circular may not be comparable to information made public by U.S. companies subject to the reporting requirements of the SEC.  This Information Circular and the documents incorporated by reference use the term “resources” which is a term not recognized by the SEC.  U.S. investors are advised that while “resources” are recog nized and required to be disclosed under Canadian securities laws, the SEC does not recognize the term or permit it to be used in filings by U.S. companies.  Under U.S. standards, a deposit may not be recognized as a “reserve” unless a determination has been made that it may be economically and legally produced or extracted at the time the determination is made.  “Resources” are not “reserves” and U.S. investors are cautioned that “resources” may not ever be converted into “reserves”.  Further, “resources” classified as “inferred resources” have a great amount of uncertainty as to their existence and whether they can be mined economically or legally.  It cannot be assumed that “inferred resources” will ever be upgraded to a higher category, and U.S. investors should not assume that all or any part of an “inferred resource” exists or can be legally or economically mined.

Securityholders should be aware that the transactions pursuant to the Plan of Arrangement whereby (i) Shareholders will dispose of Strathmore Shares and will receive Strathmore New Shares and Fission Energy Shares, (ii) Strathmore Warrantholders will have their warrants adjusted in accordance with the terms of the Strathmore Warrants and (iii) Strathmore Optionholders who are employees (“Employee Optionholders”) will dispose of their Strathmore Options for consideration consisting solely of Strathmore New Options to acquire Strathmore New Shares and Optionholders who are not employees (“Non-Employee Optionholders”) will have the exercise price of their existing Strathmore Options adjusted all as described herein, may have tax consequences both in the U.S. and in Canada.  Such consequences for investors who are resident in, or citizens of, the U.S. may not be described fu lly herein.  See “United States Federal Income Tax Considerations”.  All Securityholders should seek their own tax advice with respect to the tax consequences to them of the transactions contemplated in the Plan of Arrangement.

Enforcement by Strathmore’s and Fission Energy’s securityholders of civil liabilities under U.S. securities laws may be affected adversely by the fact that each of Strathmore and Fission Energy is organized under the laws of a jurisdiction other than the U.S., that certain of the officers and directors of Strathmore and Fission Energy are residents of a country other than the U.S., that some of the experts named in the Information Circular are residents of a country other than the U.S., and that a portion of the assets of Strathmore and a substantial portion of the assets of Fission Energy and such persons are located outside of the U.S.

The securities of Strathmore and Fission Energy issuable in connection with the Arrangement have not been approved or disapproved by the SEC or securities regulatory authorities in any state, nor has the SEC or the securities regulatory authorities of any state passed on the adequacy or accuracy of this Information Circular.  Any representation to the contrary is a criminal offence.

The securities of Strathmore and Fission Energy to be received under the Arrangement have not been and will not be registered under the U.S. Securities Act, and will be issued in reliance on the exemption from the registration requirements of the U.S. Securities Act provided by Section 3(a)(10) thereof.  Section 3(a)(10) of the U.S. Securities Act provides an exemption from registration under the U.S. Securities Act for offers and sales of securities issued in exchange for one or more outstanding securities where the terms and conditions of the issuance and exchange of such securities have been approved by a court authorized to grant such approval after a hearing upon the fairness of the terms and conditions of the issuance and exchange at which all persons to whom the securities will be issued have the right to appear.  The Court is authorized to conduct a hearing at which th e fairness of the terms and conditions of the Arrangement will be considered.  The Court issued the Interim Order on May 8, 2007 and, subject to the approval of the Arrangement by the Securityholders, a hearing on the Arrangement will be held on June 22, 2007 at 9:45 a.m. at the Law Courts, 800 Smithe Street, Vancouver, British Columbia.  All Securityholders are entitled to appear and be heard at this hearing.  See “The Arrangement – Court Approvals of the Arrangement” in this Information Circular.

Strathmore has filed a registration statement on Form 20-F with respect to the Strathmore Shares under the U.S. Exchange Act which has not become effective.  If and when this registration statement on Form 20-F becomes effective, Strathmore will become subject to the reporting requirements of Section 12 of the U.S. Exchange Act.  Strathmore and Fission Energy expect that the securities of Fission Energy issued pursuant to the Arrangement will not be registered under the U.S. Exchange Act in reliance on the exemption from registration under the U.S. Exchange Act provided by Rule 12g3-2(b) thereunder, which will require Fission Energy to furnish certain information to the SEC or the public as provided by such rule.

Securities of Strathmore and Fission Energy received by a holder who will be an “affiliate” of Strathmore or Fission Energy after the Arrangement, or is an “affiliate” of Strathmore or Fission Energy prior to the Arrangement, will be subject to certain restrictions on resale imposed by the U.S. Securities Act.  As defined in Rule 144 under the U.S. Securities Act, an “affiliate” of an issuer is a person that directly, or indirectly through one or more intermediaries, controls, or is controlled by, or is under common control with the issuer.  See “The Arrangement – Resale of Strathmore New Shares and Fission Energy Shares – Exemption from United States Registration Requirements and Resale Restrictions”.  

CURRENCY AND EXCHANGE RATE INFORMATION

All references to “$” or “dollars” set forth in this Information Circular are in Canadian dollars, except where otherwise indicated.

The following table sets forth, for each of the years indicated, the year end exchange rate, the average closing rate and the high and low closing exchange rates of one Canadian dollar in exchange for one U.S. dollar as quoted by the Bank of Canada.  The noon exchange rate on May 7, 2007 as reported by the Bank of Canada for the conversion of Canadian dollars was CAD$1.00 equals U.S.$0.9071.

	Year Ended December 31,
	2003	2004	2005	2006
High	$0.7726	$0.8493	$0.8695	$0.9134
Low	$0.6381	$0.7160	$0.7878	$0.8479
Average	$0.7159	$0.7689	$0.8256	$0.8818
Year End	$0.7713	$0.8320	$0.8606	$0.8581

SUMMARY

The following is a summary of certain information contained elsewhere in this Information Circular, including the schedules attached hereto, which are incorporated into and form part of this Information Circular. Certain capitalized words and terms used in this summary are defined in the Glossary of Terms which follows.  This summary is qualified in its entirety by the more detailed information and financial statements appearing or referred to elsewhere in this Information Circular and the schedules attached hereto.  Securityholders are urged to read this Information Circular and the documents incorporated by reference carefully and in their entirety.

The Meeting

The Meeting will be held on Tuesday, June 19, 2007 at 2nd Floor, Metropolitan Hotel, 645 Howe Street, Vancouver, British Columbia at 11:00 a.m. (Vancouver time).

Purpose of the Meeting

At the Meeting, the Shareholders will receive the audited financial statements of Strathmore for the fiscal year ended December 31, 2006 and will be asked to consider and, if thought fit, to pass resolutions approving or confirming the following matters:

(a)

Electing Strathmore’s directors for the ensuing year;

(b)

Appointing Strathmore’s auditors for the ensuing year and authorizing its directors to fix their remuneration;

(c)

Approving Strathmore’s Stock Option Plan and the granting of options thereunder; and

(d)

Subject to the approval of the Arrangement Resolution discussed below, approving the organization of Fission Energy and the Fission Energy Stock Option Plan.

In addition, Shareholders, Warrantholders and Optionholders will be asked as a group to consider and, if thought fit, to pass a resolution approving the Arrangement.  In order to become effective, the Arrangement must be approved by a least 66 2/3% of the votes cast at the Meeting by the Securityholders voting together as a single class, as well as by at least a simple majority of the votes cast by the Shareholders.

By passing the Arrangement Resolution approving the Arrangement, the Securityholders will also be giving authority to Strathmore’s Board of Directors to use its best judgment to proceed with and cause Strathmore to complete the Arrangement in the event of any variation of, or amendments to, the Arrangement Agreement without any requirement to seek or obtain any further approval of the Securityholders.

Meeting Record Date

Strathmore has fixed May 7, 2007 as the record date for determining the Securityholders entitled to receive notice of and vote at the Meeting.

The Arrangement

The purpose of the Arrangement is to “spin-out” Strathmore’s Canadian and Peruvian mineral property interests (together, the “Spin-Off Properties”) into a separate public company, Fission Energy.  The Arrangement will separate the Spin-Off Properties from Strathmore’s other mineral properties located in the United States.  

Strathmore’s Board of Directors believes that the current market price of the Strathmore Shares does not adequately reflect the underlying value of its properties.  In addition, the Board believes that the Arrangement will allow Strathmore to focus on financing and developing the Spin-Off Properties separately, while reducing stock dilution for Securityholders interested in the more advanced Strathmore assets located in the United States.

Upon completion of the Arrangement, Fission Energy will acquire all of Strathmore’s interests in the Spin-Off Properties, together with $500,000 in cash (collectively, the “Spin-Off Assets”).  Each Shareholder, other than a Dissenting Shareholder, will ultimately acquire one new common share in the capital of Strathmore (a “Strathmore New Share”) and one-third of one common share in the capital of Fission Energy (a “Fission Energy Share”) for each Strathmore common share (“Strathmore Share”) held on the Share Distribution Record Date, where the Strathmore New Shares will be identical in every respect to the present Strathmore Shares. See “The Arrangement - Details of the Arrangement”.

Effect of the Arrangement on Strathmore Options and Warrants

Strathmore Options

As of the Effective Date, each outstanding Strathmore Option held by an Employee Optionholder will be disposed of and exchanged for one Strathmore New Option and no other consideration, which Strathmore New Option will be identical in every respect to the Strathmore Option originally granted except it will have an adjusted exercise price to take into account any change in the fair market value of Strathmore Shares as a result of transferring the Spin-Out Assets from Strathmore to Fission Energy.  

The exercise price under the Strathmore New Options will be determined by the Board of Directors such that the difference between the fair market value of a Strathmore Share and the exercise price of the Strathmore Option immediately prior to the Arrangement becoming effective, shall be equal to the difference between the fair market value of a Strathmore New Share and the exercise price of the Strathmore New Option immediately after the Arrangement becoming effective.  The fair market value of the Strathmore Shares and Strathmore New Shares shall be determined as the weighted average trading price for the three days prior to and after the Share Distribution Record Date, respectively.

As of the Effective Date, each outstanding Strathmore Option held by a Non-Employee Optionholder, such as a consultant, will have its exercise price adjusted in accordance with the terms of such Strathmore Options, to take into account any difference in the fair market value of the Strathmore Shares prior to the Arrangement becoming effective and the Strathmore New Shares immediately after the Arrangement becoming effective; however, it will otherwise continue to exist in its current form.  The adjusted exercise price of the existing Strathmore Option held by a Non-Employee Optionholder will be set so that the difference between the fair market value of a Strathmore New Share and the adjusted exercise price of the existing Strathmore Option immediately after the adjustment of the exercise price is equal to the difference between the fair market value of a Strathmore Share and the exercise price of a holder’ ;s Strathmore Option, immediately before the adjustment of the exercise price, as determined by the Board of Directors as described in the paragraph above.

Strathmore Warrants

As of the Effective Date, pursuant to the terms of the warrant agreements entered into on May 9, 2006 between Strathmore and the Warrantholders who received Strathmore Warrants pursuant to Strathmore’s May 2006 brokered private placement, each Strathmore Warrant received in such private placement will be adjusted upon the occurrence of a spin-out transaction to compensate the Warrantholders for the assets spun out and, in the case of the Arrangement, the securities received by a Warrantholder on exercise of a Warrant will be adjusted to reflect the securities received by Shareholders on the Arrangement.

After the Arrangement, each Warrantholder will, upon exercise of the right to purchase Strathmore Shares, be entitled to receive, and shall accept, in lieu of the number of Strathmore Shares to which the Warrantholder was initially entitled upon such exercise, the kind and amount of shares and other securities or property which the Warrantholder would have been entitled to receive as a result of the transferring of the Spin-Out Assets if, on the effective date thereof, the Warrantholder had been the registered holder of the number of Strathmore Shares to which the Warrantholder was theretofore entitled upon such exercise.  Therefore, upon the due exercise of its Warrants, the Warrantholder will receive one Strathmore New Share and one-third of one Fission Energy Share for each Strathmore Warrant so exercised.  The exercise price paid will be split between Strathmore and Fission Energy on the same ratio th at the fair market value of the Spin-Out Assets has to the fair market value of all assets of Strathmore.

Recommendation and Approval of Board of Directors

The Board of Directors of Strathmore has reviewed the Arrangement and concluded that the terms of the Arrangement are fair and reasonable to, and in the best interests of, Strathmore and its Securityholders.  Accordingly, Strathmore’s Board of Directors has approved the Arrangement and authorized the submission of the Arrangement to the Securityholders and the Court for approval.  The Board of Directors of Strathmore recommends that Securityholders vote for the approval of the Arrangement. See “The Arrangement - Recommendation of Directors”.

Reasons for the Arrangement

The formation of Fission Energy to hold the Spin-Off Properties will allow management of Strathmore to focus entirely on the development of the more advanced U.S. Mineral Properties, and free management of Fission Energy to facilitate separate fund-raising, exploration and mining strategies that will be required to move the exploration stage Spin-Off Properties forward.  In addition, Strathmore believes that the creation of two separate public companies dedicated to the pursuit of their respective businesses will focus the efforts of each company, provide Securityholders with additional investment flexibility and also better reflect the value of all of Strathmore’s current assets, including the Spin-Out Assets.

See “The Arrangement - Reasons for the Arrangement”.

Conduct of Meeting and Securityholder Approval

The Interim Order provides that, in order for the Arrangement to proceed, the Arrangement Resolution must be passed, with or without variation, by at least two-thirds of the eligible votes cast at the Meeting by holders of Strathmore Shares, Strathmore Options and Strathmore Warrants voting together as a single class, as well as by at least a simple majority of the votes cast by holders of Strathmore Shares.  See “The Arrangement - Securityholder Approval”.

If the Arrangement Resolution is not passed by an adequate majority of eligible votes at the Meeting, the Arrangement will not be completed, Strathmore will continue to hold and manage the Spin-Off Assets in the same manner as it presently does, and Fission Energy will continue as a private company, wholly-owned by Strathmore.

Court Approval

A Plan of Arrangement under the BCBCA requires court approval. Prior to the mailing of this Information Circular, Strathmore obtained an interim order of the Court authorizing the calling and holding of the Meeting and prescribing the conduct of the Meeting (the “Interim Order”) which is attached as Schedule “E” to this Information Circular. The Interim Order, among other things, provides for the calling and holding of the Meeting and caused to be issued the notice of application for the final order of the Court (the “Final Order”). The Interim Order does not constitute approval of the Plan of Arrangement or the contents of the Information Circular by the Court.  As set forth in the Interim Order, the hearing in respect of the Final Order is scheduled to take place before the Court on June 22, 2007, at 9:45 a.m. (Vancouver time) at the Law Courts, 800 Smithe Street, V ancouver, British Columbia, subject to the adoption of the Plan of Arrangement by Securityholders at the Meeting.  The Notice of Hearing of Petition for the Final Order is attached as part of Schedule “E”.

Income Tax Considerations

Canadian federal income tax considerations to Securityholders are summarized herein under “Certain Canadian Federal Income Tax Considerations” and United States federal income tax considerations to Securityholders subject to such taxation laws are summarized herein under “Certain United States Federal Income Tax Considerations”.   

Securityholders should carefully review the applicable tax considerations under the Arrangement and are urged to consult their own tax advisors in regard to their particular circumstances.

Right to Dissent

The following description of the rights of Dissenting Shareholders is not a comprehensive statement of the procedures to be followed by a Dissenting Shareholder who seeks payment of the fair value of the Shareholder’s Strathmore Shares, and is qualified in its entirety by the reference to the full text of the relevant provisions of the BCBCA. A registered holder of Strathmore Shares who intends to exercise the right of dissent and appraisal should carefully consider and comply with those provisions of Division 2 of Part 8 of the BCBCA. Failure to comply strictly with those provisions of the BCBCA and to adhere to the procedures established therein may result in a loss of all rights of dissent.

Under the BCBCA and the Interim Order, a registered holder of Strathmore Shares has the right to dissent with respect to the Arrangement by filing a written objection (an “Objection Notice”) to the Arrangement Resolution with the Secretary of Strathmore, at Strathmore’s head office, 700 – 1620 Dickson Avenue, Kelowna, British Columbia, V1Y 9Y2, no later than 10:00 a.m. (Vancouver time) on June 18, 2007.  If the Arrangement Resolution is passed and Strathmore intends to act or acts upon it, each Dissenting Shareholder will be entitled to be paid by Strathmore the fair value of the securities in respect of which such Dissenting Shareholder dissents, in accordance with section 245 of the BCBCA. Beneficial owners of Strathmore Shares registered in the name of a broker, custodian, nominee or other intermediary who wish to dissent should be aware that only the registered holders o f Strathmore Shares are entitled to dissent.  Accordingly, a beneficial owner of Strathmore Shares desiring to exercise the right to dissent must make arrangements for the Strathmore Shares beneficially owned by such holder to be registered in his, her or its name prior to the time the written objection to the Arrangement Resolution is required to be received, or alternatively make arrangements for the registered holder of such holder’s Strathmore Shares to dissent on the beneficial holder’s behalf. See “Right of Dissent.” It is a condition of the Arrangement that Dissenting Shareholders holding not more than 3% in the aggregate of the Strathmore Shares exercise rights of dissent in relation to the Arrangement.

Stock Exchange Listings

The Strathmore Shares are currently listed and traded on the TSX Venture Exchange (the “Exchange”) and will continue to be listed following completion of the Arrangement. The closing of the Arrangement is conditional upon the Exchange approving the listing of the Fission Energy Shares on the Exchange.

Information Concerning Strathmore and Fission Energy

See “Information Concerning Strathmore Post-Arrangement” for a summary description of Strathmore, assuming completion of the Arrangement, including pro forma unaudited financial information for Strathmore.  In addition, see “Information Concerning Fission Energy Post-Arrangement” for a description of the properties, corporate structure and business, including pro forma unaudited financial information, of Fission Energy, assuming completion of the Arrangement.

Selected Unaudited Pro Forma Consolidated Financial Information for Strathmore

The following selected unaudited pro forma consolidated financial information for Strathmore is based on the assumptions described in the respective notes to the Strathmore unaudited pro forma consolidated balance sheet as at December 31, 2006 attached to this Information Circular as Schedule “H”. This pro forma consolidated balance sheet has been prepared based on the assumption, among other things, that the Arrangement had occurred on December 31, 2006.

	PRO FORMA STRATHMORE MINERALS CORP. (CONSOLIDATED)
ASSETS
CURRENT:
Cash and cash equivalents	$ 4,799,908
Short term investments	$ 27,412,579
Receivables	$ 407,910
Prepaid expenses	$ 30,593
	$ 32,650,990
Equipment	$ 320,201
Land	$ 370,703
Mineral property interests	$ 4,547,525
Deferred exploration costs	$ 3,004,864
TOTAL:	$ 40,894,283
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	$ 708,606
Due to related parties	$ 15,449
	$ 724,055
SHAREHOLDERS’ EQUITY
Share capital	$ 56,464,982
Contributed surplus	$ 1,591,993
Deficit	$ (17,886,747)
	$ 40,170,228
	$ 40,894,283

Selected Unaudited Pro Forma Financial Information for Fission Energy

The following selected unaudited pro forma financial information for Fission Energy is based on the assumptions described in the respective notes to the Fission Energy unaudited pro forma balance sheet as at December 31, 2006 attached to this Information Circular as Schedule “H”.  This pro forma balance sheet has been prepared based on the assumption, among other things, that the Arrangement had occurred on December 31, 2006.  

	PRO FORMA FISSION ENERGY
ASSETS
CURRENT:
Cash and cash equivalents	$ 500,000
Short term investments	-
Receivables	-
Prepaid expenses	-
	$ 500,000
Equipment	-
Land	-
Mineral property interests	$ 3,154,921
Deferred exploration costs	$ 8,941,150
TOTAL:	$ 12,596,071
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	-
Due to related parties	-
	-
SHAREHOLDERS’ EQUITY
Share capital	$ 12,596,071
Contributed surplus	-
Deficit	-
	$ 12,596,071
	$ 12,596,071

Risk Factors

In considering whether to vote for the approval of the Arrangement, Securityholders should be aware that there are various risks, including those described below and those described in the Information Circular. Securityholders should carefully consider these risk factors, together with other information included in this Information Circular, before deciding whether to approve the Arrangement.

Exploration, development and mining operations involve a high degree of risk that even a combination of experience, knowledge and careful evaluation may not be able to overcome.  There is no assurance that commercial quantities of minerals will be discovered on the properties currently held by Strathmore, nor is there any guarantee that Strathmore’s or Fission Energy’s exploration programs will yield positive results.

It will be necessary for Strathmore and Fission Energy to raise additional funds to carry out further exploration and development of their mineral properties and neither Strathmore nor Fission Energy may be able to raise such funds on terms acceptable to it or at all.

Strathmore’s and Fission Energy’s operations will continue to be subject to regulatory and environmental control by, and require licenses, permits and approvals from, governmental bodies over which Strathmore and Fission Energy have no control.  

See “Risk Factors” in the Information Circular.

Post-Arrangement Matters

Upon the Arrangement becoming effective, Shareholders of record on the Share Distribution Record Date will remain shareholders of Strathmore, with each currently held Strathmore Share representing one Strathmore New Share in the capital of Strathmore.  In addition, each Shareholder of record on the Share Distribution Record Date will also receive his, her or its pro rata share of the Fission Energy Shares distributed to Shareholders under the Arrangement.

The Strathmore New Shares will continue to be listed and traded on the Exchange and the closing of the Arrangement is conditional upon the Exchange approving the listing of the Fission Energy Shares.

GENERAL PROXY INFORMATION

Solicitation of Proxies by Management

This Information Circular is provided in connection with the solicitation of proxies by management of Strathmore for use at the 2007 annual and special meeting of Securityholders of Strathmore (the “Meeting”) to be held on June 19, 2007 at 2^nd Floor, Metropolitan Hotel, 645 Howe Street, Vancouver, British Columbia at 11:00 a.m. (Vancouver time).

The cost of such solicitation will be borne by Strathmore. The solicitation of proxies will be primarily by mail, but may also be by telephone, facsimile or in person by the directors, officers and employees of Strathmore, at no additional compensation. In accordance with National Instrument 54-101, arrangements have been made with brokerage houses and other intermediaries, clearing agencies, custodians, nominees and fiduciaries to forward solicitation materials to the beneficial owners of Strathmore Shares held of record by such person and Strathmore may reimburse such persons for reasonable fees and disbursements incurred.

Appointment and Revocation of Proxies

The persons named in the enclosed form(s) of proxy are directors and/or officers of Strathmore. Securityholders have the right to appoint a nominee (who need not be a Securityholder) to represent them at the Meeting other than the persons designated in the enclosed form(s) of proxy, and may do so by inserting the name of the appointed representative in the blank space provided in the first page of the form(s) of proxy. Such Securityholder should notify the nominee of the appointment, obtain the nominee’s consent to act as proxy and provide instructions on how the Securityholder’s Strathmore Securities are to be voted. The nominee should bring personal identification to the Meeting.

A form of proxy will not be valid for the Meeting or any adjournment(s) thereof unless it is completed and signed by the Securityholder or by his attorney authorized in writing, or if the Securityholder is a corporation, under its corporate seal or by a duly authorized officer or attorney of such corporation and delivered to CIBC Mellon Trust Company, 1066 West Hastings Street, Vancouver, British Columbia, V6E 3X1, fax number (604) 688-4301, not less than forty-eight (48) hours (excluding Saturdays, Sundays and holidays) before the Meeting or any adjournment(s) thereof.

In addition to revocation in any other manner permitted by law, a Securityholder who has given a proxy may revoke it, any time before it is exercised, by instrument in writing executed by the Securityholder or by his attorney authorized in writing and deposited either at the offices of Strathmore at any time up to and including the last business day preceding the day of the Meeting, or any adjournment of the Meeting, at which time the proxy is to be used, or with the chairman of the Meeting on the day of the Meeting, or any adjournment of the Meeting. A proxy may also be revoked by the Securityholder personally attending the Meeting and voting his, her or its shares.

Signature of Proxy

The enclosed form(s) of proxy will be executed by the Securityholder or his attorney authorized in writing, or if the Securityholder is a corporation, the proxy(s) should be signed in its corporate name under its corporate seal or by an authorized officer whose title should be indicated. A proxy signed by a person acting as an attorney or in some other representative capacity should reflect such person’s capacity following his, her or its signature and should be accompanied by the appropriate instrument evidencing qualification and authority to act (unless such instrument has been previously filed with Strathmore).

Voting of Proxies

The persons named in the enclosed form(s) of proxy are directors and/or officers of Strathmore and have indicated their willingness to represent as proxy the Securityholder who appoints them. Each Securityholder may instruct his proxy how to vote his, her or its securities by completing the proxy form.

The persons indicated in the accompanying proxy(s) will vote or withhold from voting the securities in respect of which they are appointed proxy on any ballot that may be called for in accordance with the instructions of the Securityholder as indicated on the proxy(s) and, if the Securityholder specifies a choice with respect to any matter to be acted upon, the Strathmore Shares, Strathmore Options or Strathmore Warrants will be voted accordingly.  In the absence of such direction,

(A)

the Strathmore Shares shall be voted in favour of:

1.

the election of the persons proposed to be nominated by management as directors;

2.

the appointment of Davidson & Company LLP, Chartered Accountants, of Vancouver, BC, as auditors of Strathmore;

3.

approving the ordinary resolution approving the Strathmore Stock Option Plan and the quantity of options under such plan;

4.

approving the special resolution approving and adopting the Plan of Arrangement; and

5.

approving the ordinary resolution approving the organization of Fission Energy and the Fission Energy Stock Option Plan; and

(B)

the Strathmore Warrants and Strathmore Options shall be voted in favour of:

1.

approving the special resolution approving and adopting the Plan of Arrangement;

all as more specifically described in this Information Circular.

Exercise of Discretion by Proxies

The enclosed form(s) of proxy confer discretionary authority upon the person indicated in the proxy(s) with respect to amendments or variations to matters identified in the Notice of Meeting and with respect to other matters which may properly come before the Meeting.  At the time of printing of the Information Circular, the management of Strathmore knows of no such amendments, variations or other matters to come before the Meeting other than the matters referred to in the Notice of Meeting and the Information Circular. If any matters which are not now known to the directors and senior officers of Strathmore should properly come before the Meeting, the persons named in the accompanying form(s) of proxy will vote on such matters in accordance with their best judgment.

Voting Securities

Strathmore is authorized to issue an unlimited number of Strathmore Shares without par value.  As of May 1, 2007, there were outstanding (a) 72,170,623 Strathmore Shares, (b) Strathmore Options to acquire an aggregate of 3,935,288 Strathmore Shares and (c) Strathmore Warrants to acquire an aggregate of 541,325 Strathmore Shares.  Each Strathmore Share carries one vote at all meetings of Shareholders.  For purposes of the Arrangement Resolution, each Strathmore Option carries one vote for each Strathmore Share that would be receivable on the exercise of such option and each Strathmore Warrant carries one vote for each Strathmore Share that would be receivable on the exercise of such warrant.

Any Securityholder of record at the close of business on May 7, 2007 who either personally attends the Meeting or who has properly executed and deposited a form of proxy in the manner and subject to the provisions described above shall be entitled to vote or have his, her or its Strathmore Securities voted at the Meeting.  Securityholders will only be entitled to vote his or her Strathmore Securities other than Strathmore Shares, or have his or her Strathmore Securities other than Strathmore Shares voted, on the approval of the Arrangement Resolution.

INFORMATION CONCERNING STRATHMORE

Strathmore’s Year-End Audited Financial Statements

Strathmore’s consolidated audited financial statements for the years ended December 31, 2006 and 2005 are attached hereto as Schedule “G”.

Principal Shareholders

To the knowledge of the directors and executive officers of Strathmore, as at May 7, 2007 the only person or company who beneficially owns, directly or indirectly, or exercises control or direction over, more than 10% of the issued and outstanding Strathmore Shares is Sprott Asset Management Inc., 200 Bay Street, Suite 2700, P.O. Box 27, Royal Bank Plaza, South Tower, Toronto, Ontario, V5J 2J1.  As at May 1, 2007, Sprott exercises control or direction over 12,680,400 Strathmore Shares and 415,000 Strathmore Warrants.  Assuming the exercise of the Strathmore Warrants, Sprott exercises control or direction over 18.04% of the issued and outstanding Strathmore Shares.

Executive Compensation

The following table sets forth all compensation for the periods indicated in respect of the individuals who served as the Chief Executive Officer and the Chief Financial Officer of Strathmore at any time during the financial year, each of the three most highly compensated executive officers of Strathmore other than the CEO and CFO, who were serving as executive officers at the end of the most recently completed financial year and whose total salary and bonus exceeded $150,000, and any additional individuals who would have satisfied these criteria except that the individual was not serving as an officer of Strathmore at the end of the most recently completed financial year (collectively, the “Named Executive Officers”).

Summary Compensation Table

		ANNUAL COMPENSATION			LONG-TERM COMPENSATION
					AWARDS		PAYOUTS
NAME AND PRINCIPAL POSITION	FISCAL YEAR (DEC 31)	SALARY ($)	BONUS ($)	OTHER ANNUAL COMPEN-SATION ($)	SECURITIES UNDER OPTIONS/ SARS GRANTED (#)	RESTRICTED SHARES OR RESTRICTED SHARE UNITS ($)	LTIP PAYOUTS ($)	ALL OTHER COMPEN- SATION ($)
Devinder Randhawa, Chief Executive Officer	2006 2005	$164,081 $121,600	$0 $0	$0 $0	375,000 312,500	Nil Nil	Nil Nil	Nil Nil
	2004	$62,455	$0	$0	437,500	Nil	Nil	Nil
Patrick Groening, Chief Financial Officer(1)	2006 2005	$84,000 $80,000	$0 $0	$0 $0	140,000 200,000	Nil Nil	Nil Nil	Nil Nil
	2004	$42,240	$0	$0	175,000	Nil	Nil	Nil
David Miller President(2)	2006 2005	$168,534 $70,956	$0 $0	$0 $0	375,000 350,000	Nil Nil	Nil Nil	Nil Nil

Notes:

1.

Mr. Groening was appointed Chief Financial Officer on April 27, 2005.

2.

Mr. Miller was appointed President and Chief Operating Officer on November 25, 2005.

Long-Term Incentive Plan Awards

A long term incentive plan (“LTIP”) is a plan providing compensation intended to motivate performance over a period greater than one financial year and does not include option or stock appreciation rights (“SARs”) or plans, or plans for compensation through shares or units that are subject to restrictions on resale. Strathmore did not award any LTIPs to any Named Executive Officer during the most recently completed financial year.

Stock Appreciation Rights

A SAR is a right to receive a payment of cash or an issue or transfer of shares based wholly or in part on changes in the trading price of Strathmore’s Shares.  No SARs were granted to, or exercised by, any Named Executive Officer or any directors during the most recently completed financial year.

Stock Option Grants During 2006

The following table sets forth the options to purchase Strathmore Shares granted during 2006 to the Named Executive Officers.

Option/SAR Grants During The Most Recently Completed Financial Year

NAME	SECURITIES UNDER OPTIONS GRANTED (#)	% OF TOTAL OPTIONS GRANTED TO EMPLOYEES IN FINANCIAL YEAR	EXERCISE OR BASE PRICE ($/SECURITY)	MARKET VALUE OF SECURITIES UNDERLYING OPTIONS ON THE DATE OF GRANT ($/SECURITY)	EXPIRATION DATE
Devinder Randhawa	275,000 100,000	10.2% 3.7%	$1.70 $2.10	$1.71 $2.10	August 31, 2011 October 27, 2011
Patrick Groening	100,000 40,000	3.7% 1.5%	$1.70 $2.10	$1.71 $2.10	August 31, 2011 October 27, 2011
David Miller	275,000 100,000	10.2% 3.7%	$1.70 $2.10	$1.71 $2.10	August 31, 2011 October 27, 2011

Aggregated Options Exercises During the Most Recently Completed Financial Year and Financial Year-End Option Values

The following table shows options that were exercised by the Named Executive Officers during the fiscal year ended December 31, 2006 and the value of unexercised options at year end.  

NAME	SECURITIES ACQUIRED ON EXERCISE (#)	AGGREGATE VALUE REALIZED(1) ($)	UNEXERCISED OPTIONS AT FY-END (#) EXERCISABLE/ UNEXERCISABLE(3)	VALUE OF UNEXERCISED IN-THE-MONEY OPTIONS AT FY-END(2) ($) EXERCISABLE/ UNEXERCISABLE(3)
Devinder Randhawa	212,500	$272,000	100,000/60,000 275,000/275,000 100,000/100,000	$183,000/$109,800 $448,250/$448,250 $135,300/$123,000
Patrick Groening	150,000	$359,500	50,000/30,000 100,000/100,000 40,000/40,000	$91,500/$54,900 $163,000/$163,000 $65,200/$49,200
David Miller	250,000	$195,250	100,000/60,000 275,000/275,000 100,000/100,000	$183,000/$109,800 $448,250/$448,250 $135,300/$100,000

Notes:

1.

Aggregate Value Realized is the difference between the market price of Strathmore’s Shares on the date of exercise and the option exercise price, multiplied by the number of Strathmore Shares acquired.

2.

Value of Unexercised Strathmore Options is equal to the difference between the closing price of the Strathmore Shares on the Exchange on December 29, 2006 of $3.33 and the exercise prices of options outstanding, multiplied by the number of shares available for purchase under such options.

3.

Unexercised Strathmore Options are subject to certain vesting provisions whereby 20% of the total number of Strathmore Options granted vest every six months until the Strathmore Options are fully vested. If the Arrangement is approved, the remaining unvested portion of the Strathmore Options will become fully vested.  

Termination of Employment, Change in Responsibilities and Employment Contracts

There are no compensatory plans or arrangements with respect to any Named Executive Officer resulting from the resignation, retirement or any other termination of employment of the officer’s employment or from a change of the Named Executive Officer’s responsibilities following a change in control.

David Miller, the President, is under contract to Strathmore for a period of one year and is paid U.S. $126,000 per year. Patrick Groening, the CFO, is under contract to Strathmore for three years and is paid $84,000 per year. Mr. Randhawa does not have an employment contract.

Compensation of Directors of the Company

None of Strathmore’s directors has received any cash compensation, directly or indirectly, for his services rendered during the most recently completed financial year of Strathmore other than the reimbursement of his expenses or as set out elsewhere in this Information Circular.  See “Interest of Informed Persons”.

Strathmore does not have any non-cash compensation plans for its directors and it does not propose to pay or distribute any non-cash compensation during the current financial year.  During the most recently completed financial year ended December 31, 2006, Strathmore did not have a pension plan for its directors, officers or employees.

Securities Authorized for Issuance under Equity Compensation Plans

The only equity compensation plan which Strathmore has in place is the Strathmore Stock Option Plan which was previously approved by Shareholders. The following table sets out, as of the end of Strathmore’s fiscal year ended December 31, 2006, all required information with respect to compensation plans under which equity securities of Strathmore are authorized for issuance:

PLAN CATEGORY	NUMBER OF SECURITIES TO BE ISSUED UPON EXERCISE OF OUTSTANDING OPTIONS, WARRANTS AND RIGHTS	WEIGHTED-AVERAGE EXERCISE PRICE OF OUTSTANDING OPTIONS, WARRANTS AND RIGHTS	NUMBER OF SECURITIES REMAINING AVAILABLE FOR FUTURE ISSUANCE UNDER EQUITY COMPENSATION PLANS (EXCLUDING SECURITIES REFLECTED IN COLUMN (A))
Equity compensation plans approved by securityholders	4,195,000	$1.82	2,868,154
Equity compensation plans not approved by  securityholders	Nil	Nil	Nil
Total	4,195,000	$1.82	2,868,154

Indebtedness of Directors, Executive Officers And Senior Officers

None of the current or former directors, executive officers or employees of Strathmore or any of its subsidiaries is indebted to Strathmore or any of its subsidiaries, nor are any of these individuals indebted to another entity which indebtedness is the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by Strathmore or any of its subsidiaries.

None of Strathmore’s directors, executive officers, proposed directors or associates of any of them, is, or, at any time since the beginning of the most recently completed financial year has been, indebted to Strathmore or any of its subsidiaries, to another entity which indebtedness is the subject of a guarantee, support agreement, letter of credit or other similar arrangement or understanding provided by Strathmore or any of its subsidiaries, or pursuant to any stock purchase program or any other program.

Interest of Informed Persons In Material Transactions

Since January 1, 2006, being the commencement of Strathmore’s last completed financial year, none of the following persons, except as set out herein and below, has any material interest, direct or indirect, in any transaction or proposed transaction which has materially affected or will materially affect Strathmore or any of its subsidiaries:

(a)

any proposed director of Strathmore;

(b)

any informed person of Strathmore; and

(c)

any associate or affiliate of any of the foregoing persons.

An “informed person” means (i) a director or executive officer of Strathmore; (ii) a director or executive officer of a person or company that is itself an informed person or subsidiary of Strathmore; (iii) any person or company who beneficially owns, directly or indirectly, Strathmore Shares or who exercises control or direction over Strathmore Shares or a combination of both carrying more than 10% of the voting rights attached to all outstanding Strathmore Shares other than shares held by the person or company as underwriter in the course of a distribution; and (iv) Strathmore itself if it has purchased, redeemed or otherwise acquired any of its securities, for so long as it holds any of its securities.

The following directors’ fees were paid to members of Board:

Devinder Randhawa:* $28,500

David Miller:* $13,500

Dr. Dieter Krewedl: $29,000

Michael Halvorson: $31,500

Steven Khan: $14,000

* These amounts are included in the disclosure of salary information in the Summary Compensation table.

Management Contracts

The management functions of Strathmore are substantially performed by directors and senior officers of Strathmore, and, not to any substantial degree, by any other person with whom Strathmore has contracted.

Interest of Certain Persons In Matters To Be Acted Upon

Except as set out herein, no director or executive officer of Strathmore or any proposed nominee of Strathmore’s management for election as a director of Strathmore, nor any associate or affiliate of the foregoing persons, has any material interest, direct or indirect, by way of beneficial ownership or otherwise, in any matter to be acted upon at the Meeting other than the election of directors or the appointment of auditors.

Audit Committee

Multilateral Instrument 52-110 of the Canadian Securities Administrators (“MI 52-110”) requires Strathmore, as a venture issuer, to disclose annually in its Information Circular certain information concerning the constitution of its audit committee and its relationship with its independent auditor, as set forth in the following.

Audit Committee Charter

The audit committee is a committee of the Board of Directors of Strathmore that is independent of Strathmore’s management and represents the interests of Shareholders.

The audit committee is authorized by the Board of Directors to:

(a)

oversee the process of selecting and appointing Strathmore’s external auditor,

(b)

oversee the conduct of the audit, and

(c)

have primary responsibility for the relationship between Strathmore and its external auditor.

Responsibilities of the Audit Committee

The audit committee must:

(a)

take reasonable steps, at the time the auditor’s appointment is under consideration, to ensure that the auditor is independent of management of Strathmore in accordance with applicable standards,

(b)

determine whether the audit fees charged by the auditor appear adequate in relation to the work required to support an audit opinion, without regard to fees that might be paid to the auditor for other services,

(c)

meet with the auditor, regularly and when otherwise appropriate, without management present to determine whether there are any contentious issues between the auditor and management relating to Strathmore’s financial disclosure and, if so, whether those issues have been resolved to the auditor’s satisfaction,

(d)

establish, and monitor compliance with, Strathmore’s policies regarding (i) the auditor’s providing services beyond the scope of Strathmore’s audit, and (ii) Strathmore’s hiring individuals formerly employed by the auditor to fill senior officer positions of Strathmore, and

(e)

prepare annually a report describing the steps it has taken to ensure that the auditor is independent of management of Strathmore, including (i) the policies and procedures followed so that any contracts for non-audit services to be provided by the auditor do not compromise the auditor’s independence, and (ii) the nature of any non-audit service contracts entered into and the amount of the related fees.

Strathmore’s audit committee is comprised of three directors: Devinder Randhawa, Michael Halvorson, and Dr. Dieter A. Krewedl. All audit committee members are “financially literate” (as defined in MI 52-110) and only Devinder Randhawa, the Chief Executive Officer, is not “independent”.

Since the commencement of Strathmore’s most recently completed financial year, Strathmore’s Board of Directors has not failed to adopt a recommendation of the audit committee to nominate or compensate an external auditor.

Since the commencement of Strathmore’s most recently completed financial year, Strathmore has not relied on the exemptions contained in section 2.4 or Part 8 of MI 52-110.  Section 2.4 provides an exemption from the requirements that the audit committee must pre-approve all non-audit services to be provided by the auditor, where the total amount of fees related to the non-audit services are not expected to exceed 5% of the total fees payable to the auditor in the fiscal year in which the non-audit services were provided.  Part 8 permits a company to apply to a securities regulatory authority for an exemption from the requirements of MI 52-110, in whole or in part.

The audit committee has not adopted specific policies and procedures for the engagement of non-audit services.  Subject to the requirements of MI 52-110, the engagement of non-audit services is considered by Strathmore’s Board of Directors, and where applicable the audit committee, on a case-by-case basis.

In the following table, “audit fees” are billed by Strathmore’s external auditor for services provided in auditing Strathmore’s annual financial statements for the subject year.  “Audit-related fees” are fees not included in audit fees that are billed by the auditor for assurance and related services that are reasonably related to the performance of the audit or review of Strathmore’s financial statements.  “Tax fees” are fees billed by the auditor for professional services rendered for tax compliance, tax advice and tax planning.  “All other fees” are fees billed by the auditor for products and services not included in the foregoing categories.

The fees paid by Strathmore to its auditor in each of the last two fiscal years, by category, are as follows:

FINANCIAL YEAR ENDING	AUDIT FEES	AUDIT RELATED FEES	TAX FEES	ALL OTHER FEES
December 31, 2006	$35,000	Nil	$1,250	Nil
December 31, 2005	$35,052	Nil	$3,000	Nil

Venture Issuer Exemption

Strathmore, as a “Venture Issuer”, is relying upon section 6.1 of Multilateral Instrument 52-110 exempting it from certain requirements relating to the composition of the audit committee requirements and reporting obligations.

Corporate Governance

Corporate governance relates to the activities of the Board of Directors, the members of which are elected by and are accountable to the Shareholders, and takes into account the role of the individual members of management who are appointed by the Board and who are charged with the day to day management of Strathmore. The Board of Directors is committed to sound corporate governance practices, which are both in the interest of its Shareholders and contribute to effective and efficient decision making.

Pursuant to National Instrument 58-101 Disclosure of Corporate Governance Practices (“NI 58-101”), Strathmore has reviewed existing guidelines in terms of NI 58-101 and hereby discloses its corporate governance practices in compliance with NI 58-101, as summarized below.

Board of Directors

Directors are considered to be independent if they have no direct or indirect material relationship with Strathmore.  A “material relationship” is a relationship which could, in the view of Strathmore’s Board of Directors, be reasonably expected to interfere with the exercise of a director’s independent judgment.

The Board of Directors facilitates its independent supervision over management by reviewing all significant transactions of Strathmore.

The independent members of the Board of Directors of Strathmore are Michael Halvorson, Dr. Dieter A. Krewedl and Raymond Larson.

The non-independent directors are Devinder Randhawa, Chief Executive Officer and David Miller, President and Chief Operating Officer.

Directorship

Certain of the directors are presently directors in one or more other reporting issuers, as follows:

DIRECTORS	OTHER ISSUERS
Devinder Randhawa	Pacific Asia China Energy Inc., Sernova Corp., Ballyliffin Capital Corp., Jalna Minerals Ltd., Knowledge Plus Multimedia Publishing Ltd.
Dieter A. Krewedl	AuEx Ventures, Inc., Kilgore Minerals Ltd.
Michael Halvorson	Gentry Resources Ltd., Radiant Resources Inc., Orezone Resources Inc., Esperanza Silver Corporation, NovaGold Resources Inc., Pediment Exploration Ltd.

Orientation and Continuing Education

When new directors are appointed, they receive orientation, commensurate with their previous experience, on Strathmore’s uranium properties and on the responsibilities of directors.  Board meetings may also include presentations by Strathmore’s management and employees to give the directors additional insight into Strathmore’s business.

Ethical Business Conduct

The Board of Directors has found that the fiduciary duties placed on individual directors by Strathmore’s governing corporate legislation and the common law and the restrictions placed by applicable corporate legislation on an individual director’s participation in decisions of the Board in which the director has an interest have been sufficient to ensure that the Board operates independently of management and in the best interests of Strathmore.

Nomination of Directors

The Board considers its size each year when it considers the number of directors to recommend to the Shareholders for election at the annual meeting of Shareholders, taking into account the number required to carry out the Board’s duties effectively and to maintain a diversity of views and experience.

The Board does not have a nominating committee, and these functions are currently performed by the Board as a whole.  However, if there is a change in the number of directors required by Strathmore, this policy will be reviewed.

Compensation Committee

The Compensation Committee determines compensation for the directors and executive officers and is comprised of three directors: Devinder Randhawa, Michael Halvorson, and Dr. Dieter A. Krewedl.  

Strathmore’s compensation philosophy for executives continues to follow three underlying principles: namely, (i) to provide a compensation package that encourages and motivates performance; (ii) to be competitive with other companies of similar size and scope of operations so as to attract and retain talented executives; and (iii) to align the interests of its executive officers with the long-term interests of Strathmore and its Securityholders through stock-related programs.

When determining compensation policies and individual compensation levels for executive officers, the Compensation Committee takes into consideration a variety of factors.  These factors include overall financial and operating performance of Strathmore, the Compensation Committee and the Board’s overall assessment of each executive’s individual performance and contribution towards meeting corporate objectives, levels of responsibility, length of service and industry comparables.

Executive compensation is comprised primarily of a base salary and participation in the Strathmore Stock Option Plan and employment benefit plans, and may also consist of bonuses and other perquisites which are awarded on an occasional basis.

The salary for each executive officer’s position is primarily determined having regard for the incumbent’s responsibilities, individual performance factors, overall corporate performance, and the assessment of such individual as presented by management to the Board and the Compensation Committee.  The salary is intended to provide the executive officer with a compensation level competitive with base salaries within the industry.  Executive officers benefit from improved performance of Strathmore almost entirely through their participation in the Strathmore Stock Option Plan and from time to time by the receipt of bonuses.

Board Review Process

The Board has adopted a policy on Board review process.  The Board review process: (a) provides directors with an opportunity once each year to evaluate the Board’s and each Board committee’s performance and to make suggestions for its improvement; (b) provides an opportunity for the Board to comment on the Chairman’s leadership; (c) provides an opportunity for the Chairman to evaluate each director’s individual performance and to make suggestions for improvement.  The Board review process is overseen by the Board as a whole.

Other Board Committees

The board has no other committees other than the audit committee and the compensation committee.

Additional Information

Financial information is provided in Strathmore’s comparative financial statements and related Management’s Discussion and Analysis for its most recently completed financial year.  Copies of these documents will be provided, upon request to the Secretary of Strathmore at 700 – 1620 Dickson Avenue, Kelowna, British Columbia, V1Y 9Y2, free of charge to a Shareholder.  Strathmore may require the payment of a reasonable charge from any person or corporation who is not a Strathmore Shareholder and who requests a copy of such document.  Additional information relating to Strathmore is available on SEDAR at www.sedar.com and on Strathmore’s website at www.strathmoreminerals.com.  

THE ARRANGEMENT

General

The purpose of the Arrangement is to reorganize Strathmore and its present operations into two separate public companies: Strathmore and Fission Energy. Upon the Arrangement becoming effective, Shareholders of record on the Share Distribution Record Date will become shareholders in both companies and will receive one Strathmore New Share and one-third of one Fission Energy Share for each Strathmore Share held by such Shareholder on such date.  Fission Energy will apply to have its shares listed on the Exchange.

On January 31, 2007, the Board of Directors of Strathmore announced the proposed Arrangement to reorganize Strathmore’s mineral property assets in an effort to maximize shareholder value.  The Arrangement has been proposed in order to facilitate the separation of all of Strathmore’s interests in the Athabasca Property, the Comstock Property, the Dieter Lake Property, the Duddridge Lake Property, the Fort McLeod Property, the Staked Canadian Properties and the Staked Peruvian Properties (collectively, the “Spin-Off Properties”) from the Chord Property, New Mexico Properties and Wyoming Properties, located in the United States (collectively, the “U.S. Mineral Properties”). Pursuant to the Arrangement, the Spin-Off Properties will be transferred to Fission Energy, while Strathmore will retain all of the U.S. Mineral Properties. Concurrently, Strathmore will transfer to F ission Energy $500,000 in cash to provide working capital and exploration funding (collectively, with the Spin-Off Properties, referred to as the “Spin-Off Assets”).

Reasons for the Arrangement

The reorganization is designed to improve the identification and valuation of specific Strathmore properties, to enhance Strathmore’s ability to divest specific properties through simpler corporate ownership, and to enable Strathmore to separately finance and develop its various assets, selectively reducing stock dilution.

The Board of Directors of Strathmore is of the view that the Arrangement will benefit Strathmore and its Securityholders.  The Board believes the formation of Fission Energy to hold the Spin-Off Properties will allow management of Strathmore to focus entirely on the development of the more advanced U.S. Mineral Properties, and free management of Fission Energy to facilitate separate fund-raising, exploration and mining strategies that will be required to move the exploration stage Spin-Off Properties forward.  In addition, Strathmore believes that the creation of two separate public companies dedicated to the pursuit of their respective businesses will focus the efforts of each company, provide Securityholders with additional investment flexibility and also better reflect the value of all of Strathmore’s current assets, including the Spin-Out Assets.

Recommendation of Directors

The Board of Directors of Strathmore approved the Arrangement and recommended and authorized the submission of the Arrangement to the Securityholders and the Court for approval. The Board of Directors of Strathmore has concluded that the Arrangement is in the best interests of Strathmore and its Securityholders, and recommends that the Securityholders vote in favour of the Arrangement Resolution proposed to be passed at the Meeting as set forth in the Notice of Meeting.

In reaching this conclusion, the Board of Directors of Strathmore considered the benefits to Strathmore and its Securityholders, as well as the financial position, opportunities and the outlook for the future potential and operating performance of Strathmore and Fission Energy, respectively.

Fairness of the Arrangement

The Arrangement was determined to be fair to the Securityholders by management and the Board of Directors of Strathmore based upon the following factors, among others:

1.

The procedures by which the Arrangement will be approved, including the requirement for two-thirds Securityholder approval and approval by the Court after a hearing at which fairness will be considered;

2.

The proposed listing of the Fission Energy Shares and the continued listing of the Strathmore New Shares on the Exchange; and

3.

The opportunity for Shareholders who are opposed to the Arrangement, upon compliance with certain conditions, to dissent from the approval of the Arrangement in accordance with the Interim Order, and to be paid fair value for their Strathmore Shares.

Each Shareholder on the Share Distribution Record Date will participate in the Arrangement on a pro rata basis and, upon completion of the Arrangement, will continue to hold the same pro rata interest that the Shareholder held in Strathmore prior to completion of the Arrangement through the Shareholder’s holdings of Strathmore New Shares and Fission Energy Shares.

Details of the Arrangement

The following description of the Arrangement is qualified in its entirety by reference to the full text of the Arrangement Agreement, a copy of which is annexed as Schedule “B” to this Information Circular, and the Plan of Arrangement, which forms Exhibit II to the Arrangement Agreement. Each of these documents should be read carefully in its entirety.

Pursuant to the Plan of Arrangement, save and except for Dissenting Shares, the following principal steps will occur and be deemed to occur in the following chronological order as part of the Arrangement:

(a)

the authorized share capital of Strathmore will be altered by:

(i)

renaming and redesignating all of the issued and unissued Strathmore Shares as Class A common shares (the “Strathmore Class A Shares”),

(ii)

creating an unlimited number of common shares without par value (the “Strathmore New Shares”), and

(iii)

creating an unlimited number of preferred shares without par value having the rights and restrictions described in Appendix I to the Plan of Arrangement (the “Strathmore Butterfly Shares”);

(b)

Strathmore’s Notice of Articles will be amended to reflect the alterations in (a) above;

(c)

each issued and outstanding Strathmore Class A Share outstanding on the Share Distribution Record Date shall be exchanged for one Strathmore New Share and one-third of one Strathmore Butterfly Share and such Shareholders shall cease to be the holders of the Strathmore Class A Shares so exchanged.  While each shareholder’s fractional Strathmore Butterfly Shares will be combined, no fractional shares will be issued and shareholders will not receive any compensation in lieu thereof.  The name of each Shareholder who is so deemed to exchange his, her or its Strathmore Class A Shares, shall be removed from the central securities register of Strathmore Class A Shares with respect to the Strathmore Class A Shares so exchanged and shall be added to the central securities registers of Strathmore New Shares and Strathmore Butterfly Shares as the holder of the number of Strathmore New Shares a nd Strathmore Butterfly Shares, deemed to have been received on the exchange, whereupon all of the issued Strathmore Class A Shares shall be cancelled with the appropriate entries being made in the central securities register of Strathmore Class A Shares.  The paid-up capital (as that term is used for purposes of the Tax Act) of the Strathmore Class A Shares immediately prior to the Effective Date shall be allocated between the Strathmore New Shares and the Strathmore Butterfly Shares so that the paid-up capital of the Strathmore New Shares and the Strathmore Butterfly Shares is based on the proportion that the fair market value (as that term is used for purposes of the Tax Act) of the Strathmore New Shares or the Strathmore Butterfly Shares, as the case may be, is of the fair market value of all new shares issued on exchange;

(d)

each holder of Strathmore Butterfly Shares (“Strathmore Butterfly Holder”) issued pursuant to (c) above will transfer to Fission Energy their Strathmore Butterfly Shares. As sole consideration, Fission Energy will issue to each particular Strathmore Butterfly Holder an equal number of Fission Energy Shares having an aggregate fair market value at that time equal to the aggregate fair market value of the Strathmore Butterfly Shares that each particular Strathmore Butterfly Holder so transferred to Fission Energy such that each Strathmore Butterfly Holder will receive one Fission Energy Share for each Strathmore Butterfly Share;

(e)

Strathmore will transfer the Spin-Off Assets to Fission Energy in exchange for that number of Fission Energy Reorganization Shares having an aggregate fair market value equal to the fair market value of the Spin-Off Assets (less the amount of related liabilities of Strathmore being assumed by Fission Energy including the value of the commitment that Fission will make to issue Fission Energy Shares to Strathmore Warrantholders upon exercise of Strathmore Warrants);

(f)

immediately after the transfer of the Spin-Off Assets by Strathmore to Fission Energy pursuant to (e) above, Strathmore will redeem all of the Strathmore Butterfly Shares held by Fission Energy for an amount equal to their fair market value at that time and will issue to Fission Energy, as payment thereof, a non-interest bearing demand promissory note having a principal amount and fair market value equal to the aggregate redemption amount and fair market value of the Strathmore Butterfly Shares so redeemed (the “Strathmore Note”). Fission Energy will accept the Strathmore Note as full satisfaction for the redemption price of its Strathmore Butterfly Shares so redeemed;

(g)

immediately after the transfer of the Spin-Off Assets by Strathmore to Fission Energy pursuant to (e) above, Fission Energy will redeem all of the Fission Energy Reorganization Shares held by Strathmore and will issue to Strathmore, as payment therefore, a non-interest bearing demand promissory note having a principal amount and fair market value equal to the aggregate redemption amount and fair market value of the Fission Energy Reorganization Shares so redeemed (the “Fission Energy Note”). Strathmore will accept the Fission Energy Note as full satisfaction for the redemption price of its Fission Energy Reorganization Shares so redeemed;

(h)

Strathmore will satisfy the principal amount of the Strathmore Note by transferring to Fission Energy the Fission Energy Note that will be accepted by Fission Energy in full payment of Strathmore’s obligation. Concurrently, Fission Energy will satisfy the principal amount of the Fission Energy Note by transferring to Strathmore the Strathmore Note that will be accepted by Strathmore in full payment of Fission Energy’s obligation. The Strathmore Note and Fission Energy Note will both be marked paid in full and cancelled;

(i)

the Strathmore Class A Shares and the Strathmore Butterfly Shares, none of which will be allotted and issued once the steps referred to in (a), (c), (d) and (g) above are completed, shall be cancelled and the authorized capital of Strathmore shall be diminished by deleting the Strathmore Class A Shares and the Strathmore Butterfly Shares as classes of shares of Strathmore;

(j)

the Notice of Articles of Strathmore shall be amended to reflect the alterations in (i) above;

(k)

the Fission Energy Reorganization Shares, none of which will be allotted and issued once the steps referred to in (e) and (f) above are completed, shall be cancelled and the authorized capital of Fission Energy shall be diminished by deleting the Fission Energy Reorganization Shares as a class of shares of Fission Energy;

(l)

the Articles of Fission Energy shall be amended to reflect the alterations in (k) above;

(m)

as of the Effective Date, each outstanding Strathmore Option held by an Employee Optionholder will be disposed of and exchanged for one Strathmore New Option and no other consideration, which will be identical in every respect to the Strathmore Option originally granted except it will have an adjusted exercise price to take into account any change in the fair market value of Strathmore New Shares as a result of transferring the Spin-Out Assets from Strathmore to Fission Energy.  The exercise price under the Strathmore New Options will be determined by the Board of Directors such that the difference between the fair market value of a Strathmore Share immediately prior to the Arrangement becoming effective and the exercise price of the Strathmore Option shall be equal to the difference between the fair market value of a Strathmore New Share and the exercise price of the Strathmore New Option im mediately after the Arrangement becoming effective.  The fair market value of the Strathmore Shares and Strathmore New Shares shall be determined as the weighted average trading price for the three days prior to and after the Share Distribution Record Date, respectively;

(n)

as of the Effective Date, each outstanding Strathmore Option held by a Non-Employee Optionholder, such as a consultant, will have its exercise price adjusted, in accordance with the terms of the existing Strathmore Options, to take into account any differences in the fair market value of the Strathmore Shares prior to the Arrangement becoming effective and the Strathmore New Shares immediately after the Arrangement becoming effective; however, the Strathmore Option will otherwise continue to exist in its current form.  The adjusted exercise price of an existing Strathmore Option held by a Non-Employee Optionholder will be set so that the difference between the fair market value of a Strathmore New Share and the adjusted exercise price immediately after the adjustment of exercise price is equal to the difference between the fair market value of a Strathmore Share and the exercise price of a ho lder’s Strathmore Option immediately before the adjustment as determined by the Board of Directors as set out in paragraph (m); and

(o)

as of the Effective Date, pursuant to the terms of the warrant agreements entered into on May 9, 2006 between Strathmore and the Warrantholders who received Strathmore Warrants pursuant to Strathmore’s May 2006 brokered private placement, each Strathmore Warrant received in such private placement will be adjusted upon the occurrence of a spin-out transaction to compensate the Warrantholders for the assets spun out.  Each Warrantholder will, upon exercise of the right to purchase Strathmore Shares, be entitled to receive, and shall accept, in lieu of the number of Strathmore Shares to which the Warrantholder was initially entitled upon such exercise, the kind and amount of shares and other securities or property which the Warrantholder would have been entitled to receive as a result of the transferring of the Spin-Out Assets if, on the effective date thereof, the Warrantholder had been th e registered holder of the number of Strathmore Shares to which the Warrantholder was theretofore entitled upon such exercise.  Therefore, upon the due exercise of its Warrants, the Warrantholder will receive one Strathmore New Share and one-third of one Fission Energy Share for each Strathmore Warrant so exercised.  The exercise price paid will be split between Strathmore and Fission Energy on the same ratio that the fair market value of the Spin-Out Assets has to the fair market value of all assets of Strathmore.

In addition to the principal steps of the Arrangement occurring in the chronological order set out above, the time for the redemption of the Strathmore Butterfly Shares set out in step (g) above will be deemed to occur immediately upon the listing of the Strathmore Butterfly Shares on the Exchange. After the time of redemption, the Strathmore Butterfly Shares will be delisted from the Exchange. The Strathmore New Shares and the Fission Energy Shares will be listed on the Exchange on the Effective Date at the conclusion of the steps set out above.

Authority of Board of Directors of Strathmore

By passing the Arrangement Resolution approving the Arrangement, the Securityholders will also be giving authority to the Board of Directors of Strathmore to use its best judgement to proceed with and cause Strathmore to complete the Arrangement in the event of any variation of, or amendments to, the Arrangement Agreement, without any requirement to seek or obtain any further approval of the Securityholders.

The Arrangement Resolution also provides that the Plan of Arrangement may be amended by the Board of Directors of Strathmore before or after the Meeting without further notice to Securityholders. The Board of Directors has no current intention to amend the Plan of Arrangement; however, it is possible that management of Strathmore may determine, on the basis set forth below, that it is appropriate that amendments be made.

Conditions to the Arrangement

The Arrangement Agreement provides that the Arrangement will be subject to the fulfillment of certain conditions, including the following:

(a)

The Arrangement Agreement must be approved by the Securityholders in the manner referred to under “Securityholder Approval”;

(b)

The Arrangement must be approved by the Court in the manner referred to under “Court Approval of the Arrangement”;

(c)

The Exchange will have conditionally approved the Arrangement, including the listing of the Strathmore Class A Shares in substitution for the Strathmore Shares, the delisting of the Strathmore Class A Shares and in substitution the listing of the Strathmore New Shares and the Strathmore Butterfly Shares, the subsequent delisting of the Strathmore Butterfly Shares, and the listing of the Fission Energy Shares issuable under the Arrangement as of the Effective Date, subject to compliance with the requirements of the Exchange;

(d)

All other consents, orders, regulations and approvals, including regulatory and judicial approvals and orders, required, necessary or desirable for the completion of the Arrangement will have been obtained or received, each in form acceptable to Strathmore and Fission Energy;

(e)

There shall not be in force any order or decree restraining or enjoining the consummation of the transactions contemplated by the Arrangement;

(f)

Notices of dissent will not have been delivered by Shareholders holding greater than 3% of the outstanding Strathmore Shares; and

(g)

The Arrangement Agreement will not have been terminated as provided for therein.

If any of the conditions set out in the Arrangement Agreement are not fulfilled or performed, Strathmore may terminate the Arrangement Agreement, or Strathmore may waive the condition in whole or in part.  As soon as practicable after the fulfillment of the conditions contained in the Arrangement Agreement, the Board of Directors of Strathmore intends to cause a certified copy of the Final Order to be filed with the Registrar under the BCBCA, together with such other material as may be required by the Registrar in order that the Arrangement will become effective.

Management of Strathmore believes that all material consents, orders, regulations, approvals or assurances required for the completion of the Arrangement will be obtained prior to the Effective Date in the ordinary course upon application therefor.

If the Arrangement Resolution is not passed by an adequate majority of eligible votes at the Meeting, the Arrangement will not be completed, Strathmore will continue to hold and manage the Spin-Off Assets in the same manner as it presently does, and Fission Energy will continue as a private company.

Securityholder Approval

In order for the Arrangement to become effective, the Arrangement Resolution must be passed, with or without variation, by at least two-thirds of the eligible votes cast at the Meeting in respect of the Arrangement Resolution by holders of Strathmore Shares, Strathmore Options and Strathmore Warrants voting together as a single class, as well as by at least a simple majority of the votes cast by holders of Strathmore Shares.

The Arrangement Resolution must not include votes attached to Strathmore Shares which, to the knowledge of Strathmore or its directors or executive officers, are beneficially owned or over which control or direction is exercised by the following persons:

(a)

an interested party who is not treated identically to all other holders of Strathmore Shares and who receives, directly or indirectly, as a consequence of the related party transaction, consideration of greater value than that received by all other holders of Strathmore Shares;

(b)

a related party of an interested party, unless:

(i)

the related party is a director of the issuer who is independent of the interested party; or  

(ii)

the related party and the interested party are treated identically to all other holders of Strathmore Shares and do not receive, directly or indirectly, as a consequence of the related party transaction, consideration of greater value than that received by all other holders of Strathmore Shares and the related party of an interested party does not hold, directly or indirectly, whether alone or jointly or in concert with others, securities of more than one party to the related party transaction sufficient to affect materially the control of such parties; and

(c)

a person or company acting jointly or in concert with a person or company referred to in paragraph (a) or (b) in respect of the transaction.

Certain directors and executive officers of Strathmore own Strathmore Shares and/or options to acquire Strathmore Shares. Insofar as such persons will receive Fission Energy Shares based on the same pro rata distribution as the other Shareholders with respect to the distribution of the Fission Energy Shares to the Shareholders under the Arrangement, they are not considered to be “interested parties” within the meaning of OSC Rule 61-501.

If the Arrangement Resolution is not passed by an adequate majority of eligible votes at the Meeting, the Arrangement will not be completed, Strathmore will continue to hold and manage the Spin-Off Assets in the same manner as it presently does, and Fission Energy will continue as a private company.

Court Approval of the Arrangement

A Plan of Arrangement under the BCBCA requires court approval. Prior to the mailing of this Information Circular, Strathmore obtained an interim order of the Court authorizing the calling and holding of the Meeting and prescribing the conduct of the Meeting (the “Interim Order”) which is attached as Schedule “E” to this Information Circular. The Interim Order, among other things, provides for the calling and holding of the Meeting and caused to be issued the notice of application for the final order of the Court (the “Final Order”). The Interim Order does not constitute approval of the Plan of Arrangement or the contents of this Information Circular by the Court.  As set forth in the Interim Order, the hearing in respect of the Final Order is scheduled to take place before the Court on June 22, 2007, at 9:45 a.m. (Vancouver time) at the Law Courts, 800 Smithe Street, Vancouver, British Columbia, subject to the adoption of the Plan of Arrangement by Strathmore’s Securityholders at the Meeting.

The authority of the Court is very broad under the BCBCA.  Strathmore has been advised by its counsel that the Court may make any enquiry it considers appropriate and may make any order it considers appropriate with respect to the Plan of Arrangement. The Court will consider, among other things, the fairness and reasonableness of the Plan of Arrangement to Securityholders.  The Court may approve the Plan of Arrangement either as proposed or as amended in any manner the Court may direct, subject to compliance with such terms and conditions, if any, as the Court thinks fit.

The Court will be advised prior to the hearing of the application for the Interim Order and the Final Order that the Court’s determination that the Plan of Arrangement is fair and reasonable will form the basis for an exemption from the registration requirements of the U.S. Securities Act with respect to the securities of Strathmore and Fission Energy to be issued pursuant to the Plan of Arrangement.

Proposed Timetable for Arrangement

The anticipated timetable for the completion of the Arrangement and the key dates proposed are as follows:

Record Date:

May 7, 2007

Annual and Special General Meeting:

June 19, 2007

Final Court Approval:

June 22, 2007

Share Distribution Record Date:

July 9, 2007

Effective Date:

July 13, 2007

Mailing of Certificates for Fission Energy Shares:

July 17, 2007

The Boards of Directors of Strathmore and Fission Energy will determine the exact Share Distribution Date, Effective Date and Mailing of Certificates for Fission Energy Shares date depending on when all the conditions to the completion of the Arrangement are satisfied. Notice of the actual Effective Date and Share Distribution Record Date will be given to Securityholders through a press release and an Exchange Bulletin when all the conditions to the Arrangement have been met or the Court and the Board of Directors of Strathmore are of the view that all transactions will be completed.

The foregoing dates may be amended if all of the conditions to the completion of the Arrangement are not met by July 13, 2007.

Fission Energy Share Certificates and Certificates for Strathmore New Shares

Pursuant to the Plan of Arrangement, the close of business on the fourth Business Day prior to the Effective Date has been established as the Share Distribution Record Date for purposes of determining Shareholders who will be entitled to receive certificates representing Fission Energy Shares.  After the Share Distribution Record Date, the share certificates representing, on their face, Strathmore Shares are deemed to represent only Strathmore New Shares. On or before the Share Distribution Record Date, the share certificates representing, on their face, Strathmore Shares are deemed under the Plan of Arrangement to represent Strathmore New Shares and an entitlement to Fission Energy Shares in accordance with the terms of the Arrangement. As soon as practicable after the Effective Date, share certificates representing the Fission Energy Shares will be sent to all Shareholders of record on the Share Distribution Record Date.

No new share certificates will be issued for the Strathmore New Shares issued pursuant to the Arrangement and therefore holders of Strathmore Shares must retain their certificates as evidence of their ownership of Strathmore New Shares.  Certificates representing, on their face, Strathmore Shares will constitute good delivery in connection with the sale of Strathmore New Shares completed through the facilities of the Exchange after the Effective Date.

Relationship Between Strathmore and Fission Energy after the Arrangement

On completion of the Arrangement, Strathmore and Fission Energy will both have the same individuals filling director and executive officer positions. See “Information Concerning Fission Energy – Directors and Officers of Fission Energy”.

Effect of Arrangement on Outstanding Stock Options and Share Purchase Warrants

Strathmore Options

As of the Effective Date, each outstanding Strathmore Option held by an Employee Optionholder will be disposed of and exchanged for one Strathmore New Option and no other consideration, which Strathmore New Option will be identical in every respect to the Strathmore Option originally granted except it will have an adjusted exercise price to take into account any change in the fair market value of Strathmore Shares as a result of transferring the Spin-Out Assets from Strathmore to Fission Energy.  

The exercise price under the Strathmore New Options will be determined by the Board of Directors such that the difference between the fair market value of a Strathmore Share and the exercise price of the Strathmore Option immediately prior to the Arrangement becoming effective, shall be equal to the difference between the fair market value of a Strathmore New Share and the exercise price of the Strathmore New Option immediately after the Arrangement becoming effective.  The fair market value of the Strathmore Shares and Strathmore New Shares shall be determined as the weighted average trading price for the three days prior to and after the Share Distribution Record Date, respectively.

As of the Effective Date, each outstanding Strathmore Option held by a Non-Employee Optionholder, such as a consultant, will have its exercise price adjusted in accordance with the terms of such Strathmore Options, to take into account any difference in the fair market value of the Strathmore Shares prior to the Arrangement becoming effective and the Strathmore New Shares immediately after the Arrangement becoming effective; however, it will otherwise continue to exist in its current form.  The adjusted exercise price of the existing Strathmore Option held by a Non-Employee Optionholder will be set so that the difference between the fair market value of a Strathmore New Share and the adjusted exercise price of the existing Strathmore Option immediately after the adjustment of the exercise price is equal to the difference between the fair market value of a Strathmore Share and the exercise price of a holder’ ;s Strathmore Option, immediately before the adjustment of the exercise price, as determined by the Board of Directors as described in the paragraph above.

Strathmore Warrants

As of the Effective Date, pursuant to the terms of the warrant agreements entered into on May 9, 2006 between Strathmore and the Warrantholders who received Strathmore Warrants pursuant to Strathmore’s May 2006 brokered private placement, each Strathmore Warrant received in such private placement will be adjusted upon the occurrence of a spin-out transaction to compensate the Warrantholders for the assets spun out and, in the case of the Arrangement, the securities received by a Warrantholder on exercise of a Warrant will be adjusted to reflect the securities received by Shareholders on the Arrangement.

After the Arrangement, each Warrantholder will, upon exercise of the right to purchase Strathmore Shares, be entitled to receive, and shall accept, in lieu of the number of Strathmore Shares to which the Warrantholder was initially entitled upon such exercise, the kind and amount of shares and other securities or property which the Warrantholder would have been entitled to receive as a result of the transferring of the Spin-Out Assets if, on the effective date thereof, the Warrantholder had been the registered holder of the number of Strathmore Shares to which the Warrantholder was theretofore entitled upon such exercise.  Therefore, upon the due exercise of its Warrants, the Warrantholder will receive one Strathmore New Share and one-third of one Fission Energy Share for each Strathmore Warrant so exercised.  The exercise price paid will be split between Strathmore and Fission Energy on the same ratio th at the fair market value of the Spin-Out Assets has to the fair market value of all assets of Strathmore.

Resale of Strathmore New Shares and Fission Energy Shares

Exemption from Canadian Prospectus Requirements and Resale Restrictions

The issue of Strathmore New Shares and Fission Energy Shares pursuant to the Arrangement will be made pursuant to exemptions from the registration and prospectus requirements contained in applicable provincial securities legislation in the provinces of Canada. Under applicable provincial securities laws, such Strathmore New Shares and Fission Energy Shares may be resold in Canada without hold period restrictions, except that any person, company or combination of persons or companies holding a sufficient number of Strathmore New Shares or Fission Energy Shares to affect materially the control of Strathmore or Fission Energy, respectively, will be restricted in reselling such shares pursuant to securities laws applicable in Canada. In addition, unless otherwise exempted, existing hold periods on any Strathmore Shares in effect prior to the Effective Date, will be carried forward to the Strathmore New Shares and the Fi ssion Energy Shares that result from such Strathmore Shares under the Arrangement.

The foregoing discussion is only a general overview of the requirements of Canadian securities laws for the resale of the Strathmore New Shares and the Fission Energy Shares received upon completion of the Arrangement. All holders of Strathmore Shares are urged to consult with their own legal counsel to ensure that any resale of their Strathmore New Shares and Fission Energy Shares complies with applicable securities legislation.

Exemption from United States Registration Requirements and Resale Restrictions

The Strathmore New Shares, the Fission Energy Shares, the Strathmore Warrants, the Strathmore New Options and the Strathmore Butterfly Shares to be issued to the Shareholders and Optionholders, as applicable, pursuant to the Arrangement will not be registered under the U.S. Securities Act. The Strathmore New Shares, the Fission Energy Shares, the Strathmore Warrants, the Strathmore New Options and the Strathmore Butterfly Shares will be issued in reliance upon the exemption from registration provided by Section 3(a)(10) of the U.S. Securities Act. Section 3(a)(10) exempts securities issued in exchange for one or more outstanding securities from the general requirement of registration where the terms and conditions of the issuance and exchange of such securities have been approved by any court of competent jurisdiction, after a hearing upon the fairness of the terms and conditions of the issuance and exchange at whic h all persons to whom the securities will be issued have the right to appear. The Court is authorized to conduct a hearing at which the fairness of the terms and conditions of the Arrangement will be considered. The Court granted the Interim Order on May 8, 2007 and, subject to the approval of the Arrangement by Securityholders, a hearing on the Arrangement will be held on June 22, 2007 by the Court. See “The Arrangement – Court Approval of the Arrangement” above.

The Strathmore New Shares, Fission Energy Shares, the Strathmore Warrants and the Strathmore New Options to be issued to Shareholders, Warrantholders and Optionholders, as applicable, in the United States will be freely tradeable under U.S. federal securities laws, except by persons who are “affiliates” of Strathmore or Fission Energy immediately prior to the Arrangement or “affiliates” of Strathmore or Fission Energy after the Arrangement. Persons who may be deemed to be “affiliates” of an issuer include individuals or entities that control, are controlled by, or are under common control with, the issuer, and generally include executive officers and directors of the issuer as well as principal shareholders of the issuer.

Strathmore New Options may not be transferred other than by will or the laws on intestacy.  Subject to certain limitations, affiliates may immediately resell Strathmore New Shares, and Fission Energy Shares outside the United States without registration under the U.S. Securities Act pursuant to Regulation S under the U.S. Securities Act. Strathmore New Shares, Strathmore Warrants, and Fission Energy Shares held by such affiliates may also be resold in compliance with the resale provisions of Rule 145(d)(1), (2), or (3) under the U.S. Securities Act or as otherwise permitted under the U.S. Securities Act.  Rule 145(d)(1) generally provides that such affiliates may not sell the Strathmore New Shares, Strathmore Warrants, and Fission Energy Shares received pursuant to the Arrangement unless pursuant to an effective registration statement or in accordance with the volume, current public information and manner of sale limitations of Rule 144. These limitations generally require that any sales made by an affiliate in any three-month period not exceed the greater of 1% of the outstanding securities of Strathmore or Fission Energy, as applicable, or, if such securities are listed on a United States securities exchange or NASDAQ, the average weekly trading volume of the respective securities over the four calendar weeks preceding the placement of the sell order, and that sales be made in unsolicited, open market “broker transactions” at times when certain information specified by the Rule 144 is publicly available with respect to Strathmore or Fission Energy, as applicable. Rules 145(d)(2) and (3) generally provide that these limitations lapse for non-affiliates of Strathmore and Fission Energy after a period of one or two years, depending upon whether information continues to be publicly available with respect to such entity.

Section 3(a)(10) of the U.S. Securities Act does not exempt the issuance of securities upon the exercise or conversion of securities that were issued pursuant to Section 3(a)(10). Therefore, the Strathmore New Shares issuable upon the exercise of the Strathmore New Options and Strathmore Options, and the Strathmore New Shares and the Fission Energy Shares to be issued upon the exercise of Strathmore Warrants may not be issued in reliance upon Section 3(a)(10) and the Strathmore New Options, Strathmore Options and Strathmore Warrants may be exercised only pursuant to an exemption from the registration requirements of the U.S. Securities Act and applicable state securities laws. As a result, the Strathmore New Options, Strathmore Options and Strathmore Warrants may only be exercised by a holder who represents that, at the time of exercise, the holder is not then located in the United States, is not a U.S. person, as d efined in Rule 902 of Regulation S under the U.S. Securities Act (a “U.S. Person”), and is not exercising the Strathmore New Options, Strathmore Options or Strathmore Warrants, as applicable, for the account or benefit of a U.S. Person or a person in the United States, unless the holder provides a legal opinion or other evidence reasonably satisfactory to Strathmore to the effect that the exercise of the Strathmore New Options, Strathmore Options or Strathmore Warrants, as applicable, does not require registration under the U.S. Securities Act or state securities laws.

In addition, any Strathmore New Shares issuable upon the exercise of the Strathmore New Options and Strathmore Options, and Strathmore New Shares and Fission Energy Shares issuable upon the exercise of Strathmore Warrants in the United States or for the account or benefit of a U.S. Person or a person in the United States will be “restricted securities” within the meaning of Rule 144 under the U.S. Securities Act, certificates representing such Strathmore New Shares and Fission Energy Shares, as applicable, will bear a legend to that effect, and such Strathmore New Shares and Fission Energy Shares, as applicable, may be resold only pursuant to an exemption from the registration requirements of the U.S. Securities Act and all applicable state securities laws. Subject to certain limitations, Strathmore New Shares and Fission Energy Shares, as applicable, may be resold outside the United States without registr ation under the U.S. Securities Act pursuant to Regulation S under the U.S. Securities Act.

The foregoing discussion is only a general overview of certain requirements of United States securities laws applicable to the Strathmore New Shares, Fission Energy Shares and the Strathmore New Options received upon completion of the Arrangement and the Strathmore New Shares issuable upon exercise of the Strathmore New Options and Strathmore Options, and Strathmore New Shares and Fission Energy Shares issuable upon the exercise of Strathmore Warrants. All holders of such securities are urged to consult with counsel to ensure that the resale of their securities complies with applicable securities legislation.

Expenses of Arrangement

Pursuant to the Arrangement Agreement, the costs relating to the Arrangement, including without limitation, financial, advisory, accounting, and legal fees will be borne by the party incurring them unless otherwise agreed by the parties. The costs of the Arrangement to the Effective Date will be borne by Strathmore.

INCOME TAX CONSIDERATIONS

Certain Canadian Federal Income Tax Considerations

The following is a summary of the principal Canadian federal income tax considerations generally applicable in respect of the redesignation of Strathmore Shares as Strathmore Class A Shares (the “Redesignation”), the exchange of Strathmore Class A Shares for Strathmore New Shares and Strathmore Butterfly Shares (the “Share Exchange”) and the transfer of the Strathmore Butterfly Shares to Fission Energy for consideration consisting of only the Fission Energy Shares (the “Share Transfer”) under the Plan of Arrangement, or the exercise of dissent rights, the exchange of Strathmore Options held by Employee Optionholders for Strathmore New Options in certain circumstances, the adjustment of the exercise price of the Strathmore Options held by Non-Employee Optionholders and the adjustments to the Strathmore Warrants, to Shareholders, Optionholders and Warrantholders who a re individuals (other than trusts) and who, for purposes of the Tax Act, deal and will deal at arms’ length with Strathmore and Fission Energy, and hold and will hold their Strathmore Shares, Strathmore Options, Strathmore Warrants and Fission Energy Shares, as applicable, as capital property.  Strathmore Shares, Strathmore Warrants and Fission Energy Shares will generally be considered to be capital property to a holder thereof provided that such holder does not hold any such Strathmore Shares, Strathmore Warrants or Fission Energy Shares in the course of carrying on a business of buying and selling securities and has not acquired such Strathmore Shares, Strathmore Warrants or Fission Energy Shares in a transaction considered to be an adventure in the nature of trade.  Certain shareholders who are resident in Canada and who might not otherwise be considered to hold such Strathmore Shares or Fission Energy Shares as capital property may be entitled to have them treated as capital property by m aking the irrevocable election outlined in subsection 39(4) of the Tax Act to have their Strathmore Shares or Fission Energy Shares and every other “Canadian Security” (as defined in the Tax Act) owned by such holder in the taxation year of the election and in all subsequent taxation years deemed to be capital property.  In addition, this summary does not address income tax considerations applicable to directors, officers or other insiders of Strathmore, Fission Energy or related companies, or persons who hold Strathmore Shares or will hold Fission Energy Shares subject to escrow, trading or other restrictions that might affect the value thereof.  The summary addresses the tax considerations applicable to Strathmore only to the extent expressly set out herein.

This summary is also generally applicable to Shareholders, Optionholders or Warrantholders who at all relevant times:  (i) deal at arm’s length (within the meaning of the Tax Act) with and are not affiliated with Fission Energy or Strathmore; (ii) following the completion of the Arrangement will not, either alone or together with other persons with whom they do not deal at arm’s length, either control Fission Energy or beneficially own shares of Fission Energy which have a fair market value in excess of 50% of the fair market value or all outstanding shares of Fission Energy; and (iii) is and was not a “foreign affiliate” (within the meaning of the Tax Act) of a person resident in Canada at any time.

This summary is based on the current provisions of the Tax Act, the regulations thereunder, all proposals to amend the Tax Act or the regulations publicly announced by the federal Minister of Finance (Canada) prior to the date hereof, and the understanding of Blake, Cassels & Graydon LLP of the current published administrative practices of the Canada Revenue Agency (“CRA”). It has been assumed that all currently proposed amendments will be enacted as proposed and that there will be no other relevant change to the Tax Act or other applicable law or policy, although no assurance can be given in these respects. For purposes of this summary, it has also been assumed that the Strathmore Class A Shares will be or remain listed on the Exchange upon the Redesignation, the Strathmore Butterfly Shares will be listed on the Exchange as of the time of the Share Exchange and the Share Transfer, and the Strat hmore New Shares and Fission Energy Shares will be listed on the Exchange when issued.

No advance income tax ruling has been obtained with respect to the Arrangement.

This summary is not exhaustive of all Canadian federal income tax considerations applicable to Shareholders, Optionholders and Warrantholders under the Plan of Arrangement or in respect of an exercise of dissent rights.  The summary does not take into account provincial, territorial, U.S. or other foreign tax legislation or considerations, which may differ significantly from those discussed herein.

This summary is of a general nature only and is not intended to be, nor should it be considered to be, legal or tax advice to any particular Shareholder, Optionholder or Warrantholder. The tax consequences to any particular Shareholder, Optionholder or Warrantholder will depend on a variety of factors including the Shareholder, Optionholder or Warrantholder’s own particular circumstances. Therefore, all Shareholders, Optionholders and Warrantholders, and all persons affected by the Plan of Arrangement should consult their own tax advisors with respect to their particular circumstances. An advance income tax ruling has not been obtained with respect to the transactions contemplated herein.  The discussion below is qualified accordingly.

Residents of Canada

The following summary applies generally to an individual who is a Shareholder, Optionholder or Warrantholder and who, for the purposes of the Tax Act, is resident only in Canada and who participates in the Redesignation, Share Exchange, and the Share Transfer or the exchange of Strathmore Options for Strathmore New Options or adjustment to the exercise price of the Strathmore Options, or the adjustment to the Strathmore Warrants under the Plan of Arrangement.

Shareholders Resident in Canada who Participate in the Plan of Arrangement

Under the Tax Act, the Redesignation is not a taxable event to a Shareholder.

The Share Exchange will not result in the recognition of a capital gain or loss to the Shareholder under the Tax Act.  On the Share Exchange, the Shareholder will be deemed to dispose of the Shareholder’s Strathmore Class A Shares for proceeds equal to his or her “adjusted cost base” of those shares, and will acquire the Strathmore New Shares and Strathmore Butterfly Shares at an aggregate cost equal to such amount.

The Shareholder must apportion such cost between the Strathmore New Shares and Strathmore Butterfly Shares in accordance with their proportionate fair market values immediately after the Share Exchange.  For this purpose, it is assumed to be reasonable to expect that the fair market value of the Shareholder’s Strathmore Butterfly Shares immediately after the Share Exchange will derive from the fair market value of the Spin-Off Assets to be transferred to Fission Energy under the Plan of Arrangement. The fair market value of Strathmore New Shares is a question of fact determined by reference to all relevant factors (including the respective trading values of those shares following the Share Exchange).

On the Share Transfer, the Strathmore Butterfly Shares acquired by each Shareholder participating under the Plan of Arrangement will be transferred by the Shareholder to Fission Energy for consideration consisting of only Fission Energy Shares, on the terms and subject to the Plan of Arrangement.  A holder of Strathmore Butterfly Shares who exchanges such shares for Fission Energy Shares will dispose of the Strathmore Butterfly Shares for proceeds of disposition equal to the aggregate adjusted cost base thereof to such holder immediately before the exchange and will acquire the Fission Energy Shares received on exchange at cost equal to such aggregate adjusted cost base, unless such holder chooses to include in computing income, and to report in the holder’s return of income, for the year in which the disposition occurs any portion of the capital gain or capital loss otherwise arising on such disposition.< /P>

Dissenting Shareholders Resident in Canada

A Shareholder who dissents (a “Dissenter”) will be deemed to receive a dividend equal to the amount by which the amount received (other than in respect of interest awarded by a Court, if any) from Strathmore exceeds the paid-up capital of the Dissenter’s Strathmore Shares. The deemed dividend will be subject to the normal gross-up and dividend tax credit rules under the Tax Act.

In addition, a Dissenter will be considered to have disposed of his or her Strathmore Shares for proceeds of disposition equal to the amount received from Strathmore (less the deemed dividend referred to above and not including any interest awarded by a Court). The Dissenter will realize a capital gain (or capital loss) to the extent such adjusted proceeds of disposition, less any reasonable costs of disposition, exceed (or are exceeded by, respectively) the Dissenter’s adjusted cost base of the Strathmore Shares so disposed of. Any such capital gain or loss will be subject to the normal rules under the Tax Act.  Interest awarded to a Dissenter by a Court, if any, must be included by the Dissenter in computing the Dissenter’s income for purposes of the Tax Act.

Disposition of Strathmore Options by Employee Optionholders

An Optionholder who:

(i)

is an employee of Strathmore, including a director;

(ii)

acquired his or her Strathmore Options pursuant to the Strathmore Stock Option Plan by virtue of being an employee or director of Strathmore; and

(iii)

exchanges his or her Strathmore Options for only Strathmore New Options and no other consideration;

will not recognize any taxable income or loss as a result of such exchange and for the purposes of the provisions of the Tax Act dealing with employee stock options will be deemed not to have disposed of Strathmore Options or acquired the Strathmore New Options, provided the total value of the Strathmore New Shares to be acquired under the Strathmore New Options immediately after the exchange less the amount payable under the Strathmore New Options to acquire the Strathmore New Shares does not exceed the total fair market value of the Strathmore Shares to be acquired under the Strathmore Options less the exercise price under the Strathmore Option determined immediately prior to the Arrangement becoming effective.

To the extent the above described rollover provision applies, the Strathmore New Options will be deemed to be the same option and a continuation of the Strathmore Options.  Further the provisions of the Tax Act providing for the deduction of one-half of any resulting employee benefit will continue to apply if at the time of the exchange of the Strathmore Option for a Strathmore New Option the exercise price was not less than the fair market value of a Strathmore Share at the time of grant of the Strathmore Option.

Adjustments to Exercise Price of the Strathmore Options held by Non-Employee Optionholders

The tax consequences to a Non-Employee Optionholder of the adjustment to the exercise price of the Strathmore Options are not clear.  On the basis that the adjustment is being made fully in accordance with the existing terms of the Strathmore Options, the adjustment should not result in a disposition of the Strathmore Option for a new option.  CRA may, however, disagree with this position and take the position that a Non-Employee Optionholder has, as a result of the adjustment, disposed of his or her Strathmore Option for proceeds of disposition equal to the fair market value of a Strathmore New Option with an adjusted exercise price.  In that case, to the extent the fair market value of the Strathmore New Option exceeded the fair market value of the Strathmore Option, the Non-Employee Optionholder would realize a capital gain equal to the difference, less any reasonable costs of disposition.

Non-Employee Optionholders are urged to seek their own tax advice with respect to the adjustment to the exercise price of the Strathmore Options.

Adjustments to Strathmore Warrants

The tax consequences to Warrantholders of the adjustments to the Strathmore Warrants are not clear.  On the basis that the adjustments to the Strathmore Warrants are being made fully in accordance with the existing terms of the Strathmore Warrants, the adjustments should not result in a disposition of such Strathmore Warrant or a receipt of income to a Strathmore Warrantholder.  CRA may, however, disagree with this position and take the position that the adjustments to the Strathmore Warrant result in a disposition of the existing Strathmore Warrant in return for proceeds of disposition equal to the fair market value of a new adjusted Strathmore Warrant.  In that case, to the extent the fair market value of the adjusted Strathmore Warrant exceeded the fair market value of the non-adjusted Strathmore Warrant, the Warrantholder would realize a capital gain equal to the difference, less any reasonable co sts of disposition.

Strathmore Warrantholders are urged to seek their own tax advice with respect to the adjustments to the Strathmore Warrants.

Non-Residents Participating in the Plan of Arrangement

The following part of the summary applies, subject to all provisos and assumptions set out above, to a Shareholder, Optionholder or Warrantholder who participates in the Redesignation, Share Exchange and the Share Transfer or the exchange of Strathmore Options for Strathmore New Options or adjustment to the exercise price of Strathmore Options or the adjustments to the Strathmore Warrants under the Plan of Arrangement, and who for the purposes of the Tax Act and any relevant tax treaty, is not and has never been resident in Canada and does not and will not at any relevant time use or hold any shares of Strathmore (including the Strathmore Shares, the redesignated Strathmore Class A Shares, the Strathmore Butterfly Shares and any other shares), Strathmore Options, or Strathmore Warrants in carrying on, or otherwise in connection with, a business in Canada (herein referred to as a “Non-Resident Shareholder”, “Non-Resident Optionholder” and “Non-Resident Warrantholder” respectively).

Non-Resident Shareholders who Participate in the Plan of Arrangement

Under the Tax Act, the Redesignation is not a taxable event to a Non-Resident Shareholder.

The Share Exchange will not result in the recognition of a capital gain or loss to the Non-Resident Shareholder under the Tax Act. On the Share Exchange, the Non-Resident Shareholder will be deemed to dispose of the Non-Resident Shareholder’s Strathmore Class A Shares for proceeds equal to his or her “adjusted cost base” of those shares, and will acquire the Strathmore New Shares and Strathmore Butterfly Shares at an aggregate cost equal to such amount.

The Non-Resident Shareholder must apportion such cost between the Strathmore New Shares and Strathmore Butterfly Shares in accordance with their proportionate fair market values immediately after the Share Exchange. For this purpose, it is assumed to be reasonable to expect that the fair market value of the Non-Resident Shareholder’s Strathmore Butterfly Shares immediately after the Share Exchange will derive from the fair market value of the Spin-Off Assets to be transferred to Fission Energy under the Plan of Arrangement.  The fair market value of Strathmore New Shares is a question of fact determined by reference to all relevant factors (including the respective trading values of those shares following the Share Exchange).

On the Share Transfer, the Strathmore Butterfly Shares acquired by each Non-Resident Shareholder participating under the Plan of Arrangement will be transferred by the Non-Resident Shareholder to Fission Energy for consideration consisting solely of Fission Energy Shares, on the terms and subject to the Plan of Arrangement.  A holder of Strathmore Butterfly Shares who exchanges such shares for Fission Energy Shares will dispose of the Strathmore Butterfly Shares for proceeds of disposition equal to the aggregate adjusted cost base thereof to such holder immediately before the exchange and acquire the Fission Energy Shares received in exchange therefore at cost equal to such aggregate adjusted cost base, unless the Shareholder chooses to include in computing income, and to report in the holder’s return of income, for the year in which the disposition occurs any portion of the capital gain or capital loss ot herwise arising on such disposition.

For the purpose of the Share Exchange, and the Share Transfer, the existing Strathmore Class A Shares, and the Strathmore Butterfly Shares owned by a Non-Resident Shareholder at the time of the Share Exchange and the Share Transfer will be considered “Excluded Property” for purposes of the Tax Act.  Therefore, there is no Canadian tax liability to be withheld by Strathmore at the time of the Share Exchange and Share Transfer, nor is there an obligation for the Non-Resident Holder to obtain a certificate from the CRA in respect of the proposed Share Exchange or Share Transfer.

Dissenting Shareholders Not Resident in Canada

This part of the summary addresses a Non-Resident Shareholder who exercises his or her dissent rights. Such Non-Resident Shareholder is referred to in this part of the summary as a “Dissenting Non-Resident”, and this part of the summary only addresses such Dissenting Non-Residents.

A Dissenting Non-Resident will be deemed to receive a dividend from Strathmore in the same circumstances as described above for Canadian Dissenters (under Dissenting Shareholders Resident in Canada). The deemed dividend, and any interest awarded by a Court, will be subject to a 25% withholding tax under the Tax Act unless such rate of withholding is reduced pursuant to an income tax treaty in force between Canada and the Non-Resident Shareholder’s jurisdiction of residence. Strathmore will apply the 25% withholding tax on payments made by it except to the extent Strathmore is satisfied that the Dissenting Non-Resident qualifies for a lower rate of withholding tax by virtue of an applicable tax treaty (if any).

A Dissenting Non-Resident will also realize a capital gain or loss in the same circumstances as described above for Canadian Dissenters (under Dissenting Holders Resident in Canada). The Dissenting Non- Resident will be subject to tax in respect of such capital gain only if the Dissenting Non-Resident’s Strathmore Shares constitute “taxable Canadian property” and the Dissenting Non-Resident is not entitled to relief under an applicable tax treaty (if any).

Strathmore Shares will not be “taxable Canadian property” to a Dissenting Non- Resident provided that (i) at no time during the 60-month period preceding the Share Exchange and the Share Transfer, respectively, did the Dissenting Non-Resident (or persons with whom the Dissenting Non-Resident did not deal at arm’s length for purposes of the Tax Act, alone or together with the Dissenting Non-Resident) hold 25% or more of the issued shares of any class of Strathmore or have the right to acquire 25% or more of the issued shares of any class of Strathmore and provided that (ii) the Dissenting Non-Resident has not used or held, and has not been considered for purposes of the Tax Act to use or hold, any shares of Strathmore in carrying on a business in Canada.

Disposition of Strathmore Options by a Non-Resident Employee Optionholder

A Non-Resident Optionholder, who meets the conditions as set out above under the heading “Disposition of Strathmore Options by Employee Optionholders” by virtue of employment with Strathmore in Canada will not recognize any taxable income or loss as a result of such exchange on the basis that the value of the Strathmore New Options received, determined immediately after the Arrangement becoming effective, will not exceed the value of the Strathmore Options, determined immediately before the Arrangement becoming effective.  For the purposes of determining the treatment under the Tax Act of any subsequent transactions involving the Strathmore New Options received on the exchange, including on the exercise of such options, such options will be treated as being the same options as the Strathmore Options, exchanged for the Strathmore New Options.

While not entirely clear, such exchange may constitute a disposition of the Strathmore Option for the purposes of calculating capital gains and capital losses.  Proceeds of disposition of the Strathmore Option will be equal to the fair market value of the Strathmore New Option calculated at the time of the exchange.  The capital gain realized would be equal to the proceeds of disposition minus any amount paid to obtain the Strathmore Option less any reasonable costs of disposition.

Non-Resident Optionholders will be subject to tax in respect of any such capital gain only if the Non-Resident Optionholder’s Strathmore Options constitute “taxable Canadian property” and the Non-Resident Optionholder is not entitled to relief under an applicable tax treaty (if any).

For this purpose, Strathmore Options will not be “taxable Canadian property” to a Non-Resident Optionholder provided that (i) at no time during the 60-month period preceding the exchange did the Non-Resident Optionholder (or persons with whom the Non-Resident Optionholder did not deal at arm’s length for purposes of the Tax Act, alone or together with the Non-Resident Optionholder) hold 25% or more of the issued shares of any class of Strathmore or have the right to acquire 25% or more of the issued shares of any class of Strathmore and provided that (ii) the Non-Resident Optionholder has not used or held, and has not been considered for purposes of the Tax Act to use or hold, any shares, options or warrants of Strathmore in carrying on a business in Canada.

A Non-Resident Optionholder who was granted Strathmore Options by virtue of employment with Strathmore outside of Canada will not recognize any taxable employment benefit on the exchange of the Strathmore New Option.

Non-Resident Non-Employee Optionholders are urged to seek their own tax advice with respect to the Canadian income tax consequences of an exchange of options.

Adjustments to Exercise Price of Strathmore Options Issued to Non-Resident Persons Who are Not Employees of Strathmore (“Non-Resident Non-Employee Optionholder”)

The tax consequences to a Non-Resident Non-Employee Optionholder of the adjustment to the exercise price of the Strathmore Options are not clear.  On the basis that the adjustment is being made fully in accordance with the existing terms of the Strathmore Options, the adjustment should not result in a disposition of the Strathmore Option for a new option.  CRA may, however, disagree with this position and take the position that a Non-Resident Non-Employee Optionholder has, as a result of the adjustment, disposed of his or her Strathmore Option for proceeds of disposition equal to the fair market value of a Strathmore New Option with an adjusted exercise price.  

Non-Resident Non-Employee Optionholders should seek their own tax advice with respect to the adjustment to the exercise price of their Strathmore Options.

If a disposition of Strathmore Options is determined to occur and this results in a capital gain, Non-Resident Non-Employee Optionholders will be subject to tax in respect of such capital gain only if the Non-Resident Non-Employee Optionholder’s Strathmore Options constitute “taxable Canadian property” and the Non-Resident Non-Employee Optionholder is not entitled to relief under an applicable tax treaty (if any).

Strathmore Options will not be “taxable Canadian property” to a Non-Resident Non-Employee Optionholder provided that (i) at no time during the 60-month period preceding the adjustment to the exercise price did the Non-Resident Non-Employee Optionholder (or persons with whom the Non-Resident Non-Employee Optionholder did not deal at arm’s length for purposes of the Tax Act, alone or together with the Non-Resident Non-Employee Optionholder) hold 25% or more of the issued shares of any class of Strathmore or have the right to acquire 25% or more of the issued shares of any class of Strathmore (ii) the Non-Resident Non-Employee Optionholder has not used or held, and has not been considered for purposes of the Tax Act to use or hold, any shares, options or warrants of Strathmore in carrying on a business in Canada.

Adjustments to Strathmore Warrants

The tax consequences to Non-Resident Warrantholders of adjustments to the Strathmore Warrants are not clear.  On the basis that the adjustments to the Strathmore Warrants are being made fully in accordance with the existing terms of the Strathmore Warrants, the adjustments should not result in a disposition of such Strathmore Warrant or a receipt of income to a Non-Resident Warrantholder.  CRA may, however, disagree with this position and take the position that the adjustments to the Strathmore Warrant result in a disposition of the existing Strathmore Warrant in return for proceeds of disposition equal to the fair market value of a new amended Strathmore Warrant.

Non-Resident Warrantholders are urged to seek their own tax advice with respect to the adjustments to the Strathmore Warrants.

If a disposition of the Strathmore Warrants is determined to occur resulting in a capital gain, Non-Resident Warrantholders will be subject to tax in respect of such capital gain only if the Non-Resident Warrantholder’s Strathmore Warrants constitute “taxable Canadian property” and the Non-Resident Warrantholder is not entitled to relief under an applicable tax treaty (if any).

Strathmore Warrants will not be “taxable Canadian property” to a Non-Resident Warrantholder provided that (i) at no time during the 60-month period preceding the adjustment to the exercise price of same, respectively, did the Non-Resident Warrantholder (or persons with whom the Non-Resident Warrantholder did not deal at arm’s length for purposes of the Tax Act, alone or together with the Non-Resident Warrantholder) hold 25% or more of the issued shares of any class of Strathmore or have the right to acquire 25% or more of the issued shares of any class of Strathmore (ii) the Non-Resident Warrantholder has not used or held, and has not been considered for purposes of the Tax Act to use or hold, any shares, options or warrants of Strathmore in carrying on a business in Canada.

U.S. Federal Income Tax Considerations

The following is a summary of the anticipated material U.S. federal income tax consequences to U.S. Holders (as defined below) arising from and relating to the Arrangement.

This summary is for general information purposes only and does not purport to be a complete analysis or listing of all potential U.S. federal income tax consequences that may apply to a U.S. Holder as a result of the Arrangement.  In addition, this summary does not take into account the individual facts and circumstances of any particular U.S. Holder that may affect the U.S. federal income tax consequences of the Arrangement to such U.S. Holder.  Accordingly, this summary is not intended to be, and should not be construed as, legal or U.S. federal income tax advice with respect to any U.S. Holder.  Each U.S. Holder should consult its own tax advisor regarding the U.S. federal income, U.S. state and local, and foreign tax consequences of the Arrangement.

No legal opinion from U.S. legal counsel or ruling from the Internal Revenue Service (the “IRS”) has been requested, or will be obtained, regarding the U.S. federal income tax consequences of the Arrangement to U.S. Holders.  This summary is not binding on the IRS, and the IRS is not precluded from taking a position that is different from, and contrary to, the positions taken in this summary.  In addition, because the authorities on which this summary is based are subject to various interpretations, the IRS and the U.S. courts could disagree with one or more of the positions taken in this summary.

Notice Pursuant to IRS Circular 230: Anything contained in this summary concerning any U.S. federal tax issue is not intended or written to be used, and it cannot be used by a U.S. Holder, for the purpose of avoiding U.S. federal tax penalties under the Code (as defined below).  This summary was written to support the promotion or marketing of the transactions or matters addressed by this Information Circular (including the Arrangement).  Each U.S. Holder should seek U.S. federal tax advice, based on such U.S. Holder’s particular circumstances, from an independent tax advisor.

Scope of this Disclosure

Authorities

This summary is based on the Internal Revenue Code of 1986, as amended (the “Code”), Treasury Regulations, published rulings of the IRS, published administrative positions of the IRS, and U.S. court decisions that are applicable and, in each case, as in effect and available, as of the date of this Information Circular.  Any of the authorities on which this summary is based could be changed in a material and adverse manner at any time, and any such change could be applied on a retroactive basis.  This summary does not discuss the potential effects, whether adverse or beneficial, of any proposed legislation that, if enacted, could be applied on a retroactive basis.

U.S. Holders

For purposes of this summary, a “U.S. Holder” is a beneficial owner of Strathmore Shares that, for U.S. federal income tax purposes, is (a) an individual who is a citizen or resident of the U.S., (b) a corporation, or any other entity classified as a corporation for U.S. federal income tax purposes, that is created or organized in or under the laws of the U.S., any state in the U.S., or the District of Columbia, (c) an estate if the income of such estate is subject to U.S. federal income tax regardless of the source of such income, or (d) a trust if (i) such trust has validly elected to be treated as a U.S. person for U.S. federal income tax purposes or (ii) a U.S. court is able to exercise primary supervision over the administration of such trust and one or more U.S. persons have the authority to control all substantial decisions of such trust.

Non-U.S. Holders

A “non-U.S. Holder” is a beneficial owner of Strathmore Shares other than a U.S. Holder.  This summary does not address the U.S. federal income tax consequences of the Arrangement to non-U.S. Holders.  Accordingly, non-U.S. Holders should consult their own tax advisors regarding the U.S. federal income, U.S. state and local, and foreign tax consequences (including the potential application and operation of any income tax treaties) of the Arrangement.

U.S. Holders Subject to Special U.S. Federal Income Tax Rules Not Addressed

This summary does not address the U.S. federal income tax consequences of the Arrangement to U.S. Holders that are subject to special provisions under the Code, including the following U.S. Holders: (a) U.S. Holders that are tax-exempt organizations, qualified retirement plans, individual retirement accounts, or other tax-deferred accounts; (b) U.S. Holders that are financial institutions, insurance companies, real estate investment trusts, or regulated investment companies; (c) U.S. Holders that are dealers in securities or currencies or U.S. Holders that are traders in securities that elect to apply a mark-to-market accounting method; (d) U.S. Holders that have a “functional currency” other than the U.S. dollar; (e) U.S. Holders that are liable for the alternative minimum tax under the Code; (f) U.S. Holders that own Strathmore Shares as part of a straddle, hedging transaction, conversion transaction, co nstructive sale, or other arrangement involving more than one position; (g) U.S. Holders that hold Strathmore Shares other than as a capital asset within the meaning of Section 1221 of the Code; (h) U.S. Holders who are U.S. expatriates or former long-term residents of the United States or (i) U.S. Holders that own (directly, indirectly, or constructively) 10% or more of the total combined voting power of all classes of shares of Strathmore entitled to vote.  U.S. Holders that are subject to special provisions under the Code, including U.S. Holders described immediately above, should consult their own tax advisors regarding the U.S. federal income tax consequences of the Arrangement.

If an entity that is classified as a partnership for U.S. federal income tax purposes holds Strathmore Shares, the U.S. federal income tax consequences of the Arrangement to such partnership and the partners of such partnership generally will depend on the activities of the partnership and the status of such partners.  Partners of entities that are classified as partnerships for U.S. federal income tax purposes should consult their own tax advisors regarding the U.S. federal income tax consequences of the Arrangement.

Tax Consequences in Other Jurisdictions Not Addressed

This summary does not address the U.S. state or local tax consequences, or the tax consequences in jurisdictions other than the U.S., of the Arrangement to U.S. Holders.  Each U.S. Holder should consult its own tax advisor regarding the U.S. state and local and foreign tax consequences of the Arrangement.

Transactions Not Addressed

This summary does not address the U.S. federal income tax consequences to U.S. Holders of transactions entered into prior to, concurrently with, or subsequent to the Arrangement (regardless of whether any such transaction is undertaken in connection with the Arrangement), including, but not limited to, the following transactions: (a) any exercise of any warrant to acquire Strathmore Shares; (b) any conversion of any note, debenture, or other debt instrument of Strathmore; and (c) any conversion of any stock option, warrant, or other right to acquire Strathmore Shares into a stock option, warrant, or other right to acquire Fission Energy Shares.

U.S. Federal Income Tax Consequences of the Arrangement

The Arrangement will be effected under applicable provisions of Canadian corporate law, which are technically different from analogous provisions of U.S. corporate law.  Therefore, the U.S. federal income tax consequences of certain aspects of the Arrangement are not certain.  This summary assumes that (a) the renaming and redesignation of the Strathmore Shares as Strathmore Class A Shares, (b) the exchange by the Shareholders of the Strathmore Class A Shares for Strathmore New Shares and Strathmore Butterfly Shares (followed by the cancellation of the Strathmore Class A Shares), (c) the transfer by the Shareholders of the Strathmore Butterfly Shares to Fission Energy in exchange for Fission Energy Shares, and (d) Strathmore’s acquisition of the Strathmore Butterfly Shares held by Fission Energy (followed by the cancellation of the Strathmore Butterfly Shares) will properly be treated, under the step- transaction doctrine or otherwise, as the distribution by Strathmore of the Fission Energy Shares under Section 301 of the Code.

There can be no assurance that the IRS will not challenge this U.S. federal income tax treatment of the Arrangement or that, if challenged, a U.S. court would not agree with the IRS.  Each U.S. Holder should consult its own tax advisor regarding the proper treatment of the Arrangement for U.S. federal income tax purposes.

Distribution of Fission Energy Shares

Subject to the “passive foreign investment company” rules discussed below, U.S. Holders will be required to include the fair market value of the Fission Energy Shares received pursuant to the Arrangement in gross income as a dividend to the extent of the current or accumulated “earnings and profits” of Strathmore.  To the extent the fair market value of the Fission Energy Shares exceeds Strathmore’s adjusted tax basis in such shares (as calculated for U.S. federal income tax purposes), the proposed Arrangement can be expected to generate additional earnings and profits for Strathmore.  Strathmore does not expect that any such dividend will qualify for the reduced U.S. federal income tax rates applicable to “qualified dividend income” under Section 1(h)(11) of the Code.  In addition, any such dividend generally will not be eligible for the “dividends received ded uction” in the case of corporate U.S. Holders.  To the extent that the fair market value of the Fission Energy Shares exceeds the current and accumulated “earnings and profits” of Strathmore, the distribution of the Fission Energy Shares pursuant to the Arrangement will be treated (a) first, as a tax-free return of capital to the extent of a U.S. Holder’s tax basis in the Strathmore Shares and, (b) thereafter, as gain from the sale or exchange of such Strathmore Shares.  Preferential tax rates apply to long-term capital gains of a U.S. Holder that is an individual, estate, or trust.  There are currently no preferential tax rates for long-term capital gains of a U.S. Holder that is a corporation.

A U.S. Holders’ initial tax basis in the Fission Energy Shares received pursuant to the Arrangement will be equal to the fair market value of such Fission Energy Shares on the date of distribution.  A U.S. Holder’s holding period for the Fission Energy Shares received pursuant to the Arrangement will begin on the day after the date of distribution.

Dissenting U.S. Holders

A U.S. Holder that exercises the right to dissent from the Arrangement and is paid cash for all of such U.S. Holder’s Strathmore Shares generally will recognize gain or loss in an amount equal to the difference, if any, between (a) the amount of cash received by such U.S. Holder in exchange for the Strathmore Shares (other than amounts, if any, that are or are deemed to be interest for U.S. federal income tax purposes, which amounts will be taxed as ordinary income) and (b) the tax basis of such U.S. Holder in the Strathmore Shares surrendered.

Subject to the “passive foreign investment company” rules discussed below, such gain or loss generally will be capital gain or loss, which will be long-term capital gain or loss if the Strathmore Shares are held for more than one year.  Preferential tax rates apply to long-term capital gains of a U.S. Holder that is an individual, estate, or trust.  There are currently no preferential tax rates for long-term capital gains of a U.S. Holder that is a corporation.  Deductions for capital losses are subject to complex limitations under the Code.

Adjustment to Exercise Price for Strathmore Options Not Acquired Pursuant to the Strathmore Stock Option Plan

There is a possibility that an adjustment to the exercise price of Strathmore Options not acquired pursuant to the Strathmore Stock Option Plan (“Non-Employee Options”), as set out above under the heading “Effect of Arrangement on Outstanding Stock Options and Share Purchase Warrants” may be considered a disposition of such Non-Employee Options.   If the adjustment is treated as a disposition of a Non-Employee Option, a U.S. Holder generally will recognize gain or loss in an amount equal to the difference, if any, between (a) the fair market value of the new Non-Employee option deemed received and (b) such holder’s tax basis in the old Non-Employee option deemed disposed of.  Additionally, because U.S. Holders of Non-Employee Options will be treated as indirect owners of Strathmore Shares under the rules applicable to passive foreign investment companies (“PFICs”), a deemed sale of such options would be treated as a sale of the underlying Strathmore Shares subject to the adverse tax consequences described below under “Potential Application of the PFIC Rules to the Arrangement”.   U.S. Holders of Non-Employee Options should consult their own tax advisors with respect to the impact of the Arrangement and related adjustment on them.

Potential Application of the PFIC Rules to the Arrangement

Qualification of Strathmore and Fission Energy as a PFIC

A foreign corporation generally will be a “passive foreign investment company” under Section 1297 of the Code (a “PFIC”) if, for a taxable year, (a) 75% or more of the gross income of the foreign corporation for such taxable year is passive income or (b) on average, 50% or more of the assets held by the foreign corporation either produce passive income or are held for the production of passive income, based on the fair market value of such assets (or on the adjusted tax basis of such assets, if the foreign corporation is not publicly traded and either is a “controlled foreign corporation” or makes an election).  “Passive income” includes, for example, dividends, interest, certain rents and royalties, certain gains from the sale of stock and securities, and certain gains from commodities transactions.

Strathmore believes that it was a PFIC for one or more prior taxable years.  Based on currently available information, Strathmore anticipates that it will be a PFIC for the current taxable year and that Fission Energy will be a PFIC for the current taxable year.  Whether Strathmore or Fission Energy will be a PFIC for the current taxable year depends on the assets and income of Strathmore and Fission Energy, respectively, over the course of such taxable year and, as a result, cannot be predicted with certainty as of the date of this Information Circular.  The determination of whether Strathmore or Fission Energy qualifies as a PFIC for a taxable year depends, in part, on the application of complex U.S. federal income tax rules, which are subject to differing interpretations.  Accordingly, there can be no assurance that the IRS will not challenge the determination made by the Strathmore concerning its PFIC status or the PFIC status of Fission Energy.

Effect of PFIC Rules on the Distribution of Fission Energy Shares

If Strathmore is a PFIC or was a PFIC at any time during a U.S. Holder’s holding period for the Strathmore Shares, the effect of the PFIC rules on a U.S. Holder will depend on whether such U.S. Holder has made a timely and effective election to treat Strathmore as a “qualified electing fund” or “QEF” under Section 1295 of the Code (a “QEF Election”) or a mark-to-market election under Section 1296 of the Code (a “Mark-to-Market Election”).  In this summary, a U.S. Holder that has made a timely and effective QEF Election or a Mark-to-Market Election is referred to as an “Electing Shareholder” and a U.S. Holder that has not made a timely and effective QEF Election or a Mark-to-Market Election is referred to as a “Non-Electing Shareholder.”  If either of these elections were successfully made, Electing Shareholders generally would n ot be subject to the rules of Section 1291 of the Code discussed below upon the receipt of the Fission Energy Shares pursuant to the Arrangement. However, the QEF Election was not available to U.S. Holders for any prior taxable year for which Strathmore was a PFIC and will not be available in the future, because Strathmore did not and does not intend to satisfy the record keeping and information disclosure requirements that apply to a QEF. As discussed further below, a Mark-to-Market election may allow a U.S. Holder to avoid the rules of Section 1291 below with respect to its receipt of Fission Energy Shares pursuant to the Arrangement, but this will depend on when the election was made.  

With respect to a Non-Electing Shareholder, the rules under Section 1291 of the Code will apply to gain recognized on the disposition of Strathmore Shares and “excess distributions” (generally, distributions received in the current taxable year that are in excess of 125% of the average distributions received during the three preceding years or, if shorter, the U.S. Holder’s holding period for the Strathmore Shares) received on the Strathmore Shares.  Any such gain or excess distribution must be rateably allocated to each day in a Non-Electing Shareholder’s holding period for the Strathmore Shares.  The amount of any such gain or excess distribution allocated to prior years of such Non-Electing Shareholder’s holding period for the Strathmore Shares (other than years prior to the first taxable year of Strathmore beginning after December 31, 1986 for which Strathmore was not a PFIC) w ill be subject to U.S. federal income tax at the highest tax rate applicable to ordinary income in each such prior year.  A Non-Electing Shareholder will be required to pay interest on the resulting tax liability for each such prior year, calculated as if such tax liability had been due in each such prior year.  Such a Non-Electing U.S. Holder that is not a corporation must treat any such interest paid as “personal interest,” which is not deductible.  The amount of any such gain or excess distribution allocated to the current year of such Non-Electing Shareholder’s holding period for the Strathmore Shares will be treated as ordinary income in the current year, and no interest charge will be incurred with respect to the resulting tax liability for the current year.

If the distribution of the Fission Energy Shares pursuant to the Arrangement constitutes an “excess distribution” with respect to a Non-Electing Shareholder, such Non-Electing Shareholder will be subject to the rules of Section 1291 of the Code discussed above upon the receipt of the Fission Energy Shares.  In addition, the distribution of the Fission Energy Shares pursuant to the Arrangement may be treated, under proposed Treasury Regulations, as the “indirect disposition” by a Non-Electing Shareholder of such Non-Electing Shareholder’s indirect interest in Fission Energy, which generally would be subject to the rules of Section 1291 of the Code discussed above.

If a Mark-to-Market Election has been made by a U.S. Holder in a year prior to the distribution of Fission Energy Shares pursuant to the Arrangement, such U.S. Holder generally will not be subject to the rules of Section 1291 of the Code discussed above upon the receipt of  such Fission Energy Shares.  However, if a U.S. Holder makes a Mark-to-Market election after the beginning of such U.S. Holder’s holding period for the Strathmore Shares and in the same year as the Fission Energy Shares are distributed pursuant to the Arrangement, the rules of Section 1291 of the Code discussed above would apply to the distribution of Fission Energy Shares.

A U.S. Holder that has made a Mark-to-Market Election in a year prior to the year in which Fission Energy Shares are distributed pursuant to the Arrangement will avoid the potential interest charge of section 1291 on the distribution of Fission Energy Shares and on any “indirect disposition” of such U.S. Holder’s indirect interest in Fission Energy deemed to occur, as described above.  Instead such U.S. Holder will include in ordinary income for the taxable year in which the distribution of Fission Energy Shares occurs an amount equal to the excess, if any, of (a) the fair market value of the Strathmore Shares as of the close of such taxable year over (b) such U.S. Holder’s tax basis in such Strathmore Shares.  Such U.S. Holder will be allowed a deduction in an amount equal to the lesser of (a) the excess, if any, of (i) such U.S. Holder’s adjusted tax basis in the Strathmore Shares over (ii) the fair market value of such Strathmore Shares as of the close of such taxable year or (b) the excess, if any, of (i) the amount included in ordinary income because of such Mark-to-Market Election for prior taxable years over (ii) the amount allowed as a deduction because of such Mark-to-Market Election for prior taxable years.  

A U.S. Holder that has made a Mark-to-Market Election generally also will adjust his or her tax basis in the Strathmore Shares to reflect the amount included in gross income or allowed as a deduction because of such Mark-to-Market Election.  Inclusion and deductions because of the Mark-to-Market election are taken into account when calculating gain or loss on a future sale of Strathmore Shares.

The PFIC rules are complex, and each U.S. Holder should consult its own tax advisor regarding the PFIC rules and how the PFIC rules may affect the U.S. federal income tax consequences of the Arrangement.  In particular, each U.S. Holder should consult its own tax advisor regarding the availability of, and procedure for making, a QEF Election or a Mark-to-Market Election.

Information Reporting; Backup Withholding Tax

The distribution within the U.S., or by a U.S. payor or U.S. middleman, of the Fission Energy Shares pursuant to the Arrangement generally will be subject to information reporting and backup withholding tax, at the rate of 28%, if a U.S. Holder (a) fails to furnish such U.S. Holder’s correct U.S. taxpayer identification number (generally on Form W-9), (b) furnishes an incorrect U.S. taxpayer identification number, (c) is notified by the IRS that such U.S. Holder has previously failed to properly report items subject to backup withholding tax, or (d) fails to certify, under penalty of perjury, that such U.S. Holder has furnished its correct U.S. taxpayer identification number and that the IRS has not notified such U.S. Holder that it is subject to backup withholding tax.  However, U.S. Holders that are corporations generally are excluded from these information reporting and backup withholding tax rules. &nb sp;Any amounts withheld under the U.S. backup withholding tax rules will be allowed as a credit against a U.S. Holder’s U.S. federal income tax liability, if any, or will be refunded, if such U.S. Holder furnishes required information to the IRS.  Each U.S. Holder should consult its own tax advisor regarding the information reporting and backup withholding tax rules.

RIGHTS OF DISSENT

Dissenters’ Rights

As indicated in the Notice of Meeting, a registered Shareholder is entitled to dissent and be paid by Strathmore the fair value of his, her or its Strathmore Shares in accordance with section 245 of the BCBCA if such registered Shareholder dissents from the Arrangement and otherwise complies with the procedure set out in section 242 of the BCBCA and the Arrangement Resolution is passed at the Meeting. The statutory provisions dealing with the right of dissent are technical and complex. Any Shareholder who wishes to exercise his, her or its right to dissent should seek his, her or its own legal advice, as failure to comply strictly with the provisions of section 242 of the BCBCA may prejudice such Shareholder’s right of dissent. The relevant provisions of the BCBCA are set out in Schedule “F” of this Information Circular.

In order for a Shareholder to dissent, a written objection (an “Objection Notice”) to the Arrangement Resolution must be received by Strathmore, to the attention of the Secretary, at its head office, 700 – 1620 Dickson Avenue, Kelowna, British Columbia, V1Y 9Y2, no later than 10:00 a.m. (Vancouver time) on June 18, 2007.  A vote against the Arrangement Resolution, an abstention, or the execution of a proxy to vote against the Arrangement Resolution, does not constitute an Objection Notice.

Holders of Strathmore Warrants or Strathmore Options must validly exercise their Strathmore Warrants or Strathmore Options, become registered holders of Strathmore Shares prior to the Meeting and otherwise comply with the BCBCA, including section 242 of the BCBCA, in order to exercise the Dissent Right.

A Dissenting Shareholder may only dissent under section 242 with respect to all the Strathmore Shares held by such Dissenting Shareholder or held on behalf of any one beneficial owner and registered in the Dissenting Shareholder’s name. A Shareholder is not entitled to dissent with respect to his, her or its shares if he, she or it votes any of his, her or its Strathmore Shares in favour of the Arrangement Resolution. Beneficial owners of Strathmore Shares registered in the name of a broker, custodian, nominee or other intermediary who wish to dissent should be aware that only registered Shareholders are entitled to dissent. Accordingly, a beneficial owner of Strathmore Shares desiring to exercise the right to dissent must make arrangements for the Strathmore Shares beneficially owned by such Shareholder to be registered in his, her or its name prior to the time the Objection Notice is required to be receive d, or alternatively, make arrangements for the registered Shareholder to dissent on the beneficial holder’s behalf.

A Dissenting Shareholder who has complied with the provisions of section 242, or Strathmore, may apply to the Court for an order requiring such Dissenting Shareholder’s Strathmore Shares to be purchased, fixing the price and terms of the purchase and sale or ordering that they may be determined by arbitration, and the Court may make such order and such consequential orders or directions as the Court considers appropriate. There is no obligation on Strathmore to make application to the Court. The Dissenting Shareholder will be entitled to receive the fair value of the Shares held by such holder as of the day before the Meeting or such later date on which the Special Resolution to authorize the Arrangement is passed.

A Dissenting Shareholder ceases to have any rights as a Shareholder, other than the right to be paid the fair value of the Strathmore Shares in the amount agreed to between Strathmore and the Dissenting Shareholder or in the amount of the judgment, as the case may be, on the earliest of the Effective Date, the making of an agreement between Strathmore and the Dissenting Shareholder as to the payment to be made for the Dissenting Shareholder’s Strathmore Shares, and the pronouncement of the order of the Court fixing the fair value of the Strathmore Shares. Until any of the foregoing events occurs, the Shareholder may withdraw the Dissenting Shareholder’s dissent, or Strathmore may rescind the Arrangement Resolution and in either event, proceedings under Part 8 of the BCBCA shall be discontinued.

Strict Compliance with Dissent Provisions Required

The above summary does not purport to provide a comprehensive statement of the procedures to be followed by a Dissenting Shareholder who seeks payment of the fair value of his Strathmore Shares. Section 242 of the BCBCA requires strict adherence to the procedures established therein and failure to do so may result in the loss of all rights dissent. Accordingly, each registered Shareholder who might desire to exercise the right of dissent and appraisal should carefully consider and comply with the relevant provisions of the BCBCA dealing with dissent, and consult his own legal advisor. The full text of sections 237-247 of the BCBCA is set out in Schedule F.

The Arrangement Agreement provides that, unless otherwise waived, it is a condition to the obligation of Strathmore and Fission Energy to complete the Arrangement, that, on or before the Effective Date, holders of not more than 3% in the aggregate of the outstanding Strathmore Shares shall have exercised the right to dissent. If the number of outstanding Strathmore Shares in respect of which the right to dissent have been exercised exceeds 3% in the aggregate the Arrangement will not proceed unless Strathmore waives such condition.

Shareholders who wish to exercise the right to dissent should review the dissent procedures described in Schedule “F” and seek legal advice, as failure to adhere strictly to the right to dissent requirements may result in the loss or unavailability of any right to dissent.

RISK FACTORS

The risk factors set out below assume the completion of the Arrangement. If the Arrangement is not consummated, the risk factors of both Strathmore and Fission Energy will remain the risk factors that Shareholders should carefully consider, in addition to the other information contained in this Information Circular. These risk factors are not a definitive list of all risk factors associated with Strathmore and Fission Energy.

Possible Non-Completion of the Arrangement

There is no assurance that the Arrangement will receive regulatory, Court or Securityholder approval or will be completed. If the Arrangement is not completed, Securityholders will lose the prospective benefits of the Arrangement, the share price of the Strathmore Shares may suffer and Securityholders will continue to be subject to the risk factors of both Strathmore and Fission Energy as disclosed in this Information Circular.

Acquisitions and Joint Ventures

Strathmore and Fission Energy will evaluate from time to time opportunities to acquire and joint venture mining assets and businesses.  These acquisitions and joint ventures may be significant in size, may change the scale of Strathmore’s or Fission Energy’s business and may expose it to new geographic, political, operating, financial and geological risks.  Strathmore’s and Fission Energy’s success in their acquisition and joint venture activities will depend on their ability to identify suitable acquisition and joint venture candidates and partners, acquire or joint venture them on acceptable terms and integrate their operations successfully with those of Strathmore or Fission Energy, as the case may be.  Any acquisitions or joint ventures would be accompanied by risks, such as the difficulty of assimilating the operations and personnel of any acquired companies; the potential dis ruption of Strathmore’s or Fission Energy’s ongoing business; the inability of management to maximize the financial and strategic position of Strathmore or Fission Energy through the successful incorporation of acquired assets and businesses or joint ventures; additional expenses associated with amortization of acquired intangible assets; the maintenance of uniform standards, controls, procedures and policies; the impairment of relationships with employees, customers and contractors as a result of any integration of new management personnel; dilution of Strathmore’s or Fission Energy’s present shareholders or of their interests in their subsidiaries or assets as a result of the issuance of shares to pay for acquisitions or the decision to grant earning or other interests to a joint venture partner; and the potential unknown liabilities associated with acquired assets and businesses.  There can be no assurance that Strathmore or Fission Energy would be successful in overcoming these r isks or any other problems encountered in connection with such acquisitions or joint ventures.  There may be no right for shareholders to evaluate the merits or risks of any future acquisition or joint venture undertaken except as required by applicable laws and regulations.

Dilution

Strathmore and Fission Energy each plan to focus on exploring for minerals and will use their working capital to carry out such exploration. However, both companies will require additional funds to further such activities.  To obtain such funds, Strathmore and Fission Energy may sell additional securities including, but not limited to, their common shares or some form of convertible security, the effect of which would result in a substantial dilution of the equity interests of Strathmore’s and Fission Energy’s shareholders.

There is no assurance that additional funding will be available to Strathmore or Fission Energy for additional exploration or for the substantial capital that is typically required in order to bring a mineral project to the production decision or to place a property into commercial production. There can be no assurance that Strathmore or Fission Energy will be able to obtain adequate financing in the future or that the terms of such financing will be favourable.  Failure to obtain such additional financing could result in the delay or indefinite postponement of further exploration and development of its properties.

Uncertainty of Mineral Resource Estimates

Mineral resource figures are only estimates.  Such estimates are expressions of judgment based on knowledge, mining experience, analysis of drilling results and industry practices.  While Strathmore and Fission Energy believe that the mineral resource estimates included are established and reflect management’s best estimates, the estimating of mineral resources is a subjective process and the accuracy of mineral resource estimates is a function of the quantity and quality of available data, the accuracy of statistical computations, and the assumptions used and judgments made in interpreting available engineering and geological information.  There is significant uncertainty in any mineral resource estimate and the actual deposits encountered and the economic viability of a deposit may differ materially from Strathmore’s and Fission Energy’s estimates.  Estimated mineral resources ma y have to be re-estimated based on changes in uranium prices, further exploration or development activity or actual production experience.  This could materially and adversely affect estimates of the volume or grade of mineralization, estimated recovery rates or other important factors that influence mineral resource estimates.  Mineral resources are not mineral reserves and there is no assurance that any mineral resource estimate will ultimately be reclassified as proven or probable mineral reserves.  Mineral resources which are not mineral reserves do not have demonstrated economic viability.

Strathmore and Fission Energy have no History of Mineral Production or Mining Operations

Neither Strathmore nor Fission Energy has ever had uranium producing properties.  There is no assurance that commercial quantities of uranium will be discovered nor is there any assurance that Strathmore’s or Fission Energy’s exploration programs will yield positive results.  Even if commercial quantities of uranium are discovered, there can be no assurance that any property will ever be brought to a stage where uranium resources can profitably be produced therefrom.  Factors which may limit the ability to produce uranium resources include, but are not limited to, the spot price of uranium, availability of additional capital and financing and the nature of any mineral deposits.  Neither Strathmore nor Fission Energy has a history of mining operations that would guarantee it will produce revenue, operate profitably or provide a return on investment in the future.  Strathmore has not paid dividends in the past and neither Strathmore nor Fission Energy has any plans to pay dividends in the foreseeable future.  

Economics of Developing Mineral Properties

Mineral exploration and development is speculative and involves a high degree of risk.  While the discovery of an ore body may result in substantial rewards, few properties which are explored are commercially mineable and ultimately developed into producing mines.

Should any mineral resources and reserves exist, substantial expenditures will be required to confirm mineral reserves which are sufficient to commercially mine and to obtain the required environmental approvals and permitting required to commence commercial operations.  The decision as to whether a property contains a commercial mineral deposit and should be brought into production will depend upon the results of exploration programs and/or feasibility studies, and the recommendations of duly qualified engineers and/or geologists, all of which involves significant expense. This decision will involve consideration and evaluation of several significant factors including, but not limited to: (1) costs of bringing a property into production, including exploration and development work, preparation of production feasibility studies and construction of production facilities; (2) availability and costs of financing; ( 3) ongoing costs of production; (4) uranium prices, which are historically cyclical; (5) environmental compliance regulations and restraints (including potential environmental liabilities associated with historical exploration activities); and (6) political climate and/or governmental regulation and control.  Development projects are also subject to the successful completion of engineering studies, issuance of necessary governmental permits, and availability of adequate financing.  Development projects have no operating history upon which to base estimates of future cash flow.

The ability to sell, and profit from the sale of any eventual mineral production from any property will be subject to the prevailing conditions in the minerals marketplace at the time of sale. The global minerals marketplace is subject to global economic activity and changing attitudes of consumers and other end-users’ demand for mineral products. Many of these factors are beyond the control of a mining company and therefore represent a market risk which could impact the long term viability of the company and its operations.

Potential Profitability Depends Upon Factors Beyond the Control of Strathmore and Fission Energy

The potential profitability of mineral properties is dependent upon many factors beyond Strathmore’s and Fission Energy’s control. For instance, world prices of and markets for minerals are unpredictable, highly volatile, potentially subject to governmental fixing, pegging and/or controls and respond to changes in domestic, international, political, social and economic environments. Another factor is that rates of recovery of minerals from mined ore (assuming that such mineral deposits are known to exist) may vary from the rate experienced in tests and a reduction in the recovery rate will adversely affect profitability and, possibly, the economic viability of a property. Profitability also depends on the costs of operations, including costs of labour, equipment, electricity, environmental compliance or other production inputs. Such costs will fluctuate in ways Strathmore and Fission Energy cannot predict and are beyond Strathmore’s and Fission Energy’s control, and such fluctuations will impact on profitability and may eliminate profitability altogether. Additionally, due to worldwide economic uncertainty, the availability and cost of funds for development and other costs have become increasingly difficult, if not impossible, to project. These changes and events may materially affect the financial performance of Strathmore and Fission Energy.

Strathmore’s and Fission Energy’s potential future revenues will be directly related to the prices of uranium as their potential revenues are expected to be derived from uranium mining.  Uranium prices are and will continue to be affected by numerous factors beyond Strathmore’s and Fission Energy’s control. Such factors include, among others, the demand for nuclear power; political and economic conditions in uranium producing and consuming countries such as Canada, the U.S., Russia and other former Soviet republics; reprocessing of used reactor fuel and the re-enrichment of depleted uranium tails; sales of excess civilian and military inventories (including from the dismantling of nuclear weapons) by governments and industry participants; and production levels and costs of production in countries such as Russia and former Soviet republics, Africa and Australia.  The effect of these fact ors, individually or in the aggregate, is impossible to predict with accuracy.  A decline in uranium prices may also require Strathmore and Fission Energy to write down their mineral resources, which would have a material adverse effect on their potential earnings and potential profitability.

Regulatory Requirements

The current or future operations of Strathmore and Fission Energy, including development activities and possible commencement of production on their properties, require permits from various federal and local governmental authorities, and such operations are and will be governed by laws and regulations governing prospecting, development, mining, production, taxes, labour standards, occupational health, waste disposal, toxic substances, land use, environmental protection, mine safety and other matters. Companies engaged in the development and operation of mines and related facilities generally experience increased costs and delays in production and other schedules as a result of the need to comply with the applicable laws, regulations and permits.  There can be no assurance that all permits which Strathmore and Fission Energy may require for the development and construction of mining facilities and conduct of min ing operations will be obtainable on reasonable terms or that such laws and regulations would not have an adverse effect on any mining project which Strathmore or Fission Energy, as the case may be, might undertake.

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

Amendments to current laws, regulations and permits governing operations and activities of mining companies, or more stringent implementation thereof, could have a material adverse impact on Strathmore and Fission Energy and cause increases in costs or require abandonment or delays in the development of new mining properties.

Worldwide demand for uranium is directly tied to the demand for electricity produced by the nuclear power industry, which is also subject to extensive government regulation and policies. The development of mines and related facilities is contingent upon governmental approvals that are complex and time consuming to obtain and which, depending upon the location of the project, involve multiple governmental agencies.  The duration and success of such approvals are subject to many variables outside Strathmore’s and Fission Energy’s control.  Any significant delays in obtaining or renewing such permits or licenses in the future could have a material adverse effect on Strathmore and Fission Energy.  In addition, the international marketing of uranium is subject to governmental policies and certain trade restrictions, such as those imposed by the suspension agreements entered into by the United Sta tes with certain republics of the former Soviet Union and the agreement between the United States and Russia related to the supply of Russian Highly Enriched Uranium into the United States.  Changes in these policies and restrictions may adversely impact Strathmore’s and Fission Energy’s businesses.

Property Title Risk

Strathmore and Fission Energy have investigated their rights to explore all of their material properties and, to the best of their knowledge, those rights are in good standing.  However, no assurance can be given that such rights will not be revoked, or significantly altered, to their detriment.  There can also be no assurance that Strathmore’s or Fission Energy’s rights will not be challenged or impugned by third parties, including the local governments and by First Nations, Navajo and Métis.  The validity of unpatented mining claims on U.S. public lands is sometimes uncertain and may be contested.  Due to the extensive requirements and associated expense required to obtain and maintain mining rights on U.S. public lands, Strathmore’s U.S. properties may be subject to various uncertainties which are common to the industry, with the attendant risk that its title may be defecti ve.

Mining and Insurance

Strathmore’s and Fission Energy’s businesses are capital intensive and subject to a number of risks and hazards, including environmental pollution, accidents or spills, industrial and transportation accidents, labour disputes, changes in the regulatory environment, natural phenomena (such as inclement weather conditions, earthquakes, pit wall failures and cave-ins) and encountering unusual or unexpected geological conditions.  Many of the foregoing risks and hazards could result in damage to, or destruction of, Strathmore’s and Fission Energy’s mineral properties or future processing facilities, personal injury or death, environmental damage, delays in or interruption of or cessation of their exploration or development activities, delay in or inability to receive regulatory approvals to transport their uranium concentrates, or costs, monetary losses and potential legal liability and adverse governmental action.  Strathmore and Fission Energy may be subject to liability or sustain loss for certain risks and hazards against which they do not or cannot insure or which it may reasonably elect not to insure because of the cost.  This lack of insurance coverage could result in material economic harm to Strathmore or Fission Energy, as the case may be.  

Uranium Industry Competition and International Trade Restrictions

The international uranium industry, including the supply of uranium concentrates, is competitive, with supplies available from a relatively small number of western world uranium mining companies, from certain republics of the former Soviet Union and the People’s Republic of China, from excess inventories, including inventories made available from decommissioning of nuclear weapons, from reprocessed uranium and plutonium, from used reactor fuel, and from the use of excess Russian enrichment capacity to re-enrich depleted uranium tails held by European enrichers in the form of UF6.  The supply of uranium from Russia and from certain republics of the former Soviet Union is, to some extent, impeded by a number of international trade agreements and policies.  These agreements and any similar future agreements, governmental policies or trade restrictions are beyond the control of Strathmore and Fission Ener gy and may affect the supply of uranium available in the United States and Europe, which are the largest markets for uranium in the world.  If Strathmore or Fission Energy is unable to supply uranium to important markets in the U.S. or Europe, its business, financial condition and results of operations may be materially adversely affected.  

Deregulation of the Electrical Utility Industry

Strathmore’s and Fission Energy’s future prospects may be tied directly to those of the electrical utility industry worldwide. Deregulation of the utility industry, particularly in the United States and Europe, is expected to impact the market for nuclear and other fuels for years to come, and may result in the premature shutdown of nuclear reactors. Experience to date with deregulation indicates that utilities are improving the performance of their reactors and achieving record capacity factors.  There can be no assurance that this trend will continue.

Public Acceptance of Nuclear Energy Cannot Be Assured

Growth in the demand for uranium and in the nuclear power industry will depend upon continued and increased acceptance of nuclear technology by the public as a safe and viable means of generating electricity.  Nuclear energy competes with other sources of energy including oil, natural gas, coal and hydro-electricity.  Sustained lower prices of oil, natural gas, coal and hydro-electricity may result in lower demand for uranium concentrates.  Furthermore, growth of the uranium and nuclear power industry will depend on continued and increased acceptance of nuclear technology as a means of generating electricity.  Because of unique political, technological and environmental factors that affect the nuclear industry, the industry is subject to public opinion risks which could have an adverse impact on the demand for nuclear power and increase the regulation of the nuclear power industry.  An accid ent or incident at a nuclear reactor anywhere in the world, or an accident or incident relating to the transportation or storage of new or spent nuclear fuel, could negatively impact the public’s acceptance of nuclear power and the future prospects for nuclear power generation, which may have a material and adverse effect Strathmore’s and Fission Energy’s businesses, financial condition and results of operations.

Public Involvement in the Permitting Process

The process of obtaining radioactive materials licenses (“RML”) from the US Nuclear Regulatory Commission and those required in the States that Strathmore is operating in allow for public participation.  If a third party chooses to object to the issuance of any RML or permit required by Strathmore, significant delays may occur before Strathmore is able to secure an RML or permit. Generally, the public objections can be overcome with the passage of time and through the procedures set forth in the applicable permitting legislation.  However, the regulatory agencies must also allow and fully consider public comment according to such procedures and there can be no assurance that Strathmore will be successful in obtaining any RML or permit.

Environmental Risks and Hazards

All phases of Strathmore’s and Fission Energy’s operations are subject to environmental regulation in the jurisdictions in which they operate.  These regulations mandate, among other things, the maintenance of air and water quality standards and land reclamation. They also set forth limitations on the general, transportation, storage and disposal of solid and hazardous waste.  Environmental legislation is evolving in a manner which will require stricter standards and enforcement, increased fines and penalties for non-compliance, more stringent environmental assessments of proposed projects and a heightened degree of responsibility for companies and their officers, directors and employees.  There is no assurance that future changes in environmental regulation, if any, will not adversely affect Strathmore’s and Fission Energy’s operations.  Environmental hazards may exist on the properties which are unknown to Strathmore and Fission Energy at present and which have been caused by previous or existing owners or operators of the properties.  Reclamation costs are uncertain and planned expenditures estimated by management may differ from the actual expenditures required.

Strathmore is not insured against most environmental risks.  Insurance against environmental risks (including potential liability for pollution and other hazards as a result of the disposal of waste products occurring from exploration and production) has not been generally available to companies within the industry.  Strathmore and Fission Energy will periodically evaluate the cost and coverage of the insurance against certain environmental risks that is available to determine if it would be appropriate to obtain such insurance.

Without such insurance, and if Strathmore or Fission Energy becomes subject to environmental liabilities, the payment of such liabilities would reduce or eliminate its available funds or could exceed the funds Strathmore or Fission Energy, as the case may be, have to pay such liabilities and result in bankruptcy.  Should Strathmore or Fission Energy be unable to fund fully the remedial cost of an environmental problem, they might be required to enter into interim compliance measures pending completion of the required remedy.

Political Risk

Strathmore’s and Fission Energy’s future prospects may be affected by political decisions about the uranium market.  There can be no assurance that the United States, Peru or other governments will not enact legislation restricting to whom Strathmore or Fission Energy can sell uranium or that the United States or other governments will not increase the supply of uranium by decommissioning nuclear weapons.

Operations in Foreign Jurisdictions

Strathmore conducts exploration, development and mining operations outside of Canada currently in the U.S. and Peru and may in future operate in other countries.  Strathmore’s foreign mining investments are subject to the risks normally associated with the conduct of business in foreign countries. The occurrence of one or more of these risks could have a material and adverse effect on Strathmore’s future cash flows, results of operations, financial condition and prospects. Risks include, among others, labour disputes, arbitrary invalidation of governmental orders and permits, corruption, uncertain political and economic environments, sovereign risk, war (including in neighbouring states), civil disturbances and terrorist actions, arbitrary changes in laws or policies of particular countries, the failure of foreign parties to honour contractual obligations, foreign taxation, delays in obtaining or the inability to obtain necessary government permits, opposition to mining from environmental or other non-governmental organizations, limitations on foreign ownership, limitations on the repatriation of earnings, foreign exchange controls, currency devaluations, import and export regulations including limitations on uranium exports, instability due to economic under-development, inadequate infrastructure and increased financing costs. In addition, Strathmore and Fission Energy may face disadvantages of competing against companies from countries that are not subject to Canadian and U.S. laws, including the Foreign Corrupt Practices Act, restrictions on the ability to pay dividends offshore, and risk of loss due to disease and other potential endemic health issues. These risks may disrupt or limit Strathmore’s or Fission Energy’s operations, restrict the movement of funds or supplies or result in the restriction of contractual rights or the taking of property by nationalization or expropriation without fair compensation.  There can be no assurance that industries deemed to be of national or strategic importance like mineral production, and in particular, uranium mining, will not be nationalized. Government policy may change to discourage foreign investment, nationalization of mining industries may occur or other government limitations, restrictions or requirements not currently foreseen may be implemented.  

Management

Strathmore and Fission Energy are both dependent on a relatively small number of key personnel, the loss of any of whom could have an adverse effect on such companies.

Conflicts of Interest

Certain directors and officers of Strathmore and Fission Energy are, and may continue to be, involved in the mining and mineral exploration industry through their direct and indirect participation in corporations, partnerships or joint ventures which are potential competitors of Strathmore. Situations may arise in connection with potential acquisitions in investments where the other interests of these directors and officers may conflict with the interests of Strathmore or Fission Energy.  The directors of Strathmore and Fission Energy are required by law, however, to act honestly and in good faith with a view to the best interests of the respective company and its shareholders and to disclose any personal interest which they may have in any material transaction which is proposed to be entered into with Strathmore or Fission Energy, as the case may be, and to abstain from voting as a director for the approval of any such transaction.

LEGAL PROCEEDINGS

There are no pending legal proceedings to which Strathmore is or is likely to be a party or of which any of its properties including the Spin-Off Properties are or, to the best of knowledge of management of Strathmore, is likely to be subject.

EXPERTS

Blake, Cassels & Graydon LLP are Canadian legal counsel to Strathmore and have prepared a summary of the principal Canadian Federal Income Tax considerations generally applicable to the holders of Strathmore Shares disclosed under the heading “Income Tax Considerations – Canadian Federal Income Tax Considerations”.

Dorsey & Whitney LLP are U.S. legal counsel to Strathmore and have prepared a summary of the principal U.S. Federal Income Tax considerations generally applicable to the holders of Strathmore Shares disclosed under the heading “Income Tax Considerations – U.S. Federal Income Tax Considerations”.

The summary of the Dieter Lake Property disclosed under the heading “Information Concerning Fission Energy – Principal Properties – Dieter Lake Property” was taken by consent from a report entitled “Strathmore Minerals Corporation – 2005 Exploration at the Dieter Lake Property”, Quebec, dated November 3, 2006, (the “Dieter Lake Report”). The Dieter Lake Report was authored by C.F. Davis, P. Geo. and M.Guo, P.Geol., each of whom are considered independent of Strathmore.  

The summary of the Duddridge Lake Property disclosed under the heading “Information Concerning Fission Energy – Principal Properties – Duddridge Lake Property” was taken by consent from a report entitled “Report on the Duddridge Lake Uranium Property – Northern Saskatchewan” dated May 28, 2004 (the “Duddridge Lake Report”) and prepared for Strathmore by Stuart C. Fraser, P. Geol., who is considered independent of Strathmore.  

The summary of the Strathmore Church Rock Property disclosed under the heading “Information Concerning Strathmore – Principal Properties – Church Rock Property” was taken by consent from a report entitled “Technical Report on the Strathmore Church Rock Property – McKinley County, New Mexico” dated December 20, 2005 (the “Church Rock Report”) and prepared for Strathmore by David C. Fitch, C.P.G., who is considered independent of Strathmore.

The summary of the Roca Honda Property disclosed under the heading “Information Concerning Strathmore – Principal Properties – Roca Honda Property” was taken by consent from a report entitled “Technical Report on the Roca Honda Property, McKinley, New Mexico” dated March 31, 2006 (the “Roca Honda Report”) and prepared for Strathmore by David C. Fitch, C.P.G., who is considered independent of Strathmore.

None of the authors of the above mentioned technical reports have an interest in this transaction. Copies of these reports may be viewed upon written request to Strathmore, or at www.sedar.com.

AUDITORS, TRANSFER AGENT AND REGISTRAR

The auditors of Strathmore are Davidson & Company LLP, Chartered Accountants, of Vancouver, British Columbia.

Strathmore’s registrar and transfer agent is CIBC Mellon Trust Company of 1066 West Hastings Street, Vancouver, British Columbia.

MATERIAL CONTRACTS

The following are the contracts which are material to Strathmore and which have been entered into within the two years prior to the date of this Information Circular:

1.

On February 14, 2007 Strathmore announced that it had entered into an Exclusivity Agreement to negotiate a joint venture agreement to develop its Roca Honda Project and construct a uranium mill in the Grants Mineral Belt of New Mexico. On May 4, 2007, Strathmore announced that both companies have mutually agreed to extend the negotiation period until July 9, 2007.

2.

On January 29, 2007, Strathmore entered into an option agreement on the Juniper Ridge property, Wyoming, whereby Yellowcake Mining Inc. has the option to earn an 80% interest by:

•

issuing 9,000,000 shares to Strathmore,

•

paying U.S.$100,000 and U.S.$100,000 on the subsequent anniversary date for 4 years for a total of U.S.$500,000,

•

spending U.S.$1,600,000 per year for a period of 5 years for a total of U.S.$8,000,000,

•

making a royalty payment of 3% on the option portion of all future production, and,

•

proceeding with the initial financing of the evaluation of the Texas database (Conoco files).

3.

On April 5, 2007 Strathmore announced that it had entered into a Letter of Intent with Yellowcake Mining Inc. whereby Yellowcake can earn a 60% interest in the SKY property in

Wyoming for a proposed expenditure of U.S.$7,500,000.

4.

On April 12, 2007 Strathmore announced that it had entered into a binding Letter of Intent with Yellowcake Mining Inc. whereby Yellowcake can earn a 60% interest in the Jeep property in Wyoming for a proposed expenditure of U.S.$10,000,000.

5.

The Arrangement Agreement.

PARTICULARS OF MATTERS TO BE ACTED UPON

Financial Statements

A copy of the audited financial statements of Strathmore and auditors’ report for the year ended December 31, 2006 is included with this Information Circular.

Election of Directors

At the meeting it is proposed that five directors be elected to serve until the next annual general meeting or until their successors are elected or appointed in accordance with the BCBCA and the articles of Strathmore. There are presently five directors of Strathmore.

The following table indicates the names of the five nominees for directors, the date each such person first became a director, the principal occupation of each such person and the number of Strathmore Shares beneficially owned or controlled (directly or indirectly) by each such person as of May 7, 2007.  The information contained in this table as to the number of Strathmore Shares beneficially owned or controlled, directly or indirectly, is based upon information furnished to Strathmore by the respective nominees. The Board of Directors is required to appoint an Audit Committee, the proposed members of which are indicated in the table.  

Name and Municipality of Residence	Principal Occupation(1)	Director Since	Number of Common Shares beneficially owned or over which control or direction is exercised(1)
DEVINDER RANDHAWA Kelowna, B.C., Canada CEO, Director (2)(3)	CEO of Strathmore and President of RD Capital Inc., a privately held consulting firm providing venture capital and corporate finance services to emerging companies in the resources and non-resource sectors both in Canada and the US.	October 18, 1996	1,619,538
DAVID R. MILLER Vancouver, B.C., Canada President, COO and Director	Mr. Miller is the President of Strathmore and a Geologist.	June 8, 2006	1,840,430
MICHAEL HALVORSON Edmonton, Alberta, Canada Director (2)(3)	President of Halcorp Capital Ltd., a private company specializing in the raising of investment capital.	July 14, 2004	611,111
DR. DIETER A. KREWEDL Truckee, California, U.S.A. Director (2)(3)	Dr. Krewedl is a retired Geologist and Businessman	January 14, 2005	150,000
RAYMOND LARSON Temecula, California, U.S.A. Director	Mr. Larson was Chairman and CEO of Uranium Resources Inc. until he retired in 1994.	January 1, 2007	105,000

Notes:

1.

The information as to principal occupation and shares beneficially owned or over which control or direction is exercised, not being within the knowledge of Strathmore, has been furnished by each director individually.

2.

Member of the Audit Committee of the board of directors.

3.

Member of the Compensation Committee of the board of directors.

Appointment of Auditors

The management of Strathmore proposes to nominate Davidson & Company LLP, Chartered Accountants, of Vancouver, British Columbia, as auditors for Strathmore until the next annual general meeting of Shareholders at remuneration to be fixed by the directors.  Davidson & Company LLP have been the auditors of Strathmore for over 10 years.  There are no “reportable events” between Strathmore and its auditors as defined in National Instrument 51-102 – Continuous Disclosure Obligations.

Approval of Stock Option Plan

During the next year, Strathmore may grant additional stock options pursuant to the Strathmore Stock Option Plan, subject to all necessary regulatory approvals.  Under the current policy of the Exchange, Shareholder approval of the Strathmore Stock Option Plan is required on an annual basis.  Under the Exchange’s Policy 4.4 governing stock options, all issuers are required to adopt a stock option plan pursuant to which stock options may be granted.  The Strathmore Stock Option Plan will be limited to not more than 10% of the current issued Strathmore Shares (subject to certain other limitations as set out in the Plan) and set at the time of any granting of options (on a non-diluted basis).  This is constituted as a “rolling” as opposed to a “fixed number” plan.  Any previously granted options are governed by the Strathmore Stock Option Plan, and if any options grante d expire or terminate for any reason without having been exercised in full, the unpurchased shares shall again be available under the Strathmore Stock Option Plan.  Options may be issued only on terms that are acceptable to the Exchange.

A copy of the Strathmore Stock Option Plan is available for review at the offices of Strathmore or at its registered offices at Suite 700, 595 Howe Street, Vancouver, British Columbia, V6C 2T5 during normal business hours up to and including the date of the Meeting.

In connection with the foregoing, Strathmore is asking Shareholders to approve the following resolutions:

“BE IT RESOLVED THAT, subject to regulatory approval:

1.  The Strathmore Stock Option Plan be and it is hereby affirmed and approved;

2.  The Board of Directors be authorized to grant options under and subject to the terms and conditions of the Strathmore Stock Option Plan, which may be exercised to purchase up to 10% of the issued common shares of Strathmore as at the time of the grant; and

3.  The directors and officers of Strathmore be authorized and directed to perform such acts and deeds and things and execute all such documents, agreements and other writings as may be required to give effect to the true intend of these resolutions”.

Approval of the Arrangement

The Securityholders will also be asked to consider and approve the Arrangement by approving the Arrangement Resolution in substantially the form set out in Schedule “A” to this Information Circular. If the Arrangement Resolution is not passed by an adequate majority of eligible votes at the Meeting, the Arrangement will not be completed, and Strathmore will continue to hold and manage the Spin-Off Assets in the same manner that it presently does and Fission Energy will continue as a private corporation.

Approval of Organization of Fission Energy and the Fission Energy Stock Option Plan

Subject to the approval of the Arrangement Resolution, the Shareholders will be asked to consider and approve the organization of Fission Energy including the Fission Energy Stock Option Plan by approving the resolution in substantially the form set out in Schedule “C” to this Information Circular.

Other Business

Management of Strathmore knows of no matters to come before the Meeting other than those referred to in the Notice of Meeting accompanying this Information Circular. However, if any other matters properly come before the Meeting, it is the intention of the persons named in the form(s) of proxy accompanying this Information Circular to vote the same in accordance with their best judgment of such matters.

INFORMATION CONCERNING STRATHMORE POST-ARRANGEMENT

Strathmore is a TSX Venture Exchange listed mining and exploration company existing under the BCBCA.  The head office of Strathmore is located at 700 – 1620 Dickson Avenue, Kelowna, British Columbia, V1Y 9Y2. The registered and records office of Strathmore is located at 700 – 595 Howe Street, Vancouver, BC, V6C 2T5.

Selected Unaudited Pro Forma Consolidated Financial Information

The following selected unaudited pro forma consolidated financial information for Strathmore is based on the assumptions described in the respective notes to the Strathmore unaudited pro forma consolidated balance sheet as at December 31, 2006 attached to this Information Circular as Schedule “H”. This unaudited pro forma consolidated balance sheet has been prepared based on the assumption, among other things, that the Arrangement had occurred on December 31, 2006.

	PRO FORMA STRATHMORE MINERALS CORP. (CONSOLIDATED)
ASSETS
CURRENT:
Cash and cash equivalents	$ 4,799,908
Short term investments	$ 27,412,579
Receivables	$ 407,910
Prepaid expenses	$ 30,593
	$ 32,650,990
Equipment	$ 320,201
Land	$ 370,703
Mineral property interests	$ 4,547,525
Deferred exploration costs	$ 3,004,864
TOTAL:	$ 40,894,283
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	$ 708,606
Due to related parties	$ 15,449
	$ 724,055
SHAREHOLDERS’ EQUITY
Share capital	$ 56,464,982
Contributed surplus	$ 1,591,993
Deficit	$ (17,886,747)
	$ 40,170,228
	$ 40,894,283

Mineral Properties to be Held Following the Arrangement

Strathmore has been, and after completion of the Arrangement will continue to be, a mining and exploration company. After the Effective Date, Strathmore will own the U.S. Mineral Properties, a description of which is set out below.

Following completion of the Arrangement, Strathmore’s material properties, for the purpose of NI 43-101, will be the New Mexico Properties consisting of the Roca Honda Property and the Church Rock Property, both of which have been the subject of a NI 43-101 compliant technical report.  Copies of the Roca Honda Report and the Church Rock Report are available upon request from Strathmore and are available on SEDAR at www.sedar.com.  The author of both the Roca Honda Report and the Church Rock Report is David C. Fitch, C.P.G, who is a “qualified person” within the meaning of NI 43-101, and the disclosure in this Information Circular considering the Roca Honda Property and the Church Rock Property has been prepared with Mr. Fitch’s consent.

The following is a summary of certain portions of the Roca Honda Report and the Church Rock Report, and is qualified by and should be read together with the Roca Honda Report and the Church Rock Report in full, for a complete set of references and authorities for the statements made in this Information Circular. The Roca Honda Report and the Church Rock Report contain tables and data that are not included in this summary.

Roca Honda Property

Property Description and Location

The Roca Honda Property is a uranium property in McKinley, New Mexico which totals approximately 1,840 acres and consists of 63 unpatented mining claims totalling approximately 1,200 acres and an adjoining New Mexico State General Mining lease, held by Strathmore Resources.

The Roca Honda Property is located in northwestern New Mexico in the Grants Mineral Belt in the eastern part of the Ambrosia Lake District, approximately 16 air miles northeast of Grants, New Mexico.

Mining Claims

The 63 unpatented mining claims are located on U.S. Forest Service land, are contiguous and consist of the following claim names and numbers: Roca Honda 163-171 (NMMC 39757-37965), Roca Honda 190-196 (NMMC 37975-37983), Roca Honda 217-225 (NMMC 37993-38001), Roca Honda 244-252 (NMMC 38011-38019), Roca Honda 271-279 (NMMC 38029-38037), Roca Honda 298-306 (38047-38055), and Roca Honda 325-333 (38065-38073).  The claims are listed in the U.S. Bureau of Land Management Mining Claim Geographic Index Report (LR2000) with a location date of June 30, 1965 and the latest assessment year is 2006.

Surface Rights

Certain claims on the Roca Honda Property are on National Forest Service Lands, administered by the U.S. Forest Service. A Notice of Intent and/or a Plan of Operations must be filed with the appropriate District Ranger of the U.S. Forest Service and approval must be received before any new surface disturbance activities may be conducted.  A Plan of Operations requires a reclamation cash bond be in an amount set by a Forest Service officer.

New Mexico State Lease

The area covered by the New Mexico State Mining Lease (in this section of the Information Circular, “Roca Honda Property”, referred to as the “Lease”) is 640 acres and it is located in Section 16.  The Lease was acquired by David Miller on November 30, 2004 and was subsequently assigned to Strathmore Resources, a wholly owned subsidiary of Strathmore.  The term of the Lease is three years and will continue as long as minerals are produced or mined in paying quantities on the Roca Honda Property.  The Lease stipulates a 5% of gross returns royalty to the State of New Mexico, less smelting or reduction costs, for production of uranium and if there is no production during the terms of the Lease, an advance royalty is required.

The Lease grants Strathmore Resources the right to enter the Roca Honda Property for mining purposes, and the right to use and occupy so much of it as may be necessary or convenient to carry out such mining purposes.

Nature and Extent of Strathmore’s Title

Strathmore Resources holds the claims on the Roca Honda Property by Quit Claim Deed by Rio Algom Mining LLC.  There is also an underlying Purchase Agreement between Rio Algom Mining LLC and Strathmore dated March 12, 2004, leading to the Quit Claim Deed.  The Purchase Agreement sets out existing royalty obligations for Section 10 of the Roca Honda Property.  Uranium production from 36 of the mining claims on the Roca Honda Property are subject to a non-participating 1% royalty to the estate of Melvin E. Richards, et al. The rights and obligations associated with this royalty are fully described in a Settlement Agreement and Release dated June 6, 1983.

Environmental Liability

To the best knowledge of the author of the Roca Honda Report, there has been no previous mining of the deposits on the property. There has been surface disturbance consisting of drill roads about eight feet wide and drill pads.  

The author of the Roca Honda Report is not qualified regarding environmental matters, but saw no apparent existing environmental liabilities associated with the Roca Honda Property.

Permits Required

Prior to any mining activity on the area covered by the New Mexico State Mining Lease, a reclamation plan must be submitted to the state commissioner for approval and permits must be obtained from various permitting agencies in accordance with the New Mexico Mining Act.

A new drilling program on the Roca Honda Property will require an approved exploration permit from the New Mexico Mining and Minerals Division of Energy, Minerals and Natural Resources Department (in this “Roca Honda Property” section, the “EMNRD”), and an approved Plan of Operations from the U.S. Forest Service.  Exploration operations also require an approved exploration permit from EMNRD.

In addition to the above surface use and drilling permits, any injection or pumping operations will require permits from the New Mexico Environmental Department, which has authority under the Safe Water Drinking Act. Furthermore, any uranium ISR pilot plant operations with wells will require an extensive permitting procedure involving material licences to be obtained from the Nuclear Regulatory Commission (“Nuclear Regulatory Commission”) and an approved Environmental Impact Statement prior to any production.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

Access

The Roca Honda Property can be reached by traveling north 23½ miles from Milan on NM State Hwy 53, then west by dirt roads approximately 1½ miles on U.S. Forest Service Lands.  Most of the drill roads require four-wheel drive.  Access to certain areas will require road maintenance and permission from the State Highway Department and owners of fee lands.

Climate, Topography, Elevation and Vegetation

The Roca Honda Property is vegetated mostly by grasses, pinion pine and juniper trees and is in a semi-arid, high-desert climate. Annual precipitation is nearly 11 inches and an average of nearly 13 inches of snow falls annually. Grants has an annual average temperature of 51°F, and average summer high temperature of 81°F, a low temperature of 50°F, and an average winter high temperature of 40°F, and an average low temperature of 10°F. Winter snow and inclement weather conditions may interrupt operations occasionally.

The Roca Honda Property has moderately rough topography in certain areas and consists of shaly slopes below ledge-forming sandstone beds as mesas.  Elevations range from 7,300 to 7,800 feet.

History

Ownership History of the Property

Kerr-McGee Oil Industries, Inc. (“Kerr-McGee”) staked the unpatented mining claims in Section 9 and 10 of the Roca Honda Property in 1965.  Kerr-McGee, its subsidiaries and its successor Rio Algom Mining LLC, held the claims until they were acquired by Strathmore Resources in March of 2004.  The land under the New Mexico State Lease (Section 16) is owned by the State of New Mexico. State Mining Leases in respect of Section 16 were issued to various companies over the years. Rare Metals Corporation held a State Mining Lease over Section 16 in the 1950s and performed the first exploration drilling in the area.  Subsequently, Western Nuclear Corporation (“Western Nuclear”) held a State Mining Lease over Section 16 from the period of 1968 to 1971 and Reserve Oil and Minerals Corporation “Reserve” owned a 25% interest in the Lease at that time. Western Nuclear an d Reserve acquired another 15-year lease in that area, which was later assigned to a company, U.Q.I.T.U., and relinquished on February 15, 1990.  Quivira Mining Company, a wholly owned subsidiary of Kerr-McGee acquired Lease number Q-1414 over Section 16 effective July 1, 1990, which was relinquished on November 11, 2000.  David Miller acquired a new State Mining Lease in November 2004 and subsequently assigned the Lease to Strathmore Resources.  David Miller was issued 300,000 Strathmore Shares valued at $406,500 for the State Mining Lease.

Exploration and Development Work Undertaken

Based largely on the author of the Roca Honda Report’s review of the drill records, Kerr-McGee performed an ongoing rotary drill hole exploration program beginning in 1966.

The first drill holes in Section 9 were completed in 1966. Discovery was made in drill hole in August 2, 1970, which encountered ore-grade mineralization. A total of 187 holes totalling 387,849 feet were completed. The first drill hole in the Section 10 was completed in October 1967. Discovery of ore grade mineralization was made in a drill hole completed March 19, 1974.  A total of 175 drill holes totalling 449,493 feet were completed.

In Section 16 the first drilling took place in the 1950s by Rare Metals Corporation, who drilled 13 holes including two holes that intercepted strong uranium mineralization. Subsequently, Western Nuclear acquired a mining lease for Section 16 and began drilling in 1968. Western Nuclear’s second drill hole intercepted strong uranium mineralization at a depth of 1,587 feet.  Between August, 1968 and September, 1970, Western Nuclear drilled a total of 63 drill holes totalling 121,164 feet drill holes totalling 7,835 feet were abandoned.

There has been no previous production from the Roca Honda Property.

Geological Setting

Regional Geology

The Grants Mineral Belt in northwest New Mexico, lies within the Colorado Plateau geologic province and on the south flank of the San Juan Basin. It extends several miles east of Laguna to the Gallup area and is 100 miles by 25 miles wide. The belt includes the Laguna, Ambrosia Lake and Church Rock districts. Principal host rocks for the uranium deposits are fluvial sandstones in the Jurassic Morrison Formation, named the Westwater Canyon Member, and the Jackpile Sandstone. Other less important host rocks for uranium deposits are the Cretaceous Dakota Sandstone, and the Jurassic Todilto Limestone. The Morrison Formation forms outcrops along the south edge of the San Juan Basin and dips gently north into the basin. It is overlain by the Cretaceous Dakota Sandstone, Mancos Shale, and Mesaverde Group. The Morrison Formation was deposited in a continental environment and in the Grants Mineral Belt consists of four membe rs in ascending order; the Recapture Member (mostly grayish-red siltstone and claystone), the Westwater Canyon Member (gray, light yellow-brown and reddish-brown), fine to coarse grained arkosic sandstone with interbeds of greenish-gray and reddish-gray claystone), the Brushy Basin Member (mostly greenish gray-gray claystone) and the Jackpile Sandstone, an informal name for the upper fluvial sandstone in the east part of the Grants Mineral Belt near Laguna, New Mexico. The Jackpile sandstone does not exist in the Ambrosia Lake district. The Westwater Canyon Member, host for the uranium at the Roca Honda Property, ranges to 450 feet thick in the Grants Mineral Belt and consists of fine to coarse grained sandstone.

Local and Property Geology

Ledge-forming sandstones above shale slopes, all in the Cretaceous Mesaverde Group, underlie the Roca Honda Property. The Gallup Sandstone, lowermost formation of the Mesaverde, lies at a depth of about 400 feet, and is underlain by the Mancos Shale, which is about 800 feet thick. These units are underlain by the Dakota Sandstone, which is about 80 feet thick. The Dakota Sandstone is an aquifer in the region and unconformably overlies the Brushy Basin Member of the Jurassic Morrison Formation. The Brushy Basin Member consists of green and reddish claystone, is about 120 feet thick and is underlain by the Westwater Canyon Member, a host rock for uranium deposits. The Westwater Canyon consists of a series of fluvial quartz-rich, arkosic sandstones separated by thin green claystone shale beds. The Westwater is about 250 to 300 feet thick and is informally divided into five sandstone units.

Structure is not complex, but will require careful study for its effect on any future In-situ recovery (ISR) or conventional underground mining plans.  There are a number of north-trending faults that cut and displace ore, especially in the western two-thirds of Section 9.  Beds dip east at 7 to 11 degrees.

Deposit Types

Deposits in the Ambrosia Lake district and the Roca Honda Property are sandstone-type uranium deposits. Sandstone-type uranium deposits are irregular in shape, are roughly tabular and elongate, and range from thin pods a few feet in width and length, to bodies several tens or hundreds of feet long. The deposits are roughly parallel to the enclosing beds, but may form rolls (tabular lenses) that cut across bedding. The deposits occur in more than one layer, form distinct trends, commonly parallel to depositional trends, and occur in clusters. Two sub-types of deposits occur, primary ore and post-fault ore, also termed stack or redistributed ore, derived from primary ore. Primary ore in the Ambrosia Lake district consists mostly of uranium-enriched humic matter that coats sand grains and impregnates the sandstone, imparting a dark color to the rock. A direct correlation exists between uranium content and organic carbo n content by weight percent in the ores. Primary ore is mostly tabular and subparallel to the bedding. Stack or post-fault ore differs from primary ore mostly in geometry, and “stacks” upward along faults and fractures. Stack ore is commonly medium gray, and lower in grade than primary ore.

Exploration

Exploration methods for sandstone uranium deposits differ in many respects from those for other metals. The uranium deposits in Ambrosia Lake and at the Roca Honda Property have no surface expression and thus, require drilling for discovery. There are no surface methods for detecting uranium deposits at depths of 1,500 to 2,500 feet, as at the Roca Honda Property. It is not possible to predict the discovery of ore deposits ahead of drilling. Common practice is to drill widely spaced random holes to gather geologic information, including alteration bleaching, traces of mineralization, and sandstone development. This information is used to guide the location of subsequent drill holes, with the object of intercepting mineralization as quickly as possible. Once strong “ore grade” uranium mineralization is intercepted in a drill hole, that hole is offset by four new drill holes spaced equally from the discovery hole and from each other. At drilling depths such as at the Roca Honda Property, the initial offsets are typically made on 150 or 200 foot spacing. Subsequent offset drilling to mineralization is modified continually as new geologic information is developed.

Previous exploration of the Roca Honda Property consisted of an ongoing drilling program performed by Kerr-McGee and staged over a number of years. The drilling was performed by contracted drilling companies and the geophysical logging was by Century Geophysical Corp and by trucks owed and operated by Kerr-McGee. Kerr-McGee logging trucks probed most of the mineralized drill holes.

Based on a review by the author of the Roca Honda Report of Section 16 drill hole maps and related summaries, an initial drill program of 13 drill holes was performed by Rare Metals Corporation in the 1950s using Century Geophysical Logging. The name of the drilling company was not available. Western Nuclear performed subsequent drilling under a new mining lease during a two-year period from 1968 through 1970 using Clyde Jones Drilling Company as the drilling contractor and Geoscience, a geophysical logging company based in Denver, Colorado for logging.

Mineralization

Summary

The typical mineralized rock in the Ambrosia Lake district, occurs as uranium-humate cemented sandstone. The uranium mineralization consists largely of unidentifiable organic-uranium oxide complexes that are light gray brown to black. Although coffinite and uraninite have been identified in the Grants Mineral Belt, their abundance is not sufficient to account for the total uranium content in an ore sample. Admixed and associated with the uranium are enriched amounts of vanadium, molybdenum, copper, selenium, and arsenic in order of decreasing abundance. Other metals are also enriched above background amounts. Total uranium production from Jurassic Morrison sandstones within the Grants Mineral Belt was more than 340 million pounds U3O8 from 1948 through 2000, including the Ambrosia Lake district, which has produced 201 million pounds.

Geologic controls

The primary ore control is the presence of a quartz-rich, arkosic, fluviatile sandstone in the Morrison Formation. This type of sandstone is the only commercial host rock in the Ambrosia Lake district. Next in importance is the presence of carbonaceous matter as detrital plant fragments and humate pods. The presence of pyrite and bleaching alteration is important. Sedimentary features may exhibit control on a small scale. For example in the nearby Johnny M mine, a sandstone scour feature truncates underlying black ore, indicating nearly syngenetic deposition of uranium ore with the sandstone beds. Uranium ore in places is related to clay-gall (cobbles) layers within the host sandstone. Alteration bleaching forms a halo that encloses ore. The bleaching caused by the removal of reddish ferric-iron pigmentation imparts a light-gray color to the sandstone, and a greenish rim on red-cored claystone cobbles or galls. Prim ary ore pre-dates, and is not related to, present structural features; however stack ore is related to both faults and occurs at the margin of reddish iron oxide staining in the sandstone.

Drilling

Previous drilling on the Roca Honda Property was performed by Kerr-McGee and by Western Nuclear using rotary mud drilling with truck-mounted drills contracted by local drilling companies. The common practice of Kerr-McGee and by Western Nuclear was to drill the holes with 4¾-inch diameter bits by conventional rotary drill rigs circulating drilling mud. All drilling was vertical. The cuttings were typically taken at five foot intervals by the driller and laid out on the ground in piles in rows of 20 samples or 100 feet. A geologist would then examine the drill cuttings and record lithology and alteration on a drill log. The drill holes were taken through the Westwater Canyon Member and a few tens of feet into the underlying Recapture Member (non-host). Upon completion of a drill hole, the hole was logged with a gamma-ray, self potential, and resistivity probe by either a contract logging company or in some cases by a logging truck owned by Kerr-McGee. After running the log, a drift tool (filmshot) was lowered into the drill hole for survey at 50 or 100 foot intervals. Deviation from vertical in a single intercept was commonly less than 1o – 3o, and the dip of beds is 7o to 11o, thus mineralized intercepts represent essentially true thickness.

A total of 438 drill holes have been completed on the Roca Honda Property, 130 of which contain the strongest mineralized intercepts with a minimum grade of 0.10% U3O8, and a minimum grade x thickness (GT) of 0.60. Table 1 summarizes the drilling results.

Table 1 Summary of Drilling Results for the Roca Honda Property

SECTION	NO. OF HOLES	TOTAL FOOTAGE	URANIUM MINERALIZATION
			GT >0.60 Grade >0.10% eU3O8	GT >0.30 Grade >0.05% eU3O8	Other
9-13-8	187	388,849	45	20	122
10-13-8	175	450,838	60	21	94
Sub-total	362	839,687	105	41	216
16-13-8	63	121,164	23	11	29
	13	unknown	2	0	11
Total	438	960,851	130	52	256

Sampling Method and Approach

Gamma-ray Logs

All of the mineralized intercepts for the historical resource estimates were calculated by Kerr-McGee from gamma-ray logs probed for each drill hole. Each log consists of gamma-ray, resistivity, and self-potential curves plotted by depth. The resistivity and selfpotential curves provide bed boundaries and are mainly used for correlation of sandstone units and mineralized zones between drill holes. The equivalent U3O8 content from the gamma logs was calculated by Kerr-McGee using the industry-standard method developed originally by the U.S. Atomic Energy Commission. Kerr-McGee’s method was as follows: For zones greater than two feet thick, first pick an upper and lower boundary by choosing a point approximately ½ height from background to peak of anomaly. Then determine the counts per second for each one-foot interval. Divide by the number of intervals for an average counts per second for the an omaly. Then convert the counts per second to % U3O8 (e U3O8) using the appropriate Kerr-McGee charts for the specific logging unit used.

Disequilibrium

Disequilibrium is a term used to describe the disparity in the normal ratio between uranium and its naturally occurring radioactive daughter products, which are measured by the gamma log. Generally, checks for disequilibrium are made when drilled resources reach approximately 100,000 to 500,000 lbs of contained U3O8 and in new areas disequilibrium is checked after the first few ore holes.

Disequilibrium was seldom a factor for dark gray, primary ore in the Ambrosia Lake district. However there may be disequilibrium to a varying extent for redistributed or stack ore. Usually in cases where disequilibrium is identified, the uranium (low radioactivity) has been transported a short distance from its daughter products (radioactive) which have remained in their original site of deposition. This must be addressed for grade-control purposes during subsequent mining.

The best evidence to allay concerns of disequilibrium is experience from identical deposits using the record trail from gamma-ray interpretations of surface drill holes, followed by ore reserve estimates, then underground gamma-ray probe from the subsequent mine, then mill-head gamma-ray probes as the truck arrives at the mill, then chemical analysis of the resultant product, termed yellowcake.

Based on years of such historical production there were no reports of significant disequilibrium effects in the east part of the Ambrosia Lake District.

It is very important how disequilibrium is determined, and using core introduces other variables requiring checks. The down-hole probe “sees” the radioactivity of a 2.5 ft. diameter cylindrical area centered about the drill hole. This should not be compared to simply the chemical assay of a 2 3/4 –inch diameter core sample. Instead, the core is sampled over the mineralized interval as determined by a hand-held Geiger counter or scintillometer to define mineralized boundaries. The core is split and sampled for the intervals selected. Each sample is crushed and pulverized, then two separate assays are made of the same pulps; a scaler-radiometric or closed can radiometric assay and a chemical assay. The disequilibrium factor, if any, is expressed as a ratio of chemical/radiometric.

It takes about 1-million years for uranium to form its radioactive daughter products and achieve equilibrium. The Morrison uranium deposits are of Jurassic age and thus are in equilibrium, unless altered by recent surface waters.

There is no report of core holes or core assays for the drilling performed by Kerr-McGee on Sections 9 and 10 (Figure 14.2). Western Nuclear reports cored intervals for 2 drill holes, Dh 68 and 69, but no assay data was reported in the files examined.

Drill cuttings

Drill cuttings are useful for mapping alteration and in conjunction with the geophysical logs for lithology, but are too dilute to analyze for uranium content. Lithologic logs were not reviewed as part of the Roca Honda Report, however drill data summary sheets provided sandstone alteration interpretations.

Sample Preparation, Analyses And Security

No chemical analyses or core holes were reported within the data searched for the Roca Honda Property. Typical operating practice in the Ambrosia Lake district was to rely on calibrated gamma log interpretation of mineralized intercepts in drilling up to and including resource estimates. The practice of core sampling for chemical assay varies by operator, but was typically done for metallurgical confirmation prior to capitalizing development such as shaft sinking and mine development. Kerr-McGee had extensive operations in the Ambrosia Lake district and from a review by the author of the Roca Honda Report of their reports and data on the Roca Honda Property (Sections 9 and 10) expressed no concern for coring for chemical assay. There was no discussion of possible disequilibrium concerns in any of the Kerr-McGee reports, including those for proposed mine and shaft sinking. It is, however, prudent and typical practice to obtain core samples for chemical assay in new regions where disequilibrium (differing chemical vs. radiometric analysis) was suspected. The author knows of no significant disequilibrium effects in the east part of the Ambrosia Lake district which extends to, and beyond the Roca Honda Property.

Probe Truck and Calibration

The Kerr-McGee files examined by the author of the Roca Honda Report contained detailed records of probe truck equipment characteristics including truck number, probe number, crystal size, dates of use, k-factors, calibration tests and resulting factors. These were kept for each logging unit. Each gamma log contained a footer with a calibration run, and a header sheet with the rerun factors and probe unit number. The Western Nuclear logging examined by the author of the Roca Honda Report was performed by Geoscience Associates, Inc., a reputable independent contract logging operator based in Denver, Colorado. Geoscience Associates, Inc. recorded calibration, instrument number and k-factor on its logs and header sheets attached to each log. Of the logs available for Section 16, calibration runs were made on all logs. The header sheet was copied at the bottom of the logs from drill holes 31 to 70, and at the top of the reduced logs for drill holes 1 to 30. There was a complete file of drill summary sheets with the interpreted grade, thickness, zone and alteration (oxidation) for each mineralized interval for all of the drill holes. Drill hole drift surveys were recorded, however the original survey shots were not recovered.

Core Samples

Based on a review of the database, drill logs, drill data sheets, and drill hole maps by the author of the Roca Honda Report, none of the Kerr-McGee drill holes in Sections 9 and 10 were cored. The fact that Kerr-McGee formulated a mining plan without the need to take cores is an indication that Kerr-McGee had full confidence in the accuracy of gamma-log interpretations. Section 16 drill data sheets denote cored intervals for two of the drill holes. Drill hole number 68 denotes cored 1430-1503 and cored 1517-1556. Drill hole number 69 denotes cored 1445-1509. There was no further information regarding core samples.

Data Verification

Review of Original Records

A detailed review was made of the extensive files in Strathmore’s warehouse in Riverton, Wyoming on October 14 and 15, 2004. There were over 300 boxes, file cabinets and map files in the data storage covering the Roca Honda Property as well as other projects. The files are quite complete with original data including gamma ray logs and maps. The specific items recovered and researched are: Original gamma ray logs, mini logs, drill hole summaries, ore reserve calculation sheets, copies of drill hole maps, ore reserve maps, reports of mine plan, survey documents, logging truck calibration records, and a few representative cross-sections. Data was reviewed in February and March, 2006 in detail for Section 16 that included drill hole maps by Rare Metals Corporation, Western Nuclear, and Kerr-McGee, reduced gamma ray logs (at a scale of 1in=50ft), drill data summary sheets with depths, thickness, grade and horizon of uranium mineralization, drift survey results and color of host rock. The dataset also included a set of drill hole data sheets prepared by Kerr-McGee for Section 16 that summarizes the mineralized intercepts by drill hole, together with a rough calculation of “ore reserves” with the initials “JWS” and dated 9-25-79. These notes did not have supportive maps with block outlines and thus may have been a set of preliminary evaluation notes.

Items not recovered for this study but listed in the data list are mylar cross-sections, lithologic logs, U.S. Atomic Energy Commission test pit logging files.

Limitations on Sample Verification

The entire original, factual assay data are represented by the continuous gamma-logs that were made during the drilling programs as each drill hole was completed. These logs were run by Kerr-McGee operated logging trucks and Century Geophysical for Sections 9 and 10, and by Geoscience Associates logging trucks and Century Geophysical for Section 16. The logging procedure is to calibrate the probe and record the plot on the log paper with a known radioactive source, and then lower the probe to the bottom of the drill hole and log coming out of the hole. When a mineralized interval is encountered the probe is pulled up through the zone to find its upper limit, lowered again and the mineralized zone is re-run at a less-sensitive scale to fit the plot on the log paper. All the information regarding scale of the re-run is noted on the log for later computation of grade.

This radiometric probe method of assay is unique to uranium exploration and provides a continuous record of the mineralization with depth.

Each logging truck periodically made logging runs of the U.S. Atomic Energy Commission (Atomic Energy Commission) test pit, a set of shallow holes with known concentrations and thickness of uranium. In addition to the gamma curve, plots are made of the Resistivity and SP (Self-Potential). The resistivity and SP provide a continuous strip chart of the various lithologies as the probe is lifted up the drill hole. Thus, the gamma anomalies may be correlated to a specific footage, correlated with specific lithologic units, much as in core, but without the possibility of mixing core, or salting samples.

The calibration of probes with the U.S. Atomic Energy Commission (later, Department of Energy, DOE) test pit is the standard by which the uranium industry operated. This method is analogous to a system of check assays of an assay laboratory. The test pits were designed with uranium-bearing material of the type and grade common to the Grants Mineral Belt. Many thousands of drill hole intercepts in the Grants Mineral Belt were logged in this manner.

Mineral Processing and Metallurgical Testing

No metallurgical test data for the Roca Honda Property were recovered in the files reviewed by the author of the Roca Honda Report. Kerr-McGee operated an acid leach mill at more than 7,000 tons-per-day in Ambrosia Lake and reported typical recoveries of 94-97%, depending on grade of the contained U3O8. There was no indication, in the files examined, that Kerr-McGee was concerned about the metallurgy for their conventional mining plans for the Roca Honda Property. However, Kerr-McGee did consider the potential for chemical mining of the uranium deposits in Sections 9 and 10. Kerr-McGee proposed an estimated 55% recovery of the historical resources and proposed a detailed chemical mining study of the Sections 9 and 10 deposits to include pump testing and leach tests of core.

Mineral Resource Estimates

Deposit Geology Pertinent to Resource Estimation

Uranium deposits occur in five sandstone units in the Westwater Canyon Member of the Jurassic Morrison Formation. The Westwater ranges from 250 to 300 feet thick in the Roca Honda Property, and is overlain by the Brushy Basin Member consisting of green mudstones and underlain by the Recapture Member consisting of mudstone, siltstone and shaly siltstone. The individual sandstone host units in the Westwater average 20 to 60 ft thick and are separated by thin mudstone interbeds. The uranium deposits are tabular and range from 1.5 to 29 feet thick. In plain view, the deposits are relatively narrow (50- 200ft) and are elongate along an east-southeast trend in Section 9 and 10 and the north part of Section 16 and an east trend in the central part of Section 16. Uranium mineralization in the Roca Honda Property would be typical of geologically identical deposits to the west in which the uranium occurs together and admixed with medium- to dark-gray humate that impregnates the sandstone. The color is due to organic carbon, which has a direct weight percent relation to uranium content. From examination of the cross sections, e-logs and underground observation to the west it is evident that uranium mineralization forms both tabular deposits that sub parallel bedding or “roll” across bedding, and in places form C-shaped roll fronts that are convex down-dip or basin ward to the northeast. Leading “tails” to the front are intersected as upper and lower limbs, up-dip from the actual front that may fill a major part of the entire thickness of an individual sandstone unit.

Data

Basic data for the author of the Roca Honda Report’s resource estimate for Sections 9 and 10 were the Kerr-McGee Drill Hole Data summaries, drill hole survey information, mineralized intercept gamma-log interpretations by Kerr-McGee geologists, drill hole maps and reports and memos prepared by Kerr-McGee. Kerr-McGee had performed a mineral survey of the claims and drill hole collars in 1980 by a professional mineral surveyor. Basic data examined by the author of the Roca Honda Report for the resource estimate for Section 16 were the Western Nuclear drill hole maps with uranium values, reduced e-logs with header sheets, gamma reruns, drill data sheets prepared by Western Nuclear with mineralization values, tops and bottoms, sand unit designation and drift survey information. Two separate maps checked each other with no visible errors.  Thickness of mineralized intercepts was taken from the measured drill ho le interval and is treated as true thickness. Drill hole deviation is less than 3o from vertical, thus any correction from apparent to true thickness is negligible. Down-hole drift survey results were available to the author of the Roca Honda Report for all holes drilled on Section 9, all but one of the 175 holes drilled on Section 10, and 52 of the 63 holes completed on Section 16.

186 mineralized intervals were used in the 0.6 GT cutoff for the measured and indicated category.

Resources

Deposits at the Roca Honda Property can be reported as a mineral resource based on the fact that Kerr- McGee was proceeding to develop the deposit under a mine plan proposal and had commenced sinking a shaft to mine uranium deposits in Section 17, southwest of, and cornering Sections 9 and 10 of the Roca Honda Property. It is believed that Kerr-McGee intended to access Sections 9 and 10 from the shaft. In addition Kerr-McGee had planned to evaluate the in-situ mining potential of the Roca Honda Property. The Johnny M uranium mine, one mile west was successfully mined from 1976 to 1982. Potentially viable recovery methods for the uranium resource in the Roca Honda Property include the use of ISR as well as conventional mining and milling techniques. Strathmore is performing preliminary evaluation of the technical, regulatory, and economic feasibility to support these in-situ and conventional mining and milling altern atives.

The method of resource calculation used in the Roca Honda Report was different from that of the Kerr-McGee method and was based on the method of polygons (perpendicularbisector polygonal method), also known as areas of equal influence (AOI), wherein polygons are constructed about each sample point (drill intercept) by using perpendicular bisectors halfway between adjoining samples.

Polygons were constructed about the bottom-hole position of drill holes, and the area of equal influence (AOI) computed for each polygon. The AOI of each polygon was further limited by either adjoining drill holes, or a maximum capped size for the polygon. Criteria for the each of the Resource classes was as follows:

Measured Resource, AOI is capped at 10,000 ft2 (100ft x 100ft).

Indicated Resource, AOI is capped at 20,000 ft2 around the Measured AOI. The Indicated Resource is computed by subtracting (Measured) from (Measured and Indicated).

Measured and Indicated Resource, AOI is capped at 30,000ft2. It was decided to cap each polygonal area at 30,000ft2 AOI rather than the 40,000ft2 AOI (200ft x 200ft) typically used for computing a Measured and Indicated class. This 25% reduction in the AOI is in the author’s opinion, justified and reasonable, based on his familiarization with the geology of trend-type mineralization, present in the Roca Honda Property, which may have sharp rather than diffuse boundaries.

Inferred Resource, AOI is capped at 160,000ft2 (400ft x 400ft), which was the largest area category. The portions of any polygons larger than this category were not used in computations.

In addition to capping polygons to a maximum area as described above, perpendicular bisectors to adjoining drill holes further limit each AOI.

The drill pattern within most of the resource area is on a spacing of approximately 150-200ft. In Section 16, large areas near the center of the Section have only widely spaced drill holes. Thickness and grade of each mineralized intercept were assigned to each polygon for computing tonnage. An assumed tonnage factor of 15 cubic feet per ton was used (Kerr-McGee, undated). This is the typical tonnage factor used by most operators in the Ambrosia Lake District for mineralized intervals in the Westwater Sandstone units. Computation of tonnage was made for each interval above a cutoff of 0.03% U3O8, (except for internal dilution of combined intercept zones) and with a further cutoff of GT (grade in %U3O8 x thickness product) at increments of 0.1, 0.2,0.3,0.4,0.5,0.6,0.7,0.8,0.9 and 1.0 GT. A minimum thickness cutoff was not used because ISR mining does not require the 6 feet mi nimum thickness necessary for underground mining equipment and personnel. The resulting tonnages were summed for each sand unit by class of resource. A weighted-average thickness and a weighted-average grade were computed for the total tonnages of each sand unit.

The new measured and indicated resource of 15.1 million pounds U3O8 for the Section 9 and 10 part of the Roca Honda Property is significantly greater (32%) than Kerr-McGee’s estimates of 11.48 million pounds for a “demonstrated resource” for the same Sections. The larger new resource estimate results from using a lower cutoff grade, no minimum mining thickness, and a larger area of influence (AOI) for the indicated category than that of Kerr-McGee. Kerr-McGee used the circle and tangent method and a cutoff of 6ft of 0.10%U3O8, (GT of 0.6). The Roca Honda Report used the polygonal-bisector method, a grade cutoff of 0.03% U3O8 and a GT cutoff of 0.6.

A summary of the estimated mineral resource is tabulated in Table 1.1:

Table 1-1 Mineral Resource Summary

Measured

Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)	GT
0.6	1,305,000	0.23	6,035,000	19.3	4.46

Indicated

Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)	GT
0.6	2,477,000	0.23	11,477,000	19.3	4.51

Measured and Indicated

Cutoff GT	Tons	Grade (%U3O8))	Pounds (U3O8)	Thickness (ft)	GT
0.6	3,782,000	0.23	17,512,000	19.4	4.50

Inferred

Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)	GT
0.6	4,546,000	0.17	15,832,000	19.3	3.36

Other Relevant Data and Information

Exploration Potential

In the author of the Roca Honda Report’s opinion there is excellent exploration potential for the discovery of additional uranium mineralization in the Roca Honda Property. Additional drilling could likely intercept mineralized material of similar thickness and grade as that previously identified. The best potential is within an east trend in the central part of Section 16. There are three “ore” holes that could each be offset-drilled on a 200-foot spacing by four drill holes. The author of the Roca Honda Report was also of the opinion that there is also potential near the center of Section 10 to offset-drill existing “ore” holes in the D sand with potential to extend a mineralized trend N30oW to the northwest corner of the Section.

ISR Consideration

Kerr-McGee considered the possibility of ISR production (In-situ leach) for the Roca Honda Property. A Kerr-McGee 1985 report contained a 2-page outline that summarized conventional and chemical mining resources and mining cost estimates for the Roca Honda, Sections 9 & 10. The outline for “chemical mining” used a “Total Resource” of 6,050,000 lbs U3O8 at a 55% recovery (of the total 11,000,000 pounds “resources”). Other items listed were: average thickness: 12 feet, average depth: 2250 feet, average grade: 0.32% U3O8, average front width: 200 feet. The cost estimate incorporated capital costs for production, monitor, and injection wells and plant cost. Operating and direct costs were also estimated. Restoration costs were also a line item. The costs are outdated and lack supportive information thus are not tabulated here.

Although Kerr-McGee proposed to conduct ISR pilot tests at the Roca Honda Property, there is no information that pilot tests, core analysis for permeability and metallurgical recoveries had been performed. ISR recoveries may typically be in the order of 60- to 70% but may range significantly lower or higher.

Interpretation, Conclusions and Recommendations

The author of the Roca Honda Report concluded that the exploration drilling, log interpretation, map posting and historical resources reviewed were, in the author’s opinion, produced in a professional, and accurate manner and that there is very good potential to drill additional uranium mineralization on Sections 9, 10 and 16 of the Roca Honda Property.

Exploration and Development

Recommendations – Stage I

The Roca Honda Property is a project of merit and justifies additional work. It is recommended to perform work to determine economic viability and to convert the Mineral Resource to a Mineral Reserve and Preliminary Feasibility Study compliant with the CIM Standards and as referenced in NI 43-101. The potential for ISR commercial production should be seriously evaluated. It is recommended to perform up-dated economic studies of possible ISR operations for the project. Further geologic studies should be performed to include compilation of numerous cross sections and detailed maps of mineralization in each sand unit to determine the geometry of mineralized fronts and tabular beds for a proposed pilot plant well pattern. Permitting should be given a high priority.

It is recommended to drill two or more core intercepts per Section to obtain cores from the mineralized zones for radiometric and chemical analysis, permeability and porosity tests. The core would also be used to perform leachability tests for possible ISR. Results of the initial coring would dictate whether additional cores are needed. A preliminary pumping test program should be performed for which approved permits must be acquired. Ground-water quality should be measured and rigorously monitored for pre-operation baseline data, possibly using the initial drill holes. A certified hydrogeologist should be contracted to perform a detailed hydrogeological study.

Recommendations – Stage II

Given demonstrated positive economic viability from Stage 1, then certain prefeasibility tasks are recommended to advance the project, which are described in greater detail in the Roca Honda Report. It is recognized that the required time and costs, especially in permitting activities may significantly exceed these recommendations.

Church Rock Property

Property Description and Location

Size and Location

The Church Rock Property is located in northwestern New Mexico in the Grants Mineral Belt, in the southern part of the Church Rock District. The Church Rock Property consists of 36 unpatented mining claims, totalling approximately 640 acres located in Section 4, T16N-R16W, New Mexico Principal Meridian, McKinley County, New Mexico. The Church Rock Property is approximately 10 air miles northeast of Gallup, New Mexico and can be reached by traveling east 6 miles from Gallup on Interstate 40, then north 10 miles on NM State Hwy 566 (paved), then west and southwest by dirt roads to the north central part of Section 4, 16N-16W. The Church Rock Property is one-half mile south of the Navajo Reservation boundary. Drill roads mostly require four-wheel drive for access and access to some parts may require maintenance.

Mining Claims

The 36 unpatented mining claims are held by Strathmore Resources.  The claims are contiguous and consist of the following claim names and numbers: Ram 1-36 (NMMC 36142-36177). The claims are listed in the U.S. Bureau of Land Management Mining Claim Geographic Index Report (LR2000) with a location date of 10/06/65, and the latest assessment year is 2006.  The claims were originally staked and recorded in 1965 in the name of Kerr-McGee Oil Industries, Inc.

Nature and Extent of Strathmore’s Title

Strathmore Resources holds the claims by Quit Claim Deed by Rio Algom Mining LLC conveying all title to the above-listed claims to Strathmore Resources.  

Mineralized Areas, Surface Disturbance, Environmental Liability

The uranium deposits on the Church Rock Property are shallow dipping and lie at depths of between 1,500 to 1,700 feet from the surface. There is no surface expression of the deposits and thus all information defining the mineralization is from drill holes.  In New Mexico there are drill hole plugging requirements for all holes that encounter water. Forms describing the method of plugging and other required information must be submitted to the State Engineer Office and the State Bureau of Mines and Mineral Resources within 90 days of encountering water in the drill hole.

As there has been no previous mining on the property, the author of the Church Rock Report was of the opinion that it is likely there are no existing significant environmental liabilities associated with the Church Rock Property.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

Access

The Property is reached by traveling east approximately 6 miles from Gallup on Old Highway 66, then north approximately 10 miles on New Mexico State Hwy 566 (a paved road) to a location approximately half of a mile south of the Navajo Indian Reservation. Several potential access routes to the site from Highway 566 are available, including two that require access approval through the Navajo Reservation and two that require access agreements with other private surface landowners.

Legislation by the Navajo Nation Council was passed and signed into law April 29, 2005 which prohibits uranium mining on Navajo territorial lands. The Church Rock Property is U.S. Bureau of Land Management lands and not Navajo Reservation Lands, however the Navajo Legislation Act may make it difficult to cross reservation lands, thus gaining alternate routes of access across non-reservation lands may be required.

Climate and Vegetation

The Church Rock Property is vegetated mostly by grasses, pinion pine and juniper trees and is in a semi-arid, high-desert climate. It is approximately 15 air miles northeast of Gallup, New Mexico, which receives an average of nearly 17 inches of precipitation annually. The major part of annual precipitation occurs with thunderstorms in June, July and August. An average of nearly 34.1 inches of snow falls annually, mostly during the period of time between December and February. Gallup has an annual average temperature of 41ºF, an average high monthly temperature of 83.9 ºF in July and an average low monthly temperature of 11.7ºF in January.  Winter snow and inclement weather conditions may interrupt operations occasionally.

Topography and Elevation

The Church Rock Property has relatively moderate topography and is mostly underlain by a mesa formed by ledge-forming sandstone beds that dip 2o to 3.5o northeast. Elevations range from 7,040 to 7,518 feet. A northeast trending canyon in the west part of the property has up to 200 ft relief, and a sandstone ledge and slopes in the extreme southeast corner of the property has 150 ft relief. The south-center to the east center part of the project has moderate relief of approximately 70 to 120 ft over a one-half mile distance.

Surface Rights

The claims on the Church Rock Property are on Bureau of Land Management Lands, administered by the U.S. Department of the Interior, Bureau of Land Management. Certain permits and approvals are required for use of the surface. A Notice of Intent and/or a Plan of Operations must be filed with the appropriate Bureau of Land Management District office and approval must be received prior to any new surface disturbance activities. A Plan of Operations requires a reclamation cash bond in an amount set by the Bureau of Land Management. In addition, exploration operations require an approved exploration permit from the New Mexico Mining and Minerals Division of Energy, Minerals and Natural Resources Department.

History

Ownership History

Kerr-McGee staked the Ram 1-36 unpatented mining claims on October 6, 1965, and recorded the location notices and affidavits in the McKinley County Courthouse. Kerr-McGee, its subsidiaries and its successor, Rio Algom Mining LLC, held the claims until they were acquired by Strathmore Resources on March 12, 2004.

No hydrologic study has been conducted for the Church Rock Property.  However, certain reports indicate that Rio Algom has not ran any ISL [in-situ leach] amenability tests for the uranium deposits in Section 4 – 1616.  However, URI to south has performed pump test and permeability studies on uranium mineralization that is a southwest extension of RAMC’s. Hence, it is believed that Section 4- 1616 uranium deposits can be mined by ISL methods.  Although Rio Algom did not run ISR tests, Kerr-McGee had previously run such tests.  Laboratory short column tests on core and ore samples indicated very leachable ore with 80 to 90% U3O8 extraction in the lab.  

Historical Mineral Resource Estimates and Reliability

Historical Resource Estimates were prepared by Kerr-McGee and its successor, Rio Algom, the results of which are summarized in the following tables.  

Table 1 Historical Resource Estimate: Cutoff of 5 ft of 0.10% (GT of 0.5)

CATEGORY	TONS	GRADE %U3O8	POUNDS U3O8
Measured	2,532,000	0.11	5,426,000
Indicated	34,000	0.11	76,000
Total Measured & Indicated	2,564,000	0.11	5,502,000
Potential			500,000
Totals			6,002,000
Cutoff of 0.50 GT (grade % U3O8 times thickness in ft)
Average thickness: 12 ft
From: D.E. Smouse (1995)

Table 2 Historical Resource Estimate: Cutoff of 6ft of 0.05% (GT of 0.30)

CATEGORY	TONS	GRADE %U3O8	POUNDS U3O8
Total Measured & Indicated
Cutoff of 6 ft of 0.05% (0.3 GT)	6,050,000	0.09	10,900,000
This Report: Cutoff of 0.03% (0.3 GT)	6,221,467	0.10	11,848,007
Difference from this report	2.74%	5.80%	8.70%
From: Falk (1979)

Kerr-McGee’s criteria for determining resource blocks was rigorous and developed from years of successful operating experience in New Mexico and Wyoming.  The procedure was as follows:

(i)

Measured category

For Blocks in the measured category a circle is drawn on the map around the drill hole intercepts that meet thickness and grade of cutoff. The radius of the circle is equal to ½ the horizontal distance to the nearest drill hole intercept below cutoff, or 50 feet whichever is less. Two or more above-cutoff holes may be connected to construct a measured block by lines tangent to the circles provided that:

The intercepts tie or correlate within the same lithologic unit, and at least one foot of the intercepts can be connected with each other by a horizontal line (in correlation section).

There are no below-cutoff intercepts in the same unit within the block.

The above-cutoff holes are no more than 300 feet apart.

Where a below-cutoff hole interferes with a straight-line connection of a measured block, a 50- foot radius is applied to such hole and the straight line drawn to its radius so as to remove the below-cutoff area from the measured block.

An above-cutoff intercept is considered an isolated block if it cannot be tied to another such intercept.

(ii)

Indicated category

Indicated blocks are constructed to enclose the unsampled area between measured blocks and/or isolated holes, using the same methods described above except:

Above-cutoff holes are not connected if greater than 300 feet apart.

(iii)

Inferred category

Inferred blocks are constructed to enclose the unsampled area between measured and indicated blocks and/or isolated holes, using the same methods as for measured except:

Horizontal distance between cutoff holes is greater than 500 feet and less than 1,000 feet if the intercepts tie. If they do not tie, the connection can be up to 500 feet.

(iv)

Miscellaneous

Cutoff grades (COG) and thickness for New Mexico surface holes: COG = 0.10% U3O8 at a mining thickness of 6 feet (6’/ 0.10 % U3O8).

Strathmore Church Rock cutoff was a GT of 0.50 (the equivalent of 5’/ 0.10 % U3O8).

Calculation sheets were used by Kerr-McGee. The surface area was computed by planimeter from the map and multiplied by the thickness. This number was divided by the tonnage factor.

A tonnage factor of 15 cubic feet per ton was used for the New Mexico calculations.

Certain reports have reported a demonstrated reserve (measured and indicated) of 10.9 million pounds U3O8 at an average grade of 0.09% U3O8 for Section 4, using a cutoff of 6ft. of 0.05% U3O8. In other reports, regarding chemical mining potential for the Church Rock Property, estimates of “approximately 4 million pounds U3O8 recoverable from section 4” were made.  Further reports that “Laboratory short column tests on core and ore samples indicated a very leachable ore with 80 to 90% U3O8 extraction in the lab” have also been made.

The author of the Church Rock Report believes that there is a high degree of reliability of the above historical resources due to the fact that Kerr-McGee was a proficient uranium operator, with extensive experience in the Grants Mineral Belt.

(v)

Production History

There has been no previous production from the Church Rock Property.

Geological Setting

Regional Geology

The Grants Mineral Belt, in northwest New Mexico, lies within the Colorado Plateau geologic province and on the south flank of the San Juan Basin. It extends from several miles east of Laguna to the Gallup area, a distance of 100 miles by 25 miles wide. The belt includes the Laguna, Ambrosia Lake and Church Rock districts. Principal host rocks for the uranium deposits are fluvial sandstones in the Jurassic Morrison Formation, named the Westwater Canyon Member, and the Jackpile Sandstone. Other, less important host rocks for uranium deposits are the Cretaceous Dakota Sandstone, and the Jurassic Todilto Limestone. The Morrison Formation forms outcrops along the south edge of the San Juan Basin and dips gently north into the basin. It is overlain by the Cretaceous Dakota Sandstone, Mancos Shale, and Mesaverde Group. The Morrison Formation was deposited in a continental environment and in the Grants Mineral Belt consist s of four members in ascending order; the Recapture Member, mostly grayish-red siltstone and claystone, the Westwater Canyon Member, gray, light yellow-brown and reddish-brown, fine- to coarse-grained arkosic sandstone with interbeds of greenish-gray and reddish-gray claystone, the Brushy Basin Member, mostly greenish gray-gray claystone, and the Jackpile Sandstone, an informal name for the upper fluvial sandstone in the east part of the Grants Mineral Belt near Laguna, New Mexico. The Jackpile sandstone does not exist in the Church Rock or Ambrosia Lake districts. The Westwater Canyon Member, host for the uranium at the Strathmore Church Rock property, ranges to 450 feet thick in the Grants Mineral Belt and consists of fine- to coarse-grained sandstone.

Local and Property Geology

Ledge-forming sandstones above shale slopes, all in the Cretaceous Mesaverde Group, underlie the Church Rock Property. The Gallup Sandstone, lowermost formation of the Mesaverde is underlain by the Mancos Shale, which is about 800 feet thick. These units are underlain by the Cretaceous Dakota Sandstone, which is about 60-80 feet thick. The Dakota Sandstone unconformably overlies the Brushy Basin Member of the Jurassic Morrison Formation. The Brushy Basin Member overlies the Westwater Canyon Member, host rock for the uranium deposits. The Westwater Canyon consists of a series of fluvial quartz-rich, arkosic sandstones separated by thin green claystone shale beds. The Westwater is about 250 to 400 feet thick and is informally divided into 8 sandstone units, A to H from top to bottom. Only sands A to F are the significant uranium-bearing units of interest.

Structure is not complex, but will require careful study for its effect on any future mining or ISR plans. There is a north-trending, shallow plunging anticline in the east half of Section 4, and a corresponding shallow plunging syncline in the west half of Section 4. The property lies on the south margin of the San Juan Basin and beds dip northeast at 2o to 3.5o.

From a review of the drill summaries, the top of mineralized zones in the Westwater Canyon Member ranges from 1,500 to 1,700 feet below ground surface.

Exploration

Exploration methods for sandstone uranium deposits differ in many respects from those for other metals. Uranium deposits in the Church Rock district have no surface expression and thus require drilling and geophysical logging for discovery. Common practice is to drill widely-spaced holes to gather geologic information, including alteration bleaching, traces of mineralization, and sandstone development. This information is used to guide the location of subsequent drill holes, with the object of intercepting mineralization as quickly as possible. Subsequent offset drilling to mineralization is modified continually as new geologic information is developed.

Based on a review of drilling records by the author of the Church Rock Report, previous exploration of the Church Rock Property consisted of an on-going drilling program performed by Kerr-McGee and staged over a number of years. Most of the drilling was by Stewart Brothers Drilling, a contract drilling company and the geophysical logging was by Kerr-McGee owned and operated trucks.

Deposits in the Church Rock Property are sandstone-type uranium deposits. Sandstone-type uranium deposits are irregular in shape, are roughly tabular and elongate, and range from thin pods a few feet in width and length, to bodies several tens or hundreds of feet long. The deposits are roughly parallel to the enclosing beds, but may form rolls (tabular lenses) that cut across bedding. The deposits occur in more than one layer, form distinct trends, commonly parallel to depositional trends, and occur in clusters. Two sub-types of deposits occur, primary ore and post-fault ore, also termed stack or redistributed ore, derived from primary ore. Primary ore in the Grants Mineral Belt consists mostly of uranium-enriched humic matter that coats sand grains and impregnates the sandstone, imparting a dark color to the rock. Primary ore is mostly tabular and subparallel to the bedding. Stack or redistributed ore differs from primary ore mostly in geometry, and “stacks” upward along faults and fractures. Stack ore is commonly medium gray, and lower in grade than primary ore. Uranium mineralization at the Church Rock Property is mostly of the stack-ore, or roll front type with the mineralization forming northwest-facing fronts that transect bedding.

During 2005, Strathmore performed ongoing geologic studies for the Church Rock Property, including the compilation of databases, drill maps, mineralization maps, cross-sections and data review and has prepared in-house mineral resource estimates. Strathmore has set up an office in New Mexico, which has been conducting ongoing environmental and permitting studies and activities.  

Mineralization

Summary

The typical mineralized rock in the Church Rock Property, as well as the Ambrosia Lake and Jackpile districts, occurs as uranium-humate cemented sandstone. The uranium mineralization consists largely of unidentifiable organic-uranium oxide complexes that are light gray brown to black. A direct correlation exists between uranium content and organic carbon content by weight percent in the ores. Although coffinite and uraninite have been identified in the Grants Mineral Belt, their abundance is not sufficient to account for the total uranium content in an ore sample. Admixed and associated with the uranium are enriched amounts of vanadium, molybdenum, copper, selenium, and arsenic in order of decreasing abundance. Other metals are also enriched above background amounts. Total uranium production from Jurassic Morrison sandstones within the Grants Mineral Belt was more than 340 million pounds U3O8 from 1948 t hrough 2000, including the Church Rock district, which has produced 16 million pounds.

The mineralization at the Church Rock Property occurs in several elongate deposits that range to 100 or 200 feet wide by 200 to more than 3,500 feet long. Thickness of mineralization ranges from 1 ft. to 42.5 ft.

Geologic controls

The primary ore control is the presence of a quartz-rich, arkosic, fluviatile sandstone in the Morrison Formation. This type of sandstone is the primary host rock in the Church Rock Property, although some ores were produced from Cretaceous Dakota Sandstone, a quartz-sandstone. The presence of carbonaceous matter as humate pods is important. Detrital plant fragments are less common in the Church Rock districts than in the Ambrosia Lake district. The presence of pyrite and bleaching alteration is important. Sedimentary features may exhibit control on a small scale. Alteration bleaching forms a halo that encloses mineralization, up dip to the deposit. The bleaching caused by the removal of reddish ferric-iron pigmentation imparts a light-gray color to the sandstone, and a greenish rim on red-cored claystone cobbles or galls.

Drilling

Based on a review of drilling records by the author of the Church Rock Report, previous drilling on the Church Rock Property was performed by Kerr-McGee using rotary mud drilling with truck-mounted drills contracted by local drilling companies.  Kerr-McGee commonly drilled holes with 4¾ inch diameter bits by conventional rotary drill rigs circulating drilling mud.  All drilling was vertical.  The cuttings were typically taken at five-foot intervals by the driller and laid out on the ground in piles for each five feet in rows of 20 samples or 100 feet.  A geologist would then examine the drill cuttings in the field and record lithology and alteration on a drill log form.  The drill holes were taken through the Westwater Canyon Member and into the underlying Recapture Member (non-host).  Upon completion of each drill hole, the hole was logged with a gamma-ray, self potential, and res istivity probe either by a contract logging company or in some cases by Kerr-McGee’s company-owned logging truck.  After running the log, a drift tool (film-shot) was lowered into the drill hole for survey at 50 to 100-foot intervals.  Deviation from vertical in a single intercept was commonly less than 1o to 3o, and the dip of beds is less than 10o, thus mineralized intercepts represent essentially true thickness.

The first drill hole on the Church Rock Property was completed in August 1967.  Discovery of uranium mineralization with a GT of 0.60% U308 was made in the sixth drill which was completed February 6, 1968.  The mineralized zone was intercepted at a depth of 1,747 feet.  Most of the drilling was performed from 1968 through 1975 with additional drilling from 1976 to 1977.  Subsequently one drill hole per year was completed in the time between 1978 and 1984, in 1989, and in 1991.  A total of 165 holes totalling approximately 306,000 feet were completed.

Based on a review of the drill summary sheets and drill hole location maps by the author of the Church Rock Report, a total of 165 drill holes were completed, of which 74 were in the ore category and 24 were in the strong mineralization category.  

Sampling Method and Approach

Gamma-ray Logs

All of the mineralized intercepts for the historical resource estimates were calculated by Kerr-McGee from gamma-ray logs probed for each drill hole. Each log typically consists of gamma ray, resistivity, and self-potential curves plotted by depth. The resistivity and selfpotential curves provide bed boundaries and are mainly used for correlation of sandstone units and mineralized zones between drill holes. The equivalent U3O8 content from the gamma logs was calculated by Kerr-McGee using essentially the industry-standard method developed originally by the U.S. Atomic Energy Commission (AEC). Kerr-McGee’s method was basically as follows: For zones greater than 2 feet thick, first pick an upper and lower boundary by choosing a point approximately ½ height from background to peak of anomaly. Then determine the counts per second (cps) for each one-foot interval. Divide by the number of intervals f or an average cps for the anomaly. Then convert the cps to % U3O8 (e U3O8) using the appropriate Kerr-McGee charts for the specific logging unit used.

Disequilibrium

Disequilibrium is a term for the disparity in the normal ratio between uranium and its naturally occurring radioactive daughter products, which are measured by the gamma log. Generally, a check is made for disequilibrium after drilled resources reach a total of approximately 100,000 to 500,000 lbs of contained U3O8, or when there is a change in geologic regime. A determination of the number of check intervals needed is made by an experienced geologist. In new areas disequilibrium may be checked after the first few ore holes. For large uranium producers with years of operating experience in well-known districts, such as Ambrosia Lake and Church Rock, and with extensions on-trend with mined deposits it was common to drill out most of the resource, then obtain several core hole intercepts of selected mineralized zones for assay and metallurgical checks prior to large capital expenditures such as shaft-sinki ng and underground development.

Disequilibrium was seldom a factor for dark gray, primary ore in the Ambrosia Lake district. However there may be disequilibrium to a varying extent for redistributed or stack ore. Usually in cases where disequilibrium is identified, the uranium (low radioactivity) has been transported a short distance from its daughter products (radioactive) which have remained in their original site of deposition.

The subject of disequilibrium may be confusing if not understood, especially if theoretical physics is introduced. A few items may be noted from years of experience.

1.

The best evidence to allay concerns of disequilibrium is experience from identical deposits using the record trail from gamma-ray interpretations of surface drill holes, followed by ore reserve estimates, then underground gamma-ray probe from the subsequent mine, then mill-head gamma-ray probes as the truck arrives at the mill, then chemical analysis of the resultant product, termed yellowcake.

2.

It is very important how disequilibrium is determined, and using core introduces other variables requiring checks. The down-hole probe “sees” the radioactivity of a 2.5 ft. diameter cylindrical area centered about the drill hole. This should not be compared to simply the chemical assay of a 2 3/4 –inch diameter core sample. Instead, the core is sampled over the mineralized interval as determined by a hand-held Geiger counter or scintillometer to define mineralized boundaries. The core is split and sampled for the intervals selected. Each sample is crushed and pulverized, then two separate assays are made of the same pulps; a scaler-radiometric or closed can radiometric assay and a chemical assay. The disequilibrium factor, if any, is expressed as a ratio of chemical/radiometric.

3.

It takes about 1-million years for uranium to form its radioactive daughter products and achieve equilibrium. The Morrison uranium deposits are of Jurassic age and thus are in equilibrium, unless altered by recent surface waters.

4.

No mention of core holes, or core assays was seen in the drill records examined.

Drill cuttings

Drill cuttings are useful for mapping alteration and in conjunction with the geophysical logs for lithology, but are too dilute to analyze for uranium content. Lithologic logs were not reviewed for this study, but could be studied at some future date for constructing sandstone alteration maps that may be used in detailed geologic planning and to identify future exploration targets.

Sample Preparation, Analyses and Security

No chemical analyses or core holes were reported within the data searched for the Church Rock Property. Typical operating practice in the Church Rock district was to rely on calibrated gamma log interpretation of mineralized intercepts in drilling up to and including resource estimates. The practice of core sampling for chemical assay varies by operator, but was typically done for metallurgical confirmation prior to capitalizing development such as shaft sinking and mine development. Also it was typical practice to obtain core samples for chemical assay in new regions where disequilibrium (differing chemical vs. radiometric analysis) was suspected.

Probe Truck and Calibration

Kerr-McGee files contained detailed records of probe truck equipment characteristics including truck number, probe number, crystal size, dates of use, k-factors, calibration tests and resulting factors. These are kept for each logging unit whether a company Kerr-McGee truck, or a Century Geophysical truck. Each gamma log contains a footer with a calibration run, and a header sheet with the rerun factors and probe unit number.

Core Samples

The author of the Church Rock Report could locate no records of previous core samples for the Church Rock Property.

Data Verification

Review of Original Records

The author of the Church Rock Report reviewed extensive files in Strathmore’s warehouse in Riverton, Wyoming on October 14 and 15, 2004. There were over 300 boxes, file cabinets and map files in the data storage covering the Church Rock Property as well as other projects. The files were quite complete with original data including gamma ray logs and maps. Specifically, the author of the Church Rock Report reviewed original gamma ray logs, mini logs, drill hole summaries, ore reserve calculation sheets, copies of drill hole maps, ore reserve maps, reports of mine plan, survey documents, logging truck calibration records, and a few representative cross-sections. Items not recovered for this study but listed in the data list are mylar cross-sections, lithologic logs, and U.S. Atomic Energy Commission test pit logging files.

Limitations on Sample Verification

The entire original, factual assay data are represented by the continuous gamma-logs that were made during the drilling programs as each drill hole was completed. These logs were run by Kerr-McGee operated logging trucks. The procedure is to calibrate the probe and record the plot on the log paper with a known radioactive source, and then lower the probe to the bottom of the drill hole and log coming out of the hole. When a mineralized interval is encountered the probe is pulled up through the zone to find its upper limit, lowered again and the mineralized zone is re-run at a less-sensitive scale to fit the plot on the log paper. All the information regarding scale of the re-run is noted on the log for later computation of grade.

This radiometric probe method of assay is unique to uranium exploration and provides a continuous record of the mineralization with depth.

And each logging truck periodically made logging runs of the U.S. Atomic Energy Commission (AEC) test pit, a set of shallow holes with known concentrations of uranium. In addition to the gamma curve, plots are made of the Resistivity and SP (Self-Potential). The resistivity and SP provide a continuous strip chart of the various lithologies as the probe is lifted up the drill hole. Thus, the gamma anomalies may be correlated to a specific footage, correlated with specific lithologic units, much as in core, but without the possibility of mixing core, or salting samples.

The calibration of probes with the U.S. Atomic Energy Commission (later, Department of Energy, DOE) test pit is the standard by which the uranium industry operated. This method is analogous to a system of check assays of an assay laboratory. The test pits were designed with uranium-bearing material of the type and grade common to the Grants Mineral Belt. Many thousands of drill hole intercepts in the Grants Mineral Belt were logged in this manner.

Mineral Processing and Metallurgical Testing

No metallurgical test data for the Church Rock Property were recovered in the files reviewed by the author of the Church Rock Report. One report stated that Westwater Canyon sandstone in the Church Rock Property has a much higher permeability than in Ambrosia Lake. Cementation of the Westwater is also much less at the Church Rock Property.  Hence, the report stated, although Rio Algom Mining LLC has not run any leach tests it is felt that ISL operations can be utilized to mine the Section 4- 1616 deposit.

Kerr-McGee did however perform metallurgical tests on ore samples and core samples from the Westwater sandstone units from their mine at the Church Rock Property located approximately 2 miles north of the Church Rock Property. The purpose of these tests was to evaluate the potential for ISR mining of the ores. Kerr-McGee Corporation Technical Center (1982) concluded that agitation leach tests on Church Rock ore indicate that a pH 8.3 carbonate solution, containing 0.5g/l hydrogen peroxide would be suitable for in mine solution mining of this ore.  The test results yielded up to 66% recovery of U3O8. Kerr-McGee further reported that regarding their uranium properties both on the Navajo Reservation and Section 4, off the reservation that:  “Laboratory short column tests on core and ore samples indicated very leachable ore with 80 to 90% U3O8 extraction in the la b. To prepare a production cost estimate, a field recovery of 55% of the 6’ / .05% U3O8 resource was used and separate estimates were prepared for the on reservation and off-reservation reserves.”

Mineral Resource Estimates

Deposit Geology Pertinent to Resource Estimation

Uranium deposits occur in six sandstone units in the Westwater Canyon Member of the Jurassic Morrison Formation. The Westwater averages 250 ft thick in the Church Rock Property. The individual sandstone units average 20 to 60 ft thick and are separated by thin (1 to 5 ft thick) mudstone interbeds. The sand units are designated A to F, from top to bottom of the sequence. The uranium deposits are tabular and range from 1.3 to 42.5 ft thick true thickness (drill hole database). In plan view, the deposits are relatively narrow (10-200ft) and are elongate along a northeast trend. Uranium mineralization in the Church Rock district occurs with medium gray humate that impregnates the sandstone. Much of the ore in the Church Rock Property consists of “redistributed” or stack ore. The geometry of redistributed ore is similar to that of Wyoming uranium deposits, forming C-shaped roll fronts that are convex down-dip o r basin ward to the north. Leading “tails” to the front are intersected as upper and lower limbs, up-dip from the actual front that may fill the entire thickness of an individual sandstone unit. The geometry of the deposits in each of the sand units is shown by the GT contour maps. They trend northeast and exhibit a relatively sharp northwest boundary, possibly due to a northeast-striking fault that may be projected from Kerr-McGee’s geologic studies in Section 27, T17N-R16W to the north. This projected fault is not mapped here, because no evidence was found in the drill data for its precise location. There may be faults in the Church Rock Property that will affect future resource and mineral reserve estimates.

Data

Basic data for the resource estimate were the Kerr-McGee Drill Hole Data summaries, entered on form KM-4092, drill hole survey information together with mineralized intercept interpretations by Kerr-McGee geologists, and drill hole maps at a scale of 1”=200’ prepared by Kerr-McGee. Individual gamma-ray, SP and resistivity logs were examined as a check, and the basic mineralized intercepts and sand unit correlations are considered reliable for purposes of resource estimation. Thickness is taken from drill hole intercept interval and is treated as true thickness. Drill hole deviation is less than 3o from vertical, thus any correction from apparent to true thickness is negligible.

Resources

The Church Rock deposit can be reported as a mineral resource based on the fact that Kerr-McGee was proceeding to develop the deposit to follow a proposed in-situ mining pilot test in Sections 27 and 34, T17N, R16W, one to two miles north of the Church Rock Property, just prior to collapse of the uranium market. Kerr-McGee had performed metallurgical tests and had prepared cost estimates for the pilot project.

The method of resource calculation herein used differs from that of the Kerr-McGee method described and is based on the method of polygons (polygonal method), also known as areas of equal influence (AOI), wherein polygons are constructed about each sample point (drill intercept) by using perpendicular bisectors halfway between adjoining samples. This method is discussed in detail by Popoff and is a method used in computing resources in tabular deposits. It is this author’s experience that the polygonal method and its variant, the general outline method were in general use for resource calculation in the Grants Mineral Belt by the U.S. A.E.C. (Department of Energy), Ranchers Exploration and Development Corporation and other companies.

Polygons were constructed as described above and the area of equal influence (AOI) computed for each polygon. For the measured resource class, each polygonal area is capped at 10,000 ft2 AOI (100ft x 100ft), and for the measured and indicated resource class, each polygonal area is capped at 40,000ft2 AOI (200ft x 200ft). The inferred resource class polygons were capped at 160,000ft (400ft x 400ft), which was the area of largest polygons. The drill pattern within the resource area is on a spacing of approximately 200ft. Thickness and grade of each mineralized intercept were assigned to each polygon for computing tonnage. An assumed tonnage factor of 15 cubic feet per ton was used. This is the typical tonnage factor used by most operators in the Grants Mineral Belt for mineralized intervals in the Westwater Sandstone units. Computation of tonnage was made for each interval above a cutoff of 0.03% U3O8, and with a further cutoff of GT (grade in % U3O8 x thickness product) at increments of 0.1, 0.2,0.3,0.4,0.5,0.6,0.7,0.8,0.9 and 1.0 GT. A minimum thickness cutoff was not used because ISR mining does not require the 6 feet minimum thickness necessary for underground mining equipment and personnel. The resulting tonnages were summed for each sand unit by class of resource. A weighted-average thickness and a weighted-average grade was computed for the total tonnages of each sand unit.

The mineral resource estimate by the polygonal method for this report, using a cutoff of 0.03% U3O8 and a GT cutoff of 0.3 for the measured and indicated class of mineral resource, correlates well with the historical resource estimate by Kerr-McGee which used a cutoff of 6ft of 0.05% U3O8, (a GT of 0.3).

A summary of the estimated resource is tabulated in the following table:

Table – Mineral Resource Summary

MEASURED
Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)
0.3	1,680,333	0.10	3,233,333	8.6
Indicated
Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)
0.3	4,541,134	0.09	8,614,674	8.6
Measured and Indicated
Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)
0.3	6,221,467	0.10	11,848,007	8.6
Inferred
Cutoff GT	Tons	Grade (%U3O8)	Pounds (U3O8)	Thickness (ft)
0.3	1,950,560	0.09	3,525,342	8.6

Interpretation Conclusions and Recommendations

From a review of all the data it is concluded that the exploration drilling, log interpretation, map posting and the historical resources calculated by Kerr-McGee and Rio Algom were, in the author’s opinion all produced in a professional, competent and accurate manner. It is also concluded that there is very good potential to drill additional mineralization.

Recommendations – Stage I

The Church Rock Property is a project of merit and justifies additional work. It is recommended to perform work to determine economic viability and to convert the mineral resource to a mineral reserve. The potential for ISR commercial production should be seriously evaluated. It is recommended to perform up-dated economic studies of possible ISR operations for the project. Further geologic studies should be performed to include compilation of numerous cross sections and detailed maps of mineralization in each sand unit to determine the geometry of mineralized fronts for a proposed pilot plant well pattern.

It is recommended to drill two core intercepts to obtain cores from the mineralized zones for radiometric and chemical analysis, porosity and permeability tests. The core would also be used to perform leachability tests for possible ISR. Ground-water quality should be measured and rigorously monitored for pre-operation baseline data, possibly using the initial drill holes. A hydrogeological study should be contracted by a certified hydrogeologist.

Recommendations – Stage II

Given demonstrated positive economic viability from Stage 1, then certain prefeasibility tasks discussed in greater detail in the Church Rock Report are recommended to advance the project.

Following the Arrangement, Strathmore will also continue to hold the following U.S. non-principal properties.

The Chord Property, USA

Strathmore acquired an option to purchase a 100% interest in a uranium property located in South Dakota, USA, by paying $48,640.  During fiscal 2003, Strathmore amended the terms of the lease agreement for consideration of 100,000 Strathmore Shares of Strathmore valued at $56,000 and incurred additional fees of $6,468.  To earn its interest, Strathmore is required to make annual payments of either 50,000 Strathmore Shares or U.S.$10,000 per year to July 1, 2009.  In fiscal 2006, Strathmore paid $14,381 (U.S.$10,000), 2005 - $12,558 (U.S.$10,000). The property is subject to a 2% gross royalty.

The Wyoming Properties, USA

Strathmore acquired an option to purchase a 100% interest in a certain claims located in Wyoming, USA by paying $87,560, incurring additional costs of $403,100 and issuing 1,150,000 Strathmore Shares valued at $2,198,750.  To earn its interest, Strathmore is required to issue an additional 100,000 common shares in stages over two years.  

INFORMATION CONCERNING FISSION ENERGY POST-ARRANGEMENT

Name and Incorporation

Fission Energy is a private corporation that was incorporated under the name Fission Energy Corp. (“Fission Energy”), pursuant to the CBCA on May 7, 2007.  The registered and records office of Fission Energy is located at Suite 700 – 595 Burrard Street, Vancouver, B.C., V6C 2T5.

To date, Fission Energy has not been organized and its first share issuance will be in accordance with the terms of the Arrangement.

Fission Energy does not presently have any subsidiaries.  After the Arrangement, Minera Peruran SAC, which holds the Peruvian properties would be a wholly-owned subsidiary of Fission Energy.

Business History

On January 31, 2007, Strathmore announced that it would reorganize its mineral property assets in an effort to maximize shareholder value.  Pursuant to the Arrangement, Strathmore will transfer to Fission Energy all of Strathmore’s Canadian mineral properties and Peruvian properties (the “Spin-Off Properties”) in exchange for Fission Energy Shares that would be distributed to the Shareholders in accordance with the terms of the Arrangement.

Ultimately, Shareholders will receive one-third of one Fission Energy Share and one New Strathmore Share for every Strathmore Share held. Concurrently, Strathmore will transfer $500,000 in cash to Fission Energy to provide working capital and exploration funding.

General Development of the Business

Stated Business Objectives

The principal business of Fission Energy following the Arrangement will be to advance the exploration stage Spin-Off Properties.  Fission Energy will be required to facilitate separate fund-raising, exploration and mining strategies to achieve its business objective and it expects to commence these strategies as soon as practicable after the Effective Date.

Milestones

For the business objectives to occur as described under Stated Business Objectives above, the first milestone will be the approval and completion of the Fission Energy Plan of Arrangement. The terms of the Arrangement include a provision for Strathmore to provide $500,000 in cash, part of which will be used to fund ongoing operations (See “Information Concerning Fission Energy Post-Arrangement – Principal Purposes for Available Funds”). This Arrangement is expected to be completed by July 19, 2007, and the funding for Fission Energy will be in place shortly thereafter.

A more detailed description of the exploration and development activities for each property is discussed below under “Principal Properties”.

Description of Assets of Fission Energy

Under the Arrangement, the Spin-Off Properties, together with $500,000 in cash will be transferred to Fission Energy in exchange for approximately 24,056,000 Fission Energy Shares.  The Spin-Off Assets are comprised of the following:

1.

All of Strathmore’s interest in the Dieter Lake Property;

2.

All of Strathmore’s interest in the Duddridge Lake Property;

3.

All of Strathmore’s interest in the Non-Principal Canadian Properties;

4.

All of Strathmore’s interest in the Staked Peruvian Properties; and

5.

$500,000 in cash.

Summary of Property Commitments

Fission Energy will have no obligation in order to maintain its properties in good standing for the first 12 months after closing of the Arrangement.

Principal Properties

Under the Arrangement, Strathmore will transfer the Spin-Off Assets to Fission Energy.  Until the Arrangement becomes effective, Fission Energy will have no assets.

Following completion of the Arrangement, Fission Energy’s material properties, for the purpose of NI 43-101, will be the Dieter Lake Property and the Duddridge Lake Property, both of which have been the subject of NI 43-101 compliant technical reports.  Copies of the Dieter Lake Report and the Duddridge Lake Report are available on SEDAR at www.sedar.com.  The authors of the Dieter Lake Report and the Duddridge Lake Report are, C.F. Davis, P.Geo, M. Guo, P.Geol and S.C. Fraser, P.Geol., respectively and each are “qualified persons” within the meaning of NI 43-101.  The disclosure in this Information Circular considering the Dieter Lake Property and the Duddridge Lake Property has been prepared with the authors’ respective consents.

The following is a summary of certain portions of the Dieter Lake Report and the Duddridge Lake Report, and is qualified by and should be read together with each of the Dieter Lake and the Duddridge Lake Reports in full for a complete set of references and authorities for the statements made in this Information Circular. The Dieter Lake Report and the Duddridge Lake Report contain tables and data that are not included in this summary.

Dieter Lake Property

Property Description and Location

The Dieter Lake Property is currently held 100% by Strathmore and will be transferred to Fission Energy as part of the Arrangement.  A comprehensive exploration program on the Dieter Lake Property was carried out during the summer of 2005 by Dahrouge Consulting Ltd. of Edmonton, Alberta.

The Dieter Lake Property is centred on latitude 55°58’N, longitude 70°34’W. During the fall of 2004, the Dieter Lake Property encompassed 168 claims totalling 8,106 hectares in northcentral Quebec. An additional 48 claims, adjoining to the south, totalling 4,512 hectares, were staked in March 2005. During and up to late summer, 236 more claims were staked, for a total area for the property of 21,809 hectares and 452 claims. During March of 2006, an additional 45 claims, totalling 2074 hectares were designated and were under application at the time that the Dieter Lake Report was being written.  

List of Mineral Claims, Dieter Lake Property

CLAIM NUMBERS	TOTAL CLAIMS	NTS	RECORD DATE	EXPIRY DATE	AREA (HA)	EXPENDITURE REQUIREMENTS*
0016999 to 0017124	126	23M/15	26 Mar 2004	25 Mar 2006>	6,079½	$17,010.00
0018450 to 0018479	30	23M/16	23 Apr 2004	22 Apr 2006>	1,447½	$4,050.00
0018480 to 0018491	12	23M/15	23 April 2004	22 Apr 2006>	579	$1,620.00
0080986 to 0081033	48	23M/15	29 Jun 2005	28 Jun 2007	2,316	$6,480.00
0092312 to 0092439	128	23M/15	07 Sep 2005	06 Sep 2007	6,176	$17,280.00
0092440 to 0092531	92	23M/16	07 Sep 2005	06 Sep 2007	4,439	$12,420.00
0095066 to 0095080	15	23M/16	20 Sep 2005	19 Sep 2007	724	$2,025.00
-	12	23M/15	03 Mar 2006’	-	579	$1,620.00
-	27	23M/16	03 Mar 2006’	-	1,206	$3,645.00
-	6	25D/02	03 Mar 2006’	-	289	$810.00
Total:	496				23,835	$66,960.00

* Expenditure requirements are for the current year.

‘ The date is the application date.
^> Updated applications in progress.

Strathmore obtained the Dieter Lake Property in March, 2004. Work requirements to continue active claim status in Quebec vary annually. In years 1 and 2, the required exploration expenditures are $135 per claim block; $450 per claim block in year 3; $900 per claim block in year 4; $1350 per claim block in year 5; $1800 per claim block in each of years 6 and 7; and $2500 per claim block in year 8 and each subsequent year. In addition, renewal fees of $98 per claim are required for each work period. This fee doubles if the work is filed within the 60 days preceding the expiry date, and quadruples within the last 15 days.

Uranium mineralization at the Dieter Lake Property occurs within a Lower Proterozoic sedimentary basin, within the Superior Structural Province of the Precambrian Shield.  Between Hudson Bay and Labrador Trough, north-central Quebec, are two east-west trending belts of sedimentary outliers attributed to the Sakami Formation.  The basins and grabens are remnants of a failed intracratonic rift system.  The Sakami Formation rests unconformably on Archean granite, diorite, migmatite, gneiss, amphibolites, metavolcanics and schists cut by late diorite and pegmatitic dykes.  The Sakami Formation exceeds 1000 m thickness and is divisible into a lower continental sequence of lacustrine and fluvial-deltaic sediments, and an upper continental arenite sequence.  The Gayot Lake outlier, which is host to the uranium mineralization at Dieter Lake, measures approximately 52 km east-west, by 12 km north-sou th.

Suggested deposit types for the uranium mineralization at Dieter Lake have included unconformity-type, black shale type, and syngenetic stratabound.  

Accessibility, Climate, Local Resources, Infrastructure and Physiography

Currently, the area can only be accessed by helicopter or fixed-wing aircraft; however, an all-weather road to the SEBJ base at Lac Pau-Duplanter comes within 140 km of the Dieter Lake Property.  Caniapiscau is approximately 120 km from Dieter Lake. During summer months, the Dieter Lake Property can be accessed by float plane or helicopter, or by limited quad access. During winter months, access to the Dieter Lake Property is by ski equipped aircraft, helicopter or snowmobile.

Accommodations are available at Mirage Outfitters, which is located about 10 km east of the Hydro-Quebec Reservoir LG-4. Mirage Outfitters is approximately 1½ hours via aircraft from the property and provides all of the necessary supplies and services, including power, fuel, water and food. An airstrip is available at the Hydro-Quebec Reservoir LG-4. Mirage is accessible via aircraft or along the Transtaiga Road from Radisson. Mirage Outfitters is 1,575 km from Quebec City along the Transtaiga Road. Dieter Lake is a two to three hour single Otter flight from Radisson/LaGrande, depending on the prevailing winds.

Topography and Vegetation

The climate of the Dieter Lake Property is subarctic-continental with temperatures reaching lows of -50°C in the winter and highs of 30°C in the summer.  Lake freezing commonly occurs in early October and ice break-up generally occurs in mid to late May. Winds are common and often reach 40 mph. Mean rainfall during the period of May to September is 450 mm.

The topography of the area generally consists of gently rolling hills with elevations of about 450 to 550 metres above sea level. Glacio-fluvial deposits constitute many of the topographic features. Other glacial features, such as moraines, erratics and eskers, are common throughout the area. Drainage of major rivers is west towards Hudson Bay and north towards Ungava Bay.

The area lies in a transitional vegetation zone between subarctic and tundra. The result is stunted open forest cover, dominated by black spruce and tamarack, along the shores of lakes and rivers, and tundra barrens found on the highland.

History

Strathmore obtained the Dieter Lake Property in March, 2004 from Jody Dahrouge and Jeff Reeder.  The Dieter Lake Property has a documented history of exploration of about 30 years, starting in 1961 with by the Geological Survey of Canada. Exploration of this region is considered sporadic. The majority of significant activity occurring in the late 1970s and early 1980s, supervised by Uranerz Exploration and Mining Ltd. in a joint venture with the Société de Développement de la Baie James.

Known exploration of the property and immediate vicinity is summarized below.

Summary of Prior Work

YEAR	DESCRIPTION OF WORK	REPORTS PRODUCED
1961	Regional geological mapping conducted by I.M. Stevenson of the Geological Survey of Canada (Bélair, 1976).	N/A
1966	K.E. Eade conducted a regional geological mapping program at a scale of 1:1,000,000; it included the Dieter Lake area and can be found in G.S.C. Memoir 339 (Orr, 1977a).	Eade (1966)
1976	Uranium was discovered in the Gayot Lake area, by a joint venture involving Uranerz Exploration and Mining Ltd. (Uranerz Exploration and Mining Ltd.) and Société de Développement de la Baie James (SDBJ).	N/A
1976	*Ground prospecting, mapping, a scintillometer survey, a lake geochemical survey (304 water, 292 sediment, 15 rock) and a spectrometer survey (620 line km).	Starke et al. (1976); Bélair (1976)
1977	*Mapping (1:5,000 and 1:50,000), sampling (212 lake sediment, 300 stream sediment, 167 lake margin, 257 soil, 127 rock), and geophysical programs; radiometric-magnetic (1450 line km), EM 16, VLF and magnetometer surveys (148.01 km each).	Orr (1977a); Orr (1977b)
Winter 1978	*Completed the EM 16 and magnetometer survey grids from the 1977 program, continued sampling (248 Dieter Lake water samples), and initiated diamond drilling (19 holes totalling 1538.2 m).	N/A
Summer 1978	*Continued drilling (24 holes totalling 2148.3m), geological and surficial mapping (1:10,000 and 1:50,000), a scintillometer survey (236 lake centres, 70 stream sediments, 43 lake margin waters, 12 lake margin sediments, 82 soils, 4 bog and stream waters, 36 rock), sampling, and a helicopter spectrometer survey (2170 km).	Orr (1978) Orr (1978)
1979	*Mapping, ground prospecting scintillometer survey, sampling (53 Dieter Lake margin, 3 stream, 5 lake centre), an induced polarization (IP) orientation test (8.7 km), and diamond drilling (47 holes totalling 7193.8 m).	Orr (1979c); Orr and Holmstead (1980); Orr et al. (1979); Ripley and Ereson (1979); Gehrisch and Orr (1979)
1980	*Exploration Development Services Group compiled Uranerz Exploration and Mining Ltd.’s exploration data into a computer; they produced variograms, isopachs (1:2500), cross sections, 2D insitu resource estimates, and statistical analyses (multi-element aspect studies, U3O8-eU3O8 correlations).
1980	*Project Division Group tested in Quebec uranium financial analysis computer program, crushed and screened bulk sample material (Lakefield Research Canada Ltd.), and conducted radiometric sorting tests (Ore Sorters Canada Ltd.) and metallurgical tests (UEB, Bonn, Germany) on bulk sample.	Flöter and Schöning (1981)
1981	*Uranerz Exploration and Mining Ltd. completes a topographic survey from compiled drill hole data.	Holmstead (1981)
1981	*Exploration Development Services Group conducts as detailed reserve estimation study.	Petura and Plouffe (1981); Kirchner et al. (1981)
1982	*No exploration work conducted; claim area reduced.	Holmstead (1983)
Spring 2004	Strathmore Minerals Corp., obtains the Dieter Lake Property	N/A
October 2004	Property visit by Dahrouge Geological Consulting Ltd., James McCrea, P. Geo. and Cameco, including the collection of 51 samples and relogging some of the old core.	McCrea (2005)
Summer 2005	Exploration program by Dahrouge Geological Consulting Ltd., Personnel described in this report
*Property held under a joint venture between Uranerz Exploration and Mining Ltd. and Société Développement de la Baie James; exploration conducted by Uranerz Exploration and Mining Ltd.

Historic Estimates

Historical resource estimates have been published for the Dieter Lake Property, as summarized in the following Table:

Historical Resource Estimates

HISTORICAL CATEGORY	GRADE	TONNAGE (METRIC)	CONTAINED(LBS U3O8)	REFERENCE
Estimated resource applying radiometric ore sorting	0.11% U3O8 (200 ppm cutoff)	8,600		Petura and Plouffe (1981)
Total geological ore reserve	0.049% U3O88	20 million		Petura and Plouffe (1981)
Global in situ resource	U3O8 metal	9,700	21.3 million	Petura and Plouffe (1981)
Discovered in situ resources	0.1-0.5% U (cutoff grade of 0.03% U)	10,000		Dahlkamp (2004)
Possible reserves	0.25% U3O8 Or 0.10% U3O8	10 – 15 million Or 50 million	55 to 110 million	Sully (1989)

The foregoing historic resource estimates were completed prior to the implementation of NI 43-101 and therefore should not be relied upon or considered a defined resource.

Exploration Development Services Group provided a statistical analysis of the historic drill hole assay data. Analysis of the raw chemical data is summarized in the following Table:

Statistical Analysis of Raw Chemical Data

VARIABLE	MEAN (PPM)	STANDARD DEVIATION (PPM)	SKEWNESS	MINIMUM (PPM)	MAXIMUM (PPM)
U3O8	175	661	9.0	0.50	11,800

Exploration Development Services Group analysed the raw chemical data, taking into account grade and thickness as variables, to produce reliable input data for resource estimation.  Assays were conducted along variable sample intervals and not over a standard thickness.  Since the study was not three-dimensional, an accumulated grade-thickness was required for each hole.  Statistics considering a cutoff of 200 ppm over a minimum thickness of 2 m is indicated in the table below.  The cutoff resulted in the use of 91 of the 145 original drill holes in the statistics.

Statistical Analysis Considering Grade and Thickness

VARIABLE	MEAN (%)	STANDARD DEVIATION (%)	SKEWNESS	MINIMUM (%)	MAXIMUM (%)
Grade & Thickness	0.112	0.088	2.47	0.04	0.49
Thickness	2.050	0.340	8.43	2.00	5.10
Grade	0.055	0.043	2.55	0.02	0.25

Geologic Setting

Regional Geology

Sedimentary rocks of the Sakami Formation appear as a series of outliers, comprising two ENE-WSW trending discontinuous belts within the eastern arm of the Superior Structural Province of the Canadian Shield in northern Quebec. The two belts are approximately 200 km apart and extend for about 300 km in length, between Hudson Bay and Labrador Trough. The belts appear representative of an early intracontinental rift system, containing several basins/grabens within Archean basement rocks. The graben structures allowed for the deposition and preservation of Sakami Formation sediments. The Sakami Formation underwent block faulting during and following deposition, as the graben controlling faults remained active. The only other tectonic activity evident in the Sakami rocks is slight tilting to the south.

Based on depositional environments, the Geological Survey of Canada subdivided the Sakami Formation into lower and upper members. The lower unit is a continental sequence with lacustrine and basal fluvial-deltaic sediments, and is up to 370 m thick. It consists of a series of interbedded arkosic sandstones, red and green shales, siltstones and wackes with minor conglomeratic beds. It displays general coarsening upwards of sediments, rapid lateral facies variations, and gradational contacts between lithologies. The upper unit exceeds 1000 m thickness and conformably overlies the lower unit. It consists of massive 1-2 m beds of clean, homogenous quartz arenites. The unit is an epicontinental sequence and displays well developed, planar-type cross bedding. A general paleocurrent orientation is to the south and east with a likely sediment source to the north and northwest. Undisturbed Sakami beds display a general east- west attitude with southerly dips of 10° to 30°.

Uranium mineralization has been discovered in sediments of the Sakami Formation located near the Proterozoic/Archean unconformity. Age dating by Uranerz Exploration and Mining Ltd. on pitchblende from lower Sakami shales determined a Pb-Pb age of 1860 Ma, indicating an early Proterozoic, late Aphebian age. The age assumes coeval deposition of uranium and Sakami sediments.

The Sakami sediments unconformably overly Archean rocks, either at a fault or nonconformable contact. The Archean basement rocks consist of granite, diorite, migmatite, para- and orthogneisses, amphibolite, metavolcanics, and minor schists cut by pegmatite and diorite dykes. Deformation of the basement rocks, including folding and faulting, intrusion, and metamorphism (greenschist to amphibolitic and locally granulite facies) occurred during the Kenoran Orogeny approximately 2480 million years ago.

Property Geology

Of the two discontinuous erosional belts of Sakami sediments, the northernmost is the belt of interest at Dieter Lake. Two outliers of the Sakami Formation are located at Gayot Lake and the Little Whale River-Mildred Lake area. The entire uranium-hosting Gayot Lake Basin has an approximate east-west length of 52 km and north-south length of 12 km.

The majority of the infilling Sakami sediments in the Dieter Lake area are relatively indifferent from the regional occurrences; however, a 200 m thick transitional zone has been recognized between the lower and upper Sakami formations, consisting of argillites to siltstones in the upper and lower thirds, with quartz arenite in the middle. The transitional zone is arbitrarily included in the Lower Sakami Formation. The Sakami sediments unconformably overlie Archean basement to the north and dip gently to the south (15-20°). Faulting has influenced deposition, and the deformation of the sediments during and after sedimentation, causing major displacements and drag folding. Major faults trend approximately 35°. Horst and graben structures exist as a result of a main fault system, which strikes at approximately 57° with a near vertical dip.

Well developed stratigraphic sections of Lower Sakami sediments are present in some areas at Dieter Lake, including thin interbeds of quartz pebble conglomerates, siltstones, red and green wackes/shales and various sandstones, all overlain by clean, white to pink quartz arenites, pink to green sandstones, and red and green shales of the Upper Sakami. Conglomerate is the basal unit and is generally 2 to 5 m thick, consisting of cobbles and boulders of granitic material. Above the conglomerate is a 5 to 8 m, medium-grained, basal sandstone. The conglomerate and sandstone are confined to depressions in the basement controlled by the northeast-southwest trending faults.

A gap above the sandstone is interpreted from angular boulders of green siltstone observed within the till. In surrounding areas the unit is observed as dominantly green, thin-bedded mudstones with laminae of carbonate, siltstone, and sandy mudstone. The laminated mudstone unit ranges from 9 to 80 m thick and contains very thin rhythmical laminae from less than 1 mm to 5 mm.

The overlying unit is interpreted as a turbidite sequence containing sandy to arkosic mudstones, sandstones and conglomerates. It consists of a lower subunit of mainly green, laminated wacke and an upper subunit of oxidized, mainly red wacke. The lower wackes exhibit a slight reddish tinge immediately above the ore horizon in areas of well developed uranium mineralization. The suggested depositional conditions for the wackes are in a lacustrine environment by agitated water under reducing conditions. Above the wackes are red and green alternating mudstones and siltstones, and pinkish- or greenish-white, fine-grained sandstones. The unit is similar to the underlying turbidites but the grain sizes are generally coarser and quartz content is more abundant.

Mineralization

Uranium mineralization at the Dieter Lake Property appears syngenetic stratabound, limited to specific stratigraphic horizons or facies equivalents. Disseminated uranium mineralization exists within a shale-wacke horizon of the Lower Sakami Formation. The horizon was initially determined through geophysics and surface studies, such as scintillometer surveys and geochemical sampling. Uranerz Exploration and Mining Ltd. confirmed the presence of stratabound uranium mineralization in their 1978 diamond drilling program, indicating the strike length may be in the order of 6 km. Uranium values were obtained from each drill hole, supporting the possibility of a large mineralized area. Mineralization thicknesses obtained from drill holes exhibited thickness variations. Thicknesses determined by radiometric downhole logs, with a cutoff of 200 ppm U3O8, vary from 0.15 m to a maximum of 2.35 m, with an average of 0.74 m. Those determined by chemical assays with the same cutoff vary from 0.40 m to 3.00 m, with an average of 1.04 m.

Low grade uranium mineralization at the Dieter Lake Property exists in oxide phase in the form of very fine grained (2.5 µ), low-temperature, sooty pitchblende. The pitchblende occurs intergrown with the very fine grained carbonate-chlorite matrix of the shale, accompanied by the presence of goethite. Carbonaceous matter commonly constitutes less than 1% of the rock constituents. Mineralization exhibits a preference for clay-rich and quartz-free laminae. The mineralized horizon is well compacted and recrystallized with a high fraction of evaporitic precipitates, primarily carbonates, and elevated levels of phosphorous, vanadium and sulphides.  Trace element distribution maps, produced following the 1980 exploration program, show a very good correlation between U and Cu, as well as a good correlation between U and V, and U and Mo.  Molybdenum mineralization encountered in the Lake Vivian areas appears to be associated with tectonized granite gneiss and biotite schist. Specular hematite filled veinlets are common in sections containing MoS2.

Exploration by Uranerz Exploration and Mining Ltd. identified four major zones of uranium mineralization within the Dieter Lake Property: the Vivian Zone, Nancy I Zone, Nancy II Zone, and Bert’s Zone. The Vivian Zone appears to be the highest grade zone in the property area, with anomalous grades up to 0.56% over 1 m. The Nancy I and II zones were originally one; however, drilling discovered a south westerly barren ridge dividing the zone into two. Grades up to 0.34% U3O8 over 1 m were encountered. The Bert’s zone was discovered in Uranerz Exploration and Mining Ltd.’s 1980 drilling program with grades up to 0.22% U3O8 over 1 m. The Nancy zones and Bert’s zone are lower grade than those in the Vivian zone but they remain open to the southwest.

The mineralization encountered in drilling of the Bert’s zone is potentially the north eastern extremity of a larger and higher grade zone.  The mineralized zones appear to have a north easterly trend, parallel the prevailing fault system and are open to the southwest. Uranerz Exploration and Mining Ltd. provided typical stratigraphic sequences for the Vivian Lake Zone and Bert’s Lake zone following their 1978 drilling program.  Uranerz Exploration and Mining Ltd. reported anomalous grades, like the high of 0.56 wt% U3O8 over 1 m in the Lake Vivian Zone, supporting the possibility of isolated zones containing above average uranium grades. Diagenetic processes are often responsible for uranium enrichment in stratabound deposits.

Sampling, Analysis and Security

Sample types collected on the Dieter Lake Property during the 2005 exploration program included sediment samples, grab samples and core samples.  This work was planned and carried out by Dahrouge Geological Consulting Ltd personnel.

For the sediment sampling, a 200 m by 200 m grid was laid with 158.6 kilometres of line.  Geochemical sampling consisted of 834 sediment samples taken approximately every 200 meters.  Sample collection was done on land by foot and quad or supported by helicopter when necessary.

During geologic and structural mapping, 36 hand samples were collected from outcrops and boulders.  Most of this work was helicopter supported.  Gamma ray meters used were 2 Exploranium GR-110G portable gamma ray scintillometers and an Exploranium GR-130 minispec surveying gamma ray spectrometer.  All of the samples collected on the project property were for uranium.

Based on scintillometer readings, 204 samples were collected from the historic core to verify old data. Gamma ray meters used were 2 Exploranium GR-110G portable gamma ray scintillometers and as needed an Exploranium GR-130 minispec surveying gamma ray spectrometer. Sampling criteria was based on notable increases in scintillometer readings over a significant length. Background readings were approximately 80 to 100 counts per second. Minimum sampling criteria were generally on the order of an average 150 counts per second over a minimum length of 30 cm (~1 foot) if there was a peak reading of at least approximately 200 counts per second.

Sample Preparation and Security

The sediment samples were processed by the Saskatchewan Research Council using ICP (partial & total digestion) and fluorimetry ICP where appropriate. The packages used were industry standards developed by Cogema and Cameco.

The grab and core samples were also processed by the Saskatchewan Research Council using ICP partial and total digestion and fluorimetry ICP where appropriate. The packages used were industry standards developed by Cogema and Cameco.

Samples were packed in 5 gallon pails, which were secured with packing tape and shrink wrap. Samples were flown out of camp by J.M. Arseneault and were secured in his hangar in LaGrande, Quebec. From LaGrande the samples were shipped to Saskatchewan by Kepa Transport.

Data Verification

Areas of interest determined from historic data were re-visited by the author of the Church Rock Report, with the collection of sediment and/or grab samples. Sample analyses protocols used included blank samples, standards and repeats analyses.  Where necessary based on anomalous results, samples were re-analyzed.

A core dump was found at each of Dieter Lake and Ranger Lake.  The core was originally stored in core racks, which were in various states of disrepair.  Core racks were rehabilitated and salvaged where possible; otherwise core boxes were neatly cross stacked off the ground.  Core boxes were organized with minimal loss.  The original box tags were punched aluminium and most were still affixed to the boxes.  Fallen tags were collected and matched up to staple holes and partial tags when possible.  Ordinal boxes were also matched up by the core as needed. Some mineralized intervals were stored away from the main racks.  The missing intervals from the Dieter Lake dump were found, but those from the Ranger Lake dump were not.  Despite this, there were mineralized intervals already in the racks.  Most of the historic sampling consisted of half core samples.  In the availab le boxes, there were few intervals that were completely sampled.  Core samples were collected by 2005 personnel under the supervision of Clinton Davis and were used to verify the available historic assays results.

Mineral Processing & Metallurgical Testing

In April of 1980, a bulk trench sample was collected within the Lake Vivian showing for radiometric ore sorting and metallurgical testing. Approximately 1618 pounds of uranium-bearing sample material was sent to Lakefield Research of Canada Ltd. for preparation and to Ore Sorters Canada Ltd. for sorting.

Results indicated a good separation of ore and waste with sorting, while achieving a uranium recovery of about 97%; however, leaching was found to be difficult due to very fine grain size and high carbonate content. Acid leaching (210.5 kg sulphuric acid per tonne; 210 hours; 92% recovery) had a high acid consumption but required shorter retention times for greater recovery than alkaline leaching (168 hours; 66.7% recovery). Increased fine-grained material decreases the average grade but increases the recoverable uranium content. According to metallurgical tests, much of the uranium is likely present as adsorptions on clay minerals rather than more easily leachable pitchblende grains. Due to radiometric ore sorting, or dilution, which does not account for fine material, the average grade of U3O8 (200 ppm cutoff) in the Dieter Lake Property area is 0.11% with a metal content of about 8600 tonnes.

Mineral Resource Estimates

Resource modelling was updated as part of the evaluation of the data collected during the 2005 exploration program and compared to the historic resource model discussed earlier.  Michael Guo used ArcView software to create polygons using the Thiessen (Voronoi) method. The new models were plotted using the 2005 core sampling results, coupled with available historic interval assay data. Data constraints used were 200 ppm, 500 ppm, and 1000ppm U3O8 over a minimum of 1 m thickness. Polygons created had radii of 200 m. A rock density of 2.67g/cm3 was used.

The combined historic and 2005 sample data for 96 holes, resulted in an average grade of 0.057 % U3O8, based on a 200 ppm radius.  The Dieter Lake Property is considered to have an inferred resource of 24,424,306 lbs U3O8.

When higher cutoff grades of 500 ppm and 1000 ppm are utilized, the resultant average grade increases to 0.108% U3O8, and 0.159% U3O8.

Inferred Resource Modelling Results with 200m Radius Polygons

CUT-OFF GRADE (PPM)	NUMBER OF HOLES USED	TONNES OF ORE	AVERAGE GRADE (%)	CONTAINED U3O8 (LBS)
200	96	19,312,816	0.057	24,424,306
500	48	6,816,913	0.108	16,167,271
1000	22	2,931,414	0.159	10,271,855

Outstanding Issues

To the knowledge of the author of Dieter Lake Report, there are no known environmental, permitting, legal, title taxation, socio-economic or political issues that adversely affect the Dieter Lake Property. No settlements or commercial land exploitation exist in or near the Dieter Lake Property area. Refuse from previous exploration programs prior to Strathmore may be an issue.

Exploration and Development

The fall 2004 site visit and summer 2005 exploration confirmed the grade and tenure of mineralization present at the property. The 2004 work concluded that samples of mineralized boulders from near Ranger Lake indicate potential for higher-grade remobilized uranium mineralization. The sericite, illite and chlorite from core samples, may be representative of an alteration halo associated with secondary mineralization related to the known mineralization.

The summer 2005 sediment sampling appears to outline mineralized zones, weakly for the individual zones, and moderately to strongly for the combined zones. The regional geologic and structural mapping helped to define the potential geometry of the mineralized zones. This will help with targeting drill holes. It also refined the known geology of the basin, for example the north-south trending gabbroic dykes.

The 2005 airborne geophysical survey found that a resistive layer impeded a clearer view of the deeper sections of the basin by electromagnetic methods. Despite this, it refined the structural interpretation of the basin. A large conductor was outlined in the north central portion of the basin.

The 2005 core sampling tends to verify the previously collected data. In some instances the results of the resource modelling of the 2005 data show lower total amount of U3O8. This can be explained in part by missing intervals in the core racks, or where some sections no core was left to sample. When comparisons are made for intervals for which historic data is available, the new sampling does tend to verify the historic results. The resource modelling also tends to confirm the geometry previously determined patterns of mineralization.

Uranerz Exploration and Mining Ltd. provided some recommendations following their summarization of the property data. Uranerz Exploration and Mining Ltd. suggested increasing the drilling density to fill in gaps, running regular check assays, producing a detailed density summary, obtaining more carbonate assays, and recognizing the presence of other milling elements.  These suggestions may aid in producing more accurate estimations and will be taken into account in future exploration programs.

The large conductor outlined in the north central basin from 2005 GEOTEM® airborne survey warrants further investigation. Areas with anomalous soil and grab samples should be followed up with denser sampling.

A diamond drilling program consisting of approximately 5000 m in a minimum of 10 to 12 holes should be completed during 2007, in and around the known mineralized area.

Potential liabilities and responsibilities associated with refuse and waster materials left from previous exploration programs prior to Strathmore’s involvement need to be assessed.

Duddridge Lake Property

Property Description And Location

The Duddridge Lake Property is currently held by Strathmore and upon completion of the Arrangement, will be held by Fission Energy.  The Duddridge Lake Property is held under Mineral Prospecting Permit MPP 1188P and consists of 10,000 hectares. The Permit was obtained on January 14, 2004, and a $15,000 refundable work deposit was provided to the Saskatchewan Government. Expenditure requirements for the Permit include $1.25/hectare in the first year ($12,500) and $4.00/hectare ($40,000) in the second year.

Accessibility, Climate, Local Resources, Infrastructure and Physiography

The Duddridge Lake Property is accessible by helicopter or by fixed wing aircraft. The Duddridge Lake Property lies 77 kilometers northwest of La Ronge, the nearest community of any significant size. In winter, a 16 kilometer road extends southerly from Duddridge Lake to an all weather road at Besnard Lake, which connects Highway 2 to La Ronge. The town of La Ronge has a population over 3500, and is a staging area to the producing uranium deposits in the Athabasca Basin.

In 1974, 1975 and 1994 Noranda Exploration utilized winter roads or trails and these roads. The roads are expected to be in poor condition.

Within the area surrounding the Duddridge Lake Property, the climate is typical of the continental type with extreme temperature and very little precipitation. Break up of ice on the lakes usually occurs in mid to late May and freezes again in early October.

There are no facilities or infrastructure at the Duddridge Lake Property, but power exists at Pinehouse, a community approximately 23 kilometers west of the southwest end of the Duddridge Lake Property.

The Duddridge Lake Property is of low relief, with differences in elevation rarely greater than 30 meters. Ridges, hills and lakes dominate the area and are generally elongate trending north northeasterly, sub parallel to the direction of ice movement and bedrock foliation. Outcrop is scarce and is generally covered with sandy glacial drift, boulders and organic rich wetlands.

Much of the Duddridge Lake Property consists of muskeg characterized by a high water table, and an abundance of tamarack bogs with black spruce, sedges and grasses. In well-drained areas characterized by an abundance of organic matter, white birch is common, with aspen poplar abundant atop gravel tills.

While there is little outcrop exposure at the Duddridge Lake Property, boulders along the west side of the lake are significant as they form an elongate mineralized boulder train, which extends for over 1500 meters. It has been suggested that the mineralized boulder field is related to lag deposits due to melt water action and/or boulder accumulations deposited by eskers. It has also been suggested that the close association of the mineralized boulders in till and the mineralized meta-arkose/carbonaceous metasandstone indicates that the till is locally derived. Noranda diamond drill logs examined by the author of the Duddridge Lake Report indicated a drift thickness of five to eight meters in the area drilled beneath the boulder train.

The author of the Duddridge Lake Report was unaware of any environmental liabilities within the area covered by Mineral Prospecting Permit 1188P.

History

Exploration History

In a joint venture arrangement in 1969, Mohawk Holdings, Thor Explorations and Mark V Mining Ltd. carried out an airborne radiometric and magnetic survey by Geo-X Surveys Ltd. over the Mark V Syndicate Permit No 1 in the Duddridge Lake area.

In 1970, Ed Schiller proposed an exploration program and outlined 13 anomalous areas for ground follow-up.

In 1970, Strato Geological Ltd. carried out various geochemical sampling and a ground magnetometer and radiometric survey at the southeast end of Sandfly Lake to explore earlier radiometric airborne anomalies. Little mineralization of economic interest was obtained from this fieldwork.

In 1974, Thor Explorations continued exploration of the Duddridge Lake Property and prospecting west of Duddridge Lake led to the discovery of a boulder train of uranium and copper mineralized boulders. A grid was established and an IP survey run and limited hand trenching carried out.

Subsequently, Noranda Exploration and Brascan Resources Ltd. optioned the property from Thor Explorations in the fall of 1974 and carried out line cutting, geologic mapping, geochemistry, and geophysics; including ground magnetic, surface radiometrics and VLF-EM surveys. In addition Sander Geophysics completed an airborne gamma ray spectrometer survey. No uraniferous anomalies were located from the airborne program.

In 1974 and 1975, Noranda Exploration undertook a diamond drill program and completed 32 holes for a total of 3223.5 metres.  In addition prospecting was carried out south of the main grid area and south of Duddridge Lake; no new indications of mineralization were discovered from outcrop or float.

In 1976, the Saskatchewan Mining Development Corporation (now, Cameco) entered into a joint venture with Noranda Exploration and continued exploration with Track Etch surveys and geochemical sampling. Exploration was carried-out over the Duddridge Lake prospect and to the south to check possible extensions to the known mineralization. Four coincident soil and Track Etch anomalies were reported, three of which overlie the known mineralization, and a fourth attributed to a pegmatitic structure. The Track Etch survey, examined by the author of the Duddridge Lake Report, did not correct for ground condition or soil type, nor did the survey attempt to correlate ground condition to radon concentrations. No strong drilling targets were delineated from the survey. The joint venture group drilled ten diamond drill holes testing the carbonaceous zone along strike to the south. Results of this drilling are unavailable. The Dud dridge Lake Property was then returned to Thor Explorations.

The Saskatchewan Research Council conducted a multi-media geochem survey over the mineralized boulder train at the Duddridge Lake Property. In one report examined by the author of the Duddridge Lake Report, it was concluded that Cu is a pathfinder indicator of uranium mineralization at Duddridge Lake and that various overburden sample horizons (Ao and B1) are interchangeable in outlining uranium mineralization at Duddridge Lake.

In 1978, Dolmage Campbell and Associates Ltd. performed grid work and geochemical sampling on additional areas at the Duddridge Lake Property and used sample techniques based on the Saskatchewan Research Council field program. Four grids were sampled for Cu and U. On one of the grids, north of Ivi Lake, coincident Cu and U anomalies with a 200m length and up to 56ppm U were located along strike to the north of the known mineralization at the Duddridge Lake Property.

In 1979, Dolmage Campbell and Associates Ltd. carried out a geochemical, rock and muskeg sampling program for Thor Explorations northeast of the mineralized zone.

In 1980, Taiga Consultants Ltd. completed a basal till survey for Thor Exploration and analyzed U, Cu, Pb, Zn and As. The samples were analyzed using both fine (-250 mesh) and coarse (+250 mesh) fractions.

In 1981, Dolmage Campbell and Associates Ltd. completed a ten hole diamond drilling project for Thor Explorations. Five of the holes were drilled in Duddridge Lake to test Track Etch anomalies and may have targeted quartz pebble conglomerate horizons, which have been mapped in the area to the north. The other five holes were targeted at the south end of the Duddridge Lake grid. No new mineralization was intersected.

In 1992, Noranda Exploration revisited the Duddridge Lake area with additional prospecting, boulder train sampling and field checking of earlier geochemical anomalies as well as resampling old drill core. Noranda further prospected the area north of Ivi Lake along the up ice direction to delineate the extent of the copper mineralized boulders.

In 1993, geological mapping with the Saskatchewan Geological Survey was carried out to re-examine the U-Cu, U and Cu mineralization in the area.

In 1994, Noranda Exploration completed three diamond drill holes totalling 482 metres. Two of the holes were drilled on geophysical anomalies in the area west of and north of Ivi Lake while a third tested a HLEM geophysical anomaly southwest of Duddridge Lake. No significant copper or uranium mineralization was intersected. Noranda recommended no further work and allowed the claims to lapse.

Geological Setting

Regional Geology

The Duddridge Lake Property lies along the southeast edge of the Wollaston Domain, a northeast-trending belt of Aphebian supracrustals and granitoids. The supracrustals consist of siliciclastic metasediments and minor metavolcanics and are segmented by elongate granitoid bodies, which have been dated as late Archean. The Needle Falls Shear Zone, a major crustal structure up to several �ilometres wide, comprised of cataclastic gneisses and mylonites, bounds the Wollaston Domain to the east. Metamorphic grade generally increases from east to west within the domain from lower amphibolite to amphibolite-granulite facies toward the Mudjatik Domain.

Local Geology

Within the southeastern portion of the Wollaston Domain, metasediments are characterized by coarse clastics and rapid facies changes along the belt adjacent the Needle Falls Shear Zone.  West of the Needle Falls Shear Zone granitoids consisting predominantly of granite and diorite are overlain with metasediments including a basal conglomerate, which in turn are overlain by quartzite and arkose comprising the Meyers Lake Group. The metamorphic grade of these metasediments is interpreted as lower amphibolite.

Property Geology

Much of the Duddridge Lake Property is covered with thick glacial drift. The eastern part consists of granitoids including granite, felsite and diorite. Overlying the granitoids is the Meyers Lake Group, a thick succession of siliciclastic metasediments including a basal quartz pebble conglomerate overlain by quartzite, which in turn is overlain by a thick sequence of arkose, conglomerate, and grit with intercalated pelites. The metasediments trend northeasterly and have a steep westerly dip. Quartzofeldspathic gneiss of unknown thickness lies west of the supracrustals. Pegmatitic structures appear to cut all lithologies.

Carbonaceous bearing lenses within hematized arkose host the known uranium-copper mineralization at Duddridge Lake. Uranium mineralization has also been reported from basal quartz pebble conglomerate (east of Ivi Lake) and pegmatite (Duddridge Island). The main mineralization west of Duddridge Lake was discovered from prospecting a boulder train and diamond drilling directly below the mineralized boulders.

Uranium mineralization is associated with carbonaceous arkose, a light-gray to buff coloured rock with dark gray carbonaceous laminations and mottled areas. The carbonaceous arkose occurs as irregular lenses within a hematitic arkose, which may be cut and/or replaced by pegmatitic structures. Footwall to the mineralized zone is biotite schist, which locally is magnetite bearing. Airborne magnetic data superimposed on drill hole plan maps, does not appear to pinpoint the footwall contact clearly with the arkose.

Mineralization

The author of the Duddridge Lake Report refers to suggestions that there is an association with uranium and copper at the Duddridge Lake Property based on diamond drill information, mineralized U-Cu boulders and multi-media geochemical sample results. The Noranda 1975 drill logs, examined by the author of the Duddridge Lake Report, do not provide Cu assays, but the drill logs record numerous occurrences of minor chalcopyrite with associated radioactivity within carbonaceous arkose (S4 in Noranda drill logs). Noranda drill logs also refer to leaching and bleaching of drill core. Nevertheless there is also reference to abundant chalcopyrite with no trace of radioactivity.

There have been reports that mineralized boulders at the Duddridge Lake Property have two styles of mineralization; a dark-gray to black, fine-grained meta argillite with abundant graphite; and a pink to cream, feldspathic quartzite. Higher-grade mineralization is associated with the former, while copper mineralization predominates over uranium in the latter, as well as uraninite, galena, sphalerite, pyrite, pyrrhotite and molybdenite. Tyuyamunite, a uranyl vanadate has also been reported.

The meta-arkoses are commonly variably hematized adjacent the mineralized zone and kaolinization and carbonatization accompany the hematization.

Drilling

The Noranda 1974 and 1975 diamond drilling was completed by Midwest Drilling Company. A total of 32 BQ sized drill holes were completed. In the summer of 1976 an additional six diamond drill holes were drilled on the Duddridge Lake Property by Noranda.

Dolmage Campbell and Associates completed 10 BQ size drill holes with Coates Drilling in 1981. Seven drill holes were drilled on the Duddridge Lake Property to test anomalies within the pebble conglomerate, which parallels the mineralized zone west of the lake. Three holes were drilled at the south end of the mineralized boulder zone. Drill hole T-9-81, (section 64+00N) cuts meta-arkose from 6.1 to 18.1m, followed by abundant pegmatite and footwall biotite schist at 36m depth. Drill hole T-10-81 reports meta-arkose from 206.15 to 255.08 with minor hematite and quartzite from 255.08-285.29 with weak hematite staining and minor (<1%) disseminated �ilomet mineralization. No samples were taken for analysis from these holes.

In 1994 Noranda Exploration completed three additional diamond drill holes: SF94-1 to 3. Holes SF94-1 and 2 were drilled at the north end of the Noranda grid along sections 156 and 136N respectively. These holes were apparently drilled to test geophysical conductors and failed to intersect uranium mineralization. The third hole SF94-3 was drilled to test a HLEM anomaly in the southern part of the property.

Sampling and Analysis

Method and Approach

Much of the geochemical sampling completed by previous explorers on the Duddridge Lake Property was of high quality. Haughton (1976) with the Saskatchewan Geological Survey carried out a multi-media geochemical approach, which was intended to be a model for additional uranium and base metal sampling exploration programs within the Wollaston Domain.  Later, Taiga Consultants (1980) carried out a basal till sampling program for Dolmage Campbell and Associates and Thor Explorations using a Wacker tool under the auspices of the Saskatchewan Research Council. This work was intended to be an extension of the sampling of Haughton (1976). Radon soil and water samples were collected by Noranda Exploration and Track Etch surveys were completed in 1976, but depth of sampling are inconsistent and soil type not differentiated.

Mineral Resources

A longitudinal section along the Duddridge Lake mineralized structure shows drill hole intercepts from 86N through 124N, a strike length of 1140 meters. Tonnage calculations are shown on drill hole cross sections and blocks are illustrated on a 1:2000 scale longitudinal section in the pocket of the report. Tonnage figures are compiled from the center of each drill hole intercept to half the distance to the nearest drill hole, or 30 meters, whichever is less. True widths are taken from drill hole sections and a specific gravity of 2.4 is used to multiply and convert cubic meters to metric tons.

Based on the calculations as shown from drill hole sections, an overall tonnage of 215,016 metric tons at a grade of 2.14 lbs U3O8/tonne is estimated. This mineral resource differs substantially from the previous resource estimation of Noranda (357,310 short tons at a grade of 2.11 lbs/ton). This resource still has only been drill tested to approximately 80 meters depth. The 1994 Noranda diamond drill holes at the north west end of Ivi Lake appear to have been drilled deep enough to test the structure, but footwall biotite schist was not noted in the drill logs.  

Exploration and Development

General

The Duddridge Lake Property hosts stratabound uranium and copper mineralization within carbonaceous meta-arkose, which are probably derived from underlying granitoids. The style of mineralization present appears to have ore bearing minerals consistent with both vein type and unconformity-type deposits with nickel and cobalt arsenides.  The two styles of mineralization have similarities based on association with structures such as faults and unconformities may be a significant factor in the Beaverlodge area.  The style of alteration at the Duddridge Lake Property is similar to a typical uranium vein association with strong hematization.

Recent advances in lithogeochemistry and research in Saskatchewan within the Athabasca Basin has shown boron lithogeochemistry to be effective in outlining source of mineralized boulders. In addition clay analyses including illite, kaolinite and chlorite have been useful in uranium exploration in their proximity to the unconformity-type deposits.

The mineral resource calculated in this report represents an inferred mineral resource based on closely spaced diamond drill holes. No trenching results are otherwise available to upgrade the continuity of the resource.

Recommendations

Noranda Exploration in 1992 apparently carried out fieldwork north of the boulder train, but this data is presently unavailable. Before any fieldwork is undertaken, all previous exploration work done by Noranda and not presently available through Saskatchewan assessment files should be obtained, including results for the 1976 drill holes (D-33 to 38-76) at the south end of the boulder field. In addition 3 diamond drill holes (including T-8, 9, and 10-81) from the 1981 drilling should be relogged as well as 1994 drill holes.

A field program is recommended once Noranda reports are obtained and former drill core relogged. In combination with the acquisition of Noranda data north of Ivi Lake, lithogeochemistry should be undertaken to trace source of mineralized boulders and additional basal till sampling to augment the 1980 data and to verify present anomalies. In addition, geophysics should be run with Max-Min to trace carbonaceous zones within meta-sandstone.

Contingent upon geophysics and lithogeochemistry, a winter drilling program is suggested with four diamond drill holes. Two drill holes should be targeted beneath geophysical and/or lithogeochemical anomalies, while two holes are recommended below Sections 116 and 118N, to test possible northerly rack of known mineralization.

Non-Principal Properties

The following Non-Principal Canadian Properties and Staked Peruvian Properties will also be transferred to Fission Energy.

(i)

The Athabasca Property, Canada

Strathmore acquired an option to purchase a 100% interest in a uranium property located in Alberta, Canada, by paying $98,192, incurring additional costs of $29,510 and issuing 200,000 Strathmore Shares valued at $332,000.  The property is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property. The property acquired by Strathmore is located approximately 25 kilometers west of the Cluff Lake uranium mine operated by Cogema Resources Inc. Other deposits within a short distance of the property include the Shea Creek deposit and the Maybelle River deposit. The Maybelle River deposit is located 15 km south of the property. Significant drill intersections at Maybelle River reportedly include 21% U₃O₈ across 5 m. The Athabasca Property is sub-divided into holdings located north of the lake and tho se located south of the lake.

(ii)

The Comstock Property, Canada

Strathmore acquired an option to purchase a 100% interest in certain claims located in British Columbia, Canada by issuing 300,000 Strathmore Shares valued at $491,000 and incurring additional fees of $3,271. The Comstock property, located 12 kilometres southeast of Silverton, British Columbia, is a polymetallic Silver-Gold property consisting of 3 claims covering 300 hectares.

(iii)

The Fort Mcleod Property, Canada

Strathmore acquired an option to purchase a 100% interest in certain claims located in south western Alberta, Canada, by paying $34,070 for staking costs and issuing 100,000 Strathmore Shares valued at $265,000.  To earn its interest, Strathmore is required to issue an additional 100,000 Strathmore Shares. The property totals approximately 900,000 acres (364,218 ha). The part of the western sedimentary basin covering south western Alberta is host to a number of uranium occurrences and showings, primarily hosted within the sandstones of the Tertiary Willow Creek formation. Historical exploration during the 1980’s identified a number of sandstone hosted roll-front uranium occurrences within the region.

(iv)

The Staked Canadian Properties, Canada

Strathmore acquired, by staking, a 100% interest in the following uranium properties located in north- central Saskatchewan: Davy Lake, Hall Lake, Patterson Lake, and Waterbury Lake.

Davy Lake – The Davy Lake Project encompasses about 1.5 million acres along the northern part of the Athabasca Basin. It is underlain at depth by the Clearwater, Western Granulite and Tanto basement domains. For much of the project area, the depth to the basement unconformity is estimated at depths of less than 600 metres. The project is along trend to the southwest of the Black Lake and Riou Lake projects of UEX Corp.

Hall Lake – The Hall Lake Project encompasses about 6 claims totalling approximately 26,000 hectares along the southern part of the basin. It is underlain at depth by rocks of the Western Granulite Domain, and much of the project area is estimated to have a depth to the basement unconformity of less than 600 metres.

Patterson Lake – The property covers approximately 25,000 hectares within the southwestern part the Athabasca Basin, northwestern Saskatchewan. The Patterson Lake Property is located about 150 km north of the town of La Loche, Saskatchewan and comprises 9 claims totalling 25,000 hectares. The claims encompass an area proximal to Cluff Lake Mine Road 955 from about 1¼ km south of Broach Lake to about 2 km south of the Douglas River-Road intersection.

Waterbury Lake – The Company has acquired, via staking, approximately 100,000 acres within the eastern part of the Athabasca Basin, near Waterbury Lake in north-central Saskatchewan.  The Waterbury Lake Project is located adjacent to the Midwest Project operated by Cogema Resources Inc, and to the northeast of the Cigar Lake Project operated by Cameco Corp.

(v)

The Staked Peruvian Properties

Strathmore acquired, by staking, a 100% interest in certain uranium properties located in Peru. Strathmore’s property covers 24 square �ilometres in the central area of the Macusani District, which is approximately 250 square �ilometres in size. Exploration of the area began in the 1970’s by the Peruvian Institute of Atomic Energy (“IPEN”) and continued through the 1980’s and early 1990’s with successful results.

Description of the Securities

Each Fission Energy Share carries one vote at all meetings of shareholders, participates rateably in any dividends declared by the directors of Fission Energy on the Fission Energy Shares, and is entitled, on the liquidation, dissolution, winding-up or other distribution of assets of Fission Energy for the purposes of winding-up its affairs, to a pro rata share of the assets of Fission Energy after payment of all its liabilities and obligations.

Selected Unaudited Pro Forma Financial Information and Management’s Discussion and Analysis

Fission Energy has not completed a financial year and has not yet conducted any business. The following is a summary of certain financial information on a pro forma basis for Fission Energy as at December 31, 2006, assuming completion of the Arrangement as of such date, and should be read in conjunction with the unaudited pro forma balance sheet of Fission Energy included in Schedule “G” to this Information Circular:

	PRO FORMA FISSION ENERGY
ASSETS
CURRENT:
Cash and cash equivalents	$ 500,000
Short term investments	-
Receivables	-
Prepaid expenses	-
	$ 500,000
Equipment	-
Land	-
Mineral property interests	$ 3,154,921
Deferred exploration costs	$ 8,941,150
TOTAL:	$ 12,596,071
LIABILITIES
CURRENT:
Accounts payable and accrued liabilities	-
Due to related parties	-
	-
SHAREHOLDERS’ EQUITY
Share capital	$ 12,596,071
Contributed surplus	-
Deficit	-
	$ 12,596,071
	$ 12,596,071

Pro Forma Consolidated Capitalization of Fission Energy

The following table represents the share and loan capitalization of Fission Energy, as at December 31, 2006 and assuming completion of the Arrangement.

SHARE AND LOAN CAPITAL	AUTHORIZED	DECEMBER 31, 2006	AFTER COMPLETION OF THE ARRANGEMENT
Common Shares	unlimited	Nil	24,056,000 (1)
Bank Debt	(2)	Nil	Nil

Notes:

(1)

This figure is the approximate number of Fission Energy Shares to be issued pursuant to the Arrangement for  the Spin-Off Assets.

(2)

Fission Energy currently has no long term liabilities.

Fully Diluted Share Capital of Fission Energy

The pro-forma fully diluted share capital of Fission Energy, upon completion of the Arrangement and the exercise of all warrants and other rights to purchase Fission Energy Shares, is set out below:

DESIGNATION OF FISSION ENERGY SECURITIES	NUMBER OF FISSION ENERGY SHARES	PERCENTAGE OF TOTAL
Subscribers’ shares issued on incorporation	Nil	0%
Fission Energy Shares issued to the Securityholders in accordance with the Arrangement	24,056,000	99.93%
Fission Energy Shares issued to Strathmore Warrantholders upon exercise of all outstanding Strathmore Warrants	178,637	0.07%
Total	24,234,637	100%

Available Funds

Fission Energy will receive $500,000 from Strathmore pursuant to the Arrangement. The estimated unaudited pro forma working capital of Fission Energy at December 31, 2006 is $500,000. Accordingly, Fission Energy will have $500,000 available to it upon completion of the Arrangement (the “Available Funds”).  Strathmore has committed to lend Fission Energy additional funds if the Available Funds are not sufficient to carry out the Principal Purposes for Available Funds, as described below.

Principal Purposes for Available Funds

Assuming completion of the Arrangement, Fission Energy will use the Available Funds as follows:

USE OF PROCEEDS

AVAILABLE FUNDS

To pay for the exploration activities set out under the heading
“Principal Properties” as follows

$100,000

To fund ongoing operations and administration costs

$325,000

Fees associated with Exchange listing application

$75,000

Total

$500,000

The funds available for ongoing operations are expected to be sufficient to meet Fission Energy’s administration costs for the next 12 months. See “Administration Expenses”.

Fission Energy will spend the Available Funds as set out above. There may be circumstances, however, where, for sound business reasons, a reallocation of funds may be necessary. Fission Energy will only redirect funds to other properties on the basis of a recommendation from a professional geologist or engineer.

Administration Expenses

The following table discloses the estimated aggregate monthly and yearly administration costs that will be incurred by Fission Energy:

TYPE OF ADMINISTRATIVE EXPENSE	MONTHLY ESTIMATED EXPENDITURE	12-MONTH ESTIMATED EXPENDITURE
Rent and Office Services	$2,917	$35,000
Professional Fees(1)	$4,583	$55,000
Consulting Fees	$17,500	$210,000
Regulatory Filing Fees	$1,250	$15,000
Miscellaneous	$833	$10,000
Total	$27,083	$325,000

Notes:

(1)

Legal, audit and accounting.

Dividends

Fission Energy has not issued any shares. Any decision to pay dividends on common shares in the future will be made by the board of directors on the basis of the earnings, financial requirements and other conditions existing at such time. Management does not foresee payment of dividends in the short or medium term.

Prior Sales of Securities of Fission Energy

As of the date of this Information Circular, Fission Energy has not issued any shares.

Principal Shareholders of Fission Energy

The only person known by Fission Energy that may have upon completion of the Arrangement, direct or indirect beneficial ownership of, control or direction over, or a combination of direct or indirect beneficial ownership of and control or direction over, voting securities that constitute more than 10% of the Fission Energy Shares is Sprott Asset Management Inc., 200 Bay Street, Suite 2700, P.O. Box 27, Royal Bank Plaza, South Tower, Toronto, Ontario, V5J 2J1.  Based on its applicable Strathmore shareholdings on May 1, 2007, Sprott is expected to exercise control or direction over 4,226,800 Fission Energy Shares and, if it exercises all of its Strathmore Warrants, Sprott would be entitled to acquire an additional 138,333 Fission Energy Shares.  Assuming the exercise of the Strathmore Warrants and completion of the Arrangement, Sprott will exercise control or direction over 18.04% of the issued and outs tanding Fission Energy Shares.

Directors, Officers and Management of Fission Energy

Under the terms of the Arrangement, the directors, executive officers and management of Fission Energy are the same directors, officers and management as those of Strathmore.  Fission Energy will establish an Audit Committee and appoint the same members as those currently serving on Strathmore’s Audit Committee.

As of May 1, 2007, and assuming completion of the Arrangement, directors and executive officers of Fission Energy would hold the following Fission Energy Shares:

NAME AND MUNICIPALITY OF RESIDENCE	OFFICE HELD IN FISSION ENERGY UPON COMPLETION OF THE ARRANGEMENT	NUMBER AND PERCENTAGE OF COMMON SHARES OF FISSION ENERGY BENEFICIALLY OWNED OR CONTROLLED UPON COMPLETION OF THE ARRANGEMENT
DEVINDER RANDHAWA(1) Kelowna, B.C.	Director, Chief Executive Officer, Chairman	539,846 or 2.24%
DAVID R. MILLER Riverton, Wyoming	Director, President, Chief Operating Officer	613,477 or 2.55%
MICHAEL HALVORSON(1) Edmonton, Alberta	Director	203,704 or 0.84%
DR. DIETER A. KREWEDL(1) Truckee, California	Director	50,000 or 0.21%
RAYMOND LARSON Temecula, California	Director	35,000 or 0.14%
STEVEN KHAN Vancouver, B.C.	Executive Vice President	25,000 or 0.10%
PATRICK GROENING Kelowna, B.C.	Chief Financial Officer	28,333 or 0.12%

Notes: (1)

Proposed Members of Audit Committee.

The following is the background information on the above proposed directors, officers and management:

DEVINDER RANDHAWA	MR. RANDHAWA FOUNDED STRATHMORE MINERALS CORP. IN 1996 AND IS CURRENTLY THE COMPANY’S CEO AND CHAIRMAN. MR. RANDHAWA ALSO FOUNDED AND IS CURRENTLY THE PRESIDENT OF RD CAPITAL INC., A PRIVATELY HELD CONSULTING FIRM PROVIDING VENTURE CAPITAL AND CORPORATE FINANCE SERVICES TO EMERGING COMPANIES IN THE RESOURCES AND NON-RESOURCE SECTORS BOTH IN CANADA AND THE US.
DAVID R. MILLER	Mr. Miller is a minerals industry expert in exploration, acquisition and operations. His primary focus has been on uranium, coal bed methane and gold. Mr. Miller worked with Cogema, the second largest producer of uranium in the world, the last 4 years of which as its chief geologist for in-situ operations in the US. Mr. Miller has over 25 years of experience in exploration and acquisition of uranium properties.
MICHAEL HALVORSON	Mr. Halvorson has been involved in the securities industry and mining finance since 1967. He is a successful entrepreneur and is currently a director of a number of public mining and oil and gas companies.
DR. DIETER A. KREWEDL	Dr. Krewedl was with Pathfinder Mines Corporation, a wholly owned subsidiary of the French uranium company Cogema (Areva), for 23 years and was Pathfinder’s Vice President, Exploration from 1990 to 1995. Dr. Krewedl was instrumental in the discovery of the Green Mountain uranium deposit in Wyoming, uranium breccia pipe deposits in Arizona and uranium deposits in the Grants, New Mexico mineral belt. Dr. Krewedl was also Vice President of Echo Bay Mines, Senior Vice President of Coeur d’Alene Mines and  President of the Geological Society of Nevada.
RAYMOND LARSON	Mr. Larson founded Uranium Resources Inc. (URI) in 1977, and was its Chairman and CEO until his retirement in 1994. URI, which was one of the few US based uranium mining companies to survive the industry’s extended market downturn, pioneered the exploration, development and production of uranium ore bodies using in-situ recovery (ISR) technology. Mr. Larson’s experience includes the commercial development of ISR uranium extraction plants at Kingsville Dome and Rosita in south Texas as well as developing significant uranium mineral interests at Church Rock and Crownpoint in northwestern New Mexico. In addition, he negotiated multiple long-term uranium sale contracts with both US and European utilities, and other industry participants. Under Mr. Larson’s leadership, URI successfully restored ISR properties in Texas and Wyoming and was a founding member of the Uranium Producers of America Association.
STEVEN KHAN	Mr. Khan spent close to twenty years in all aspects of the investment industry, including retail, institutional, corporate finance, capital markets, and investment banking areas.  Mr. Khan has held senior management roles including serving as Executive Vice President, President, Chief Executive Officer, and Chairman of a number of regional and national Canadian investment brokerage houses.  Since 2003, Mr. Khan has held various Director and executive positions with a number of public and private companies.  In addition, Mr. Khan is the sole owner of Sona Capital Ltd., a private consulting company. He holds a B.Sc. and M.B.A from the University of British Columbia and is a Fellow of the Canadian Securities Institute, holds a Chartered Financial Analyst designation, and is a member of the CFA Institute.
PATRICK GROENING	Mr. Groening obtained his Chartered Accountant designation in 1999 and is a member of the Institute of Chartered Accountants of British Columbia.  He also holds a professional accounting designation as a Certified Public Accountant and is member of the Illinois Board of Examiners in the United States.  In addition to being an auditor for several years, Mr. Groening has provided business advisory, information technology, and financial accounting services to many medium and large size organizations.  Mr. Groening has held Controller and CFO positions for a number of private and public companies.

Other Reporting Issuers

The following proposed directors, officers or promoters of Fission Energy are, or within the past five years have been, directors, officers or promoters of the following reporting issuers (other than Fission Energy):

DIRECTORS	OTHER REPORTING ISSUERS	EXCHANGE	POSITION	DATES
Devinder Randhawa	Strathmore Minerals Corp.	TSX-V	Director President Chief Executive Officer Chairman	Oct 18, 1998 – present Jun 3, 2003 – Nov 25, 2005 Nov 25, 2005 – present Nov 25, 2005 – present
	Pacific Asia China Energy Inc.	TSX-V	Director Chief Executive Officer President	Dec 30, 2005 – present Dec 30, 2005 – present Dec 30, 2005 – May 3, 2006
	Sernova Corp.	TSX-V	Director Chief Executive Officer Vice Chairman	Mar 28, 2005 – present Mar 28, 2005 – Apr 19, 2007 Apr 19, 2007 – present
	Wolf Capital Corp.	TSX-V	Director President	Jul 28, 2003 – Jul 2006 Jul 28, 2003 – Jul 2006
	Royal County Minerals Corp.	TSX-V	Director President Vice President Finance	May 1998 – Jul 2003 Dec 1998 – Jul 2003 Oct 1996 – Nov 1996
	Predator Capital Inc.	TSX-V	Director President	Jan 2000 – Jun 2003 Jan 2000 – Jun 2003
	Cumulus Ventures Inc.	TSX	Director	Feb 1995 – Aug 2002
	Jalna Minerals Ltd.	TSX-V	Director President Chief Executive Officer	Jul 7, 2006 – present Jul 7, 2006 – present Jul 7, 2006 – present
	Ballyliffin Capital Corp.	TSX-V	Director Chief Executive Officer Chief Financial Officer President	Jun 2006 – present Jun 2006 – present Jun 2006 – present Jun 2006 – present
	Knowledge Plus Multimedia Publishing Ltd.	ASE	Director	Oct 1997 – present
Michael Halvorson	Strathmore Minerals Corp.	TSX-V	Director	Jul 14, 2004 – present
	Gentry Resources Ltd.	TSX	Director	Oct 1997 – present
	Radiant Resources Inc.	TSX-V	Director	Apr 1998 – present
	Orezone Resources Inc.	TSX	Director	May 1999 – Aug 2002; Jun 5, 2003 – present
	Esperanza Silver Corporation	TSX-V	Director	Apr 2003 – present
	Canadian Gold Hunter Corp.	TSX	Director	Sept 25, 2003 – Aug 9, 2006
	Viceroy Exploration Ltd.	TSX-V	Director	Jun 30, 2003 – Nov 27, 2006
	NovaGold Resources Inc.	TSX	Director	Jul 19, 2004 – present
	Pediment Exploration Ltd.	TSX-V	Director	Mar 16, 2006 – present
	Quest Capital Corporation	TSX	Director	Jun 30, 2003 – Jun 16, 2004
	Western Silver Inc.	TSX	Director	Oct 1997 – Mar 2004
	Royal County Minerals Corp.	CDNX	Director	Jun 2001 – Nov 2003
	Predator Capital Inc.	CDNX	Director	Sept 2000 – Jun 2003
	Luxor Developments Ltd.	CDNX	Director	May 2001 – Sept 27, 2005
	Majescor Resources Inc.	CDNX	Director	Sept 2003 – Nov 1, 2005
	Newcastle Minerals Inc.	CDNX	Director	Jun 2002 – Dec 16, 2005
Dr. Dieter Krewedl	Strathmore Minerals Corp.	TSX-V	Director	Jan 14, 2005 – present
	Yamana Resources	TSX	Director	Jan 2003 – Apr 2003
	AuEx Ventures, Inc.	TSX-V	Director	May 2004 – present
	Kilgore Minerals Ltd.	TSX-V	Director	Mar 2004 – present
Steven Khan	Strathmore Minerals Corp.	TSX-V	Director Executive Vice President	Nov 25, 2003 – Jun 8, 2006 Jun 8, 2006 – present
	Ballyliffin Capital Corp.	TSX-V	Director Secretary	Jun 2006 – present Jun 2006 – present
	Pacific Asia China Energy Inc.	TSX-V	Director Executive Vice President Chief Financial Officer	Jun 22, 2005 – present Jan 27, 2006 – present Jun 22, 2005 – Jan 27, 2006
	Permission Marketing Solutions Inc.	TSX-V NEX	Director Chief Financial Officer	Jun 2005 – Dec 2005 Jun 2005 – Dec 2005
	Wolf Capital Corp.	TSX-V	Director	Sept 2003 – Jul 2006
	Globetech Ventures Corp.	NASDAQ  OTCBB	Director President Chief Executive Officer	Dec 2003 – Oct 2004 Aug 2004 – Oct 2004 Aug 2004 – Oct 2004
Patrick Groening	Strathmore Minerals Corp.	TSX-V	Chief Financial Officer	Apr 27, 2005 – present
	Pacific Asia China Energy Inc.	TSX-V	Chief Financial Officer	Jan 27, 2006 – present
	Sernova Corp.	TSX-V	Secretary Chief Financial Officer	Jul 25, 2005 – present Jul 25, 2005 – present
	Jalna Minerals Ltd.	TSX-V	Chief Financial Officer	Nov 23, 2006 – present
	Wolf Capital Corp.	TSX-V	Chief Financial Officer	Jun 2004 – Aug 2006
David Miller	Strathmore Minerals Corp.	TSX-V	Director President Chief Operating Officer	Jun 8, 2006 – present Nov 25, 2005 – present Nov 25, 2005 – present
Raymond Larson	Strathmore Minerals Corp.	TSX-V	Director	Jan 1, 2007 – present

Promoter of Fission Energy

Upon completion of the Arrangement, Strathmore will be the promoter of Fission Energy.

Corporate Cease Trade Orders or Bankruptcies

Except as disclosed below, no proposed director of Strathmore or Fission Energy is, or, within the past ten years before the date of this Information Circular has been, a director or executive officer of any other issuer that, while such person was acting in that capacity:

(i)

was the subject of a cease trade or similar order, or an order that denied the other issuer access to any exemptions under securities legislation, for a period of more than 30 consecutive days; or

(ii)

was subject to an event that resulted, after the director or executive officer ceased to be a director or executive officer, in the company being the subject of a cease trade or similar order or an order that denied the company access to any exemption under securities legislation, for a period of more than 30 consecutive days; or

(iii)

within a year of that person ceasing to act in that capacity, became bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency or was subject to or instituted any proceedings, arrangement or comprise with creditors or had a receiver, receiver-manager or trustee appointed to hold its assets; or

has, within the past ten years before the date of this Information Circular, become bankrupt, made a proposal under any legislation relating to bankruptcy or insolvency, or was subject to or instituted any proceedings, arrangement, or compromise with creditors or had a receiver, receiver-manager or trustee appointed to hold the assets of that individual.

Devinder Randhawa was formerly a director of Knowledge Plus Multimedia Publishing Ltd. (“Knowledge Plus”). Mr. Randhawa joined the board of directors of Knowledge Plus to assist in facilitating a reorganization of its affairs at a time when Knowledge Plus had no active business. The parties were unable to complete the reorganization in a timely manner and, on July 23, 1998, Knowledge Plus was delisted by the Exchange (formerly the Canadian Venture Exchange (Alberta)) for failure to meet the continuing listing requirements of the Exchange. Mr. Randhawa was a director of Knowledge Plus when it was subject to the term a cease trade order, which has not been revoked, issued by the Alberta and British Columbia Securities commissions on May 7, 1998.

Devinder Randhawa was formerly a director of Cumulus Ventures Ltd. (“Cumulus”) (formerly Cumulus Technology Ltd.). Cumulus was cease traded by the British Columbia and Ontario Securities Commissions in 2001 and the cease trade order has not been revoked.  

Penalties or Sanctions

Except as disclosed below, no proposed director of Strathmore or Fission Energy has been subject to any penalties or sanctions imposed by a court relating to securities legislation or by a securities regulatory authority or has entered into a settlement agreement with a securities regulatory authority or has been subject to any other penalties or sanctions imposed by a court or regulatory body that would likely be considered important to a reasonable securityholder in deciding whether to vote for a proposed director.  

In September, 1989, Mr. Randhawa agreed to pay $750 for costs of an investigation by the British Columbia Securities Commission resulting from a breach of local policy for Guidelines for Advertising Guidelines of Securities and for Promotional Activities during the Course of Distribution. Mr. Randhawa wrote a series of articles for a magazine which indicated his personal opinions of a publicly traded company and its principals without the approval of Haywood Securities Inc. (“Haywood”). Mr. Randhawa was employed as a registered representative of the corporate finance department of Haywood at the time the articles were written. Mr. Randhawa waived his right to a hearing and review by the British Columbia Securities Commission, agreed to pay the costs of the investigation and also agreed to ensure that all future publications with which he is involved received appropriate approvals in compliance with the loc al policy. On March 21, 1996, Mr. Randhawa was fined $5,000 by the Exchange (Canadian Venture Exchange (British Columbia)) for failing to fulfill his duties in 1993 as a registered representative for Canaccord Capital Corporation due to his involvement in loaning funds to a company listed on the Exchange without first advising Canaccord Capital Corporation. Mr. Randhawa appealed the decision to the British Columbia Securities Commission and, on September 11, 1997, as a result of a hearing held on March 21, 1997, the British Columbia Securities Commission held that the Exchange erred, in part, in its decision, and reduced the fine to $2,000. Mr. Randhawa was subject to strict supervision for 3 months and had to pass a conduct and practices handbook exam. The British Columbia Securities Commission confirmed the finding of the Exchange that Mr. Randhawa had breached the Exchange’s Rule F.2.22(c) in that he made a loan to a company listed on the Exchange without first advising his employer, Canaccord Capita l Corporation.

In 2003 and 2004 the Pacific District Council of the Investment Dealers Association investigated Mr. Khan’s previous employer, IPO Capital Corp. and the activities of a number of registered representatives that took place in 1999. During the relevant period, Mr. Khan was Chairman and CEO of IPO Capital Corp. In August 2004, Mr. Khan entered into a settlement agreement with the Pacific District Council of the Investment Dealer’s Association accepting that he failed to prohibit one of the representatives from selling debtor Certificates to IPO clients, when he knew, or ought to have known that the only person doing due diligence was not qualified to conduct proper due diligence with respect to the investment. Mr. Khan was fined $8,000 and paid $2,000 in investigative costs for failing to observe high standards of conduct contrary to Association By-Law 29.1.

Conflicts of Interest

The directors of Fission Energy are required by law to act honestly and in good faith with a view to the best interest of Fission Energy and to disclose any interests which they may have in any project or opportunity of Fission Energy. If a conflict of interest arises at a meeting of the board of directors, any director in a conflict will disclose his interest and abstain from voting on such matter. In determining whether or not Fission Energy will participate in any project or opportunity, that director will primarily consider the degree of risk to which Fission Energy may be exposed and its financial position at that time.

Except as disclosed in this Information Circular, to the best of Fission Energy’s knowledge, there are no known existing or potential conflicts of interest among Fission Energy and its promoters, directors, officers or other members of management as a result of their outside business interests except that certain of the directors, officers, promoters and other members of management serve as directors, officers, promoters and members of management of other public companies, and therefore it is possible that a conflict may arise between their duties as a director, officer, promoter or member of management of such other companies.

Proposed Executive Compensation of Fission Energy

Compensation of Directors

Upon completion of the Arrangement, it is anticipated that Fission Energy will pay no cash compensation to directors for services rendered in their capacity as directors.

Compensation of Executive Officers and Summary Compensation Table

The following table sets forth the expected annual and long-term compensation for services in all capacities to Fission Energy for the twelve months following completion of the Arrangement in respect of individual(s) who are expected to be acting in a capacity similar to the Chief Executive Officer, Chief Financial Officer and the three most highly compensated Executive Officers.

NAME AND PRINCIPAL POSITION	YEAR	ANNUAL COMPENSATION			LONG TERM COMPENSATION
		Salary ($)	Bonus ($)	Other Annual Compensation ($)	Awards		Payouts
					Securities Under Options/ SARS(1) Granted (#)	Restrict Shares or Restricted Share Units ($)	LTIP(2) ($)	All Other Compensation ($)
Dev Randhawa	2007	36,000	Nil	Nil	Nil	Nil	Nil	Nil
David Miller	2007	30,000	Nil	Nil	Nil	Nil	Nil	Nil
Steven Khan	2007	24,000	Nil	Nil	Nil	Nil	Nil	Nil
Patrick Groening	2007	24,000	Nil	Nil	Nil	Nil	Nil	Nil

Notes:

(1)

“SARS” or “Stock appreciation right” means a right granted by Fission Energy as compensation for services rendered, to receive a payment of cash or an issue or transfer of securities based wholly or in part on changes in the trading price of publicly traded securities of Fission Energy.

(2)

“LTIP” or “long term incentive plan” means any plan which provides compensation intended to serve as incentive for performance to occur over a period longer than one financial year, but does not include option or stock appreciation right plans or plans for compensation through restricted shares or restricted share units.

Indebtedness of Directors and Executive Officers of Fission Energy

No individual who is, or at any time from the date of Fission Energy’s incorporation on May 7, 2007 was a director or executive officer of Fission Energy, or an associate or affiliate of such an individual, is or has been indebted to Fission Energy.

Investor Relations Arrangements

As of the date of this Information Circular, there are no promotional or investor relations agreements contemplated for Fission Energy upon completion of the Arrangement.

Options and Warrants

As of the date of this Information Circular, Fission Energy is not authorized to issue options or warrants.

Subject to Shareholder approval of the organization resolution substantially in the form set out in Schedule “C”, upon giving effect to the Arrangement, Fission Energy will have adopted a stock option plan identical to the Fission Energy Stock Option Plan.  See “Particulars of Matters to be Acted Upon – Fission Energy Stock Option Plan”.

Fission Energy will not initially be issuing any options under the adopted stock option plan.

Auditors, Transfer Agent and Registrar

It is anticipated that Davidson & Company LLP, Chartered Accountants, of Vancouver, British Columbia, auditors of Strathmore, will also be the auditors of Fission Energy upon completion of the Arrangement.  Davidson & Company LLP are independent in accordance with their rules of professional conduct.

It is anticipated that CIBC Mellon Trust Company of Suite 1600, 1066 West Hastings Street, Vancouver, British Columbia will be the registrar and transfer agent of Fission Energy upon completion of the Arrangement.

Sponsorship

It is anticipated that Fission Energy will obtain a sponsorship exemption from the Exchange.

GLOSSARY OF TERMS

The following is a glossary of general terms and abbreviations used in this Information Circular:

“Arrangement” means the arrangement under the Arrangement Provisions pursuant to which Strathmore proposes to reorganize its business and assets, and which is set out in detail in the Plan of Arrangement attached as Exhibit I to the Arrangement Agreement;

“Arrangement Agreement” means the agreement dated as of May 7, 2007 between Strathmore and Fission Energy, a copy of which is attached as Schedule “B” to this Information Circular, and any amendments or variations thereto;

“Arrangement Provisions” mean Part 8, Division 2 and Part 9, Division 5 of the BCBCA;

“Arrangement Resolution” means the special resolution which will be considered by the Securityholders to approve the Arrangement, the full text of which is set out in Schedule “A” to this Information Circular;

“Athabasca Property” means the uranium property located in Alberta, Canada, 100% of which Strathmore has an option to purchase, that is subject to a 0.75% net smelter royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property;

“BCBCA” means the Business Corporations Act (British Columbia), as amended, together with all regulations promulgated pursuant thereto;

“Business Day” means a day which is not a Saturday, Sunday or statutory holiday in Vancouver, British Columbia;

“CBCA” means the Canada Business Corporations Act, as amended, together with all regulations promulgated pursuant thereto;

“Chord Property” means the uranium property currently being leased by Strathmore, located in South Dakota, United States, 100% of which Strathmore has an option to purchase and that is subject to a 2% gross royalty;

“Church Rock Property” means certain mining claims on the uranium property located in McKinley County, New Mexico, United States, 100% of which Strathmore owns;

“Church Rock Report” means the technical report entitled, “Technical Report on the Strathmore Church Rock Uranium Property” – McKinley County, New Mexico, dated December 20, 2005, submitted by David C. Fitch, C.P.G.;

“CIBC Mellon” means CIBC Mellon Trust Company, Strathmore’s registrar and transfer agent;

“Comstock Property” means certain mining claims located in British Columbia, Canada, 100% of which Strathmore owns;

“Court” means the British Columbia Supreme Court;

“Dieter Lake Property” means certain mining claims located in Quebec, Canada, 100% of which Strathmore owns;

“Dieter Lake Report” means the technical report entitled, “Strathmore Minerals Corporation – 2005 Exploration at the Dieter Lake Property, Quebec”, dated November 3, 2006, submitted by C.F. Davis, P. Geo. and M.Guo, P.Geol.;

“Dissenting Shareholders” means registered Shareholders who validly exercise their rights of dissent provided to them with respect to the Arrangement and who will be paid fair value for their Strathmore Shares in accordance with the Interim Order and the Arrangement Provisions;

“Dissenting Shares” means the Strathmore Shares in respect of which Dissenting Shareholders have exercised a right of dissent;

“Duddridge Lake Property” means certain mining claims located in Saskatchewan, Canada, 100% of which Strathmore owns;

“Duddridge Lake Report” means the technical report entitled, “Report on the Duddridge Lake Uranium Property, Northern Saskatchewan”, dated May 28, 2004, submitted by Stuart C. Fraser, P. Geol.;

“Effective Time” means the time on the Effective Date at which the Arrangement becomes effective;

“Effective Date” means the date upon which the Arrangement becomes effective;

“Employee Optionholders” means holders of Strathmore Options who are employees of Strathmore;

“Exchange” means the TSX Venture Exchange Inc.;

“Final Order” means the final order of the Court approving the Arrangement;

“Fission Energy” means Fission Energy Corp., a private corporation incorporated under the CBCA;

“Fission Energy Reorganization Shares” means the preferred shares, as more particularly described in Appendix II of the Plan of Arrangement, to be created and issued by Fission Energy to Strathmore as consideration for the Spin-Off Assets as set out in paragraph 3.1(e) of the Plan of Arrangement;

“Fission Energy Shareholders” means the shareholders of Fission Energy;

“Fission Energy Shares” means the common shares without par value that Fission Energy is authorized to issue as the same are constituted on the date hereof;

“Fission Energy Stock Option Plan” means the proposed Stock Option Plan of Fission Energy, which is subject to Exchange acceptance and Shareholder approval;

“Fission Energy Stock Option Plan Resolution” means an ordinary resolution which will be considered by the Shareholders to approve the Plan, the full text of which is set out in Schedule “C” to this Information Circular;

“Fort Mcleod Property” means certain mining claims located in Alberta, Canada, 100% of which Strathmore owns;

“Information Circular” means this Management Information Circular dated May 8, 2007;

“interested party” means an interested party within the meaning of OSC Rule 61-501;

“Interim Order” means the interim order of the Court dated May 8, 2007, providing, among other things, for the calling and holding of the Meeting, a copy of which Interim Order is set out as Schedule “E” to this Information Circular;

“Meeting” means the annual and special meeting of the Securityholders to be held on June 19, 2007 and includes any adjournment thereof;

“New Mexico Properties” means the Church Rock Property and the Roca Honda Property;

“NI 43-101” means National Instrument 43-101 – Standards of Disclosure for Mineral Projects;

“Non-Employee Optionholders” means holders of Strathmore Options who did not receive their Strathmore Options by virtue of their employment by Strathmore or a subsidiary or related corporation of Strathmore;

“Non-Principal Canadian Properties” means the Athabasca Property, the Comstock Property, the Fort Mcleod Property and the Staked Canadian Properties;

“Notice of Meeting” means the Notice of Annual and Special General Meeting of the Securityholders in respect of the Meeting;

“OSC Rule 61-501” means Ontario Securities Commission Rule 61-501;

“Optionholder” means a holder of Strathmore Options;

“Plan of Arrangement” means the plan of arrangement attached as Exhibit I to the Arrangement Agreement, and any amendments or variations thereto;

“proxy” means the form of proxy which accompanies this Information Circular;

“qualified person” means an individual who is a “qualified person” within the meaning of National Instrument 43-101;

“Registrar” means the Registrar of Companies under the BCBCA;

“related party” means a related party within the meaning of OSC Rule 61-501;

“Roca Honda Property” means certain mining claims located in McKinley County, New Mexico, 100% of which Strathmore owns, some of which are subject to a 1% royalty;

“Roca Honda Report” means the technical report entitled, “Technical Report on the Roca Honda Uranium Property” – McKinley County, New Mexico”, dated March 31, 2006, prepared by David C. Fitch, C.P.G.;

“Securityholder” means a registered holder of Strathmore Shares, Strathmore Warrants or Strathmore Options;

“Share Distribution Record Date” means the close of business on the fourth Business Day prior to the Effective Date for the purpose of determining the Shareholders entitled to receive share certificates representing Fission Energy Shares under the Arrangement;

“Shareholder” means a holder of Strathmore Shares;

“Spin-Off Assets” means, collectively, the Spin-Off Properties and $500,000 in cash that are to be transferred from Strathmore to Fission Energy pursuant to the Arrangement;

“Spin-Off Properties” means all of Strathmore’s interest in the Athabasca Property, the Chomstock Property, the Dieter Lake Property, the Duddridge Lake Property, the Fort Mcleod Property, the Staked Canadian Properties and the Staked Peruvian Properties;

“Staked Canadian Properties” means the Canadian uranium properties located in Saskatchewan (namely, Davy Lake, Hall Lake, Patterson Lake, and Waterbury Lake) in which Strathmore has acquired a 100% interest by staking;

“Staked Peruvian Properties” means the uranium properties located in Peru in which Strathmore has acquired a 100% interest by staking;

“Strathmore” means Strathmore Minerals Corp., a public corporation continued under the BCBCA, whose shares are listed on the Exchange;

“Strathmore Butterfly Holder” means a holder of Strathmore Butterfly Shares;

“Strathmore Butterfly Shares” means the new preferred shares which Strathmore will create and issue as described in the Plan of Arrangement and for which the Strathmore Class A Shares are, in part, to be exchanged under the Plan of Arrangement;

“Strathmore Class A Shares” means the Strathmore Shares as renamed and redesignated as Class A common shares under the Arrangement;

“Strathmore New Options” means the new options of Strathmore issued in exchange for Strathmore Options to take into account the reduction in Strathmore’s fair market value as a result of transferring the Spin-Out Assets from Strathmore to Fission Energy;

“Strathmore New Shares” means a new class of common shares without par value which Strathmore will create and issue as described in the Plan of Arrangement and for which the Strathmore Class A Shares are, in part, to be exchanged under the Plan of Arrangement and which, immediately after completion of the transactions comprising the Plan of Arrangement, will be identical in every relevant respect to the Strathmore Shares;

“Strathmore Options” means share purchase options issued pursuant to the Strathmore Stock Option Plan which are outstanding on the Effective Date;

“Strathmore Resources” means Strathmore Resources (US) Ltd., a wholly-owned subsidiary of Strathmore Minerals Corp., incorporated under the state laws of Nevada;

“Strathmore Securities” means Strathmore Shares, Strathmore Warrants and Strathmore Options;

“Strathmore Shares” means the common shares without par value which Strathmore is authorized to issue as the same are constituted on the date of this Information Circular;

“Strathmore Stock Option Plan” means the stock option plan of Strathmore;

“Strathmore Warrants” means common share purchase warrants of Strathmore which are outstanding on the Effective Date;

“Tax Act” means the Income Tax Act (Canada), as amended;

“United States” or “U.S.” means the United States of America;

“U.S. Mineral Properties” means the Chord Property, the New Mexico Properties, and the Wyoming Properties, all of which will continue to be held by Strathmore following completion of the Arrangement;

“U.S. Securities Act” means the United States Securities Act of 1933, as amended;

“Warrantholder” means a holder of Strathmore Warrants; and

“Wyoming Properties” means the properties containing certain mining claims located in Wyoming, United States, 100% of which Strathmore owns.

AUDITORS’ CONSENTS

We have read the Information Circular of Strathmore Minerals Corp. (the “Company”) dated May 8, 2007 relating to the proposed arrangement involving the Company, its shareholders and Fission Energy Corp.  We have complied with Canadian generally accepted standards for an auditor’s involvement with offering documents.

We consent to the use in the above mentioned Information Circular of our report to the directors of the Company on the balance sheets of the Company as at December 31, 2006 and 2005 and the statements of operations and deficit and cash flows for the years then ended.  Our report is dated February 19, 2007 (except as to Note 13 which is as of May 8, 2007).

(Signed)  Davidson & Company LLP

Vancouver, Canada	Chartered Accountants
May 8, 2007

DIRECTORS’ APPROVAL

The contents and the sending of the Notice of Meeting and this Information Circular have been approved by the Board of Directors of Strathmore.

Dated this 8^th day of May, 2007.

ON BEHALF OF THE BOARD
OF DIRECTORS OF STRATHMORE MINERALS CORP.

(signed) DEVINDER RANDHAWA

Devinder Randhawa
Chairman and Chief Executive Officer

CERTIFICATE

The foregoing, including all schedules attached hereto, contains no untrue statement of a material fact and does not omit to state a material fact that is required to be stated or that is necessary to be made a statement not misleading in the light of the circumstances in which it was made.

DATED: May 8, 2007

(signed) DEVINDER RANDHAWA

(signed) PATRICK GROENING

Chairman and Chief Executive Officer

Chief Financial Officer

- # -

SCHEDULE A

THE ARRANGEMENT RESOLUTION

RESOLUTION OF THE HOLDERS OF COMMON SHARES, OPTIONS AND WARRANTS OF STRATHMORE MINERALS CORP. (THE “SECURITYHOLDERS”)

BE IT RESOLVED as a special resolution that:

1.

The Arrangement Agreement dated effective May 7, 2007 between Strathmore Minerals Corp. (“Strathmore”) and Fission Energy Corp. (“Fission”), attached as Schedule “B” to the notice and annual and special meeting and management information circular (the “Circular”) of Strathmore dated effective May 8, 2007 is hereby confirmed, ratified and approved.

2.

The arrangement (the “Arrangement”) under Part 9, Division 5 of the Business Corporations Act (British Columbia) substantially as set forth in the Plan of Arrangement attached as Exhibit II to the Arrangement Agreement attached as Schedule “B” to the Circular is hereby approved and authorized.

3.

Notwithstanding that this special resolution has been passed by the Securityholders of Strathmore or has received the approval of the Supreme court of British Columbia, the board of directors of Strathmore may amend the Arrangement Agreement and the Plan of Arrangement to the extent permitted by the Arrangement Agreement and/or decide not to proceed with the Arrangement or revoke this special resolution at any time prior to the filing of the certified copy of the court order approving the Arrangement with the Registrar of Companies for British Columbia without further approval of the Securityholders of Strathmore.

4.

Any one director or officer of Strathmore is hereby authorized, for and on behalf of Strathmore to execute and deliver all documents and instruments and take all such other actions as may be necessary or desirable to implement this special resolution and the matters authorized hereby, such determination to be conclusively evidenced by the execution and delivery of any such documents or instruments and the taking of any such actions.

SCHEDULE B
ARRANGEMENT AGREEMENT AND PLAN OF ARRANGEMENT

SCHEDULE C
FISSION ENERGY STOCK OPTION PLAN RESOLUTION

SCHEDULE D
FISSION ENERGY STOCK OPTION PLAN

SCHEDULE E
INTERIM ORDER AND NOTICE OF APPLICATION

SCHEDULE F
DISSENT RIGHTS UNDER THE BUSINESS CORPORATIONS ACT (BRITISH COLUMBIA)

SCHEDULE G
STRATHMORE CONSOLIDATED FINANCIAL STATEMENTS FOR 2005 AND 2006

STRATHMORE MINERALS CORP.

CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

AUDITORS' REPORT

To the Shareholders of

Strathmore Minerals Corp.

We have audited the consolidated balance sheets of Strathmore Minerals Corp. as at December 31, 2006 and 2005 and the consolidated statements of operations and deficit and cash flows for the years then ended.  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 audits.

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

In our opinion, these consolidated financial statements present fairly, in all material respects, the financial position of the Company as at December 31, 2006 and 2005 and the results of its operations and its cash flows for the years then ended in accordance with Canadian generally accepted accounting principles.

"DAVIDSON & COMPANY LLP"

Vancouver, Canada	Chartered Accountants
February 16, 2007 (except as to Note 13,    which is as of May 8, 2007)

A Member of SC INTERNATIONAL

1200 - 609 Granville Street, P.O. Box 10372, Pacific Centre, Vancouver, BC, Canada, V7Y 1G6

Telephone (604) 687-0947  Fax (604) 687-6172

STRATHMORE MINERALS CORP.

CONSOLIDATED BALANCE SHEETS

YEAR ENDED DECEMBER 31

	2006	2005
ASSETS
Current
Cash and equivalents	$ 5,299,908	$ 12,143,821
Short term investments (Note 3)	27,412,579	9,001,064
Receivables	407,910	240,244
Prepaid expenses	30,593	26,651
	33,150,990	21,411,780
Property and equipment (Note 4)	690,904	208,229
Mineral property interests (Note 5)	7,702,446	5,579,778
Deferred exploration costs (Note 6)	11,946,014	3,570,990
	$ 53,490,354	$ 30,770,777
LIABILITIES AND SHAREHOLDERS' EQUITY
Current
Accounts payable and accrued liabilities	$ 708,606	$ 171,356
Due to related parties (Note 9)	15,449	14,291
	724,055	185,647
Shareholders' equity
Capital stock (Note 7)	69,061,053	41,299,968
Subscriptions received in advance	-	3,600
Contributed surplus (Note 7)	1,591,993	4,857,621
Deficit	(17,886,747)	(15,576,059)
	52,766,299	30,585,130
	$ 53,490,354	$ 30,770,777

Nature of operations (Note 1)

Subsequent events (Note 13)

On behalf of the Board:
“Dev Randhawa”	Director	“Michael Halvorson”	Director

The accompanying notes are an integral part of these consolidated financial statements.

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENT OF OPERATIONS AND DEFICIT

YEAR ENDED DECEMBER 31

	2006	2005
GENERAL AND ADMINISTRATIVE EXPENSES
Advertising and promotion	$ 90,532	$ 70,154
Amortization	64,749	43,046
Business development	111,876	96,636
Consulting fees	819,123	654,100
Investors relations	24,858	110,718
Office and miscellaneous	171,744	222,318
Professional fees	370,419	132,637
Property investigation costs	126,289	-
Regulatory fees	37,958	16,384
Rent	60,706	47,581
Shareholder communications	47,287	9,329
Short term investment fees	92,127	3,061
Stock-based compensation  (Note 7)	731,026	476,610
Telephone	41,414	37,031
Transfer agent	17,791	16,105
Trade shows and conferences	379,389	229,792
Travel	47,644	36,009
Wages and benefits	448,492	158,628
Loss before other items	(3,683,424)	(2,360,139)
OTHER ITEMS
Investment income	1,393,310	365,930
Allowance for decline in investments (Note 3)	(20,574)	(4,817)
Loss before income taxes	(2,310,688)	(1,999,026)
Future income tax recovery (Note 10)	-	376,524
Loss for the year	(2,310,688)	(1,622,502)
Deficit, beginning of year	(15,576,059)	(13,953,557)
Deficit, end of year	$ (17,886,747)	$ (15,576,059)
Basic and diluted loss per common share	$ (0.03)	$ (0.03)
Weighted average number of common shares outstanding	66,314,107	53,550,088

The accompanying notes are an integral part of these consolidated financial statements.

#

STRATHMORE MINERALS CORP.

CONSOLIDATED STATEMENT OF CASH FLOWS

YEAR ENDED DECEMBER 31

	2006	2005
CASH FLOWS FROM OPERATING ACTIVITIES
Loss for the year	$ (2,310,688)	$ (1,622,502)
Items not affecting cash
Amortization	64,749	43,046
Allowance for decline in investments	20,574	4,817
Stock-based compensation	731,026	476,610
Future income taxes	-	(376,524)
Property investigation costs	126,289	-
Changes in non-cash working capital items:
Increase in receivables	(167,666)	(205,678)
Increase in short term investments	(18,432,089)	(9,005,881)
Increase in prepaid expenses	(3,942)	(13,335)
(Decrease) increase in accounts payable and accrued liabilities	40,641	(12,247)
Increase in due to related parties	1,158	3,343
Cash used in operating activities	(19,929,948)	(10,708,351)
CASH FLOWS FROM INVESTING ACTIVITIES
Deferred exploration costs	(7,878,415)	(3,283,523)
Property and equipment purchased	(547,424)	(181,217)
Mineral property interests	(41,957)	(513,300)
Cash used in investing activities	(8,467,796)	(3,978,040)
CASH FLOWS FROM FINANCING ACTIVITIES
Subscriptions received in advance	-	3,600
Share issuance costs	(684,014)	(1,158,352)
Capital stock issued	22,237,845	18,901,938
Cash provided by financing activities	21,553,831	17,747,186
Change in cash and equivalents during the year	(6,843,913)	3,060,795
Cash and equivalents, beginning of year	12,143,821	9,083,026
Cash and equivalents, end of year	$ 5,299,908	$ 12,143,821

Supplemental disclosure with respect to cash flows (Note 8)

The accompanying notes are an integral part of these consolidated financial statements.

#

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

1.

NATURE OF OPERATIONS

Strathmore Minerals Corp. (the “Company”) is incorporated under the laws of the Province of British Columbia and is considered to be in the exploration stage.

The Company is in the process of exploring its mineral property interests and has not yet determined whether these properties contain ore reserves that are economically recoverable.  The recoverability of the amounts shown for mineral property interests and related deferred exploration costs is dependent upon the existence of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete their development and upon future profitable production.

2.

SIGNIFICANT ACCOUNTING POLICIES

Principles of consolidation

These consolidated financial statements include the accounts of the Company and its wholly owned subsidiaries, Minera Peruran S.A. (incorporated under the laws of Peru), and Strathmore Resources (US) Ltd. (incorporated under the laws of Nevada, USA).  Significant inter-company balances and transactions are eliminated on consolidation.

Use of estimates

The preparation of financial statements in accordance with Canadian generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amount of assets and liabilities and the disclosure of contingent assets and liabilities at the date of the financial statements and the reported amount of revenues and expenses during the period.  Actual results could differ from these estimates.

Cash and equivalents

Cash is comprised of cash on hand and demand deposits. Cash equivalents are short-term, highly liquid investments with original maturities of three months or less that are readily convertible to known amounts of cash and which are subject to an insignificant risk of change in value.

Short term investments

Short term investments are recorded at the lower of cost or market value on an aggregate basis.

Property and equipment

Property and equipment is recorded at cost and amortization is calculated using the declining-balance method,

unless otherwise

noted, at the following annual rates:

Office equipment	20%
Geological equipment	20%
Leasehold improvements	5 year straight-line
Computer equipment	30%
Computer software	50%

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

2.

SIGNIFICANT ACCOUNTING POLICIES (cont’d…)

Mineral property interests and deferred exploration costs

The Company records mineral property interests, which consist of the right to explore for mineral deposits, at cost.  The Company records deferred exploration costs, which consist of costs attributable to the exploration of mineral property interests, at cost.  All direct and indirect costs relating to the acquisition and exploration of these mineral property interests are capitalized on the basis of specific claim blocks until the mineral property interests to which they relate are placed into production, the mineral property interests are disposed of through sale or where management has determined there to be an impairment.  If a mineral property interest is abandoned, the mineral property interest and deferred exploration costs will be written off to operations in the period of abandonment.

On an ongoing basis, the capitalized costs are reviewed on a property-by-property basis to consider if there is any impairment on the subject mineral property interest.  Management’s determination for impairment is based on: i) whether the Company’s exploration programs on the mineral property interests have significantly changed, such that previously identified resource targets are no longer being pursued; ii) whether exploration results to date are promising and whether additional exploration work is being planned in the foreseeable future or iii) whether remaining lease terms are insufficient to conduct necessary studies or exploration work.  As at December 31, 2006 and 2005, management believes that no impairment relating to the mineral property interests and deferred exploration costs was required.

The recorded cost of mineral property interests and deferred exploration costs is based on cash paid and the value of share considerations issued for mineral property interest acquisitions and exploration costs incurred.  The recorded amount may not reflect recoverable value as this will be dependent on future development programs, the nature of the mineral deposit, commodity prices, adequate funding and the ability of the Company to bring its projects into production.

Foreign currency translation

The Company’s subsidiaries are integrated foreign operations and are translated into the Canadian dollar equivalent using the temporal method.  The monetary assets and liabilities of the Company that are denominated in foreign currencies are translated at the rate of exchange at the balance sheet date and non-monetary items are translated at historical rates.  Revenues and expenses are translated at rates approximating those in effect at the time of the transaction.  Exchange gains and losses arising on translation are included in the statement of operations.

Flow-through common shares

Resource expenditure deductions for income tax purposes related to exploration activities funded by flow-through share arrangements are renounced to investors in accordance with Canadian income tax legislation. The Company records a future income tax liability and a reduction in capital stock for the estimated tax benefits transferred to shareholders.

When the Company renounces flow-through expenditures, a portion of the Company’s future income tax assets that were not recognized in previous years, due to the recording of a valuation allowance, will be recognized as a recovery of income taxes in the statement of operations.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

2.

SIGNIFICANT ACCOUNTING POLICIES (cont'd...)

Asset retirement obligations

An asset retirement obligation is a legal obligation associated with the retirement of tangible long-lived assets that the Company is required to settle.  The Company recognizes the fair value of a liability for an asset retirement obligation in the year in which it is incurred when a reasonable estimate of fair value can be made.  The carrying amount of the related long-lived asset is increased by the same amount as the liability.  

Stock-based compensation

The Company uses the fair value method whereby the Company recognizes compensation costs over the vesting period for the granting of all stock options and direct awards of stock.  Any consideration paid by the option holders to purchase shares is credited to capital stock.

Income taxes

Income taxes are recorded using the asset and liability method whereby future tax assets and liabilities are recognized for the future tax consequences attributable to differences between the financial statement carrying amounts of existing assets and liabilities and their respective tax bases.  Future tax assets and liabilities are measured using the enacted or substantively enacted tax rates expected to apply when the asset is realized or the liability settled.  The effect on future tax assets and liabilities of a change in tax rates is recognized in income in the period that substantive enactment or enactment occurs.  To the extent that the Company does not consider it more likely than not that a future tax asset will be recovered, it provides a valuation allowance against the excess.

Loss per share

The Company uses the treasury stock method to compute the dilutive effect of options, warrants and similar instruments.  Under this method the dilutive effect on earnings per share is recognized on the use of the proceeds that could be obtained upon exercise of options, warrants and similar instruments.  It assumes that the proceeds would be used to purchase common shares at the average market price during the period.  For the years presented, this calculation proved to be anti-dilutive.

Basic loss per share is calculated using the weighted average number of shares outstanding during the year.

Comparative figures

Certain comparative figures have been reclassified to conform with the current year’s presentation.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

3.

SHORT TERM INVESTMENTS

Short term investments are comprised of the following:

	2006	2005
Canadian bond funds	$ 20,325,270	$ 2,986,357
Canadian short term investment fund	7,087,309	6,014,707
	$ 27,412,579	$ 9,001,064

As at December 31, 2006, short term investments have an aggregate market value of $27,412,579 (2005 -$9,001,064).  During fiscal 2006, the Company recorded an allowance for decline of $20,574 (2005 - $4,817) to reflect the market value of the investments.

4.

PROPERTY AND EQUIPMENT

		2006			2005
	Cost	Accumulated Amortization	Net Book Value	Cost	Accumulated Amortization	Net Book Value
Office equipment	$ 108,821	$ 38,371	$ 70,450	$ 91,121	$ 24,142	$ 66,979
Geological equipment	132,430	19,090	113,340	43,276	7,471	35,805
Leasehold improvements	65,114	17,413	47,701	55,817	5,936	49,881
Land	370,703	-	370,703	-	-	-
Computer equipment	105,239	55,092	50,147	88,758	35,783	52,975
Computer software	48,343	9,780	38,563	4,254	1,665	2,589
	$ 830,650	$ 139,746	$ 690,904	$ 283,226	$ 74,997	$ 208,229

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

5.

MINERAL PROPERTY INTERESTS

	2006	2005
Athabasca property, Canada	$ 459,702	$ 459,702
Chord property, USA	137,282	137,282
Comstock property, Canada	494,271	297,271
Dieter Lake property, Canada	618,792	421,792
Duddridge Lake property, Canada	382,245	191,245
Fort Mcleod property, Canada	299,071	34,070
New Mexico properties, USA	1,720,833	1,272,616
Staked properties, Canada	831,260	798,153
Staked properties, Peru	69,580	69,580
Wyoming properties, USA	2,689,410	1,615,698
Pre-acquisition property costs	-	282,369
	$ 7,702,446	$ 5,579,778

Title to mineral property interests 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 property interests.  The Company has investigated title to all of its mineral property interests and, to the best of its knowledge, title to all of its properties are in good standing.

Athabasca property, Canada

The Company acquired a 100% interest in a uranium property located in Alberta, Canada, by paying $98,192, incurring additional costs of $29,510 and issuing 200,000 common shares valued at $332,000. The property is subject to a 0.75% net smelter returns royalty on certain mineral production and a 4% gross over riding royalty on all diamond production from the property.

Chord property, USA

The Company acquired a 100% interest in a uranium property located in South Dakota, USA, by paying $48,640.  During fiscal 2003, the Company amended the terms of the lease agreement for consideration of 100,000 shares of the Company valued at $56,000 and incurred additional fees of $6,468.  To earn its interest, the Company is required to make annual payments of either 50,000 common shares or US$10,000 per year to July 1, 2009. In fiscal 2006, the Company paid $14,381 (US$10,000) (2005 - $12,558 (US$10,000)).  The property is subject to a 2% gross royalty.

Comstock property, Canada

The Company acquired a 100% interest in certain claims located in British Columbia, Canada by issuing 300,000 common shares valued at $491,000 and incurring additional fees of $3,271.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

5.

MINERAL PROPERTY INTERESTS (cont’d...)

Dieter Lake property, Canada

The Company acquired a 100% interest in certain claims located in Quebec, Canada by issuing 300,000 common shares valued at $603,000 and incurring additional costs of $15,792. An additional 200,000 shares will be issued in the event a resource of more than 60 million pounds containing U₃O₈ (Uranium) is confirmed at the property.

Duddridge Lake property, Canada

The Company acquired a 100% interest in certain claims located in Saskatchewan, Canada by issuing 200,000 common shares valued at $344,000 and incurring additional fees of $38,245.

Fort Mcleod property, Canada

The Company acquired an option to purchase a 100% interest in certain claims located in Alberta, Canada, by paying $34,071 for staking costs and issuing 100,000 shares valued at $265,000. To earn its interest, the Company is required to issue an additional 100,000 common shares.

New Mexico properties, USA

The Company acquired a 100% interest in certain claims located in New Mexico, USA, by paying $293,752, incurring additional costs of $318,581 and issuing 600,000 common shares valued at $1,108,500. Certain claims are subject to a 1% royalty.

Staked properties, Canada

The Company acquired, by staking, a 100% interest in the following uranium properties located in north-central Saskatchewan: Davy Lake, Hall Lake, Patterson Lake, and Waterbury Lake.

Staked properties, Peru

The Company acquired, by staking, a 100% interest in certain uranium properties located in Peru.

Wyoming properties, USA

The Company acquired a 100% interest in certain claims located in Wyoming, USA by paying $87,560, incurring additional costs of $403,100 and issuing 1,150,000 common shares valued at $2,198,750.

Pre-acquisition property costs

The pre-acquisition property costs represent expenditures related to mineral property interests prior to implementation of the acquisition.  These costs will be added to the mineral property interest costs to which they relate on completion of the acquisition or written-off to operations should the acquisition not proceed.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

6.

DEFERRED EXPLORATION COSTS

	Canada	USA	Peru	Total
As at December 31, 2004	$ 103,933	$ 63,716	$ -	$ 167,649
Airborne geophysics surveys	1,497,325	-	-	1,497,325
Camp costs	41,534	-	4,573	46,107
Claim fees	38,178	168,188	22,165	228,531
Geologists fees and supplies	418,162	370,852	129,554	918,568
General expenses	16,326	8,074	1,861	26,261
Helicopter rental and equipment fuel	586,482	-	-	586,482
Lab analysis and sampling	38,802	-	-	38,802
NI 43-101 reports	21,334	3,841	-	25,175
Report/map preparation	33,869	606	1,615	36,090
As at December 31, 2005	2,795,945	615,277	159,768	3,570,990
Airborne geophysics surveys	2,516,823	-	-	2,516,823
Camp costs	238,368	-	-	238,368
Claim fees	181,430	514,003	30,276	725,709
Geologists fees and supplies	1,743,786	1,582,897	131,355	3,458,038
General expenses	62,172	130,264	37,633	230,069
Travel	506,005	159,605	30,224	695,834
Helicopter rental and equipment fuel	424,851	494	-	425,345
Lab analysis and sampling	19,990	-	-	19,990
NI 43-101 reports	10,417	-	-	10,417
Report and map preparation	51,346	2,324	761	54,431
As at December 31, 2006	$ 8,551,133	$ 3,004,864	$ 390,017	$ 11,946,014

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS

	Number of Shares	Capital Stock	Contributed Surplus
Authorized
Unlimited number of common shares, without par value
Issued
As at December 31, 2004	36,241,257	$ 23,457,405	$ 2,420,262
Private placements	10,144,286	12,752,584	2,505,917
Exercise of options	887,000	466,080	(169,381)
Exercise of warrants	7,082,971	4,280,507	(875,269)
Acquisition of mineral property interests	1,400,000	2,377,750	-
Stock-based compensation	-	-	476,610
Share issuance costs	-	(1,657,834)	499,482
Tax benefits renounced to flow through share subscribers	-	(376,524)	-
As at December 31, 2005	55,755,514	41,299,968	4,857,621
Private placements	3,265,950	8,699,795	-
Exercise of options	2,370,000	2,815,678	(884,878)
Exercise of warrants	8,340,084	14,809,977	(3,199,127)
Acquisition of mineral property interests	900,000	2,207,000	-
Stock-based compensation	-	-	731,026
Share issuance costs	-	(771,365)	87,351
As at December 31, 2006	70,631,548	$ 69,061,053	$ 1,591,993

Included in issued capital stock are 75,000 common shares subject to an escrow agreement that may not be transferred, assigned or otherwise dealt with without the consent of the regulatory authorities.

In January, 2005, the Company issued 30,000 flow-through common shares at a price of $1.95 per share for proceeds

of $58,500 which were received in fiscal 2004.

In February, 2005, the Company issued 10,000,000 units at $1.50 per unit for gross proceeds of $15,000,000. Each unit consists of one common share and one half of one share purchase warrant. One whole warrant is exercisable at $1.75 until February 21, 2006 and thereafter at $2.00 expiring February 21, 2007. An estimated fair value of $2,480,945 was allocated to the warrants and is included in contributed surplus. In connection with the placement the Company issued agents’ warrants to purchase 1,027,180 common shares at a price of $1.75 per share in the first year and $2.00 per share in the second year and paid commissions of $1,027,180, of which $169,892 was allocated to the commissions on the warrants and is included in contributed surplus.  The fair value of the agents warrants, being $802,026, was determined using the Black-Scholes option pricing model with a volatility of 62%, risk-free interest rate of 2.92%, expected life of 2 years, and a dividend rate of 0%.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d...)

In October 2005, the Company issued 114,286 units at $1.75 per unit for gross proceeds of $200,001.  Each unit consists of one common share and one half of one share purchase warrant exercisable at $2.00 per share until October 26, 2007.  An estimated fair value of $24,972 was allocated to the warrants and is included in contributed surplus.

In May, 2006, the Company issued 1,697,300 flow-through shares at $3.00 per share and 1,568,650 units at $2.30 per unit for total proceeds of $8,699,795. Each unit consists of one common share and one half of one share purchase warrant. One whole warrant is exercisable at $3.25 and expires November 9, 2007. In connection with the placement, the Company paid commissions of $521,988 in cash and issued 195,957 agents’ warrants. Each warrant entitles the Agent to purchase one common share at $2.55 per share and expires May 9, 2007. The fair value of the agents’ warrants, being $87,351, was determined using the Black-Scholes option pricing model with a volatility of 53%, risk-free interest rate of 4.26%, expected life of 1 year, and a dividend rate of 0%.

Stock options and warrants

The Company has a stock option plan whereby, from time to time, at the discretion of the Board of Directors, stock options are granted to directors, officers, employees and certain consultants.  The exercise price of each option is based on the market price of the Company’s common stock at the date of grant less an applicable discount.  The options can be granted for a maximum term of five years with vesting provisions determined by the Board of Directors.

Stock option and share purchase warrant transactions are summarized as follows:

	Warrants		Stock Options
	Number	Weighted Average Exercise Price	Number	Weighted Average Exercise Price
Outstanding, December 31, 2004	10,081,638	$   0.54	3,275,000	$ 0.68
Granted	6,084,323	1.75	1,600,000	1.69
Exercised	(7,082,971)	0.48	(887,000)	0.33
Expired/cancelled	-	-	(100,000)	1.44
Outstanding, December 31, 2005	9,082,990	1.39	3,888,000	1.16
Granted	980,282	3.11	2,840,000	1.89
Exercised	(8,340,084)	1.39	(2,370,000)	0.81
Expired/cancelled	(2,500)	0.76	(163,000)	1.91
Outstanding, December 31, 2006	1,720,688	$   2.53	4,195,000	$ 1.82
Number currently exercisable	1,720,688	$   2.53	1,063,000	$ 1.89

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

7.

CAPITAL STOCK AND CONTRIBUTED SURPLUS (cont’d…)

As at December 31, 2006, stock options and share purchase warrants were outstanding as follows:

	Number of Shares	Exercise Price	Expiry Date
Options	190,000	$ 1.75	January 14, 2007
	20,000	2.25	February 8, 2007
	300,000	2.20	April 29, 2007
	125,000	2.50	April 13, 2009
	945,000	1.50	October 6, 2010
	50,000	1.75	June 14, 2011
	1,765,000	1.70	August 31, 2011
	700,000	2.10	October 27, 2011
	100,000	3.00	December 15, 2010
Total	4,195,000
Warrants	683,263	2.00	February 21, 2007
	195,957	2.55	May 9, 2007
	57,143	2.00	October 26, 2007
	784,325	3.25	November 9, 2007
Total	1,720,688

Stock-based compensation

During fiscal 2006, the Company granted 2,840,000 (2005 – 1,600,000) options to employees, consultants and directors.  Accordingly, using the Black-Scholes option pricing model, the stock options are recorded at fair value in the statement of operations.  Total stock-based compensation recognized in the statement of operations during fiscal 2006 was $731,026 (2005 - $476,610) as a result of options granted and vested.  This amount was also recorded as contributed surplus on the balance sheet.  The weighted average fair value of options granted was $1.09 (2005 - $0.62) per option.  

The following assumptions were used for the valuation of stock options:

	2006	2005
Risk-free interest rate	4.02%	3.00%
Expected life	3.6 years	2.3 years
Annualized volatility	79%	60%
Dividend rate	0.00%	0.00%

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

8.

SUPPLEMENTAL DISCLOSURE WITH RESPECT TO CASH FLOWS

	2006	2005
Cash paid during the year for interest	$ -	$ -
Cash paid during the year for income taxes	$ -	$ -
Cash and equivalents:
Cash balances	$ 5,189,185	$ 12,032,505
Term deposits	110,723	111,316
	$ 5,299,908	$ 12,143,821

Significant non-cash transactions during the year ended December 31, 2006 included:

a)

Issuing 900,000 (2005 – 1,400,000) common shares valued at $2,207,000 (2005 – $2,377,750) pursuant to the acquisition of mineral property interests and issuing 195,957 (2005 – 1,027,180) agents’ warrants valued at $87,351 (2005 – $802,026) as finders’ fees on private placements.

b)

Accruing deferred exploration costs in accounts payable and accrued liabilities of $616,427 (2005 – $119,818) at December 31, 2006.

c)

Issuing 10,000 (2005 – 30,000) common shares for proceeds of $3,600 (2005 – $58,500) received in the prior year.

9.

RELATED PARTY TRANSACTIONS

The Company entered into transactions with related parties as follows:

a)

Paid or accrued $290,615 (2005 - $225,598) for consulting fees to a director and a company controlled by a director.

b)

Paid or accrued $290,415 (2005 - $225,684) for consulting fees to officers of the Company.

c)

Paid or accrued $116,000 (2005 - $NIL) for director’s fees, included in wages, to directors.

.

These transactions were in the normal course of operations and were measured at the exchange amount, which is the amount of consideration established and agreed to by the related parties.

Amounts due to related parties are due to directors and companies controlled by directors and are unsecured, non-interest bearing and have no specific repayment terms.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

10.

INCOME TAXES

A reconciliation of current income taxes at statutory rates with the reported income taxes is as follows:

	2006	2005
Loss before income taxes	$ (2,310,688)	$ (1,999,026)
Expected income tax recovery	$ 834,621	$ 697,061
Other items  not deductible for income tax purposes	(343,052)	(229,573)
Stock-based compensation not deductible for income tax purposes	(264,047)	(166,194)
Recognized (unrecognized) benefits of non-capital losses	(227,522)	75,230
Future income tax recovery	$ -	$ 376,524

The significant components of the Company’s future income tax assets are as follows:

	2006	2005
Future income tax assets:
Equipment	$ 61,021	$ 45,074
Mineral property interests and related exploration expenditures	1,102,853	888,852
Other assets	360,987	434,843
Non-capital losses available for future periods	859,747	1,001,692
	2,384,608	2,370,461
Valuation allowance	(2,384,608)	(2,370,461)
Net future income tax asset	$ -	$ -

The Company has available approximately $2,773,000 of non-capital losses which, if unutilized, will expire through 2026.  Subject to certain restrictions, the Company also has capital losses of $367,000 and resource exploration expenditures of approximately $23,332,338 available to reduce taxable income of future years.   Future tax benefits which may arise as a result of these losses and resource deductions have not been recognized in these financial statements, and have been offset by a valuation allowance.

During fiscal 2005, the Company renounced certain deductions for Canadian exploration expenditures incurred on the Company’s resource properties resulting in a future income tax recovery of $376,254 and a charge against capital stock.

11.

SEGMENTED INFORMATION

The Company primarily operates in one reportable operating segment, being the exploration of mineral property interests and considers its loss from operations for fiscal years 2006 and 2005 to relate to this segment.

STRATHMORE MINERALS CORP.

NOTES TO THE CONSOLIDATED FINANCIAL STATEMENTS

DECEMBER 31, 2006

11.

SEGMENTED INFORMATION (cont’d...)

The Company has mineral property interests located in the USA, Canada and Peru and conducts administrative activities from Canada.  The total amount of capital assets attributable to Canada is $11,979,000 (2005 - $5,172,337), Peru is $459,597 (2005 - $229,348) and the USA is $7,900,767 (2005 - $3,957,312).

12.

FINANCIAL INSTRUMENTS

The Company's financial instruments consist of cash and equivalents, short term investments, receivables, accounts payable and accrued liabilities and amounts due to related parties. Unless otherwise noted, it is management's opinion that the Company is not exposed to significant interest or credit risks arising from these financial instruments.  The fair value of these financial instruments approximates their carrying value, unless otherwise noted. The Company is subject to financial risk arising from fluctuations in foreign currency exchange rates. The Company does not use any derivative instruments to reduce its exposure to fluctuations in foreign currency exchange rates.

13.

SUBSEQUENT EVENTS

Subsequent to December 31, 2006, the Company:

a)

Issued 1,441,075 common shares for proceeds of $3,197,018 pursuant to the exercise of stock options and warrants.

b)

Issued 100,000 common shares pursuant to the acquisition of mineral property interests.

c)

Entered into an option agreement with Yellowcake Minerals Inc.  (“Yellowcake”) to option an 80% interest in the Company’s Juniper Ridge property in Wyoming.  Pursuant to the agreement, the Company will receive 9,000,000 common shares of Yellowcake, US$500,000 in cash over five years, and Yellowcake will incur a total of US$8,000,000 in exploration expenditures over five years on the property.  Upon spending US$4,000,000 in exploration expenditures, Yellowcake will have earned a 40% interest.  The Company will maintain a 3% NSR on the optioned portion on all future production.  Further, the Company agreed to option a 50% interest in their Texas database to Yellowcake for consideration of US$25,000, Yellowcake incurring US$440,000 evaluating the database, and if a suitable target is identified, Yellowcake will incur the first US$500,000 in costs to acquire any mining leas es.

d)

On February 14, 2007, granted an exclusive right to an undisclosed corporation to negotiate a joint venture agreement to develop its Roca Honda project and construct a uranium mill in the Grants Mineral Belt of New Mexico. Pursuant to the Exclusivity Agreement, the undisclosed party paid $US100,000 and has 90 days to negotiate a joint venture agreement with the Company.  On May 4, 2007, both companies agreed to extend the negotiation period until July 9, 2007.

e)

On April 5, 2007, entered into a Letter of Intent (“LOI”) with Yellowcake to option a 60% interest in the Company’s SKY property in Wyoming.  Pursuant to the agreement, Yellowcake will incur a total of US$7,500,000 in exploration expenditures over four years on the property.  Upon spending US$2,500,000 in exploration expenditures, Yellowcake will have earned a 25% interest.  

f)

On April 12, 2007, entered into a LOI with Yellowcake to option a 60% interest in the Company’s Jeep property in Wyoming.  Pursuant to the agreement, Yellowcake will incur a total of US$10,000,000 in exploration expenditures over six years on the property.  Upon spending US$1,500,000 in exploration expenditures, Yellowcake will have earned a 25% interest.  

SCHEDULE H
UNAUDITED PRO FORMA BALANCE SHEETS OF STRATHMORE AND FISSION ENERGY

COMPILATION REPORT ON

PRO-FORMA CONSOLIDATED FINANCIAL STATEMENTS

To the Directors of

Strathmore Minerals Corp

We have read the accompanying unaudited pro-forma balance sheet of Strathmore Minerals Corp. (“Strathmore”) and Fission Energy Corp. (“Fission”) as at December 31, 2006 and have performed the following procedures:

1.

Compared the figures in the column captioned “Strathmore Minerals Corp.” to the audited consolidated financial statements of the Company as at December 31, 2006 and found them to be in agreement.

2.

Made enquiries of certain officials of Strathmore and Fission who have responsibility for financial and accounting matters about:

a)

the basis for determination of the pro-forma adjustments; and

b)

whether the unaudited pro-forma balance sheets comply as to form in all material respects with regulatory requirements of the various security commissions and similar regulatory authorities in Canada.

The officials:

a)

described to us the basis for determination of the pro-forma adjustments; and

b)

stated that the unaudited pro-forma balance sheets comply as to form in all material respects with regulatory requirements of the various security commissions and similar regulatory authorities in Canada

3.

Read the notes to the unaudited pro-forma balance sheets, and found them to be consistent with the basis described to us for determination of the pro-forma adjustments.

4.

Recalculated the application of the pro-forma adjustments to the aggregate of the amounts in the column captioned “Strathmore Minerals Corp.” as at December 31, 2006, and found the amounts in the column captioned “Pro-forma Strathmore Minerals Corp.” and “Pro-forma Fission Energy Corp.” to be arithmetically correct.

A pro-forma balance sheet is based on management assumptions and adjustments which are inherently subjective.  The foregoing procedures are substantially less than either an audit or a review, the objective of which is the expression of assurance with respect to management’s assumptions, the pro-forma adjustments, and the application of the adjustments to the historical financial information.  Accordingly, we express no such assurance.  The foregoing procedures would not necessarily reveal matters of significance to the pro-forma balance sheets, and we therefore make no representation about the sufficiency of the procedures for the purposes of a reader of such statements.

 (Signed)  Davidson & Company LLP

Vancouver, Canada

Chartered Accountants

May 8, 2007

STRATHMORE MINERALS CORP. AND

FISSION ENERGY CORP.

Pro Forma Balance Sheets

As at December 31, 2006

(Unaudited – See Compilation Report)

	Strathmore Minerals Corp. (Consolidated) $	Pro Forma Adjustments $	Reference	Pro Forma Strathmore Minerals Corp. (Consolidated) $	Pro Forma Fission Energy Corp. $
ASSETS
CURRENT
Cash and cash equivalents	5,299,908	(500,000)	Note 2(a)	4,799,908	500,000
Short term investments	27,412,579			27,412,579	-
Receivables	407,910			407,910	-
Prepaid expenses	30,593			30,593	-
	33,150,990			32,650,990	500,000
Equipment	320,201			320,201	-
Land	370,703			370,703	-
Mineral property interests	7,702,446	(3,154,921)	Note 2(a)	4,547,525	3,154,921
Deferred exploration costs	11,946,014	(8,941,150)	Note 2(a)	3,004,864	8,941,150
	53,490,354			40,894,283	12,596,071
LIABILITIES
CURRENT
Accounts payable and accrued
liabilities	708,606			708,606	-
Due to related parties	15,449			15,449	-
	724,055			724,055	-
SHAREHOLDERS’ EQUITY
Share capital	69,061,053	(12,596,071)	Note 2(a)	56,464,982	12,596,071
Contributed surplus	1,591,993	-		1,591,993	-
Deficit	(17,886,747)			(17,886,747)	-
	52,766,299			40,170,228	12,596,071
	53,490,354			40,894,283	12,596,071

Basis of presentation (Note 1)

Pro-forma transactions (Note 2)

The accompanying notes are an integral part of these pro-forma balance sheets.

STRATHMORE MINERALS CORP. AND

FISSION ENERGY CORP.

Pro Forma Balance Sheets

As at December 31, 2006

(Unaudited)

1.

BASIS OF PRESENTATION

The accompanying unaudited pro forma consolidated balance sheet of Strathmore Minerals Corporation (“Strathmore”) and unaudited pro forma balance sheet of Fission Energy Corp. (“Fission”) have been prepared by management for inclusion in the Management Information Circular (the “Circular) of Strathmore dated May 8, 2007. Strathmore intends to proceed with a reorganization which will have the result of dividing its present mineral assets into two separate companies. Upon implementation of a Plan of Arrangement, Fission will hold four properties (Dieter Lake, Duddridge Lake, Non-Principal and Staked Peruvian) and Strathmore will continue to hold the remaining mineral properties. These unaudited pro forma balance sheets have been derived from the audited financial statements of Strathmore as at December 31, 2006, and the assumptions contained in Note 2 below. Fission is a newly formed company incorporated in the province of British Columbia.

The unaudited pro forma balance sheets are prepared as if the reorganization of Strathmore into the two separate entities, Strathmore and Fission, had occurred on December 31, 2006 and the assumptions in Note 2 had occurred as at December 31, 2006. In the opinion of management, the unaudited pro forma balance sheets include all the adjustments necessary for fair presentation in accordance with Canadian generally accepted accounting principles, applied on a basis consistent with Strathmore’s accounting policies.

No unaudited pro forma income statement has been provided as all properties of Strathmore i.e. those being transferred to Fission and those being retained in Strathmore are in development stage and have no operations associated with them.

These unaudited pro forma balance sheets have been prepared and are not intended to reflect the financial position that would have occurred if the events reflected therein had been in effect at the dates indicated. Further, these unaudited pro forma balance sheets are not necessarily indicative of the financial position that may be obtained in the future. These unaudited pro forma balance sheets should be read in conjunction with the consolidated financial statements of Strathmore for the year ended December 31, 2006 as filed on www.sedar.com.

2.

PRO FORMA TRANSACTIONS

The pro-forma consolidated balance sheets were prepared based on the following assumptions:

a)

Strathmore is to transfer to Fission $500,000 cash and all of Strathmore’s investment in the following mineral properties:

i.

Dieter Lake Property in Quebec

ii.

Duddrige Lake Property in Saskatchewan

iii.

Non-Principal Canadian Properties

iv.

Staked Peruvian Properties

The property transfers are recorded at their carrying values of $12,096,071.

b)

The unaudited pro forma balance sheet assumes that Fission will be created and that shares will be issued directly to shareholders of Strathmore.

EX-23.1

DAVIDSON & COMPANY LLP           _{Chartered Accountants}    ^{A Partnership of Incorporated Professionals}           

CONSENT OF INDEPENDENT REGISTERED

PUBLIC ACCOUNTING FIRM

We consent to the use in this Registration Statement on Form 20-F (as amended) of Strathmore Minerals Corp. of our report dated February 16, 2007 appearing in the Registration Statement, and to the reference of us under the heading "Statement by Experts" in such Registration Statement.

"DAVIDSON & COMPANY LLP"

Vancouver, Canada	Chartered Accountants
July 12, 2007

A Member of SC INTERNATIONAL

1200 - 609 Granville Street, P.O. Box 10372, Pacific Centre, Vancouver, BC, Canada, V7Y 1G6

Telephone (604) 687-0947  Fax (604) 687-6172

EX-23.2

EX-23.3

EX-23.4

COVER

Cover Letter

CORRESP

Strathmore Minerals Corp.

Response to SEC Staff Comments

The following table addresses the Staff’s comments as listed in the SEC Staff’s comment letter dated April 18, 2007  with regards to the Company’s Comprehensive Registration Statement on Form 20-FR12g filed on March 19, 2007.

Comment Number	Page	Response
1		The date of the effectiveness of the registration statement have been noted.
2		The document has been updated with the latest information available.
3	7, 8, 82-84	The text has been revised.
4	8	The text has been revised to reflect that Davidson and Company LLP has been the Company’s auditor for the last 10 years, and the financial statements have been prepared in accordance with the standards of the Public Company Accounting Oversight Board of the United States.
5	10	The exchange rate table has been updated with the latest available information.
6	Risk Factors	The mitigating language has been deleted
7	Risk Factors	The risk factors have been revised to better reflect those that are relevant to the Company.
8	13	Risk factors addressing the planned spin-out have been added.
9	Risk Factors	The government regulation and environmental requirement risk factors have been revised.
10	13	The risk factors of no positive cash flow and dilution to common shareholders have been separated into separate risk factors and the discussion revised.
11	15, 64	The disclosure has been revised to clarify that the Company’s focus is on uranium exploration properties.
12	16-18	Details of the spin-out of the Canadian and Peruvian properties has been added to the text.
13	25	Additional details of the proposed spin out and its effect on the Company’s exploration budget have been added to the text.
14	27	A notation to the effect that Strathmore and North American Gem were unable to come to mutually agreeable final terms on the proposed agreement has been added to the text.
15	30-64	The estimated exploration budget for fiscal 2007 has been added to the discussion of each individual property.
16	29, 71	Clarification of the Canadian assets to be spun-out has been added, and the discussion has been reformatted into a table. Additional discussion has been added under Operating and Financial Review and Prospects.
17	64-71	The discussion of expenses in each period have been revised.
18	71	Additional disclosure regarding current liquidity has been added to the text.
19	82	Mr. Miller’s middle name has been added.
20	82-84	The biographical sketches have been updated.
21	86	Table 8 containing the shareholdings of officers and directors has been updated.
22	Exhibits	The 2 consulting contracts currently in effect have been filed as exhibits with this amendment.
23	90-91	The first entry in each case is for fiscal 2006 ended December 31. The amount for Sona Capital for Fiscal 2005 has been corrected.
24	92	The date has been corrected.
25	105	The term “for general information only” has been deleted from the text..
26	111	The Controls and Procedures disclosure has been revised to reflect there were no changes in internal control over financial reporting for the fiscal year ended December 31, 2006.
27	Financial Statements	The Financial Statements are included in the Form 20-F, with an index included. The statements have been ordered from the most recent interim statement first, with the independent accountants opinion, followed by the annual financial statements in reverse chronological order. The statements have been paginated, and the director’s signatures have been included.
28	Financial Statements	The statements have been revised to correct the typographical errors.
29	Financial Statements	The dates of the agreements have been added.
30	Financial Statements	The capitalized property costs have been disclosed in the US GAAP reconciliation note. The properties to be transferred in the spin-out have been disclosed.
31	12	A risk factor discussion the Navajo opposition to Uranium mining in “Indian Country” has been added. Since none of the Company’s New Mexico properties have completed feasibility studies, the availability of uranium milling capacity, the feasibility of the Company constructing its own uranium mill, and the effect of both on the commercial viability of any potential mining project is unknown at this time.
32	Exhibits	A signed consent of David Fitch has been included as an exhibit.
33	32, 34	The pounds of uranium estimates have been deleted from the text.
34	32, 44 31, 36 45	Disclosure about adjacent properties has been deleted. The reference to the previously constructed shaft near the Roca Honda deposit has been removed. A discussion of the possibility of using the existing shaft present on the Nose Rock property has been added to the text. The term “potential resource” has been deleted from the text.

Sincerely,

/s/ Patrick Groening

Patrick Groening,

Chief Financial Officer