WESTERN PROSPECTOR GROUP LTD AND EMEELT MINES LLC INDEPENDENT TECHNICAL REPORT ON THE RESULTS OF A PRELIMINARY ECONOMIC ASSESSMENT GURVANBULAG URANIUM DEPOSIT, MONGOLIA Compiled by: Malcolm Buck, P.Eng. Bruce C. Fielder, P.Eng. Marek Nowak, MASc., P.Eng. Eugene Puritch, P.Eng. Mani M. Verma, P.Eng. Jane Spooner, P.Geo. EMEELT MINES LLC November 27, 2007 MONGOLIA SUITE 900 - 390 BAY STREET, TORONTO ONTARIO, CANADA M5H 2Y2 Telephone (1) (416) 362-5135 Fax (1) (416) 362 5763 Table of Contents Page 1.0 SUMMARY ....................................................................................................................1 1.1 HISTORY AND DESCRIPTION OF THE PROPERTY........................................1 1.2 GEOLOGY AND MINERAL RESOURCES..........................................................1 1.3 MINING...................................................................................................................4 1.4 METALLURGY AND PROCESS DESIGN...........................................................5 1.5 INFRASTRUCTURE AND SITE FACILITIES .....................................................6 1.6 ENVIRONMENTAL, SOCIO-ECONOMIC CONDITIONS AND PERMITTING..........................................................................................................6 1.7 THE MARKET FOR URANIUM ...........................................................................7 1.8 PROJECT SCHEDULE AND MANPOWER .........................................................8 1.9 PRELIMINARY ECONOMIC ASSESSMENT......................................................8 1.10 CONCLUSIONS AND RECOMMENDATIONS.................................................10 2.0 INTRODUCTION AND TERMS OF REFERENCE ..............................................12 2.1 ACKNOWLEDGEMENTS ...................................................................................13 2.2 UNITS OF MEASURE AND ABBREVIATIONS...............................................13 3.0 RELIANCE ON OTHER EXPERTS ........................................................................16 4.0 PROPERTY DESCRIPTION AND LOCATION ....................................................17 4.1 ENVIRONMENTAL CONSIDERATIONS.........................................................21 4.2 PERMITS...............................................................................................................21 5.0 ACCESSIBILITY, CLIMATE, LOCAL RESOURCES, INFRASTRUCTURE AND PHYSIOGRAPHY ...................................................22 6.0 HISTORY .....................................................................................................................24 7.0 GEOLOGICAL SETTING.........................................................................................25 7.1 REGIONAL GEOLOGY.......................................................................................25 7.1.1 Central Mongolia Fold Belt ...............................................................................25 7.1.2 Argun-Mongolia province.................................................................................26 7.1.3 Stratigraphic Setting...........................................................................................27 8.0 DEPOSIT TYPES ........................................................................................................28 8.1 URANIUM IN VOLCANIC ROCKS ...................................................................28 9.0 MINERALIZATION...................................................................................................29 9.1 BASEMENT ROCKS (LOWER STRUCTURAL STAGE).................................29 9.2 MESOZOIC ROCKS (UPPER STRUCTURAL STAGE)....................................29 9.3 STRUCTURE ........................................................................................................31 9.4 HYDROTHERMAL ALTERATION....................................................................31 i 10.0 EXPLORATION..........................................................................................................33 10.1 2005 EXPLORATION PROGRAM......................................................................33 10.2 2006 EXPLORATION PROGRAM......................................................................34 11.0 DRILLING ...................................................................................................................35 11.1 LOCATION AND SURVEYING..........................................................................36 11.1.1 Field Location....................................................................................................36 11.1.2 Surveying ...........................................................................................................36 11.2 DOWNHOLE SURVEYS.....................................................................................38 11.3 CONSTRUCTION OF DRILLHOLE DATABASE FROM RUSSIAN DATA...................................................................................................39 11.3.1 Digitizing of Russian drillholes .........................................................................40 11.4 DRILLING RESULTS...........................................................................................41 11.4.1 Resource Block 1-06..........................................................................................41 11.4.2 Verifications in Gurvanbulag Central Zone.......................................................43 11.4.3 Exploration near Gurvanbulag Central Zone.....................................................44 11.5 CONCLUSIONS OF WNP 2005 DRILL PROGRAM .........................................44 12.0 SAMPLING METHOD AND APPROACH .............................................................46 12.1 DATA ACQUISITION ON CORE........................................................................46 12.1.1 Core Handling....................................................................................................46 12.1.2 Depth and Recovery Measurements ..................................................................46 12.1.3 Quick Log and Radiometric Scan......................................................................48 12.1.4 Geotechnical Logging........................................................................................48 12.1.5 Radiometric Scan Log........................................................................................49 12.1.6 Core Logging.....................................................................................................49 12.1.7 Specific Gravity Measurements.........................................................................53 12.1.8 Photography of Core..........................................................................................54 12.1.9 Core Storage.......................................................................................................54 12.2 DRILL CORE SAMPLING...................................................................................54 12.3 SHIPMENT OF SAMPLES...................................................................................55 13.0 SAMPLE PREPARATION, ANALYSES AND SECURITY..................................57 13.1 SAMPLE PREPARATION AND ANALYSES....................................................57 13.1.1 Alex Stewart Laboratory, Ulaanbaatar ..............................................................57 13.1.2 XRF Analyses in Ulaanbaatar............................................................................57 13.1.3 Activation Laboratories, Canada.......................................................................58 13.2 QUALITY ASSURANCE AND QUALITY CONTROL PROGRAMS..........................................................................................................58 13.2.1 Duplicates ..........................................................................................................58 13.2.2 Blanks and Standards - Selection.......................................................................60 13.2.3 Blanks and Standards - Insertion .......................................................................63 13.2.4 Re-assaying Procedures.....................................................................................63 13.2.5 Re-Sampling Procedure.....................................................................................65 ii 13.2.6 Record Keeping for Traceability .......................................................................65 13.2.7 Data Storage and Security..................................................................................67 13.3 COMPILATION OF RUSSIAN ANALYTICAL DATA .....................................67 14.0 DATA VERIFICATION .............................................................................................68 14.1 CONTROL OF ASSAY RESULTS ......................................................................68 14.2 ASSAY DATABASE............................................................................................68 15.0 ADJACENT PROPERTIES .......................................................................................70 16.0 MINERAL PROCESSING AND METALLUGICAL TESTING ..........................71 16.1 METALLURGICAL TESTWORK.......................................................................71 16.1.1 Composite Preparation.......................................................................................71 16.1.2 Leach Tests........................................................................................................73 16.1.3 Settling and