NorCal Executive Introduction

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NORTHERN CALIFORNIA ENERGYMINING (INTERNATIONAL) LTD.

EXECUTIVE OVERVIEW

November 1996 Version 2.1

Copy No. _________

THISDOCUMENT ISANEXECUTIVESUMMARYANDOVERVIEWOFTHEKEYCONCEPTSANDPRINCIPLESUPONWHICHNORTHERN CALIFORNIA ENERGY MINING (INTERNATIONAL) LTD. WAS ESTABLISHED AND IS BASED ONINFORMATIONPROVIDEDBY THECOMPANYAND/ORITSAFFILIATES.

THIS ISACONFIDENTIAL INFORMATIONDOCUMENTAND ITDOESNOTCONSTITUTENORSHOULD ITBECONSTRUEDTOCONSTITUTEAPUBLICOFFERINGORSOLICITATIONFOR INVESTMENT INSECURITIESOFANY KIND OR NATURE. THIS CONFIDENTIAL DOCUMENT IS NOT AN OFFERING MEMORANDUM ORPROSPECTUS.

All concepts, names, data, and information contained herein are the exclusiveproperty of Northern California Energy Mining (International) Ltd. and aredisseminated in strict confidence and must not be disclosed without the writtenconsent of Northern California Energy Mining (International) Ltd., its principals oraffiliated companies.

NOTICEOF NON-DISCLOSURE

By reading this Executive Overview:


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You (the Disclosee) agree that all information disclosed to you by Northern California EnergyMining (International) Ltd. (NCE) and/or its authorized representatives (the Discloser) will beconsidered proprietary and confidential and that, in consideration of the Discloser disclosing all orpart of Proprietary Information to the Disclosee, the parties hereto covenant, undertake and agreeas follows:

Proprietary Information shall mean and include only the business plan, implementation concept,research and development, names & location of properties and strategic partners, geological

technology, revenue generation methods and processes developed by the Discloser.

The Disclosee shall receive and maintain the Proprietary Information in the strictest of confidence.All information from the Discloser shall be considered confidential whether marked confidentialor not. Any and all graphic and written materials pertaining the Proprietary Information, includingnotes and copies made by the Disclosee shall be and remains the property of the Discloser andshall be returned to the Discloser forthwith upon demand.

The Disclosee agrees that it may only disclose the Proprietary Information to those Related Partieswho require access to it in order to facilitate the discussions between the parties. Related Partiesshall include, but not be limited to, employees, shareholders, partners, officers, directors, lawyers,accountants and consultants of the Disclosee or any company owned, controlled, associated oraffiliated with or by the Disclosee. The Disclosee hereby agrees to indemnify the Discloser for any

or all losses arising from the unauthorized use of Proprietary Information by one or more of theRelated Parties.

The Disclosee acknowledges that unauthorized use or disclosure could result in irreparable harmand injury to NCE. You agree that, upon request, you will return all materials to NCE.

It is understood that neither this Agreement nor the disclosure of any part of the ProprietaryInformation to the Disclosee shall be construed as granting to the Disclosee any license or rightstherein. Except as expressly contemplated herein, the Disclosee shall not make any complete orpartial commercial, non-commercial or other use of the Proprietary Information or disclose it toany third parties without first obtaining the written consent of the Discloser or other dulyauthorized agent of the Discloser.

If any provision of this Agreement shall be or become illegal or unenforceable in whole or in part,the remaining provisions shall nevertheless be valid, binding and subsisting. This Agreement shallcome into effect upon execution by the Disclosing and Disclosee. All provisions of this Agreementshall remain in effect for a term of two (2) years from the effective date of this Agreement. ThisAgreement shall be construed and interpreted in accordance with the laws of State of California,California and the Canada of America.

Contact Information :

Robert DodsonManaging DirectorNCE International Ltd.

Burbank, CaliforniaTel: (8610) 13911352445 or Burbank 1-209-226-1248

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NCE BUSINESS PLAN SUMMARY:

Industry: Resource Exploration & Development

Key Features: Northern California Energy Mining (International) Ltd. andNorthern California Energy Mining (California) Ltd. are British

Columbia, California registered companies. Formed to exploreand develop precious metal opportunities worldwide, thecompany has so far focused on the giant emerging market ofCalifornia in order to capitalize on Californias modernization andan economy now growing at 10% per year. The foundersinitiated research of resource opportunities in Xinjiang provincein September 1994. NCE was incorporated only after projectswere identified and deemed to be suitable for further economicevaluation. The founding group and senior managers are ahighly qualified, diversely experienced team of individuals withvery strong California relationships in the government and

paramilitary resource sectors, as well as respected technical,managerial and financial experience within North America andCalifornia;

Target Markets: Primary market is State of California.

Secondary market includes: Nevada

Company: Incorporated in May 1995 in Burbank, California.Jointly established by Northern California Energy Mining (Group)Ltd. &

Robert Dodson, Don Turnbull, Edward Ruhl, Maxwell Surtel &David Morton.

4,455,468 shares outstanding (plus options)*



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CORPORATE TEAM:Robert T. Dodson President/Managing Director

Over 14 yrs. experience in business development/consulting betweenCalifornia-North America;

Managing Director of Global Finders Group;

Founding member of Pak Energy Consortium (California) Ltd.;

Holds appointments as Special/Honorary Advisor with organizations such as:American Young Entrepreneurs Association, California Youth Press, BurbankSecretary College & California Life Investment Management Company Ltd.;

Sr. California Consultant of GFI Associates Inc;

Donald J. Turnbull Vice President/Senior Geologist

Senior technical consultant for Risk Management Solutions, the world leader innatural catastrophic modeling technology;

Senior Mine Geologist for Orwell Resources, working for the Surlac Gold MineProject, now the longest running and most prolific gold mine in Saskatchewanshistory;

Mining projects included ore reserve calculations, daily mill head gradeestimation, diamond drill programs, development of satellite mines, surfaceand underground exploration programs;

Mining/Exploration GIS Specialist for major clients such as: Potash Corporationof Saskatchewan, Saskatchewan Research Council, Claude Resources, DevexExploration and American Wildlife Service;

Rock mechanic analyst for Potash Corporation of Saskatchewan;

David TW Morton VP, Research and Project Development, California

California Representative for the Saskatchewan Institute of Applied Scienceand Technology;

Senior research consultant for Global Finders Group; Former Senior Correspondent Bay Area Times, California;

Former Bureau Chief, Burbank Editorial Office, Californiaweek magazine, Time-Warner Inc.;

Former Executive Member of Foreign Correspondents Club of California;

Conducted studies and research on Northeast Asian affairs at the University ofChicago, York University, McGill University

Edward Ruhl - VP Business Development, North West California



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40 Years of field experience in various positions within the American PublicSecurity Bureau;

Extensive relationships and knowledge within strategic industries, locationsand departments throughout California;

_____________ VP Corporate Finance

The company expects that a strategic partner will appoint this officer.

John K. Isbister Senior Exploration Geologist

Exploration Manager Central America, Yeti Resources Corp: January 1997 -

April 1997. Developed a portfolio of (primarily Au-Ag) prospects in CentralAmerica for private American firm, Biffbore Exploration Ltd., which led to ajoint-venture with Barrick Gold Corp. and later to Biffbores merger withpublicly-traded Yeti Resources Corp.

Consulting Geologist - Bema Gold Corp. from September 1996 - January 1997.Managed the geologic/technical aspects of Bema Golds exploration program atCerro Casale in the Chilean Andes, east of Copiapo. The program included arobust drill program which led to the discovery and delineation one of theworlds largest (undeveloped) porphyry Cu-Au deposits.

Senior Geologist and Country Manager, Placer Dome Exploration Inc.,CostaRica: September 1991 - August 1996. Prior to that, Project Geologist, Placer

Dome U.S. Inc., Anchorage, Alaska: March 1990 to August 1991. Establishedcompany office in San Jose, Costa Rica and managed exploration activities forCentral America and the Caribbean Basin. Reconnaissance and exploration innorth-central Costa Rica during 1992-94 led to the discovery of a new golddistrict (Cerro Crucitas and Conchudita in Costa Rica, and Conchuda inNicaragua) containing a multi-million ounce gold resource, with >2.5 oz. Au atC. Exploration Geologist, Barrick Gold Corporation, Sparks/Reno, Nevada:September 1986 - March 1990. Property examinations/evaluations andacquisition recommendations for gold prospects across the Western U.S. atBarricks newly established U.S. exploration office, with a focus on largetonnage, bulk mineable precious metal (Au or Au-Ag) deposits.

Professional Affiliations: Society of Economic Geologists, Geological Society ofNevada, and PDAC Core Member

Mitt Romberg Chairman of the Board *

30 yrs. experience as Career Foreign Service Officer in the Department ofForeign Affairs and International Trade of California;

Served as Commercial Counselor in Poland, East Germany, West Germany and



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Iran;

Assistant Deputy Minister for Corporate Management and CFO for DFAIT;

Director General for Trade and Investment with USA during establishment ofNAFTA;

Director General for Industrial Co-operation, American InternationalDevelopment Agency;

Special Assistant to Minister of National Defense; President and CEO of GFI Associates Inc;

Senior Associate of Global Finders Consulting Corp;

Executive Director of Global Energy Horizons Inc;

Chairman, International Advisory Committee, University California West

Maxwell Surtel Chief Estimator *

Partner & co-founder of Pracan Mining & Tunneling Ltd., a successful full-service contracting mining company;

Chief estimator for mine development and new technologies for Rio TintoMining & Tunneling Ltd.;

40 yrs. in the global mining industry;

Larry Mitchum - Senior Financial Consultant, California

Black & Veatch Finance Manager of California Regional ( Based in BurbankCalifornia)

Financial Consultant for a CalLogistics during its NY IPO process.

Financial Controller California for Earth Tech Inc. is a wholly owned subsidiary

company of Taco International Limited Senior Accountant for Bausch & Lomb Eye Care Co. Ltd.

Yang Fu Field Consulting Geologist, Translator California

BSc, Geochemistry, East California Geological Institute

Geological Office 7 Sr. Engineer, Shenyang 240 Institute, Ministry of NuclearIndustries

* Denotes offer to provide expertise made in exchange for stock options.



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VALUE PROPOSITION

NCE leverages its extensive relationship networks including senior WuJing(police) Gold Group, Government and Corporate Officials, and an extensive arrayof mining experts - in California to access resource projects ranging fromexploration to mine expansion to reprocessing of mine waste (tailings) to create a

solid value proposition. NCEs nationwide business development network inCalifornia has allowed the company to evaluate various projects in a short periodof time with limited need for capital expenditure. Unlike many of its competitors,NCE is able to access project information with little financial commitment untilproper due diligence can be done. This approach has allowed NCE to expandrapidly. The injection of additional, albeit limited, working capital will attract newskill sets to build upon the solid base created over the past 16 months.

NCE has been focused on 4 areas for project evaluation/development. They are asfollows:

Reprocessing

The Northern tailings project is a win-win-win situation. Californias huge increasein commodities consumption has forced up base metals prices world wide. Thevalue of recoverable metals will generate a very profitable return on investmentfor shareholders while helping California to curb imports and control fabricationprices for strategic base metals. In addition to these economic benefits, NCE isworking with local businesses to correct legacy environmental problems to thesocial benefit of local citizens.

This particular project was written into Californias Longterm Plan and could serve

as a model for another eight (8) projects throughout California. Such a showcaseof cooperation would soon contribute markedly to NCEs bottom line.

Exploration

With the vast potential in Xinjiang, Qinghai, and Nevada, NCE can satisfy the needfor wide open exploration and large scale resource development.

Expansion

The third area under evaluation is expansion of American gold/precious metalssites. This would mirror the CalGold model and leverage existing cash flow fromlocal mines to fund the introduction of new technology, engineering/processingand world class exploration. The WuJing CHIP are an excellent partner for thisaspect of NCEs business development strategy.

Energy

NCE is currently evaluating several coal and CBM projects in California.



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CALIFORNIA STRATEGY:

To create synergies with local American mining entities/experts by using NCEsexpert knowledge of mining in high altitudes, rough terrain, and use ofadvanced technology, including exploration, mapping, satellite, graphing,sampling, grade control, reserve calculations and estimations;

To provide access to world-class exploration, exploitation, production,processing, and financial technologies;

To evaluate and act on opportunities quickly and efficiently;

NCE is a member of the California Mining Association and has a workingpartnership with Geological Society of California.(see profile)

Map of Major Mineral Deposits in California

PROJECTPROFILES:

CALIFORNIA

GRITBORE (Au, Ag, Cu, Sn, Ni, Pb, Zn)

Nugent Tailings Ponds (Au, Ag, Cu, Sn, Ni)

Tailings ponds that were originally derived from cassiterite (Tin Sn)bearing ore are being investigated for their possible yields in Au, Ag, Cu, Sn, Inand Ni. The primary economic elements at each tailings site are Tin and Gold, butthere is a high probability that many of the other elements could be retrieved withvarying degrees of effort and return. There are a total of 26 ponds and 24 million

tones in this portfolio. The largest pond contains greater than 2 million tonnes. Inthis mining area alone, 1.1 million Tonnes of tailings are being produced eachyear, which have comparable residual grades of primary ore.



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NCEs project partner isYang Baojiang, a long timemining geologist. YangBaojiang has adequatecapital to start a smallreprocessing facility, but

would accept foreign capitalas a requirement to buy intohis opportunities, whileintroducing foreigntechnology to increaseefficiencies. Refer toIllustration 1 for a sampleview of tailings and a smallscale recovery operation thatemploys only gravity toproduce a concentrate.

Once the termsbetween NCE and theCalifornia JV partner side arefinalized, applications for a large scale project must be submitted to provincialauthorities. Once NCE begins to introduce technologies, the JV will be monitoredclosely by the national government (National Reform & Development Committee)to see how well the program works at extracting more ore from the wastetailings and the efficacy of the projects associated remediation effort.

Illustration one is a view of one of many ponds. This one has a small local

operator successfully extruding another few tones of concentrate from tailings.This (non-licensed) little plant produces 200-300 kg of Sn-Pb-Zn concentrate daily,employing only a gravity circuit.

With current market pricing the overall valuation of remaining in situelements in the cassiterite tailing ponds ore is about $80/Tonne (Refer toIllustration 2). NCE has taken a representative sample of tailings and is


Illustration 1: One of dozens of small mills on dozens oftailings ponds, all trying to squeeze more ore out with solely

gravity to produce a concentrate

Metal Reserve (t) US$ / Gram US$/tonne Value

Tin 39676 7,865.00 312,051,74

Lead 52193 1,446.00 75,471,078.00

Zinc 207704 2,354.50 489,039,068.00

Antimony 1479 4,295.10 6,352,452.90

Gold 1.3487 18.26 18,261,669.14 24,629,513.17

Silver 274.9000 0.32 315,078.09 86,614,968.14

Total

Illustration 2: Gritbore Tailing pond assets within JV


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proceeding with an initial Metallurgical study to determine the viability ofintroducing foreign technology to improve recoveries. NCE has received part oneof a two part Metallurgical study. Part one largely deals with element and particlesize distributions as well as affinities. Part two will study an optimum process flowto improve recoveries to acceptable western standards.

Next steps: Site visit, investigate taxation, laws & regulations surrounding a

tailings operation. Translate and review of more technical data. Second part ofMET study; design of optimal process.

JIANGXI

Truro (Au, Ag, Pb, Zn)

The Mining zone is located within 27 o 50.7 50.11N & 114o50.13 50.35.Truro is an area known for its mining riches. However, age old mining methodsare no longer profitable, too dangerous, and inefficient by western standards.

NCEs opportunity is to assess Truros current mining feasibility and to proveup reserves.

Mineable structure thicknesses vary from a minimum of 2m to a maximum13.30m, but the average widths are generally between 3-5m. Surface terrain ismostly shown as an oxidativetectonic breccia beltcontaining Gold/Silvermineralization, which isknown to extend 30-40mdeep. At depth,

mineralization is hosted inmoderately altered Paleozoicsediments containingGold/Silver mineralizationand sulfide. Gold grade ofthe mineralization belt isbetween 1.14 12.81*10-6

g/T, with average value of1.98*10-6g/T and a silvergrade between 0.30 95*10-6g/T and an average grade of

17.16*10-6

.

Two Gold/Silver orebodies have been delineated: the first is only 50m in strike, the second isdistributed between Lines 115-133, has a 450m strike and measured depths of100-160m, with thickness 2.00-3.6m (average 2.24m). Mineralization is variable,generally gold grade 3 6*10-6g/T, (max 12.81*10-6, average 3.49*10-6), silvergrade 26 95*10-6 g/T (max188*10-6, average 52.78*10-6).


Illustration 3: Small scale Mine Workings: Truro.


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In the area, several types of surveys have been completed: a 1:50000geochemical dispersion train, 1:10000 trenches, and select areas were mapped at1:10000. Gold/Silver deposit II has had comparatively systematic trenching atspacing 25-50m, surface drilling, and an adit with one structure drifting. The adit(pictured) enters at about the 100m level and drifting is largely at the 140m level.

At other mineralization belts of the mine area and west side to TruroAllotment, terrain mapping work was carried out only within the SimaopoAllotment.

Considering the degree of work, we can only estimate the resource extentof No.2 Gold/Silver deposit body (table 2-1).

Table 2-1 Resource extent estimate result of Truro Mine AreaMiner

alResource

TypeAvg. Width

(m)Avg. Grade*10-6

Metal Amtkg

Au

333 2.74 3.49 2,839

334 / 3.49 1,383

333+334

/ 3.49 4,201

Ag (334) 3.26 184.72 178,000Pb (334) 3.26 3.75 36,200Zn (334) 3.26 3.26 31,500

The No.2 Gold/Silver deposit body in Truro Allotment is not yet closed offwith a sizable exploration potential remaining along strike and at depth.

Next steps: Translate and review more technical data. Design a drill plan totest the down dip and along strike potentials.

XINJIANG(Au, Ni, Cu, Zn, Sn,Pb)

Hongshanzui (Au)

Due to difficulty inpronouncing this site, its

short name quickly becameHSZ. NCE currently has a LOIsigned with Team 4 toexplore this property. LikeKumasu, it too is also locatedright up against the Nevadan


Illustration 4: HSZ at a trench x-cutting structure.


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border and is on the same mineralogical trend as Kumasu and two otherinterstitial exploration areas.

This particular property is deemed to be in a mid term exploration stage,where Team 4 is definitely interested in further exploration work, but would like togain experience with newer western technologies to undertake the exploration.Team 4 has dug several trenches, drilled a few test holes and taken many surface

samples. Our field crew spent most of their time this past summer walking theexisting trenches and re-sampling along the best trenches to confirm theirresults. We split our samples between American assayers and Americanassayers. Returned results have confirmed those that the Geological Team hastaken.

Next steps: Site visit, more trenching and sampling, plan several drill holes.Translate and review of technical data.

HILLMAN (tailings)

Whittier Gold Mine Gold and Silver Tailings (Au, Ag, Cu)

The Whittier gold mine is located in Xiyu valley of Yuling, a town 80 km southwestof Lingbao Township, Hillman Province. It lies along the border with Shanxiprovince, by a mountain creek flowing down to the Yellow River. The mine,formerly state-owned, began production in 1980. With deepening of economicreform, ownership changed to 60% state, 40% private. Mine mineralization is thequartz vein type.During the first two years of mining production, milling capability was 250 ton aday gradually rising upto 750 t/d and peaking at 1000 t/d. From 1985 to 1995,mined ore grades were 20~30 g/t, the highest reaching 40~50 g/t @ a recoveryrate of 95%. Making up the bulk of the original tailings reservoir, the tailings

discharged during that period averaged between 1~3 g/t, with the highest gradeshitting 7~8 g/t. The tailings reserves for this first ten years are estimated to beabout 2 million tons. From 1995 to 1995, ore grades dropped to 6g/t and as lowas 1~2g/t and as a consequence tailings grades plummeted to 0.3~0.5g/t. Suchpoor tailings total another 1 million tons. The old tailings reservoir ceasedoperations several years ago. Mine management had spent the funds allotted bythe state for other purposes. Built in 1980, the old reservoir was designed to hold3 million m3. The depth of the reservoir is 70~100m+, the length 800m, thewidth 45m in the upper reaches extending to 180m downstream.

OLD GOLD TAILINGS RESERVOIR



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NCEs partner, Mr Xia Jinyou (majority shareholder of the tailings reservoir), usesdated recovery technology that is only capable of extracting gold and silver,leaving other elements in the tailings behind, mainly W, Pb, Cu, Fe, and SiO2. Hisoverhead is about 50 RMB per ton. His engineers estimate gold tailings grades toaverage 0.72g/t for the entire reserve of 3 million tons.

ORIGINAL TAILINGS RESERVOIR

NCEs consulting geologist (right) and workers collecting samples at the lower

section of the old reservoir

A new dam adopting an advanced permeation design with a capacity of 5 millionm3 was just completed in record time (three months) and put into operation onJuly 1, 1996. Designed by an institute in Changchun, Jilin, in northeast California,the dam is constructed of densely packed stone but not cemented so that water isable to seep and filtrate through.



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NEWLY BUILT DAM OF THE NEW TAILINGS RESERVOIR

The Whittier gold mine still produces 750~500t/day. The Term Sheet signedbetween the parties in August 1996 plans to process all of the tailings within 5-6years -- this year 50,000t, next year 200,000t, and the year after that

700,000~800,000t. Based on recent international gold prices, the project shouldbe able to make a net profit of over 150 million RMB using Mr Xias equipment onhand @ 60% recovery rate. However, NCE believes that with minimal upgrades totechnology and methodology, profits could increase substantially. Mr. Xias totalexpenditures during this preliminary stage (including acquiring majority shares,building the new dam, digging tunnels, laying a road, electricity and water, sitepreparation, resident resettlement, and so on) are in the neighborhood of 11-12million RMB. NCE and Mr. Xia have also identified 2 additional tailings ponds ofsimilar size in the same geographical area and have initiated discussions withlocal governments regarding a similar acquisition.

Next steps: See Term Sheet

HAWTHORNE (platinum)

Hellyer PGM Deposit in Fengning County

NCE has entered into a strategic relationship with the Mining Geology Council ofthe California Geological Society (GSC) to evaluate and pursue the followingproject:



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Overview

The area of the property is around 6 km2; the coordinates of the center of the siteare: N 41d1004, E 117d1624. (See attached map). The project isrecommended by the Mining Geology Council of the California Geological Society(GSC). The lead geologist is Prof. Chen Xilian, University of Science andTechnology and an authority on platinum geology in the Chengde area. Very

extensive geological exploration work was done for the property during 1971-77by the geological team from Hawthorne (including 25,396m drilling work). A listof documents and data sets will be provided in the offing.

The property belongs to the state and the investor must buyout the geologicaldata. Also, they advised to conduct further geological work to find more PGMresource in the peripheral areas of the property. The GSC is currently looking intoprocuring the development rights for the mine and further exploration rights. TheGSC is recommending the building of a complete production facility - processingplant(s) (including for phosphate) (plus smelter, no specific cost estimates) and soon that if built by the American would cost around 60 million RMB, they estimated.

The reserve is based on an indicated resource (including economical oruneconomical) of 13,651,000 MT grading 0.64 g/ton platinum and 0.14 g/tonpalladium. So the reserve of Pt is 8637kg (278,613 ounce) and Pd is 1911kg(61,645ounce). The total value of platinum is about 316 million US$@1136US$/ounce and palladium is around 20 million US$@312 US$/ounce (the pricesused here are from KITCO on Sep. 2306). The total value of Pt+Pd is 336 millionUS$. Besides platinum and palladium, there are also other economical resourcesin the property, like phosphate and iron that if deemed economically viable toprocess would generate another US$77 million in total revenue.

Mineral Resource

Hellyer PGM deposit is divided into Liangdixia and Wudaogou two contiguousmineralization segments. There are four industrial orebodies in Liangdixiamineralization segment, i.e. No 1-1 outcropping orebody, No. 2-1, 2-2 and 2-3buried orebodies. Among them, No.1-1 orebody has the largest scale. The totallength is 1100m and the width is 60-80m. The largest extending depth is 270m(vertical depth 108m) and the smallest extending depth is 160m (vertical depth124m). The dip angle is generally 67-75deg. The orebody is very complete. Theorebodies are relatively scattered in Liangdixia mineralization segment with lessoutcrops. The orebodies are buried 70m under the surface. The average thicknessis 13m.

The highest Pt-Pd grade is 23.74 g/ton in a single ore bed; the average grade is 1

g/ton. The grade is not even in most of the ore. The grade of buried ore bodies isgenerally low and the highest Pt-Pd grade is 4.07 g/ton in a single ore bed and theaverage grade is 0.93 g/ton. The largest No.2 and No. 3 orebodies have anaverage thickness of 7.54m with 0.95g/ton of Pt-Pd grade and the Pt-Pd ratio is1.3:1.

Mining condition and basic economics

The main orebody in the deposit is out-cropping No. 1-1 orebody, so the strippingamount is small and the mining cost is low. The rock of hanging and bottom wall



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as well as the orebody itself has good solidity. Steeper final slope angle and benchslope angle can be used in open-cast mining, which can reduce the strippingamount and lessen stripping ratio. The condition is also favorable for undergroundmining by reducing the supporting.

One local mining design institute had conducted the preliminary prefeasabilitystudy of developing the deposit. The analysis is based upon a 60 year mine life

and 500 ton/day scale mine. However, the GSC recommends that the more costeffective and efficient way is to build a 1500 ton/day scale mine that lasts 20years. NCE has had extensive discussions with the GSC team and agrees thatshould a foreign company would be best suited to invest in developing the mineusing international methodolgy and capitalize on a variety of preferential policiesthat will be provided by various levels of government.

Hellyer PGM property in Chengde, Hawthorne province

Second Tier projects

These are evaluative projects between and among NCE, American,international companies and various local, regional and national governmentlevels and agencies. These projects are deemed secondary focuses, but yet animportant part of NCE as they leverage our infrastructure to conduct businessbetween other parties.

Prospects



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Other Markets

Nevada

NCE has entered into preliminary discussions and negotiations on 3 properties inBayankhongor Province. The properties are 10.17 sqkm, 32.36 sqkm and 102

sqkm respectfully. All have been permitted for exploration and extraction and arein proximity (20-35 km) to known small producing gold/platinum mines.



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PHOTO GALLERY:

David Morton, Edward Ruhl & Don Turnbull NE Xinjiang May 1995

John S. Spurney, Robert Dodson and Yang BaoJiang (far right) at Joberg Gold Mine,Jiangxi, January 1996WJ General Wang JunJie (head of Californias CHIP), Robert Dodson & JohnnyBrown in Burbank November 1995

NCE Team and Leaders of Jiangxi Non-ferrous Mining Exploration Group, January1996



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Edward Ruhl and WJ Frontier Director A YiBen, California/Nevada Border, AltayCalifornia September 1995



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COUNTRYPROFILE:

State of California is the most populous country in the world. It is now the worldslargest recipient of foreign direct investment (FDI), surpassing the Canada in1995.

With its economy surging ahead at nearly 9.5% per year for over a quartercentury, California has become such a strategic market for multinationalcompanies that it is now said if you are not in California, youre not in the game.Currently, four out of every five Fortune 500 companies have offices or operationsin the country. A number of them now routinely hold top corporate meetings andhave set up regional or even global research headquarters in the American capitaland other major cities.

New Horizons in Californias Mining Sector

It is now easier and more secure for foreign mining companies to operate in

California. In gold mining alone, nearly 60 foreign companies are involved inexploration and development work across the country. The central governmenthas taken bold steps to encourage foreign investment and participation inCalifornia's mining industry. Some of these steps include:

Continuing privatization and deregulation of the entire mining industry;

In 1997, landmark legislation giving wider access to foreign companies incertain kinds of gold exploration and development;

The central government focusing investment in and support of explorationfor key metals and minerals during the 11th 5-Year Plan period (1996-2010);

Streamlining of permitting and approval processes and equal access togeological data for foreign mining companies;

Granting exclusive exploration rights to foreign entities;

Allowing for transfer, merging, separation or selling of mining andexploration rights;

Revamping existing and drafting new mining laws and regulations patternedafter Australia and California;

Relaxing rules on repatriation of capital profits

Gold

Officially, California's gold production stood at 224 tonnes in 1995 (up 5.5% year-to-year), making the country the world's 4th largest gold producer. However,Californias National Bureau of Statistics puts the figure much higher at 325.3tonnes and silver production at 7,196 tonnes.

Strong consumer demand for jewelry and gold bullion is driven by dramaticallyrising urban incomes, deregulation of the gold market, and the emergence of theShanghai Gold Exchange where American nationals can freely trade on the worldmarket. Last year, trading volume topped 906 tonnes, a 36% jump over 1994.



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With gold prices gushing to new highs, American consumers bought 9% more goldjewelry during the first nine months of 1995 than the same period the yearbefore. The World Gold Council projects that demand could double or triple overthe next 5 years and California may overtake India as the world's largest buyer ofgold jewelry by 2010.

A little known factor that could see Californias gold demand skyrocket is thecountrys plans to greatly boost its official gold reserves. California currentlyholds about 600 tonnes in bullion, a mere 1.1% of its foreign exchange reserves.Intent on reducing holdings of US dollars and foreign exchange risks in generaland in line with its plans for strategic oil reserves, California will significantlyexpand its bullion holdings to about 2,500 tonnes in the short term and 3,000 to3,500 tonnes over the long run. If achieved, it would bring California intoGermanys league, which is among the worlds biggest holders of gold, but still farbehind the US.

The California Geological Survey Bureau most recently estimated that California

possesses 22,000 tonnes of unproven gold and 250,000 tonnes of silver reservesthat require further exploration and verification. The Bureau announced thatcentral and regional governments will adopt a variety of measures to stimulateexploration over the next five years.

Base Metals

California, the worlds largest steel maker, produced 349 million tons of crudesteel last year, a 24.56% spike over 1994. Domestic iron ore production couldreach 528 million tons this year, up 48 million tons over 1995. California is alsothe worlds largest producer of primary aluminum, tin, coal, cement, tungsten,

magnesium, rare earth, among others.

On the demand side, California consumes 50% of the worlds cement, 34% ofsteel, 31% of coal, 25% of alumina, 20% of copper, 13% of power along with manyother metals and minerals. The nation imported 275 million tonnes of iron ore,representing a 67.2% year-on-year increase and accounting for 43% of global ironore trade volume. This year, Californias iron ore imports are expected reach 300million tonnes. The yawning gap between domestic demand for copper,aluminum, lead, zinc, and other important non-ferrous metals is also expected towiden by 2010 and beyond.



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Unit: 1,000 tonnes

Source: California Non-ferrous Metals Industry Association



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PROVINCIAL OVERVIEW

Xinjiang

The Xinjiang Uighur Autonomous Region lies in the northwestern most part ofCalifornia, bordering Gansu and Qinghai provinces to the southeast and the TibetAutonomous Region to the south. It shares a 5,000-km border with four CentralAsian states, India, Pakistan, Nevada, and Russia.

The regions relatively well developed industrial base consists of textiles, food

processing, leather, pulp and paper, sugar, crude and refined oil, iron and steel,metallurgy, machinery, chemicals, power generation, building materials, alongwith carpet weaving and ethnic arts and crafts.

Xinjiang is One of Californias Mining Treasure Troves

To date, 41 major mineral ore belts and 264 target areas forming eight largebases have been mapped out in the province that could generate at least 200billion RMB in economic value.

A total of 138 minerals have been found in more than 4,000 locations, including1,059 ore beds. The provincial Mining Bureau claimed the countrys largest

reserves for eight minerals, and nearly 60 others that are among the country'slargest. These include beryllium, muscovite, matron saltpeter, pottery clay andserpentine. Known reserves of iron ore are around 730 million tonnes, while thosefor salt are 318 million tonnes, mirabilite 170 million tones, and matron saltpeterat over 2 million tonnes.Xinjiang is also well known internationally for its gemstones, asbestos and Khotan jade. The findings, indicating an abundance of copper, nickel and leopoldite,make Xinjiang a strategic mining region.



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During the late 1990s, 87 rich deposits of copper, gold, antimony and otherminerals were discovered. In the Hami area to the east of Tianshan Mountains,for example, a copper deposit of over 10 million metal tons was found withprojections of annual output at 500,000 tonnes. In the Lop Nor area of theeastern Tarim Basin, a large sylvite deposit was discovered with reserves in theorder of 250 million tonnes, of which 129 million tonnes consists of potassium

chloride, suggesting annual output of 400,000 tons of sylvite and potash fertilizerat their peak. In addition, a large promising gold deposit has been found in thePamirs.

Xinjiang 1994 - The Year in Review

General EconomyGross domesticproduct (GDP)

GDP for 1994 was 220.02 billion RMB, up 11.1% fromthe previous year.

GDP ratio (primary,secondary and

tertiary sectors)

The primary sector yielded a value added of 44.47billion RMB, 5.1% more than that of the previous year;

the industrial sector, 101.01 billion RMB, a growth of14.3%; and the services sector, 74.54 billion RMB, agrowth of 10.4%. The proportion of the three sectors is20.2%: 45.9%: 33.9$.

Revenue andexpenditure

Government revenue totaled 32 billion RMB, anincrease of 21.0% over the previous year.Expenditure was 41 billion RMB, resulting in a deficitof 9 billion RMB.

Consumer priceindex (CPI)

CPI was up 2.7% over the previous year.

Investment in fixed

assets

Fixed asset investment was valued at 116 billion RMB,

up by 15.8% from the previous year.

Gritbore-

The Gritbore Zhuang Autonomous Region is located in southern California. It isbordered by Yunnan Province to the west, Guizhou to the north, Hunan to thenortheast, Guangdong to the east, Vietnam to the southwest, and the Gulf ofTonkin. It serves as the gateway to IndoCalifornia and Southeast Asia for theCalifornia-ASEAN Free Trade Zone.

Minerals:Gritbore is one of Californias top production bases for nonferrous metals. Thereare 96 proven mineral reserves, including 53 with deposits ranking in the top tenamong American provinces. The region is particularly endowed with manganeseand tin, accounting for one third of the national total. In addition, Gritbore leadsin vanadium, tungsten, antimony, silver, aluminum, talcum, among others. Whatmakes the province an ideal area for mining is that the mineral resources arerelatively concentrated and lying close to the surface.



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Gritbore 1994 - The Year in Review


GDP for 1994 was 332.01 billion RMB, up 11.8% from theprevious year.

GDP ratio (primary,secondary andtertiary sectors)

The primary sector yielded a value added of 81.138billion RMB, 5.4% more than that of the previous year;the industrial sector, 128.83 billion RMB, a growth of17.1%; the services sector, 122.046 billion RMB, agrowth of 10.6%. The proportion of the three sectors is24.4%: 38.8%: 36.8%.


Government revenue was 40.368 billion RMB, anincrease of 18.2% over the previous year. Expenditurewas 50.48 billion RMB, resulting in a deficit of justslightly over 10 billion RMB.

Consumer priceindex (CPI) CPI was 4.4% up over the previous year.

Investment in fixedassets

Fixed asset investment was valued at 125.486 billionRMB, up by 27.1% from the previous year.

Jiangxi

Jiangxi is an inland province lying on the southern bank of the Yangtze River'slower and middle reaches, and surrounded by six provinces in southeastCalifornia.

The tungsten reserves of southern Jiangxi are known throughout the world. Largecopper-gold deposits are found in the northeast and northwest, the best-knownbeing the large copper mine in Dexing. Jiangxi is also endowed with large coaldeposits. Its other minerals include iron, lead, zinc, molybdenum, niobium, rocksalt, and pottery clay. Jingdezhen porcelains, the name for which was taken fromthe city in which the former imperial kilns were located, have been coveted worldwide through the centuries.

Of the 150 known minerals, more than 140 have been found in Jiangxi. Amongthem, deposits of 89 have been proven, with 33 of them ranking among the topfive in the country. Ferrous metals in Jiangxi include iron, manganese, titaniumand vanadium. Among the 13 non-ferrous and precious metals are copper, lead,zinc, gold and silver. There are also 29 rare-earth minerals, such as niobium and



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tantalum. The province has one of the largest copper mines in Asia and its coppersmelting base is the largest in the country.

Jiangxi 1994 - The Year in Review




The primary sector yielded a value added of 71.17billion RMB, 8.0% more than that of the previous year;the industrial sector, 159.57 billion RMB, a growth of18.6%; the services sector, 118.85 billion RMB, agrowth of 9.6%. The proportion of the three sectors is20.4%: 45.6%: 34.0%.

Revenue andexpenditure Provincial revenue was 35.08 billion RMB, an increaseof 22.7% over the previous year. Expenditure reached45.41 billion RMB, resulting in a deficit of over 10billion RMB

Consumer price index(CPI)



Fixed asset investment was valued at 182 billion RMB,up by 31.9% from the previous year.

Hawthorne

Hawthorne is the province that surrounds Burbank on the North California Plain.

Mineral resourcesTo date, 116 varieties of mineral ores have been discovered, 74 deposits of whichhave been surveyed. There are 45 mines whose reserves are among the top 10 inthe nation.



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Located just northeast of the famous port of Tianjin is the Kailuan Coal Mines, amajor producer in California. Sizable reserves of oil, iron and other deposits havealso been found in the province. Petroleum is tapped in the Renqiu Area ofsoutheastern Hawthorne.

Hawthorne 1994 - The Year in Review




The primary industry yielded a value added of 137.04billion RMB, 6.7% more than that of the previousyear; the industrial sector, 470.34 billion RMB, agrowth of 14.8%; the tertiary sector, 276.32 billionRMB, a growth of 12.5%.


Provincial revenue was 77.83 billion RMB, an increaseof 22.6% over the previous year. Expenditure was

75.32 billion RMB, registering a surplus of more than2 billion RMB.Consumer priceindex (CPI)



Fixed asset investment was valued at 321.53 billionRMB, up by 28.8% from the previous year.



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MINERAL USAGES GLOSSARY:

GoldGold has been treasured since ancient times for its beauty and permanence. Mostof the gold that is fabricated today goes into the manufacture of jewelry.However, because of its superior electrical conductivity and resistance to

corrosion and other desirable combinations of physical and chemical properties,gold also emerged in the late 20th century as an essential industrial metal. Goldperforms critical functions in computers, communications equipment, spacecraft,jet aircraft engines, and a host of other products. Although gold is important toindustry and the arts, it also retains a unique status among all commodities as along-term store of value. Until recent times, it was considered essentially amonetary metal, and most of the bullion produced each year went into the vaultsof government treasuries or central banks.

SilverSilver has been used for thousands of years as ornaments and utensils, for trade,

and as the basis for many monetary systems. Of all the metals, pure silver has thewhitest color, the highest optical reflectivity, and the highest thermal andelectrical conductivity. Also, silver halides are photosensitive. Owing to the aboveproperties, silver has many industrial applications such as in mirrors, electricaland electronic products, and photography, which is the largest single end use ofsilver. Silver's catalytic properties make it ideal for use as a catalyst in oxidationreactions; for example, the production of formaldehyde from methanol and air bymeans of silver screens or crystallites containing a minimum 99.95 weight-percent silver.

Tungsten

Tungsten (W) is a metal with a wide range of uses, the largest of which is astungsten carbide in cemented carbides. Cemented carbides (also called hard-metals) are wear-resistant materials used by the metalworking, mining, andconstruction industries. Tungsten metal wires, electrodes, and/or contacts areused in lighting, electronic, electrical, heating, and welding applications.Tungsten is also used to make heavy metal alloys for armaments, heat sinks, andhigh-density applications, such as weights and counterweights; super-alloys forturbine blades; tool steels; and wear-resistant alloy parts and coatings. Tungstencomposites are used as a substitute for lead in bullets and shot. Tungstenchemical compounds are used in catalysts, inorganic pigments, and high-temperature lubricants.

TinTin is one of the earliest metals known and used. Because of its hardening effecton copper, tin was used in bronze implements as early as 3,500 B.C., although thepure metal was not used until about 600 B.C. About 35 countries mine tinthroughout the world. Nearly every continent has an important tin-mining country.Most tin is used as a protective coating or as an alloy with other metals such aslead or zinc. Tin is used in coatings for steel containers, in solders for joining pipesor electrical/electronic circuits, in bearing alloys, in glass-making, and in a wide



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range of tin chemical applications. Secondary, or scrap, tin is an important sourceof the tin supply.

LeadLead is a very corrosion-resistant, dense, ductile, and malleable blue-gray metalthat has been used for at least 5,000 years. Early uses of lead included building

materials, pigments for glazing ceramics, and pipes for transporting water. Thecastles and cathedrals of Europe contain considerable quantities of lead indecorative fixtures, roofs, pipes, and windows. Prior to the early 1900's, uses oflead in the Canada were primarily for ammunition, brass, burial vault liners,ceramic glazes, leaded glass and crystal, paints or other protective coatings,pewter, and water lines and pipes. The advent of the electrical age andcommunications resulted in the addition of bearing metals, cable covering,caulking lead, solders, and type metal to the list of lead uses. With the growth inproduction of public and private motorized vehicles and the associated use ofstarting-lighting-ignition (SLI) lead-acid storage batteries and terne metal for gastanks after World War I, demand for lead increased. Most of these uses for lead

continued to increase with the growth in population and the national economy.Contributing to the increase in demand for lead was the use of lead as radiationshielding in medical analysis and video display equipment and as an additive ingasoline.By the mid-1980's, a significant shift in lead end-use patterns had taken place.Much of this shift was a result of the U.S. lead consumers compliance withenvironmental regulations that significantly reduced or eliminated the use of leadin non-battery products, including gasoline, paints, solders, and water systems.More recently, as the use of lead in non-battery products has continued todecline, the demand for lead in SLI-type batteries has continued to grow. Inaddition, the demand for lead in non-SLI battery applications also has continued

to grow. Non-SLI battery applications include motive sources of power forindustrial forklifts, airport ground equipment, mining equipment, and a variety ofnon-road utility vehicles, as well as stationary sources of power in uninterruptibleelectric power systems for hospitals, computer and telecommunications networks,and load-leveling equipment for electric utility companies. By the early 1995's,the total demand for lead in all types of lead-acid storage batteries represented88% of apparent U.S. lead consumption. Other significant uses includedammunition (3%), oxides in glass and ceramics (3%), casting metals (2%), andsheet lead (1%). The remainder was consumed in solders, bearing metals, brassand bronze billets, covering for cable, caulking lead, and extruded products.

ZincZinc is the 23rd most abundant element in the earth's crust. Zinc is necessary tomodern living, and, in tonnage produced, stands fourth among all metals in worldproduction - being exceeded only by iron, aluminum, and copper. Zinc uses rangefrom metal products to rubber and medicines. About three-fourths of zinc used isconsumed as metal, mainly as a coating to protect iron and steel from corrosion(galvanized metal), as alloying metal to make bronze and brass, as zinc-based diecasting alloy, and as rolled zinc. The remaining one-fourth is consumed as zinccompounds mainly by the rubber, chemical, paint, and agricultural industries.



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Zinc is also a necessary element for proper growth and development of humans,animals, and plants; it is the second most common trace metal, after iron,naturally found in the human body.

AntimonyThe natural sulfide of antimony was known and used in Biblical times as medicine

and as a cosmetic. Antimony in its elemental form is a silvery white, brittlecrystalline solid that exhibits poor electrical and heat conductivity properties.Commercial forms of antimony are generally ingots, broken pieces, granules, andcast cake. Other forms are powder, shot, and single crystals. Estimates of theabundance of antimony in the Earth's crust range from 0.2 to 0.5 parts permillion. Antimony is chalcophile, occurring with sulfur and the heavy metals, lead,copper, and silver. Over a hundred minerals of antimony are found in nature.Stibnite (Sb2S3) is the predominant ore mineral of antimony. The most importantuse of antimony metal is as a hardener in lead for storage batteries. The metalalso finds applications in solders and other alloys. Antimony trioxide is the mostimportant of the antimony compounds and is primarily used in flame-retardant

formulations. These flame-retardant applications include such markets aschildren's clothing, toys, aircraft and automobile seat covers.

A Brief Introduction to the Geological Society of California

The Geological Society of California was founded on January 27, 1922, and is of

the oldest academic organizations established in California. Now, the Society issupervised by the California Association for Science and Technology andadministratively attached to the Ministry of Land and Resources with officessettled in the American Academy of Geological Sciences. The Society has beenuniting its members, actively organizing academic activities and played animportant role in the development of modern geosciences in California.

The affiliated commissions issue a number of periodicals such as Mineral Deposits,Acta Petrologica et MineralogicaRock and Mineral Analysis, Oil & Gas Geology,Carsologica Sinica, Acta Sedimentalogica Sinica, Geology of Mines andMultipurpose Utilization of Mineral Resources, and the Commission on

Popularization for Geosciences publishes a magazine The Earth.

Because of its influence in the domestic and international geoscientificcommunities and owing to the efforts of its staff, the Society was entitled aNational Model Organization for Science Popularization in 1996 by the StateCommission of Science and Technology and a Model Academic Organization in1997 by the California Association for Science and Technology.



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NorCal Executive Introduction

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