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| | Bakoudou-Magnima Property Status In July 2005, the Company signed a strategic CAD 4,200,000 joint venture agreement with Managem on the 2,318 km² Bakoudou-Magnima Gold Project in Gabon which consists in the 24 km² Bakoudou exploitation permit and the 2,294 km² Magnima exploration permit. The terms of the JV agreement are as follows: Managem can earn 54% of SearchGold's 90% initial interest through the execution of CAD 1,200,000 cash payment and work commitments of CAD 3,000,000 over a 2-year period; an additional 9% by completing a bankable feasibility study and an additional 4.5% by arranging, if requested by SearchGold, the financing through to production for SearchGold. Managem is the project operator and exploration and development programs are determined jointly by both SearchGold and Managem through a 4-member management committee composed of two members of each party. Managem has now acquired a 54% in the project. Once the bankable feasibility study is finalized, Managem will have acquired an additional 9% to hold a 63% interest in the project. A remaining carried 10% interest is held in the project by a local partner. Regional Context Bakoudou-Magnima is located in south-eastern Gabon, near the border with Congo-Brazzaville and sits approximately 55 km southwest of the Country's second largest city, Franceville. The area is accessible by a main road and a well developed network of forestry roads insures easy access to virtually all parts of the property. Comilog is a major mining company active in the area and its main operations are located 45 km north of the project in Moanda. Moanda is an important manganese mining center as the deposits presently under exploitation represent approximately 25% of the world's known reserves. The local population is therefore mining-friendly and mining supplies and a skilled work force are available. Archean rocks underlie approximately 50% of Gabon's territory. The potential for gold is severely undeveloped and SearchGold Bakoudou-Magnima Project represents the most advanced gold project in Gabon. The Bakoudou deposit is a classic vein-type deposit hosted in the Achaean Chaillu massif which is dated at 2 650 Ma. The principal rock type at the level of the Bakoudou Permit consists in tonalitic gneiss. The major lithological characteristic of the area is the Magnima greenstone belt located on the Magnima Permit. It shows a NNE orientation, a width of about 5 km and is composed principally of mafic and felsic gneisses, quartzites and iron formations. Rocks are metamorphosed to the amphibolite facies and mafic and felsic gneisses where most likely derived from the mafic and felsic rocks. Work History Work has been carried out in the Bakoudou area since the early eighties by essentially two parties; the French (Mostly Comilog and BRGM for regional studies) and Golden Gram Gabon / SearchGold. When SearchGold reactivated the Project in 2003 sufficient geological and metallurgical information was available to initiate a scoping study. Zone A, located at the southern extremity of the Bakoudou Gold Corridor, was chosen by SearchGold to be the object of the scoping study because the density of information (drilling and pits) was sufficient and reliable enough to provide a reasonable estimate. A mandate was given to Met-Chem Canada Inc. to execute such a scoping study. The study identified, on Zone A, an oxide resource of 165,412 oz Au comprising 2,100,000 metric tons at a grade of 2.45 g/t Au in the measured and indicated categories and a sulfide resource of 111,968 oz Au comprising 570,000 metric tons at a grade of 6.11 g/t Au in the measured and indicated categories (The combined oxide-sulfide measured and indicated resource stands at 277,380 oz Au). The full details are available in the document titled "Met-Chem Scoping Study on Bakoudou Gold Deposit". Once this study was finalized and clearly recommended the execution of a bankable feasibility study, SearchGold established a logistical / operational base in Bakoumba (closest town to Bakoudou) and mobilized the drilling equipment from Canada to Gabon. Up to the signature of the joint venture with Managem, SearchGold's main objective on the Project was to advance the bankable feasibility study on Zone A targeting the oxide part of the deposit. The bulk of the work therefore consisted in diamond drilling. In February 2005, an exploration program was initiated and allowed the confirmation of a 3km mineralized corridor. A summary of the technical information relative to the 2003 - 2005 period is are available in the document titled "Bakoudou Technical Summary". * Readers are cautioned that while the resource estimate was executed in conformity with the recommendations of norm 43-101, the Conceptual Study Report by Met-Chem does not constitute a Technical Report as all resource estimates are based on prior data and reports obtained and prepared by previous operators. The conceptual study was executed for the sole purpose of deciding to undertake a 43-101 compliant feasibility study. The conceptual resource estimates should therefore not be relied upon and SearchGold is not treating the mineral resource estimates as a National Instrument 43-101 defined resource verified by a qualified person. Exploration Works Completed by Managem Since Joint Venture Signature in 2005 Work on Bakoudou Permit The soil geochemical survey carried out on Bakoudou has now allowed the full definition of the Bakoudou gold soil anomaly over a length of 2.5 km. The results show the presence of a strong, continuous peak located 1.7 km north-north-west of Zone A at the northern end of the anomaly. The highlights of this anomalous peak are:
Drilling started in November 2006 and on March 13th 2007, SearchGold provided an update on the drilling campaign presently in progress on its Bakoudou-Magnima Gold Project, the highlights of which included :
These results confirmed the widths and grades previously obtained while extending the area of known mineralization. Work on Magnima Permit The initial results of the stream geochemical survey carried out on Magnima have so far outlined three new gold bearing areas within a 10 km radius of Bakoudou's Zone A.
Latest Developments In late May 2007, SRK Consulting (Canada) Inc. (« SRK ») was appointed for an engineering mandate. SRK will act as SearchGold's Consulting Engineer to monitor the progress of the feasibility study presently in progress on Zone A. A first site visit by SRK and SearchGold's management was executed in June 2007 in Gabon and was followed by technical meetings in Morocco. In early July 2007, SearchGold provided an update on the drilling program on Zone A. A total of 37 holes have been executed since Managem has resumed drilling activities and the program is continuing uninterrupted with two drills testing the extensions of the mineralization defined to date. The highlights of the recent results are: 1 - Extension and thickening of Zone A at depth as demonstrated by the following mineralized intervals:
2 - Extension of Zone A towards the north-west as demonstrated by the following mineralized intervals obtained 50m to the north-west of the previous SearchGold drill holes:
Managem's recent drilling almost systematically reached the fresh rock and, along with the observed thickening of Zone A towards the south in the oxide zone, persistent mineralization in the sulfide zone was recorded on wider intervals than previously recognized in Met-Chem's conceptual study. An increase in the gold grade in the fresh rock was also observed in Managem's holes BA06-12 (14.22 g/t Au over 2.0m from 105.0m to 107.0m) and BA06-04 (11.98 g/t Au over 5.4m from 100.1m to 105.5m). In the light of these observations, it appears that the oxide part of Zone A would be the starting point of a mining operation with the opportunity to extend its mine life with the fresh rock mineralization. Exploration is also progressing well at the regional level. As of July 2007:
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