RNS Number:0190N
Mano River Resources Inc
01 July 2003


                           MANO RIVER RESOURCES INC.

                                  NEWS RELEASE

1 July 2003
No: 2003/13


TSX-Venture Exchange (Trading Symbol: MNO)
London Stock Exchange - AIM (Trading Symbol: MANA)


                   PUBLICATION OF FIRST QUARTER 2003 ACCOUNTS

The Board of Mano River Resources Inc. is pleased to release the Accounts of the
Company for the quarter ended April 30th 2003, together with the Management
Discussion & Analysis.

On behalf of the Board of Mano River Resources Inc.

Tom Elder
President and CEO

For further information on Mano River Resources and its exploration programme,
you are invited to visit the Company's website at www.manoriver.com or contact
one of the following:

Tom Elder             President and CEO                  UK +44 (0) 1235 810 740
Guy Pas               Co-Chairman                    Switzerland +41 22 758 2151
Anthony Rhatigan      Co-Chairman                    Mobile +44 (0) 7785 297 348
Raz Hussein           Controller                        Canada +1 (604) 689 1700
Gary Middleton        Britton Financial PR               UK +44 (0) 20 7251 2544

 The TSX Venture Exchange has not reviewed and does not take responsibility for
                    the adequacy or accuracy of this release

                           MANO RIVER RESOURCES INC.

                                  Schedule 'C'

                       MANAGEMENT DISCUSSION AND ANALYSIS

                    for the Quarter Ending April 30th, 2003

The Consolidated Financial Statements for Mano River Resources Inc. ("Mano" or
the "Company") covering the quarter ending April 30th, 2003 are provided herein
for your review.

DESCRIPTION OF BUSINESS

Mano River Resources Inc is engaged in the acquisition, exploration and
development of gold and diamond properties. The Company, through its
subsidiaries, holds interests in properties located in Liberia, Sierra Leone,
Guinea and Canada.

OPERATIONS AND FINANCIAL CONDITION

For the quarter ended April 30, 2003, the Company incurred a net loss of $74,993
as compared to a net loss of $87,216 for the corresponding quarter in 2002. This
is a $12,223 decrease in net loss compared to 2002. This was due to a reduction
in operating expenses which were $76,846 for Q1 2003, compared with $91,268 for
Q1 2002. The decrease of $14,422 over 2002 was due to a decrease in management
fees and other administrative cost savings. Revenue for the quarter, consisting
of interest income, was $1,853 as compared to $4,052 in 2001, a decrease of
$2,199. Total assets on April 30, 2003 were $12,390,528 as compared to
$12,253,662 at year ended January 31, 2003. As at April 30, 2003, the Company
had total current liabilities of $614,718 as compared to $924,503 for the same
period in 2002, the reduction having been achieved as a result of a Shares for
Debt Scheme finalised in May 2002. Current liabilities includes $512,347 due to
related parties for management fees, bridging loan and reimbursable expenses.

As at April 30, 2003, the Company had cash and cash equivalents of US$129,101 as
compared to US$42,541 for the same period in 2002. The Company had as at April
30, 2003 working capital deficiency of $467,706 as compared to $879,461 for the
same period in 2002.

The Company's ability to continue its operations is dependent on its capacity to
secure additional financing in the near term and, while it has been successful
in doing so in the past, there can be no assurance it will be able to do so in
the future. In order to continue developing its mineral properties, management
is actively pursuing such additional sources of financing.

EXPLORATION AND PROJECT DEVELOPMENT

Exploration activity during the quarter under review was focused on gold and
diamonds in Sierra Leone.

 a) Diamond Exploration - Sierra Leone

In February 2003, Mano announced further very encouraging results from its
mini-bulk sampling of the Lion-1 kimberlite dyke within its EPLs in the Kono
diamond district. Macro-diamonds had already been reported by the Company from a
1.7ton mini-bulk sample of Lion-1, which yielded 5 diamonds in the +2.0mm size
fraction weighing in total 0.85-carats, for a minimum grade of 49 carats per
hundred tonnes (49cpht).

Subsequent sorting of the +0.71mm to -2.0mm concentrate in South Africa yielded
a further 17 macrodiamonds weighing a total of 49.69mg or 0.25 carats. The
calculated grade for the 1.7 tonne mini-bulk sample of Lion-1 is therefore now
64.6 cpht. These diamonds were weighed and described by John Gurney's
Laboratory, Mineral Services, in Cape Town.

In summary, Kono Lion 1 exploration programme highlights are as follows: -

   *The Lion-1 dyke has been mapped discontinuously along strike for +/- 5km.

   *A mini-bulk sample of approximately 1.7 tons, including significant
    dilution by granite, was collected, washed and gravitated on site. The
    sample yielded 22 diamonds for a total weight of 1.1-carats from the +0.71mm
    size fraction, suggesting an initial minimum grade of 64.6 cpht

   *The largest stone recovered from the mini-bulk sample weighed 0.32 carats
    and is of gem quality

   *Lion-1 is associated with abundant G10 garnets and a petrographic
    analysis confirms its high interest potential

   *Kimberlite has been identified elsewhere throughout the area, many
    occurrences coinciding with significant artisanal diamond workings and high
    interest indicator mineral chemistry

   *Diamonds of 110-carats (officially reported) and 400-carats and
    1,400-carats (both unofficially reported) have been recovered during 2002
    from the area immediately adjacent to Mano's EPLs in Kono.

b) Gold Exploration - Sierra Leone

Elsewhere in Sierra Leone, Mano announced in February 2003 highly encouraging
results from its Sonfon Joint Venture gold programme. The Sonfon district
contains Sierra Leone's richest and most prolific historic gold fields, across
the country's pre-eminent Sula Mountains greenstone gold belt. (See map
www.manoriver.com/properties/sl_lakesonfon.html.)

A 3km long northwest trending gold-in-soil anomaly identified by a 25ppb
contour, was defined by a geochemical soil sampling programme and termed the
Yanfarina-Dalakuru-Sende (YDS) gold zone. The programme included 879 samples,
covering an area of approximately 50km2, which were assayed by SGS Laboratories
in Ghana. The YDS zone is coincident with an area of extensive artisanal gold
workings and is within a prominent structure, approximately 9km long by 5km
wide. Trenching has identified a series of high grade gold-bearing narrow veins
(stockwork) that could represent a highly significant bulk tonnage gold target.
Results from a previous soil geochemical programme conducted by Mano identified
certain gold anomalies assaying up to 3,227ppb (3.2 g/t) coincident with and up
to 5km north and 4km south of the YDS zone.

A series of recent trenches targeting primary vein gold mineralization on the
side of the Yanfarina River north of Dalakuru, returned the following highly
encouraging results:

                   Phase-1 YDS Zone Trench Samples
                       --------------------------
                          
     Trench                      Length (m)               Grade (g/t) Au
    ---------                   ---------                   ------------
DT-1                                3.5                            3.6
---------                       ---------                   ------------
DT-2                                0.9                            1.6
---------                       ---------                   ------------
DT-3*                               1.9                           24.9
---------                       ---------                   ------------
DT-4                                6.0                            0.5
---------                       ---------                   ------------
DT-5                                2.0                            0.2
---------                       ---------                   ------------
DT-6                                7.3                            7.4
---------                       ---------                   ------------
DT-7                                5.9                            3.6
---------                       ---------                   ------------
*including                         0.45                            108
---------                       ---------                   ------------

The mineralised quartz tourmaline veins trend north westerly and range between
0.1m and 1m wide, the stockwork having been traced continuously over a distance
of at least 75m with artisans having masked its continuation through their
mining activities.

It is considered likely that the veins exposed in Trench DT-4 along strike are
part of the same system suggesting a minimum length of 150m. Grab samples from a
3m wide highly silicified outcrop 5km northeast of the YDS gold zone, range from
1 to 12.6 g/t for an average of 6.3 g/t. A previous channel sample taken by IMC
Mackay & Schnellman (IMC) assayed 3m @ 10.3 g/t. IMC reported the area to be
"highly prospective for primary gold targets".

                                    Phase-1 Yisangba Grab Samples
                                    ------------------------------
                              Sample No.                            Gold g/t
                            -------------                        -----------
                                   50901                               5.6
                             -------------                       -----------
                                   50902                               2.9
                             -------------                       -----------
                                   50903                               1.0
                             -------------                       -----------
                                   50904                              12.6
                             -------------                       -----------
                                   50905                               9.1
                             -------------                       -----------

The Yisangba target is located within the 'Bongone block', where previous
drilling of a geochemical anomaly in the 1960s reportedly intersected an 85m
wide zone of sulphide mineralization (2-3% sulphides).

Previous work has identified gold occurrences related to major shear structures
in areas with extensive artisanal gold workings. The presence of gold in the
Sonfon area has historical relevance, with the name of the local river 'Sende',
translating to "gold bearing water." Active artisanal gold workings are found
extensively across the Sonfon district. The prospect has reportedly been
described by independent consultants IMC as hosting the 'potential for the
discovery of gold deposits of significant size'.

LIBERIA AND GUINEA

There was no exploration activity during the period under review. Programmes in
Liberia will recommence as soon as an improving security situation allows.

CANADA

The Manotaur diamonds joint venture (JV) remains on hold while efforts are made
to investigate the scope for widening the JV to include two other companies who
hold ground in the immediate area, as a means of facilitating fund raising.

INVESTOR RELATIONS

During the quarter under review, three Press Releases were issued recording
material exploration developments affecting the Company. Mano's very
comprehensive website, www.manoriver.com, continues to be given high priority.

Investor relations remain of prime importance to the Company, and in May 2003
Mano announced the appointment of Britton Financial PR ("Britton") to handle its
Investor Relations. Britton is a financial PR company based in the City of
London, dealing with a variety of sectors. Its strengths lie in the personal
relationships it has with the media and with the financial community, through
the extensive contacts and experience of its staff. Britton's aim is to lift
Mano's profile so as to achieve a better understanding in the investment
community of the Company's portfolio of gold and diamond exploration projects in
West Africa.

SUBSEQUENT EVENTS - CORPORATE

In May 2003, Mano announced that Seymour Pierce Limited has been appointed as
the Company's Nominated Adviser on the London Stock Exchange - AIM market with
immediate effect. Seymour Pierce Ltd together with Seymour Pierce Ellis Ltd,
Mano River's Nominated Broker, are a leading adviser and broker to AIM, with
some one hundred retained corporate clients. They are specialists in providing
research, corporate broking and corporate finance advice to smaller quoted
companies and have a growing specialism in extractive industries.

In June 2003, The Company announced that the board of directors had adopted a
stock option plan (the "Plan") pursuant to the policies of the TSX Venture
Exchange. The Plan is subject to TSX Venture Exchange approval and shareholder
approval. The Plan will allow for the reservation of up to 10% of the Company's
issued and outstanding shares as at the date of a particular stock option grant
(the Company currently has 133,890,216 (10% = 13,389,021) shares issued and
outstanding). Options under the Plan may be granted to the Company's directors,
officers, employees, management company employees and consultants. Upon receipt
of all necessary approvals, the Plan will govern any outstanding stock options
previously granted and any new stock options issued.

Also in June 2003, the Company announced that it had arranged, subject to
regulatory approval, a brokered Private Placing to raise gross proceeds of
GBP431,250 (approximately US$698,000) from existing and new institutional
investors. The brokered Placing was arranged in the UK of 17,250,000 common
shares at GBP0.025 per share through Seymour Pierce Ltd. Application was made
for approval of the Placing by the TSX Venture Exchange and for the new shares
to be admitted to trading on AIM.

The proceeds of the Placing will be used by Mano to continue the Company's
exploration programme over its range of promising gold and diamond targets in
the Mano River Union countries, and for general working capital purposes.

SUBSEQUENT EVENTS - EXPLORATION

In June 2003, Mano announced the acquisition of the 'North Pampana' EPL, which
hosts the high grade Yirisen gold deposit and strategically adjoins Mano River's
'South Pampana' EPL in central Sierra Leone.

The North Pampana EPL contains the well known Yirisen gold deposit and several
further gold anomalies as defined by a 1980s United Nations Development
Programme (UNDP) funded geochemical programme. Mano will be integrating the
extensive results of the UNDP programme into the Company's Geographical
Information System, which includes satellite imagery and structural analysis of
the Pampana district, with the aim of generating further gold targets and
extensions to the known gold mineralized trend.

Mineralisation was first noted at Yirisen by the Geological Survey of Sierra
Leone in 1958. Seven north easterly trending sub-vertical lodes of quartz
veining, averaging 150m in length were identified and returned gold values of
between 5.5 and 48 g/t over widths of between 0.7 and 6.4 metres. The host rocks
are predominantly talc schists with extensive pervasive sulphide mineralization.

Artisanal miners are currently working the Yirisen gold deposit to depths of up
to 15 metres. In one exceptional instance a narrow (one metre wide) shaft has
been sunk to an estimated depth of over 75 metres. Artisanal gold workings
currently define a strike length of over 1km to the known mineralization, which
remains open in both directions.

The North Pampana licence acquisition completes Mano River's portfolio of gold
targets in Sierra Leone, comprising:

 i. The Joint Venture (JV) with Golden Prospect Plc (AIM:GOL) over two
    contiguous exploration licences in the Sonfon area, within the northern end
    of the Sula Mountains greenstone gold belt. The JV has defined a 3km long
    gold in soil anomaly, below which trenching has revealed a gold-bearing
    stockwork vein system with a best trench intersection of 7.3m @ 7.4g/t (see
    www.manoriver.com/mano/projects/gold_sl_sonfon.shtml).

ii. The two strategically located Nimini Central and Nimini South EPLs within
    the Nimini Hills greenstone gold belt (see www.manoriver.com/mano/projects/
    gold_sl_nimini.shtml) which host parts of known lode gold deposits shared
    with two EPLs held by AfCan Mining (TSX-V:AFK), namely Nimini East and
    Nimini West and over which AfCan recently announced the signature of a Heads
    of Agreement for a Joint Venture with Ashanti Goldfields

iii. The North and South Pampana EPLs containing the Yirisen gold deposit
    within the Yirisen-Massamank mineralised trend, 30km north of the Baomahun
    gold deposit where a joint venture was recently announced between Mr Ronald
    Winston and Caldera Resources (TSX:CDR)

 Management encourages shareholders and other interested parties to contact the
following individuals at any time for information about the activities of Mano:

 Tom Elder President and CEO UK +44 (0)1235 810 740

 Guy Pas  Co-Chairman Switzerland +41 22 758 2151

 Anthony Rhatigan  Co-Chairman Mobile +44 (0)7785 297 348

 Gary Middleton Britton Financial  UK +44 20 7251 2544


                   Consolidated Interim Financial Statements
                   For The Three Months Ended April 30, 2003

MANO RIVER RESOURCES INC
Consolidated Balance Sheets
(Prepared by Management without audit)
(Stated in U.S. Dollars)

                                           Three months           Year
                                                  ended          ended
                                              April 30,    January 31,
                                                   2003           2003
                                                      $              $
                                            (unaudited)      (audited)
               --------------------------       ---------       --------
ASSETS
Current
Cash and cash equivalents                       129,101        184,116
Accounts receivable                              17,911          2,139
--------------------------                      ---------       --------
                                                147,012        186,255

Investments (Note 3)                             34,496         34,496
Resource properties (Note 4)                  4,045,090      4,045,090
Deferred exploration costs                    7,823,320      7,647,211
Reclamation bonds (Note 5)                      340,610        340,610
--------------------------                      ---------       --------

                                             12,390,528     12,253,662
               --------------------------       ---------       --------

LIABILITIES
Current Liabilities
Accounts payable and accrued liabilities        102,371         97,664
Due to related parties (Note 8)                 512,347        305,195
--------------------------                      ---------       --------
                                                614,718        402,859

Provision for reclamation (Note 5)              340,610        340,610
Convertible debenture (Note 7)                  138,723        138,723

SHAREHOLDERS' EQUITY
Share capital (Note 6)                       15,867,323     15,867,323
Equity component of convertible debenture        96,000         96,000
(Note 7)
Cumulative translation difference               (21,755)       (21,755)
Deficit                                      (4,645,091)    (4,570,098)
--------------------------                      ---------       --------
                                             11,296,477     11,371,470
               --------------------------       ---------       --------
                                             12,390,528     12,253,662
               --------------------------       ---------       --------

APPROVED BY THE DIRECTORS:

"TOM G.ELDER" (Signed)                     "GUY E.PAS" (Signed)


MANO RIVER RESOURCES INC
Consolidated Statements of Loss
(Prepared by Management without audit)
Stated in U.S. Dollars)

                                          Three months    Three months
                                                 ended           ended
                                             April 30,       April 30,
                                                  2003            2002
                                                     $               $
                                           (unaudited)     (unaudited)
             ---------------------------       ---------       ---------

Revenue
Interest income                                  1,853           4,052
---------------------------                    ---------       ---------

Expenses
Administrative and office expenses               1,275           2,370
Bank and interest charges                        3,134             192
Directors fees                                   2,000           5,000
Foreign exchange loss (gain)                     4,349             844
Investor communications                         10,689               -
Management fees                                 21,000          40,500
Mine maintenance expenses                        9,361          13,778
Professional fees, legal, adviser, audit        20,529          17,954
and accounting
Transfer agent and regulatory fees               3,309           4,530
Travel and promotion                             1,200           6,100
---------------------------                    ---------       ---------
                                                76,846          91,268
             ---------------------------       ---------       ---------
Loss for the Period                            (74,993)        (87,216)
---------------------------                    ---------       ---------
Loss per share                                 (0.0006)        (0.0009)
---------------------------                    ---------       ---------


MANO RIVER RESOURCES INC
Consolidated Statements of Deficit
(Prepared by Management without audit)
Stated in U.S. Dollars)
              
                                       Three months               Year
                                              ended              ended
                                          April 30,        January 31,
                                               2003               2003
                                                  $                  $
                                        (unaudited)          (audited)
                 ----------------           ---------           --------

Deficit, Beginning of year               (4,570,098)        (4,217,881)
Loss for the Period                         (74,993)          (352,217)
Deficit, End of Period                   (4,645,091)        (4,570,098)



MANO RIVER RESOURCES INC
Consolidated Statements of Cash Flows
(Prepared by Management without audit)
Stated in U.S. Dollars)

                                          Three months    Three months
                                                 ended           ended
                                             April 30,       April 30,
                                                  2003            2002
                                                     $               $
                                           (unaudited)     (unaudited)
-------               ------------------       ---------       ---------

Operating Activities
Loss for the period                            (74,993)        (87,216)
Changes in non-cash working capital
accounts
         Accounts receivable                   (15,772)            277
         Accounts payable                        4,707          14,350
-------  ------------------                    ---------       ---------
                                               (86,058)        (72,589)
-------               ------------------       ---------       ---------

Financing Activities
Issuance of share capital (net of costs)             -          97,570
Due to related parties                         207,152          53,154
-----------------------                        ---------       ---------
                                               207,152         150,724
-------               ------------------       ---------       ---------

Investing Activities
Resource properties -
         Deferred exploration expenditures     (176,109)       (160,692)
-------  ------------------                    ---------       ---------
         
                                              (176,109)       (160,692)
-------               ------------------       ---------       ---------

Increase ( Decrease) In Cash                   (55,015)        (82,557)

Cash, Beginning of Period                      184,116         125,098
-----------------------                        ---------       ---------

Cash, End of Period                            129,101          42,541
-----------------------                        ---------       ---------

Supplemental disclosure of non-cash financing and investing activities


During the quarter ended April 30, 2002, the Company:
Issued 1,111,636 common shares for the settlement of debt of $222,327
and 2,000,000 common shares for share subscriptions of $367,579 received
in the previous financial year.


MANO RIVER RESOURCES INC
Consolidated Statements of Deferred Exploration Costs
(Prepared by Management without audit)
Stated in U.S. Dollars)

                                        Three months      Three months
                                               ended             ended
                                           April 30,         April 30,
                                                2003              2002
                                                   $                 $
                                         (unaudited)       (unaudited)
                --------------------         ---------         ---------

Deferred exploration expenditures
Accommodation and meals                        1,989            12,553
Assays and geochem                            16,845               666
Communications                                 4,908             8,586
Consultants                                   19,125            38,534
Data, images, reports and maps                 2,352             1,673
License, permit fees                          50,480             3,752
Project/field office costs, other             21,144            19,520
Salaries                                      52,888            53,579
Transportation                                 6,378            21,829
                --------------------         ---------         ---------
Net expenditures during the period           176,109           160,692

Balance, Beginning of period               7,647,211         6,878,104
--------------------                         ---------         ---------

Balance, End of period                     7,823,320         7,038,796
--------------------                         ---------         ---------

1. NATURE OF OPERATIONS AND CONTINUING OPERATIONS

        The Company is engaged in the acquisition, exploration and development
        of gold and diamond properties. The Company is in the development stage
        and has no source of cash flows other than loans from related parties or
        equity offerings.

        These consolidated financial statements are prepared on a going concern
        basis which assumes that the Company will be able to realize assets and
        discharge liabilities in the normal course of business. The Company's
        ability to continue on a going concern basis depends on its ability to
        successfully raise additional financing. If the Company cannot obtain
        additional financing the Company may be forced to realize its assets at
        amounts significantly lower than the current carrying value.

2. SIGNIFICANT ACCOUNTING POLICIES

        These financial statements have been prepared in accordance with
        generally accepted accounting principles in Canada and reflect the
        following significant accounting policies. The United States dollar has
        been identified as the Company's currency of measurement and is used for
        external reporting purposes.

        (a) Principles of consolidation

                These financial statements include the accounts of Mano River
                Resources Inc. and its principal subsidiary, Mano River
                Resources Ltd. and its subsidiaries.

        (b) Cash and cash equivalents

                Cash and cash equivalents consists of cash on hand, deposits in
                banks and highly liquid investments with an original maturity of
                ninety days or less.

        (c) Investments

                Investments are recorded at the lower of cost and net realizable
                value

        (d Resource properties and deferred exploration costs

                The Company follows the method of accounting for its mineral
                properties whereby all costs related to acquisition, exploration
                and development are capitalized by property.

        (e) Loss per share

                Loss per share is computed using the weighted average number of
                shares outstanding during the year.

3. INVESTMENTS
                                            
                                           April 30,       January 31,
                                               2003               2003
Royal Victoria Minerals Ltd            $     34,496        $    34,496


4. RESOURCE PROPERTIES

                                          April 30,        January 31,
                                               2003               2003

Acquisition costs        
Liberia, West Africa                  $    320,000        $    320,000
Guinea, West Africa                      1,940,000           1,940,000
Sierra Leone, West Africa                1,695,000           1,695,000
ManoTaur Joint Venture, Canada              90,090              90,090

Closing balance                      $   4,045,090       $   4,045,090


5. RECLAMATION BONDS

        As at April 30, 2003, term deposits totaling $340,610 (January 31, 2003
        - $340,610) have been pledged to the State of Washington as security for
        reclamation costs on the Van Stone property. A reclamation provision has
        been accrued in the amount of $340,610. The Company has completed an
        assessment of the reclamation and closure costs and it is anticipated
        that costs incurred will not exceed this provision. The Company will
        continually monitor the costs related to the Van Stone mine and will
        make further provisions if it is determined necessary.

6. SHARE CAPITAL

        (a) Authorized - Unlimited common shares without par value

        (b)    Issued

                                                        Shares        Amounts
Balance at January 31, 2002                          101,162,671    $ 14,357,213
Shares issued for settlement of debt                   6,427,545         415,295
Shares issued on private placement (net of costs)     26,300,000       1,094,815

Balance at 31 January, 2003                          133,890,216      15,867,323

Shares issued for settlement of debt                           -               -
Shares issued on private placement (net of costs)              -               -

Balanace at 30 April, 2003                           133,890,216      15,867,323


        During the period, 470,000 stock options lapsed. As at April 30, 2003,
        the following stock options were outstanding:

                                    Exercise price
            Number of                per share
           Common Shares                (Cdn$)              Expiry date

              2,540,000                $    0.34            February 12,2004
                100,000                $    0.34            April 14,2005
                990,000                $    0.22            May 1, 2006
                845,000                $    0.10            February 21, 2007
              5,000,000                $    0.11            March 21, 2007

              9,475,000

        As at April 30, 2003, there were 2,100,000 shares held in escrow with
        their release subject to approval of regulatory authorities.



7. CONVERTIBLE DEBENTURE

        The Company entered into a convertible debenture agreement with respect
        to advances from a company controlled by a director. Advances totaling
        $200,000 will under this debenture be repayable on April 30, 2004,
        together with accumulated interest at 6% per annum. The principal amount
        is convertible by the holder into common shares of the Company at a
        price of #0.04 per share at any time prior to maturity.

        In accordance with the recommendations of the Canadian Institute of
        Chartered Accountants, the convertible debenture issued has been
        segregated into its debt and equity components. The financial liability
        component, representing the value allocated to the liability at
        inception, is recorded as a long-term liability. The remaining
        component, representing the value ascribed to the holders' option to
        convert the principal balance into common shares, is classified in
        shareholders' equity as "Equity component of convertible debenture".
        These components have been measured at their respective fair values on
        the date the convertible debenture was originally issued.

8. RELATED PARTY TRANSACTIONS

        During the year to date, the Company incurred billings of $26,654 from
        related parties for management fees and professional services. All
        transactions with related parties have occurred in the normal course of
        operations. As at April 30, 2003, the amount due to related parties
        totals $512,347. These balances are payable on demand and have arisen
        from the provision of services referred to above and provision of
        short-term bridge financing.

9. FAIR VALUE OF FINANCIAL INSTRUMENTS

        The Company's financial assets and liabilities are cash and cash
        equivalents, accounts receivable, investments, accounts payable and
        accrued liabilities, and due to related parties. The fair values of
        these financial instruments are estimated to approximate their carrying
        values due to their immediate or short-term nature except for
        investments whose fair value is described in Note 3. Due to the nature
        of the Company's operations, there is no significant credit or interest
        rate risk. As at April 30, 2003, the Company held approximately $89,712
        cash in bank accounts denominated in U.K. pounds. The Company has taken
        no action to reduce its exposure to foreign currency risk.

10. SUBSEQUENT EVENTS

        Subsequent to April 30, 2003, the Company:

Arranged a private placement for 17.25 million common shares at GBP 0.025p per
share to raise GBP 431,250 (approximately USD$697,848) before issue costs. This
private placement is subject to regulatory approval.




                      This information is provided by RNS
            The company news service from the London Stock Exchange

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