Reese River

The Company entered into a formal agreement with Placer Dome US (a subsidiary of Barrick Gold) to jointly explore three claim blocks totaling 3,000 acres in the Reese River Pediment, Lander County, Nevada. Title of the claims was transferred from Placer Dome to the Company.

The property Placer Dome/Barrick interest has now reverted to a 2% net returns royalty.

A NI-43-101 Technical Report on the Reese River/Horse Mountain Project, November 14, 2006 was completed and is available on Sedar.com.

A gravity survey has been completed with a total of 64 new gravity stations surveyed. The gravity survey indicates a complex structural setting composed of three major structural zones. Geologic mapping supports the zones with correlating mapped faults and major lithologic boundaries. An up-thrown block is interpreted at the zones’ intersection with the associated gravity high being potentially the result of lower plate carbonates. The structures and the lower plate are both exploration targets.

X-Cal has two gold projects in the CORTEZ AREA as pictured below. Both of the properties are located on lower plate windows.

The phrase “lower plate window” refers to areas on the Battle Mountain and Carlin Trends, where normally deeper rocks have been thrust to surface or near surface. Many of the most productive gold deposits on these trends occur in the lower plate rocks.

Reese River and Mill Creek Properties are along the Battle Mountain-Eureka mineral belt which includes numerous gold deposits. The map base is the USGS Gravity map dated 1997.

X-Cal has 100% of the 3000 acre property.

The Reese River Property outlined above consists of three separate claim blocks located on the flanks of the Horse Mountain Window, with a total area of approximately 3,000 acres.

The project covers part of the north and western flanks of the Horse Mountain Lower Plate Window.

Barrick (previously Placer) has retained a 2% NSR interest in the property.