On November 30, 2012, we completed the Continuation to the BVI which resulted in the change of the jurisdiction of incorporation of our company from Nevada to the BVI.

We are engaged in the exploration of gold properties exclusively in Ghana, West Africa in the search for mineral deposits, mineral resources and/or mineral reserves which could be economically and legally extracted or produced. Our exploration activities include the review of existing data, grid establishment, geological mapping, geophysical surveying, trenching and pitting to test the areas of anomalous soil samples and reverse circulation (RC) and/or diamond drilling to test targets followed by infill drilling, if successful, to define a mineral resource and, perhaps ultimately, a mineral reserve.

Our mining portfolio currently consists of 225.87 square kilometers comprised of 33.65 square kilometers for our Kibi project, 51.67 square kilometers for our Banso project, 55.28 square kilometers for our Muoso project, 44.76 square kilometers for our Kwabeng project, and 40.51 square kilometers for our Pameng project, or 55,873 acres, pursuant to the leased areas set forth in our mining leases.

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Our interests in our projects are held by our Ghanaian subsidiary, XG Mining, through mining leases granted by the Government of Ghana and registered to XG Mining for leased areas located within and upon concessions in Ghana. A concession is a grant of a tract of land made by a government or other controlling authority in exchange for an agreement that the land will be used for a specific purpose. The mining lease areas for our projects total approximately 226 square kilometers and are located at the northern extremity of the Kibi Gold Belt which is a greenstone belt, as defined in all the geological publications in Ghana, and is one of the four main greenstone belts located in Ghana.

Development of our Business During 2012

As at the date of this annual report, we have the following five projects all of which are in the exploration stage.

• Kibi Project. Our Kibi project is located on the Apapam concession and is our only material project. This project consists of an over 5.5 kilometer long mineralized trend delineated from gold-in-soil anomalies, geophysical interpretations, trenching and drilling along the northwest margin of the Apapam concession. Our company’s exploration efforts from January 1 to December 31, 2012, being the fiscal year for which this annual report is being filed, have been focused on our Kibi project. During the fiscal year, we announced:

• 70 holes totaling 12,984 meters of core had been drilled with respect to our 2012 drill program including:

• the completion of an initial National Instrument 43-101 compliant mineral resource estimate for our Kibi project encompassing five deposits collectively hosting 278,000 ounces of gold at an average grade of 2.56 g/t in the indicated category and 147,000 ounces of gold at an average grade of 1.94 g/t in the inferred category (November 5);

• initial trenching results from Zone 5 including 20.5 meters grading 7.26 g/t gold and 6.7 meters grading 32.32 g/t gold (November 12);

• the prospecting discovery of two new gold-bearing structures parallel to the recently delineated high-grade Zone 5 shear zone with outcrop grab sampling returning gold values up to 13.2 g/t, 6.86 g/t, 6.37 g/t, 6.32 g/t and 5.33 g/t;

• saw-cut channel sample composites grading 3.13 g/t gold over 7.6 meters in sample string KBCS028B-KBCS028 and 1.08 g/t gold over 6.5 meters in sample string KBCS012; from a newly exposed quartz-tourmaline vein zone along the main Zone 5 shear zone; and

• the newly discovered parallel structures confirm a gold-bearing Zone 5 deformation / alteration corridor over an apparent 325 meter width, with the main Zone 5 shear zone traced to date over an approximately 300 meter strike length (December 5).

See “Kibi Project - Initial Results of 2012 Drill Program” and “Kibi Project - 2013 Exploration Program” for further details relating to the matters noted above. As at the date of this annual report, we have planned for a drill program of up to 3,000 meters targeting Zone 5 of our Kibi project at an estimated cost of $600,000 and the following exploration activities, at an estimated cost of $250,000, during the next 12 months:

• a field exploration program focusing on Zone 5 but also including additional high priority soil geochemical and geophysical targets on our Kibi project at an estimated cost of $250,000, consisting of:

• ongoing reconnaissance geology and prospecting to further define the strike extensions of the seven known gold- bearing structures hosted by the Zone 5 gold corridor and to identify any additional prospective structures along the 1.8 kilometers long Zone 5 gold-in-soil trend;

• trenching and outcrop stripping to further expose the known auriferous structures in preparation for systematic geological mapping and channel sampling;

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• infill soil geochemical sampling on newly established 100 meter spaced grid lines designed to tighten-up the Zone 5 gold-in-soil anomaly and an induced polarization (IP) survey; and

• scout trenching focusing on the prioritization of additional gold showings yielded by our recently completed property-wide soil geochemical survey, geological modeling, and VTEM targets.

See “Kibi Project” for exploration activities conducted by our company during the two years preceding the fiscal year.

• Kwabeng Project. Our Kwabeng project is located on the Kwabeng concession. During the fiscal year, we did not conduct any exploration activities on this project. As of the date of this annual report, we have resumed placer gold recovery operations on our Kwabeng project. As at the date of this annual report, we have not planned for any exploration activities during the next 12 months, however, we may consider doing so at a later date. See “Kwabeng Project” for exploration activities conducted by our company during the two years preceding the fiscal year.

• Pameng Project. Our Pameng project is located on the Pameng concession. During the fiscal year, we did not conduct any exploration activities on this project. As of the date of this annual report, we have not planned for any exploration activities during the next 12 months, however, we may consider doing so at a later date. See “Pameng Project” for exploration activities conducted by our company during the two years preceding the fiscal year.

• Banso Project. Our Banso project is located on the Banso concession. During the fiscal year, we did not conduct any exploration activities on this project. In connection with an agreement entered into in January 2011 with Buccaneer Gold Corp. (formerly Verbina Resources Inc.), a mineral resource company listed on the TSX Venture Exchange (the “TSXV” ), as part of the criteria to meet exploration expenditures to earn the 55% interest in our 90% interest of the mineral rights in the Banso mining lease, this company was required to spend $1,000,000 in exploration expenditures between this project and our Muoso project during our fiscal year. Buccaneer Gold Corp. completed an aggregate 5,000 meter core drilling program on this project together with our Muoso project to test several drill targets identified on these concessions. The results of this drilling program appear elsewhere in this annual report. As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months and we may consider doing so at a later date. See “Banso Project for exploration activities conducted on this project during the two years preceding the fiscal year.

• Muoso Project. Our Muoso project is located on the Muoso concession. During the fiscal year, we did not conduct any exploration activities on this project. In connection with an agreement entered into in January 2011 with Buccaneer Gold Corp. as part of the criteria to meet exploration expenditures to earn the 55% interest in our 90% interest of the mineral rights in the Muoso mining lease, this company was required to spend $1,000,000 in exploration expenditures between this project and our Banso project during our fiscal year. Buccaneer Gold Corp. completed an aggregate 5,000 meter core drilling program on this project together with our Banso project to test several drill targets identified on these concessions. The results of this drilling program appear elsewhere in this annual report. As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months and we may consider doing so at a later date. See “Muoso Project” for exploration activities conducted on this project during the two years preceding the fiscal year.

As of the date of this annual report, we have:

• received a final option payment of $135,000 in January 2012 from Discovery Gold Corporation (formerly (Norman Cay Development, Inc). in connection with the assignment of our interest in the Edum Banso project;

• announced the completion of the Continuation, effective November 30, 2012, whereby we changed the jurisdiction of registration of our company from Nevada to the British Virgin Islands

• received gross cash proceeds of $1,660,025 (CAD$1,639,650) from a private placement completed in December 2012 which proceeds will be used to accelerate exploration on Zone 5 of our Kibi project;

• have achieved losses since inception;

• have minimal operations, and

• rely upon the sale of our securities to fund our operations.

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Principal Capital Expenditures/Divestitures over the last Three Fiscal Years

Our company has not had any principal capital expenditures or divestitures over the last three fiscal years.

The following organization chart sets forth our significant subsidiaries.

National Instrument 43-101 Compliance

The hardrock, lode gold exploration technical information relating to our mineral properties contained in this annual report on Form 20-F is based upon information prepared by or the preparation of which was supervised by Yves Clement, P.Geo., our Vice-President, Exploration. Mr. Clement is a Qualified Person as defined by Canadian Securities National Instrument 43-101 concerning standards of disclosure for mineral projects.

Location of Operations

Except for the land upon which our field camp is located in Kwabeng, Ghana, we do not own any real property. We own the mineral rights on our projects located in the Kibi Gold Belt where all of our exploration activities are currently conducted. Mining leases granted by the Government of Ghana and registered to our Ghanaian subsidiary, XG Mining, grant us the right to operate at our Kibi, Kwabeng, Pameng, Banso and Muoso projects and are described elsewhere in this annual report.

We currently conduct limited administrative activities from our corporate office located at Suite 902, 357 Bay Street, Toronto, Ontario, M5H 2T7, Canada, where we have leased 881 square feet for a five year term commencing on November 1, 2012 and expiring on October 31, 2017, at approximately $3,679 (CAD$3,666) per month.

As of the date of this annual report, our technical and administrative activities are conducted at our field camp. We do not pay any rent as we own our field camp.

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Map of Projects and Operations

The map below shows the locations of our Kibi, Kwabeng, Pameng, Banso and Muoso projects all of which are described in further detail in this annual report.

Xtra-Gold Mining Concessions Located in the Kibi Gold Belt

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Xtra-Gold Mining Leases Located in the Kibi Gold Belt

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Overview of Projects

All of our mineral exploration projects are currently at an early stage of evaluation. As at the date of this annual report, except for:

• an initial National Instrument 43-101 compliant mineral resource estimate for our Kibi project encompassing five deposits collectively hosting 278,000 ounces of gold at an average grade of 2.56 g/t in the indicated category and 147,000 ounces of gold at an average grade of 1.94 g/t in the inferred category (see “Kibi Project - National Instrument 43-101 Compliant Mineral Resource Estimate” for further details)

no mineralized material or mineral resource or mineral reserve estimates have been made at any of our other projects; and

• the following exploration activities which we have planned for 2013:

• a drill program of 3,000 meters targeting Zone 5 of our Kibi project;

• a field exploration program focusing on Zone 5 but also including additional high priority soil geochemical and geophysical targets on our Kibi project (see “Kibi Project – Future Exploration Plans”); and

• resumption of placer gold recovery operations at our Kwabeng project

there are no exploration activities currently being conducted on our other projects or have any such activities been planned for the next 12 months, however, we may consider doing so at a later date.

Title to Properties

We hold 30-year mining leases expiring on July 26, 2019 on our Kwabeng and Pameng concessions, a 7-year mining lease on our Apapam concession expiring on December 17, 2015, a 14-year mining lease on our Banso concession expiring on January 5, 2025 and a 13-year mining lease on our Muoso concession expiring on January 5, 2024.

Recovery of Placer Gold

In July 2010, we entered into agreements with independent Ghanaian contract miners to recover placer gold and produce the mineralized material from our Kibi and Pameng projects and an agreement with Ravenclaw Mining Limited, a Swiss company, to assist in overseeing the contract miners to limit our involvement in the placer gold recovery operations from July 2010 through December 2011 and enable our company to focus on lode gold exploration activities (see “Kibi Project – Recovery and Sale of Placer Gold and “Pameng Project – Recovery and Sale of Placer Gold” for further details). There was no placer gold recovery operations carried out at these projects in 2012.

As of the date of this annual report, we have resumed placer gold recovery operations at our Kwabeng project and have engaged Ravenclaw Mining Limited to assist us (see “Kwabeng Project – Resumption of Placer Gold Recovery Operations at our Kwabeng Project” for further details. During 2010 through 2012, we did not conduct any placer gold recovery operations at our Kwabeng project.

VTEM Survey

In 2011, an airborne Versatile Time-domain Electromagnetic ( “VTEM” ), Magnetic and Radiometric survey (the “VTEM survey” ) was completed by our company on our projects which are all located in the Kibi Gold Belt and encompassed approximately 4,000 line-kilometers at 200 meter line spacing, with approximately 490 line-kilometers of detail 100 meter line spacing coverage over our core Kibi project mining lease area. The VTEM system is renowned for its superior penetration depth of greater than 400 meters, low base frequency for enhanced penetration in conductive ground cover and high spatial resolution which permits the spotting of drill targets directly off the airborne anomalies. The primary purpose of the VTEM survey was to delineate auriferous graphitic or sulphidic shears but resistivity-depth data may also help further define and/or identify the granitoid bodies hosting the Kibi project mineralization In addition to helping map lithological contacts, including the gold prospective granitoid bodies, the aeromagnetic survey will permit the detection of low-magnetic domains possibly reflecting demagnetization resulting from intense gold-related hydrothermal alteration. The radiometric survey may also help further define and/or identify the gold-hosting granitoid bodies.

The VTEM data was incorporated into the geological compilation following our receipt of the final survey interpretation data from Geotech Airborne Limited (see “Technical Reports - Interpretation Report of VTEM Survey” below for further details). This integrated survey, in combination with previous soil geochemistry and reconnaissance geology surveys will help further delineate known gold occurrences outside Zone 2 of the Kibi project, and evaluate the remainder of the Apapam mining lease area for the hosting of granitoid-hosted and Ashanti style shear zone gold mineralization. Similarly, the VTEM survey will help further define the extent and regional controls of the gold-bearing structures discovered to date by scout trenching on the Ankaase Gold Trend, located on the Muoso concession, and Banso Area No. 3 gold-in-soil anomalies; with the objective of guiding follow-up trenching designed to outline high priority, cost effective drill targets.

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Technical Reports

National Instrument 43-101 Technical Reports

In November 2012, we announced the completion of an initial National Instrument 43-101 compliant mineral resource estimate on our Kibi project. The resource estimate encompasses the Big Bend, East Dyke, Mushroom, and South Ridge deposits in Zone 2 and the Double 19 deposit in Zone 3. All the above mineralized bodies remain open in several directions. In aggregate, these five gold deposits are estimated to contain an indicated mineral resource of 278,000 ounces of gold and an additional inferred mineral resource of 147,000 ounces of gold. An independent National Instrument 43-101 technical report supporting the resource estimate prepared by SEMS Exploration Services Ltd. and dated October 31, 2012, is filed under our company’s profile on SEDAR at www.sedar.com (see “ Independent Technical Report, Apapam Concession, Kibi Project, Eastern Region, Ghana ” for further details). In July 2010, SEMS Exploration Services Ltd. prepared an independent technical report consistent with the Canadian Securities Administrators National Instrument 43-101 – Standards of Disclosure for Mineral Projects, Form 43-101F1 – Technical Report and Companion Policy 43-101 CP on our Kibi project.

Interpretation Report of VTEM Survey

In August 2011, Geotech Airborne Limited provided our company with a report setting forth its interpretation of approximately 4,027 line kilometers of electromagnetic, magnetic and radiometric data for gold exploration in our Kibi project area.

The airborne geophysical datasets display a complex signal largely dominated by NE-SW to NNE-SSW structures that are interpreted as shear zones and graphitic sediments. Metasediments, metavolcanics and granitoids units have been delineated from their geophysical (magnetic, electromagnetic and radiometric) characteristics. The electromagnetic anomaly picks show elongated patterns of conductors located in NE-SW to NNE-SSW trending areas interpreted as graphitic layers within the interpreted shear zone and graphitic sediments.

The available geological and geophysical data was interpreted in terms of gold potential within the area of interest. The geophysical interpretation used the genetic model for stockworks/silicification gold emplacement and the genetic model of granitoid gold emplacement. A total of 38 targets were delineated and ranked according to a priority level for ground follow-up. Geotech Airborne Limited suggested that these targets should be further investigated in the field using geology and geochemistry before planning a drilling program.

Modified Gold Deportment Study

In October 2011, SGS South Africa (Pty) Ltd. provided our company with a mineralogical report relating to mineralogical test work consisting of a modified gold deportment study to characterize the gold, in two samples, to recommend a process route to maximize gold recoveries. Approximately 10 kilograms of sample G478923 sulphide material (drill core) and 10 kilograms of composite oxide (saprolite) material were utilized for the test work. The composite oxide sample was created by SGS South Africa (Pty) Ltd. from trench samples that were crushed and combined. The mineralogical test work included metallurgical and mineralogical tests and was done in conjunction with gravity test work conducted by the Metallurgical Section of SGS South Africa (Pty) Ltd. This report outlined the methodology as to how the different tests were conducted, the results of the test work, conclusions and recommendations.

The objective of the modified gold deportment study was to gain an understanding of the nature and mode of occurrence of the gold in each sample. The modified gold deportment study included the following:

• test work to determine the amenability of the ore to gravity recovery;

• gold distribution across size fractions (grading analysis);

• heavy liquid separation to determine the amount of free gold or gold in heavy particles such as sulphides;

• exposure and mineral association analysis of the particulate gold grains in the gravity concentrate;

• chemical composition of the ore and metallurgical test products;

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• general mineralogical characterization of the ore;

• identification and quantification of gold minerals including native gold, gold-tellurides, etc. in the gravity concentrates;

• grain size distribution of the gold grains in the gravity concentrate;

• test work to determine the gold recovery by direct cyanidation; and

• diagnostic leach analysis of the gravity tailings to determine the gold deportment in the gravity tails.

SGS South Africa (Pty) Ltd. made the following preliminary gold recovery conclusions in their report:

• The gold in the G478923 gold ore samples (3.49 g/t Au) is highly amenable to cyanidation leaching with ~97% recoverable by means of direct cyanidation. This ore is also amenable to gravity upgrading, with ~67% of the gold recovered at a mass pull of ~3%. In the gravity concentrate (97.5 g/t Au), a total of 143 particulate gold grains were observed in the gravity concentrate of this sample.

• The grading analysis on the G478923 gold ore sample indicated a very high upgrading of gold in the +106µm size fraction (~69%). This indicates that the gold is either large gold grains or locked in large gold-bearing particles. From the liberation and mineral association characteristics determined by QEMSCAN, on the gravity concentrate, the gold was found to be ~63% liberated and ~25% was associated with pyrite. This indicates that the gold is either large, liberated gold grains or locked in large gold-bearing pyrite particles.

• The direct cyanidation and diagnostic leach indicates that the sample is highly amenable to cyanide leaching, with ~97% of the gold recovered from the head sample at a grind of 80%-75µm by direct cyanidation and ~96% for the gravity tailings at a grind of~50%-75µm. This is corroborated by the exposure and the mineral association characteristics as determined by QEMSCAN analysis of the gravity concentrate. Approximately 90% of the particulate gold grains are ≥10% exposed and should be leachable.

• The gold in the composite gold ore sample (7.28 g/t Au) is also highly amenable to cyanidation, with ~97% of the gold recoverable by means of direct cyanidation. The ore is also amenable to gravity upgrading, to some degree, with only ~56% of the gold recovered at a mass pull of ~3%. In the gravity concentrate (134.83 g/t Au) a total of 125 particulate gold grains were observed by QEMSCAN.

• The grading analysis on the composite gold ore sample indicated a very high upgrading of gold in the +106µm size fraction (~74%). This indicates that the gold is either large gold grains or locked in large gold-bearing particles. From the liberation and mineral association characteristics determined by QEMSCAN analysis of the gravity tailings, it was found that the gold grains were moderately liberated (~76%) and that ~10% was occurring in silicates and ~14% in oxides. This indicates that the gold is either large, liberated gold grains or locked in large gold-bearing silicate/oxide particles.

• The direct cyanidation and diagnostic leach tests indicated that the sample is highly amenable to cyanide leaching, with ~98% of the gold recovered from the head sample at a grind of 80%-75µm and ~99% of the gold in the gravity tailings at a grind of 50%-75µm. This is corroborated by the exposure and mineral association characteristics of particulate gold in the gravity concentrate, as determined by QEMSCAN analysis. Approximately ~96% of the gold grains are ≥10% exposed and should be leachable.

• The most simplistic processing option would be to mill the ore to ~80%-75µm followed by carbon-in-leach cyanidation. Another option, which may result in somewhat lower operational cost is to mill the ore relatively coarsely (say 80%-106µm) followed by gravity concentration and intensive cyanidation of the gravity concentrate. The gravity tailings could then be milled finer to ~80%-75 µm, followed by carbon-in- leach cyanidation. Taking out the coarse gold and some of the sulphides by gravity, will allow shorter retention times in the leach tanks and possibly even lower cyanide consumption.

Report on Structural Geological Investigations of Zone 2, Kibi Project

In November 2011, SRK Consulting (Canada) Inc. provided our company with a report of their structural geological investigations of Zone 2 (Big Bend zone, South zone and other zones including the Mushroom zone) on our Kibi project.

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Objectives and Overview

• to review geological mapping to date and to provide on ground structural geological guidance; and

• to conduct structural geological investigations of key exposures and drill core at Zone 2 with a focus on understanding:

• the 3D geometry of diorite dykes;

• structural controls on the distribution of gold mineralization (including ore plunge); and

• kinematics of shear/fault zones and their influence on the distribution of gold mineralization.

SRK Consulting (Canada) Inc. Conclusions

• The distribution of gold mineralization in the Big Bend zone is controlled by two NNE-trending shear zones that bound the auriferous zone in a quartz diorite.

• Auriferous quartz veins in the Big Bend zone comprise:

• shear and extensional veins related to the development of NNE-trending shear zones; and

• stockwork veins in a particular portion of the quartz diorite.

• Vein geometry, rare kinematic indicators and steeply plunging mineral lineation imply that deformation associated with gold mineralization in the Big Bend zone resulted from a protracted episode of reverse SE over NW movement.

• The controls on gold mineralization at the South zone and other zones are not well understood and require further oriented core drilling followed by structural geology investigations.

SRK Consulting (Canada) Inc. Recommendations

Big Bend Zone

• complete infill drilling at the Big Bend zone to confirm gold grade continuity in preparation for resource estimation;

• conduct detailed petrography studies to identify compositional variations in the quartz diorite and verify their potential control on the distribution of gold mineralization;

• include structural contours of auriferous diorite contacts on geological maps to investigate the relationship between the geometry of the auriferous portion of the diorite body and the distribution of gold mineralization; and

• define the continuation of (auriferous) shear zones to the north and south of the Big Bend diorite.

South Zone and Other Zones (including the Mashroom Zone)

• undertake further oriented core drilling to verify the extent and potential presence of shear zones at the South zone (drill orientations to SW and SE); and

• determine the shear zone kinematics and controls on gold distribution.

Regional Structural Geology Interpretation of the Aeromagnetic Data from the VTEM Survey

In December 2011, SRK Consulting (Canada) Inc. provided our company with a report of their structural geological interpretation of aeromagnetic data covering our Kibi Gold Belt mining concessions to assist in understanding the structural setting of gold mineralization in the area and to provide a practical structural framework for future exploration targeting. The defined area of interest is ~705 square kilometers in area and is located at the northern extremity of the Kibi Gold Belt. The area of interest was based on the extent of the VTEM Survey conducted by Geotech Airborne Limited. The SRK Consulting (Canada) Inc. report documents the methodology, results, conclusion and recommendations from the structural geological interpretation.

The scope of work included a desktop structural interpretation of the airborne geophysical data we acquired over the area of interest. Based on the available airborne geophysical data, SRK Consulting (Canada) Inc. constructed form lines outlining the internal geometry of stratigraphy within our area of interest. In general, form lines within our area of interest display a strong southwest-northeast trend, parallel to the tectonic grain in the known greenstone belts of Ghana. Variations from this trend occur in a north-west-southeast-trending belt along the lower portion of our area of interest.

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SRK Consulting (Canada) Inc. Conclusions

• A fault network was interpreted and subdivided in terms of age. The fault network comprises dominant southwest- northeast- trending faults, subparallel to the dominant trend observed in the form lines that include early reactivated D _E extensional faults. These faults are interpreted to have developed (or reactivated) during the Eburnean Orogeny (D ₂ -D ₅ ) and are believed to be closely linked to gold mineralization.

• Two types of intrusions (belt and basin type granitoids) were identified in our area of interest, both of which were emplaced before the culmination of the Eburnean Orogeny (D ₅ ) and therefore are overprinted by D ₅ deformation.

• A late (D ₆ ) fault set is represented by east-west-rending faults that are linked by minor northwest-southeast- trending faults. These are characterized by narrow, linear breaks in the magnetic data often with little to no visible offset in the magnetic stratigraphy. These late faults are interpreted to have resulted from northeast-southwest compression that may have occurred at the final stages of the Eburnean Orogeny or post-dated the Eburnean Orogeny.

• Several areas of structural complexity were identified within our area of interest, including left and right- hand steps along the major fault corridors, intersections between D ₂ -D ₅ faults and intersections between D ₂ -D ₅ and D ₅ faults, particularly in the vicinity of intrusions.

SRK Consulting (Canada) Inc. Recommendations

• Regional ground-truthing of the regional structural interpretation should be conducted. This should aim to not only identify whether a given fault is present, but also characterize each fault in terms of:

• fault products (including the brittle/brittle-ductile/ductile nature of the fault);

• orientation of associated foliations and lineations if present;

• kinematics; and

• alteration or gold mineralization present.

• A confidence rating should be compiled for each interpreted fault identified as part of this interpretation. This may include using existing geological mapping, satellite imagery, other geophysical datasets, or ground-truthing to produce a confidence rating based on the number of datasets, a given fault is identified in, or based on the resolution of datasets a given interpreted fault is based on.

• Regional ground-truthing of the regional lithological interpretation should be conducted. This should focus on the location of the boundary between the basin and belt assemblages, as well as better defining the internal variation within both these assemblages, including their known relationships with gold mineralization.

• Conduct a regional geochemical survey to verify the validity of identified target areas and conduct close- spaced soil geochemical sampling to guide exploration drilling in areas of positive results.

Note:

• 1 ppm = 1 gram per tonne (g/t) = 1,000 part per billion (ppb)

• All gold results for our exploration programs are reported in parts per million gold (Au).

Our Prior Exploration Activities

Please refer to our annual reports on Form 10-K previously filed with the SEC for any exploration activities conducted by us before the three years required by this annual report.

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Kibi Project

Overview

Our Kibi project is also referred to in this annual report as the Apapam concession and is comprised of a 33.65 square kilometer land position.

Our Kibi project land position also encompasses the following two land staking applications:

• the Akim Apapam concession is a reconnaissance license contiguous to the southwest extremity of our Kibi project covering an area of 7.0 square kilometers (700 hectares); and

• the Apapam concession extension is a ground extension along the northwest boundary of our Kibi project covering an area of 1.42 square kilometers (142 hectares).

The Akim Apapam concession application was made to provide a buffer area. The Akim Apapam concession was covered by a first pass (200 meters x 25 meters) soil geochemistry survey in 2011; with 2012 exploration efforts including a single trench (157 meters) and 27 hand auger holes (147 meters) targeting a gold-in-soil anomaly. The Apapam concession extension application was made to cover certain trench and drill gold intercepts. The applications for the Akim Apapam concession and the Apapam concession extension were submitted by our company to the Minerals Commission of Ghana on January 15, 2008 and November 19, 2009, and as at the date of this annual report, approval of these applications is still pending and there is no assurance that either of them will be granted.

The Apapam concession contains two small scale mining licenses, comprising approximately 0.1012 square kilometers (10.12 hectares) located within the northwest portion of the concession which were granted to third parties before our company’s application for the Apapam concession. None of the in situ, lode gold mineralization occurrences, described in the October 31, 2012 independent National Instrument 43-101 technical report prepared by SEMS Exploration Services Ltd. are located within and/or proximal to these third party small scale mining licenses, and there is no current knowledge of any lode gold occurrences being present on these parcels. No information is available on past and/or current alluvial gold mining activity on these small scale mining licenses.

Location and Access

Our Kibi project lies within the Kibi-Winneba greenstone belt in the Eastern Region of Ghana and is located on the eastern flank of the Atewa Range along the headwaters of the Birim River in the immediate vicinity of the district capital of Kibi, approximately 75 kilometers NNW of the nation’s capital city of Accra. Access to our Kibi project is by driving northwest from Accra on the paved Accra-Kumasi Trunk Road, the main national highway, for approximately 90 kilometers until the town of Kibi, marked by a road sign, is reached. One would make a left hand turn at the Kibi sign and drive southwest for approximately 5 kilometers to arrive at our Apapam concession. A tarred road emanating from the Accra-Kumasi Trunk Road, approximately 15 kilometers northeast of Kibi, dissects the north-central and south-eastern portions of our concession, while the tarred road servicing the town of Apapam provides access to the concession’s south-western extremity. Our Kibi project is located approximately 15 kilometers south-southeast from our field camp.

The Kibi-Winneba greenstone belt is characterized by a narrow sequence of Birimian metavolcanics underlying most of the Atewa Range, which is covered by an extensive laterite/bauxite capping, and surrounded by a thick package of Birimian metasediments dominating the flanks and the lower lying areas. Our Kibi project covers the Birimian volcanic-sediment contact which we believe represents a highly favorable environment for the hosting of lode gold deposits throughout Ghana.

Historic Work

Before the exploration work conducted by our company, very little systematic exploration work for bedrock gold deposits has been conducted in the Kibi area since the 1930s.

Prior Exploration by Xtra-Gold

Phase III Drill Program

Based on the results of our 2009 Phase II drill program, we commenced and completed our follow-up Phase III drill program on our Kibi project from July 2010 to December 15, 2010 to:

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• further test the dip and strike extensions of the gold mineralization zones identified in our Phase I and Phase II drill programs; and

• test IP / Resistivity anomalies spatially associated with the Kibi gold-in-soil trend. The Phase III drill program was implemented from July 2010 to December 15, 2010 by Burwash (2009) Ghana Limited of Accra, Ghana.

Results of Phase III Drill Program

Drilling highlights from the South Ridge granitoid of Zone 2 include surface or near surface granitoid-hosted gold mineralization intercepts of 19.5 meters grading 1.52 g/t gold in drill hole KBDD10085; 25.5 meters grading 1.50 g/t gold in hole KBDD10086 and 23 meters grading 1.74 g/t gold in hole KBDD10090. Hole KBDD10091 encountered a 17.0 meter intersection grading 2.42 g/t gold as noted in Table 1. These holes yielded significant gold intercepts, with all mineralized intercepts consisting of granitoid-hosted gold mineralization spanning from 2 meters to 72 meters in core length. Drilling and trenching traced an extensive system of en echelon extension vein arrays across an approximately 440 meter distance along the SE-trending South Ridge granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite to tonalite composition. Additional trenching/drilling is required to further define the extent and strike length of the quartz vein arrays, the structural controls of the mineralization and the contacts of the host granitoid body.

Ongoing diamond drilling has significantly expanded known gold mineralization down dip on the Zone 2 - Central granitoid at our Kibi project. Three step-back holes (685 meters) successfully expanded the gold mineralization to a down dip depth of up to approximately 115 meters. Drilling highlights include classical granitoid-hosted gold mineralization intercepts of 20 meters grading 2.43 g/t gold in KBDD10099, 58 meters grading 2.46 g/t gold, including 28 meters grading 3.67 g/t gold, in KBDD10101, 27 meters grading 1.98 g/t gold and 25 meters grading 1.76 g/t gold in KBDD10103.

The above-noted drill holes targeted the depth potential of the gold mineralization along the southeast portion of the Central granitoid body located at the south-eastern extremity of the approximately 1,200 meter long by 500 meter to 800 meter wide Zone 2 gold-in-soil anomaly. All three holes were designed to test the down dip extension of gold mineralization along an approximately 100 meter strike extension of the host granitoid body; with the drilling centered on a flexure or possible fold nose imparting a change from a northwesterly trend to an easterly trend to the moderate, northerly dipping granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite to tonalite composition.

Hole KBDD10099 was drilled in a southwest direction on the NW-trending segment of the granitoid body. It was designed to undercut a mineralized intercept of 27.0 meters grading 4.03 g/t gold in hole KBDD10069 and yielded two significant mineralization intercepts located approximately 75 meters down dip of the KBDD10069 intercept, including: 20.0 meters grading 2.43 g/t gold from a down hole depth of 141 meters and 7.0 meters grading 2.53 g/t gold from a down hole depth of 176 meters. Significant mineralization was traced over an approximately 115 meters down dip distance from surface on the KBDD10069 – KBDD10074 – KBDD10099 drill section.

Hole KBDD10101, consisting of a south trending borehole designed to test the nose of the flexure in the granitoid body at depth below an intercept of 25.4 meters grading 2.11 g/t gold yielded by scout diamond core hole KBD08012, returned a wide mineralized intercept of 58.0 meters grading 2.46 g/t gold from a down hole depth of 112 meters; approximately 45 meter down dip of the KBD08012 intercept. This 58 meter mineralized intercept encompasses an essentially barren, 11.0 meter core-length interval (130 meters to 141 meters) appearing to reflect the truncation of the mineralization by a post mineralization dyke; with the mineralized section above the dyke yielding an intercept of 18.0 meters grading 2.18 g/t gold (112 meters to 130 meters), and the segment below the dyke returning 28.0 meters grading 3.67 g/t gold (142 meters - 170 meters), including 15 meters grading 5.42 g/t gold. Hole KBDD10103, also consisting of a south trending borehole collared approximately 50 meters to the east of hole KBDD10101 along the northern, hanging wall flank of the easterly trending granitoid body, was designed to undercut intercepts of 15.0 meters grading 0.87 g/t gold and 33 meters grading 1.28 g/t yielded by scout diamond core hole KBD08013. Hole KBDD10103 returned two significant mineralization intercepts extending approximately 45 meters to 75 meters down dip from the lower KBD08013 mineralized intercept, including: 27.0 meters grading 1.98 g/t gold from a down hole depth of 131.0 meters, including 15.0 meters grading 3.23 g/t gold; and 25.0 meters grading 1.76 g/t gold from a down hole depth of 180.0 meters.

The 2010 drilling and trenching efforts traced significant gold mineralization within the southeastern segment of the Central granitoid over an approximately 300 meter strike extension of the host granitoid body and down to a maximum down dip distance 115 meters.

2011 Drill Program

On January 15, 2011, we commenced our 2011 drill program on our Kibi project. The drilling was primarily designed to expand known gold mineralization along strike and at depth within the southeast portion of the Central granitoid body located at the southeastern extremity of the approximately 1,200 meter long by 500 to 800 meter wide Zone 2 gold-in-soil anomaly.

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Results of 2011 Drill Program

The first two diamond core holes from our 2011 drill program have significantly expanded known gold mineralization down plunge on the Zone 2 – East Dyke granitoid at our Kibi project. The vertical fan pattern holes (379 meters) successfully expanded the gold mineralization to a down plunge depth of approximately 200 meters.

Highlights of these holes include classical granitoid–hosted gold mineralization intercepts of:

• 15 meters grading 2.05 g/t gold, including 5 meters grading 4.00 g/t gold, in KBDD11105; and

• 14 meters grading 2.36 g/t gold, including 5 meters grading 5.18 g/t gold, in KBDD11106.

At the time, drilling targeted the depth potential of the gold mineralization along the northern portion of the East Dyke granitoid body located at the south-eastern extremity of the approximately 1,200 meter long by 500 to 800 meter wide Zone 2 gold-in-soil anomaly. The two west trending, vertical fan pattern holes (-50 ^o & -70 ^o ) were designed to undercut a mineralized intercept of 7 meters grading 4.83 g/t gold in scout hole KBD08010 located at the northern extremity of the easterly dipping host granitoid body. Other drilling highlights from the North zone – East Dyke granitoid include intercepts of: 8.49 g/t gold over 12 meters in hole KBD08004 and 6.29 g/t over 23 meters, including 8.66 g/t over 10 meters, in hole KBRC09047, and 2.97 g/t over 18 meters, including 6.32 g/t over 8 meters, in hole KBRC09042. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

The upper KBDD11105 borehole (-50 ^o dip) yielded a significant mineralized intercept of 15 meters grading 2.05 g/t gold, including 5 meters grading 4.0 g/t gold, from a down hole depth of 105 meters, approximately 60 meters down dip from the scout hole KBD08010 intercept; and the steeper KBDD11106 borehole (- 70 ^o ) returned a mineralized intercept of 14 meters grading 2.36 g/t gold, including 5 meters grading 5.18 g/t gold from a down hole depth of 141 meters, approximately 65 meters down dip of the KBDD11105 intercept. To date, significant gold mineralization had been traced over an approximately 100 meter strike length and a 200 meter down plunge distance along the North zone of the East Dyke granitoid. Drilling to date indicated that the North zone consists of a northerly plunging (approx. 65 ^o ) mineralized vein package appeared to be developed at a flexure in the host granitoid body.

Geological mapping and trenching efforts appear to indicate that the four auriferous granitoid bodies discovered to date on Zone 2 may form part of a continuous, folded granitoid body. To date, gold mineralization had been traced by drilling and trenching over an approximately 1,500 meter aggregate distance along the limbs and nose of this SE-trending fold structure. The mineralization remained open in all directions and drilling/trenching to further define the extent and geological controls of the mineralization was ongoing.

In April 2011, a spectacular, coarse native gold-bearing, vein quartz clast was discovered by our local contracted placer gold miners along the Birim River valley within the north-central portion of the Apapam mining lease area. A photograph of the gold specimen has been posted on our website at www.xtragold.com. Although the complex geomorphologic setting and depositional history of the auriferous gravel deposits present along the base of the Atewa Range make it difficult to determine conclusive bedrock sources for the widespread placer gold occurrences, the high grade nature of this quartz vein gold mineralization renders it of considerable lode gold exploration significance.

A 3.5 kilometer long, NE-trending, chargeable/resistive induced polarization anomaly exhibiting a spatial relationship with a geophysically inferred, NE-trending, regional structural trend, and characterized by coincidental gold-in-soil anomalies and/or auriferous floats, lying approximately 1 kilometer northwest of the Birim River along the south-western margin of the approximately 5.5 kilometer long Kibi project gold trend, represents a possible bedrock source for the vein gold material; based on the fact that the gold specimen was discovered at the confluence of an alluvial gold-bearing, secondary stream dissecting this anomalous trend. Another possible bedrock source for the gold mineralization is the southwest extension of the Kibi Old Mine structure inferred to pass to the south of the Birim River.

At the time, a mechanized trenching program targeting the 3.5 kilometer long geophysical/geochemical trend and an extensive soil sampling program (75 line-kilometers) covering the possible southwest extension of the Kibi Old Mine structure within the central portion of the Apapam concession was scheduled for initiation in mid May, 2011. See the National Instrument 43-101 Technical Report entitled “Kibi Project, Eastern Region, Ghana” dated July 12, 2010, under “Kibi Project – NI 43-101 Technical Reports” on our website at www.xtragold.com for further details regarding the aforementioned geophysical/geochemical target, the Kibi Old Mine prospect, and the geology and geomorphology of the Kibi Gold Belt placer gold deposits.

Two additional diamond core holes (586 meters) were drilled on the newly named Big Bend Gold Zone - Central granitoid at our Kibi gold project.

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Highlights of these holes include classical granitoid–hosted gold mineralization intercepts of:

• 42 meters grading 2.39 g /t gold in KBDD11108 from 189 meters down-hole; and

• 27 meters grading 0.89 g/t gold in KBDD11107 from 127 meters down-hole.

The Big Bend gold zone was intersected approximately 215 meters down-plunge of previously identified mineralization; extending down-plunge potential from surface to approximately 360 meters along a through-like flexure within the Central granitoid body.

These two southwest (225 ^o ) trending, vertical fan pattern holes (-50 ^o & -75 ^o ) targeting an embayment or wallrock protrusion developed along the hanging wall of the Central granitoid body represent the first holes drilled on the Big Bend gold zone during the current 20,000 meter drill campaign to follow up on the significant gold intercepts yielded by Phase III holes KBDD10101 and KBDD10103. Hole KBDD10101 collared approximately 210 meters to the west of the present drill collars returned 2.46 g/t gold over 58 meters, including 3.67 g/t gold over 28 meters; and KBDD10103 located 40 meters to the east of KBDD10101 yielded intercepts of 1.98 g/t gold over 27 meters and 1.76 g/t gold over 25 meters. To date, significant gold mineralization had been traced over an approximately 300 meter strike length and approximately 360 meters down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicated that the Big Bend zone consisted of northeasterly plunging, en echelon, mineralized vein packages appearing to be developed along a through-like flexure within the Central granitoid body.

The upper KBDD11107 borehole (-50 ^o dip) yielded a mineralized intercept of 27 meters grading 0.89 g/t gold from a down hole depth of 127 meters; and the steeper KBDD11108 borehole (-75 ^o ) returned a mineralized intercept of 42 meters grading 2.39 g/t gold, including 14 meters grading 3.11 g/t gold and 9 meters grading 3.19 g/t gold from a down hole depth of 189 meters, approximately 100 meters down dip of the KBDD11107 intercept. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

Both boreholes also intersected mineralization spatially associated with a northerly trending shear zone cross-cutting the Central granitoid; with KBDD11107 yielding a sheared diorite intercept grading 8.44 g/t gold over 3 meters from a down-hole depth of 60 meters; and sheared, graphitic metasedimentary rocks in KBDD11108 returning mineralized intercepts grading 2.12 g/t gold over 4 meters and 2.36 g/t gold over 5 meters, including 5.36 g/t gold over 2 meters, from down-hole depths of 87 meters and 116 meters. This newly discovered gold-bearing shear zone represented a very prospective target to be followed-up by additional trenching and drilling.

To date, we had completed 31 holes totaling 7,692 meters (KBDD11105 - KBDD11135) of our 2011 drill program (including KBDD11116 which was abandoned at 71 meters); with 15 out of the 31 holes (4,390 meters) targeting the Big Bend gold zone on the Central granitoid body. At the time, ongoing drilling efforts were focused on the further delineation of the Big Bend gold zone.

Ongoing drilling on the Big Bend gold zone on our Kibi gold project continues to intersect significant gold mineralization, including 2.42 g/t gold over 52 meters. At the time, assay results from six new diamond core holes (1,308 meters noted hereunder continued to confirm the down-plunge continuity and the multiple en-echelon vein package structural style of the mineralization, and demonstrated the occurrence of higher grade mineralization within the Big Bend gold system.

Highlights of the holes noted hereunder include classical granitoid – hosted gold mineralization intercepts of:

• 52 meters grading 2.42 g/t gold in KBDD11113 from 84 meters down-hole, including 27 meters grading3.58 g/t gold (and including 6.09 g/t gold over 12 meters);

• 50 meters grading 1.64 g/t gold in KBDD11110 from 158 meters down-hole, including 24 meters grading 2.45 g/t gold; and

• 50 meters grading 1.31 g/t gold in KBDD11114 from surface, including 20 meters grading 2.21 g/t gold.

To date, significant gold mineralization had been traced over an approximately 300 meter strike length and an approximately 360 meter down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicated that the Big Bend zone consisted of north-easterly plunging, en echelon, mineralized vein packages appearing to be developed along a through-like flexure within the Central granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition. Irregularities or flexures in the geometry of the host diorite bodies appear to strongly influence the development of veining and grade distribution; as is exemplified by the Big Bend zone on the Central granitoid and the East Dyke granitoid zone. Similar flexures have potential to host mineralization elsewhere along the strike or down-dip extensions of the extensive dioritic bodies characterizing our Kibi gold project.

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Boreholes KBDD11109 – KBDD11110 and KBDD11111 – KBDD11112 consisting of a pair of south trending, vertical fan drill sections (-50 ^o & -75 ^o ), collared approximately 45 meters apart were designed to test the quartz diorite body at depth between holes KBDD10103 and KBDD11108 which yielded significant gold intercepts located approximately 45 meters west and 50 meters east of the present drill sections. With KBDD10103 returning mineralized intercepts of 1.98 g/t gold over 27 meters and 1.76 g/t gold over 25 meters; and KBDD11108 returning an intercept of 42 meters grading 2.39 g/t gold.

The upper KBDD11109 borehole (-50 ^o ) of the KBDD11109 – KBDD11110 vertical fan pattern yielded a mineralized intercept of 2 meters grading 5.75 g/t gold from a down-hole depth of 91 meters; and the steeper KBDD11110 borehole (-75 ^o ) returned a mineralized intercept of 50 meters grading 1.64 g/t gold, including 24 meters grading 2.45 g/t gold, from a down-hole depth of 158 meters, approximately 75 to 125 meters down dip of the KBDD11109 intercept. The shorter KBDD11109 intercept appeared to represent the upper fringes of the north-easterly plunging mineralization zone.

The upper KBDD11111 borehole (-50 ^o ) of the KBDD11111 – KBDD11112 vertical fan pattern yielded mineralized intercepts of 22 meters grading 1.25 g/t gold and 18 meters grading 2.09 g/t gold, including 7 meters grading 4.18 g/t gold, from down-hole depths of 94 meters and 133 meters. The steeper KBDD11112 borehole (-75 ^o ) yielded three mineralized intercepts developed over a 115 meter core-length starting at a down-hole depth of 130 meters, including: 47 meters grading 0.71 g/t gold, including 2.71 g/t gold over 6 meters; 18 meters grading 1.31 g/t gold; and 17 meters grading 2.0 g/t gold, including 3.89 g/t gold over 7 meters. The KBDD11112 mineralization envelope extended from approximately 55 meters to 120 meters down-dip of the upper KBDD11111 intercepts.

KBDD11113 and KBDD11114, consisting of vertical boreholes (-90 ^o ) collared approximately 35 meters apart at the western extremity of the Big Bend gold zone, were designed to test the extensive system of shallowly dipping, extension (ladder) vein arrays associated with the mineralized system; and to obtain additional information on the structural controls of the mineralization. Hole KBDD11113 returned a mineralized intercept of 52 meters grading 2.42 g/t gold, including 27 meters grading 3.58 g/t gold (and including 6.09 g/t gold over 12 meters), from a down-hole depth of 84 meters; and KBDD11114 yielded an intercept of 50 meters grading 1.31 g/t gold from surface, including 20 meters grading 2.21 g/t gold.

To date, we had completed 34 holes totaling 8,550 meters (KBDD11105 to KBDD11138) of our 2011 drill program (including KBDD11116 which was abandoned at 71 meters after encountering 7 meters of 2.57 g/t gold from 64-71 meters); with 18 out of the 31 holes (5,248 meters) targeting the Big Bend gold zone on the Central granitoid body. Ongoing drilling efforts during that time frame focused on the further delineation of the Big Bend gold zone.

In June 2011, field preparations were underway for exploration programs in the third quarter of 2011 designed to fully maximize the discovery potential on our Kibi gold project.

The comprehensive and systematic field programs will include a combination of follow-up work to define drill targets on untested gold-in-soil and induced polarization (IP) anomalies lying along the approximately 5.5 kilometer long Kibi project gold trend located along the north-western margin of the Apapam mining lease; as well as first pass, grassroots exploration covering the southeastern portion (70%) of the concession, and the contiguous Akim Apapam reconnaissance license area. The multi-faceted work programs, including first pass (200 meters x 25 meters) and in-fill (100 meters x 25 meters) soil sampling, geological mapping and prospecting, hand auger sampling, and mechanized trenching, will also permit the prioritization and definition of geophysical anomalies produced by the completed, detail 100 meter line-spacing, airborne VTEM, magnetic, and radiometric survey over the Apapam property area.

To date, only approximately 15% of the existing Kibi gold project soil geochemistry / induced polarization (IP) survey grid, covering approximately 30% of the 33.65 square kilometer Apapam mining lease, had been subjected to follow-up work; with the ongoing 2011 drill program focused on Zone 2 of our Kibi gold project only representing approximately 3% of the total concession area. Limited trenching and scout drilling outside Zone 2 has traced the granitoid–hosted gold mineralization over an approximately 2,100 meter distance along the approximately 5.5 kilometer NE – trending Kibi Gold Trend. In combination with VTEM/Mag/Radiometric survey, these target generation/definition programs will enable our company to further define known gold occurrences outside Zone 2, and evaluate the remainder of this very prospective land position for the hosting of granitoid-hosted and Ashanti style shear zone gold mineralization.”

Line cutting for the Apapam South control grid, to be followed by soil sampling, commenced on June 13, 2011. Hand auger sampling and mechanized trenching will follow-up on untested gold-in-soil and induced polarization (IP) anomalies on the existing Kibi gold project grid and was expected to start by the end of June. At the time, these target generation/definition work programs were scheduled to be implemented concurrently over the next two to three months; with arrangements in progress for the booking of a second diamond drill rig to start testing high priority targets towards the end of the third quarter of 2011.

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Regional government mapping indicated that the Apapam South / Akim Apapam soil geochemistry survey area covers highly prospective terrain for the hosting of Ashanti style shear zone gold mineralization in the form of two major Birimian unit contacts, including the contact between an extensive metavolcanic rock sequence, forming the core of the Kibi Gold Belt, and a metasedimentary/volcaniclastic rock package; and a major north-east trending reverse fault along the eastern margin of the belt. The Kibi Old Mine historical lode gold prospect located at the north-central extremity of the Apapam concession is spatially associated with this regional structure.

The first pass soil survey will cover an approximately 25 square kilometer area and encompass an estimated 5,450 samples to be collected at a sampling density of 200 meters x 25 meters. Reconnaissance geology and prospecting will also be conducted along the approximately 136 kilometers of NW-SE trending cross-lines. Every second sample (50 meter stations) will initially be submitted for gold and arsenic analysis (approximately 2,725 samples); with the “held – back” samples subsequently subjected for analysis where required to delineate / bracket anomalous gold-in-soil anomalies. Detailed (100 meters x 25 meters) follow-up soils and hand auger sampling will be conducted upon reception of analytical results to provide greater definition of gold-in-soil anomalies.

Untested gold-in-soil and IP anomalies lying within the existing Kibi gold project grid area will be followed-up by in-fill (100 meters x 25 meters) soil sampling and/or hand auger sampling, and mechanized trenching designed to identify high priority, cost-effective drill targets. Of particular interest is a 3.5 kilometer long, NE-trending, chargeable/resistive induced polarization (IP) anomaly exhibiting a spatial relationship with a geophysically inferred, NE-trending, regional structural trend, and characterized by coincidental gold-in-soil anomalies and/or auriferous floats lying along the south-western margin of the approximately 5.5 kilometer long Kibi project gold trend.

See the National Instrument 43-101 Technical Report entitled “Kibi Project, Eastern Region, Ghana” dated July 12, 2010, under “Kibi Project – NI 43-101 Technical Reports” on our website at www.xtragold.com for further details regarding the aforementioned Kibi Old Mine historical prospect and the high priority geophysical/geochemical target.

In August 2011, ongoing drilling on our Kibi gold project continued to intersect significant gold mineralization, including 2.67 g/t gold over 38 meters on the Big Bend gold zone – Central granitoid and 4.88 g/t gold over 16 meters on the newly defined Mushroom gold zone at the southeastern extremity of the Upper Central Granitoid. Assay results from 19 new diamond core holes (5,055 meters), as noted hereunder, continued to confirm the down-plunge continuity and the multiple en-echelon vein package structural style of the Big Bend gold zone, and demonstrated the multiple gold deposit potential within Zone 2 of our Kibi gold project.

Highlights of the holes noted hereunder include:

• 16 meters grading 2.25 g/t gold and 38 meters grading 2.67 g/t gold in KBDD11133 from 152 meters and 182 meters down- hole (Big Bend gold zone);

• 32 meters grading 2.41 g/t gold in KBDD11136 from 149 meters down-hole, including 17 meters grading 4.01 g/t gold (Big Bend gold zone);

• Big Bend gold zone now traced over approximately 325 meter strike length and 450 meters down plunge from surface within the Central granitoid body;

• 16 meters grading 4.88 g/t gold, including 10 meters grading 7.38 g/t gold, from 67 meters down hole in KBDD11117, on the newly defined Mushroom gold zone on the Upper Central granitoid (as noted below); and

• 3 newly defined shear targets, including 34.80 g/t gold over 1 meter in coarse visible gold-bearing shear zone in KBDD11133.

These drill results are part of our 2011 drill program. Holes included nine holes (2,913 meters) on the Big Bend gold zone, 3 holes (612 meters) on the newly defined Mushroom gold zone on the Upper Central granitoid, and 7 exploration holes (1,530 meters) on newly discovered shear and induced polarization (IP) / soil geochemistry targets.

At the time, drilling included nine holes on the Big Bend gold zone, including 8 holes (2,446 meters) designed to further delineate/infill the gold zone and 1 hole (KBDD11134; 467 meters) drilled down the plunge of the zone to obtain additional structural information on the multiple en-echelon vein package system and to test the continuity of the mineralization down plunge. The delineation/infill holes, with the exception of KBDD11115, consist of southerly trending boreholes (- 50 ^o to -75 ^o inclinations) collared on the northern, hanging wall flank of the easterly trending host diorite body and drilled across the ESE-trending, northerly dipping mineralization sheets.

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Holes KBDD11128, KBDD11133, and KBDD11135 to KBDD11137 were designed to further delineate/infill the Big Bend gold zone along strike at vertical depths ranging from approximately 90 meters to 175 meters. Boreholes KBDD11138 and KBDD11139 tested the down plunge extension of the zone at vertical depths of approximately 200 meters to 300 meters. Hole KBDD11115 consists of a vertical borehole (-90 ^o ) collared at the western extremity of the Big Bend gold zone designed to test the extensive system of shallowly dipping, extension (ladder) vein arrays associated with the mineralized system; and to obtain additional information on the structural controls of the mineralization.

All eight Big Bend gold zone delineation/infill holes returned significant gold mineralization, including: intercepts of 2.25 g/t gold over 16 meters and 2.67 g/t gold over 38 meters from down hole depths of 152 meters and 182 meters in hole KBDD11133; and 0.78 g/t gold over 7 meters and 2.41 g/t gold over 32 meters (including 4.01 g/t gold over 17 meters) from down hole depths of 134 meters and 149 meters in KBDD11136. The KBDD11133 gold intercepts are located approximately 25 meters west and below mineralized intercepts of 1.98 g/t gold over 27 meters and 1.76 g/t gold over 25 meters yielded by previously reported hole KBDD10103. The KBDD11136 gold intercepts are located approximately 50 meters below mineralized intercepts of 22 meters grading 1.25 g/t gold and 18 meters grading 2.09 g/t gold in previously reported hole KBDD11111, and approximately 40 meters above and east of mineralized intercepts of 47 meters grading 0.71 g/t gold, 18 meters grading 1.31 g/t gold, and 17 meters grading 2.0 g/t gold in hole KBDD11112.

Hole KBDD11134 was drilled down the plunge of the Big Bend gold zone to obtain additional structural information on the multiple en-echelon vein package system, to test the continuity of the mineralization down plunge, and to serve as a pilot hole to permit better targeting of deeper holes along the down plunge extension of the zone. The NE-trending borehole (060 ^o /-58 ^o ) was collared at the western, surface expression, extremity of the Big Bend gold zone and allowed to run unaided down the plunge and diagonally across (down dip) the system of stacked, approximately 70 ^o northerly dipping, mineralization sheets. KBDD11134 remained within the confines of the host Central granitoid body to its final depth of 467 meters; with the borehole stopped due to a shortage of drill rods.

Hole KBDD11134 yielded multiple mineralized intervals, ranging from 3 meters to 73 meters in core length, reflecting the en-echelon style vein packages forming the Big Bend gold zone mineralization, including: 1.51 g/t gold over 26 meters from a down hole depth of 6 meters, 3.03 g/t gold over 41 meters from a down hole depth of 96 meters, 2.04 g/t gold over 42 meters from a down hole depth of 223 meters, and 1.06 g/t gold over 73 meters from a down hole depth of 312 meters (see Table 1). The array of mineralized intervals produced a length weighted average grade of 1.62 g/t gold over a cumulative core length of 276 meters, and the hole returned 1.01 g/t gold, including internal dilution, over its 464 meter core length (3 meters to 467 meters); exemplifying the down plunge continuity of the Big Bend gold zone mineralization.

To date, significant gold mineralization had been traced over an approximately 325 meter strike length and an approximately 450 meter down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicated that the Big Bend zone consisted of north-easterly plunging, en-echelon, mineralized vein packages appearing to be developed along a trough-like flexure within the Central granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

Mushroom Gold Zone

Holes KBDD11117, KBDD11118 and KBDD11120 were designed to follow up on significant drill intercepts yielded by reverse circulation (RC) hole KBRC09060 and diamond drill hole KBDD10081 within the southeastern portion of the Upper Central granitoid, i.e. the newly defined Mushroom gold zone.

Hole KBDD11117 consisting of the re-drilling of hole KBDD11116, which returned 7 meters grading 2.57 g/t gold before being abandoned due to technical difficulties at the 71 meter mark, was designed to follow up on scout hole KBRC09060 drilled down the dip of the host granitoid body to transect an extensive system of westerly dipping, sheeted quartz veining; with the borehole returning an intercept from surface of 39.0 meters grading 9.23 g/t gold uncut (3.54 g/t gold cut). The southeast trending KBDD11117 borehole designed to intersect the Upper Central granitoid at right angles from a collar position on the northeastern, hanging wall flank of the host granitoid body returned a mineralized intercept of 4.88 g/t gold over 16 meters, including 10 meters grading 7.38 g/t gold, from a down hole depth of 67 meters, approximately at the same vertical depth as the bottom of the KBRC09060 intercept.

Hole KBDD11118 designed to undercut a mineralized intercept of 9 meters grading 3.60 g/t gold in KBDD10081, approximately 60 meters to the northwest of KBDD11117, returned 2.57 g/t gold over 11 meters, including 5 meters grading 4.23 g/t gold, from a down hole depth of 84 meters, approximately 45 meters down dip of the KBDD10081 intercept. Drilling to date appeared to indicate that the Mushroom gold zone consists of a northeast plunging vein system spatially related to a series of pinch and swells in the Upper Central granitoid body.

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Irregularities or flexures in the geometry of the host diorite bodies appear to strongly influence the development of veining and grade distribution; as is exemplified by the Big Bend gold zone on the Central granitoid, the East Dyke granitoid zone, and the newly defined Mushroom gold zone on the Upper Central granitoid. Similar flexures have potential to host mineralization elsewhere along the strike or down-dip extensions of the extensive dioritic bodies characterizing our Kibi gold project.

Shear Zone Targets

An approximately 0.5 meter wide, coarse visible gold bearing, quartz vein hosted within a fault breccia forming part of a prominent shear zone spanning over an approximately 10 meter core length returned 34.80 g/t gold over a 1 meter core length at a down hole depth of 398 meters in hole KBDD11133. This newly discovered northwest trending/northeasterly dipping shear zone represented a very prospective exploration target due to its emplacement along the southern limb of the Central granitoid body.

Boreholes KBDD11122 and KBDD11123 consisting of a west trending, vertical fan drill section (-50 ^o & -70 ^o ) was designed to further test the northerly trending junction shear cross-cutting the Central granitoid; approximately 80 meters south of a 8.44 g/t gold over a 3 meter intercept yielded from the same structure in hole KBDD11107. The upper KBDD11122 borehole (-50 ^o ) of the vertical fan pattern returned mineralized intercepts of 3 meters grading 3.14 g/t gold, including 7.59 g/t gold over 1 meter, and 5.15 g/t gold over 1 meter from down hole depths of 78 meters and 92 meters and the steeper KBDD11123 hole (-70 ^o ) returned an intercept of 2.45 g/t gold over 1 meter at a down hole depth of 126 meters, approximately 50 meters down dip of the KBDD11122 intercept.

To date, we had completed 54 holes totaling approximately 14,825 meters (KBDD11105 - KBDD11158) in our 2011 drill program (including KBDD11116 which was abandoned at 71 meters); with 24 out of the 54 holes (7,704 meters) targeting the Big Bend gold zone on the Central granitoid body. Ongoing drilling efforts during that time frame are currently focused on the further delineation of the newly defined Mushroom gold zone on the Upper Central granitoid.

In November 2011, ongoing drilling continued to confirm the down-plunge continuity and the multiple en-echelon vein package structural style of the Big Bend gold zone, and demonstrated the multiple gold deposit potential within Zone 2 of our Kibi project.

Highlights of the 15 diamond core holes (5,714 meters) noted hereunder include:

• 62 meters grading 1.57 g/t gold, including 2.00 g/t gold over 42 meters (and including 2.76 g/t gold over 19 meters) in KBDD11141 from 232 meters down-hole (Big Bend zone);

• 41 meters grading 1.62 g/t gold, including 2.18 g/t gold over 20 meters, in KBDD11143 from 249 meters down- hole (East Dyke- North zone);

• Big Bend zone now traced over an approximately 325 meter strike length and 500 meter down plunge from surface within the Central granitoid body;

• South Ridge gold zone extended 170 meters further down dip than from 2010 drilling; gold mineralization now traced over distances of approximately 440 meters along the strike and 400 meters down the dip of the South Ridge granitoid body;

• New typical Kibi-type granitoid hosted vein system (i.e. Road Cut zone) discovered in diorite body located 60 meters due south of the Central granitoid’s Big Bend zone; and

• Second diamond drill rig contracted to accelerate delineation/infill drilling of the Big Bend zone and East Dyke – North zone geared towards an initial resource estimate.

The following drill results are part of our 2011 drill program designed to delineate/infill the Big Bend gold zone – Central granitoid; as well as further test/delineate other prominent gold systems and geophysical / geochemical anomalies on the approximately 1,200 meter long by 500 to 800 meter wide Zone 2 gold-in-soil anomaly of our Kibi gold project. The 15 holes (KBDD11129 to KBDD11150) drilled at the time included: 6 holes (2,327 meters) on the Big Bend zone, including KBDD11142 which tested both the East Dyke and Big Bend zones; 3 holes (899 meters) on the East Dyke zone; 3 holes (1,211 meters) on the newly discovered Road Cut zone; 1 hole on the South Ridge granitoid zone (578 meters); and 3 geology/exploration holes (699 meters) designed to further define the geometry of Zone 2 diorite bodies.

Big Bend Zone (Central Granitoid)

Drilling included 6 holes (2,327 meters) on the Big Bend zone, including 4 holes designed to further delineate/infill the gold zone and 2 holes targeting the down plunge extension of the mineralized body. In addition, hole KBDD11146 targeting the southern diorite body hosting the Road Cut zone was collared on the footwall margin of the Central granitoid (i.e. Big Bend zone) but exited the Central granitoid body at a down-hole depth of 25 meters.

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The Big Bend zone holes, with the exception of KBDD11142, consist of southerly trending boreholes (- 60o to -77o inclinations) collared on the northern, hanging wall flank of the easterly trending host diorite body and drilled across the ESE-trending, northerly dipping mineralization sheets. KBDD11142 consists of a WNW-trending borehole originally designed to test the East Dyke zone but extended down to the Central granitoid to test the down plunge extension of the Big Bend zone and to obtain additional structural information on the mineralized vein system.

Holes KBDD11140 and KBDD11141 were drilled in a vertical fan pattern (-60 ^o and -72 ^o ) with the upper borehole designed as an infill hole along the eastern portion of the Big Bend zone and the lower borehole targeting the down plunge extension of the mineralized body. The upper KBDD11140 borehole (-60 ^o ) yielded mineralized intercepts of 7 meters grading 1.46 g/t gold and 15 meters grading 1.39 g/t gold from down-hole depths of 162 meters and 192 meters, and the steeper KBDD11141 borehole (-72 ^o ) intersected 2.00 g/t gold over 42 meters from 241 meters down-hole, including a higher-grade core grading 2.76 g/t gold over 19 meters (251 meters to 270 meters), in a broader intercept grading 1.57 g/t gold over 62 meters from a down-hole depth of 232 m; approximately 100 meters vertically below the KBDD11140 intercept. This mineralization exhibited good continuity with an intercept of 42 meters grading 2.39 g/t gold, including 3.11 g/t gold over 14 meters and 3.19 g/t gold over 9 meters, in hole KBDD11108; approximately 50 meters above the KBDD11141 intercept.

Hole KBDD11142 initially targeted the East Dyke zone (see description below) but was extended down to the Central Granitoid to test the down plunge extension of the Big Bend zone and to obtain additional structural information on the mineralized vein system. The westerly trending (285 ^o ) borehole diagonally transected (down dip) the easterly trending, steep northerly dipping system of stacked, mineralized vein sheets. This lower segment of KBDD11142 yielded multiple mineralized intervals, spanning from 350 meters to 468 meters down-hole, reflecting the en-echelon style vein packages forming the Big Bend zone mineralization, including: 6 meters grading 1.98 g/t gold; 20.1 meters grading 1.71 g/t gold; 3 meters grading 2.14 g/t gold; and 22 meters grading 1.43 g/t gold, including 3.19 g/t gold over 5 meters. The lowermost KBDD11142 intercept (446 meters-468 meters) lies approximately 150 meters below the KBDD11141 mineralized intercept and approximately 500 meters down plunge from the surface expression of the mineralized body.

Holes KBDD11130, KBDD11131, and KBDD11132 were designed to further delineate/infill the down-dip extension of the western portion of the Big Bend gold zone, approximately 150 meters down-plunge from surface, at vertical depths ranging from approximately 150 meters to 280 meters. All 3 holes returned significant gold mineralization, including: intercepts of 1.75 g/t gold over 26 meters, including 12 meters grading 2.56 g/t gold, from a down-hole depth of 211 meters in hole KBDD11131; and 1.72 g/t gold over 6 meters, 3.21 g/t gold over 3 meters, and 0.81 g/t gold over 20 meters (including 5 meters grading 2.30 g/t gold) from down hole-depths of 237 meters, 264 meters, and 280 meters. The KBDD11131 gold intercept is located approximately 70 meters vertically below mineralized intercepts of 27 meters grading 1.98 g/t gold and 25 meters grading 1.76 g/t gold in KBDD10103, and approximately 70 meters below and 22 meters west of intercepts of 16 meters grading 2.25 g/t gold and 38 meters grading 2.67 g/t gold in KBDD11133.

To date, significant gold mineralization had been traced over an approximately 325 meter strike length and an approximately 500 meter down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicated that the Big Bend zone consisted of north-easterly plunging, en-echelon, mineralized vein packages appearing to be developed along a trough-like flexure within the Central granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

East Dyke – North Zone (KBDD11142 and KBDD11143)

Holes KBDD11142 and KBDD11143 consisting of a pair of west trending, vertical fan pattern holes (-55 ^o and -70 ^o ) collared on the eastern (hanging wall) flank of the northern segment of the East Dyke granitoid, targeted the down-plunge extension of significant gold mineralization intersected earlier in the Fiscal Year by fan pattern holes KBDD11105 and KBDD11106; which returned 15 meters grading 2.05 g/t gold, including 5 meters grading 4.0 g/t gold, and 14 meters grading 2.36 g/t gold, including 5 meters grading 5.18 g/t.

The upper KBDD11142 borehole (-55 ^o dip) yielded a mineralized intercept of 26 meters grading 1.41 g/t gold, including 8 meters grading 2.37 g/t gold, from a down-hole depth of 200 meters, approximately 50 meters north and 25 meters below the KBDD11106 intercept; and the steeper KBDD11143 borehole (-70 ^o ) returned a significant mineralized intercept grading 1.62 g/t gold over 41 meters, including 2.18 g/t gold over 20 meters, from a down-hole depth of 249 meters, approximately 80 meters down dip of the KBDD11142 intercept.

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To date, significant gold mineralization had been traced over an approximately 150 meter strike length and a 320 meter down plunge distance along the north zone of the East Dyke granitoid (i.e. East Dyke – North zone). Drilling to date indicated that the north zone consisted of a northerly plunging (approx. 65 ^o ) mineralized vein package appearing to be developed at a flexure in the host granitoid body.

Road Cut Zone (KBDD11144; New Zone)

Hole KBDD11144 (100 ^o /-55 ^o ) returned a mineralized intercept of 30 meters grading 0.79 g/t gold (34 meters to 64 meters), including 19 meters grading 1.05 g/t gold, across a NNE-trending system of typical Kibi-type granitoid hosted quartz-albite-carbonate-sulphide veining. This new gold zone (i.e. Road Cut zone) is emplaced within an easterly trending quartz diorite body lying approximately 60 meters south of the Central granitoid; due south of the flexure along the Central granitoid appearing to control the Big Bend gold zone mineralization. Additional trenching/drilling is planned to further define the geometry of the host diorite body and the structural controls of the mineralization.

South Ridge Zone (KBDD11148)

Hole KBDD11148 (225 ^o /-55 ^o ) was drilled as a combination geology/exploration borehole designed to further delineate the western extensions of the Central granitoid and South Ridge granitoid bodies, define the stratigraphy across the colluvium-filled valley separating the Central granitoid and South Ridge granitoid, and test the down dip potential of the central portion of the South Ridge gold zone.

Hole KBDD11148 returned a significant, quartz diorite-hosted, mineralized intercept of 15 meters grading 1.40 g/t gold (452 meters to 467 meters), including 7 meters grading 2.53 g/t gold, appearing to correspond to the down dip extension of the South Ridge gold zone; approximately 170 meters down dip of the lowermost intercept of 47 meters grading 0.58 g/t gold in hole KBDD10086. The borehole also intersected two previously unmapped iron-carbonate altered quartz diorite bodies prospective for the hosting of Kibi-type granitoid hosted gold mineralization.

Drilling and trenching to date had traced an extensive system of en-echelon extension vein arrays across an approximately 440 meter distance along the SE-trending, moderately NE-dipping South Ridge granitoid body; with the present borehole appearing to extend the mineralization to a down-dip depth of approximately 400 meters.

Drilling Progress and Exploration Outlook

At the time, 70 holes totaling 18,932 meters had been completed by our company in our 2011 drill program, of which, including the 15 holes (5,714 meters) noted in the preceding paragraphs, 50 drill holes have been reported.

In November 2011, a new 20,000 meter drill contract, to be initiated following the completion of our 2011 drill program, had been signed with Burwash Drilling Limited, and our company also contracted Global Drilling Services for a second diamond drill rig (10,000 meters minimum) which commenced drilling on December 16, 2011.

One drill rig will be dedicated to the further delineation/infill drilling of the Big Bend zone and East Dyke – North zone geared towards an initial resource estimate. The second drill rig will focus on the further testing/delineation of other prominent Zone 2 gold systems including the South Ridge and Mushroom zones, the scout drilling of Zone 3 and Zone 4 trench showings and gold-in-soil anomalies, and the testing of priority geophysical targets yielded by the airborne VTEM, magnetic, and radiometric survey completed earlier in the fiscal year.

The results from 26 additional diamond core holes totaling 6,713 meters from Zone 2 of our Kibi gold project are noted hereunder.

Highlights of the drill results include:

• 17 meters grading 5.47 g/t gold, including 12.66 g/t gold over 4 meters, in KBDD11172 from 127 meters down- hole (Big Bend zone);

• 24.5 meters grading 3.43 g/t gold, including 4.70 g/t gold over 17 meters, in KBDD11176 from 165.5 meters down-hole (East Dyke - North zone);

• 20 meters grading 2.82 g/t gold in KBDD11157 from 92 meters down-hole (Mushroom zone – Upper Central granitoid);

• North zone traced approximately 465 meters down plunge from surface within the East Dyke granitoid body (KBDD11175);

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• New typical Kibi-type granitoid hosted vein system discovered at depth within the apparent fold nose developed within the Central granitoid (KBDD11161); and

• Ongoing follow-up trenching on Double 19 zone within extensive Zone 3 gold-in-soil anomaly returns channel sample intercept of 2.27 g/t gold over 36 meters trench-length, including 2 meters grading 22.22 g/t gold, in trenches TAD022 to ADRS001.

These drill results are part of our 2011 drill program of our Kibi gold project. The 26 holes (KBDD11151 to KBDD11176) include: 6 holes (2,148 meters) on the Big Bend zone; 5 holes (1,157 meters) on the East Dyke zone; 7 holes (1,290 meters) on the Mushroom zone – Upper Central granitoid; 2 holes (433 meters) on the South Ridge granitoid zone; 2 holes (510 meters) on the recently defined Road Cut zone; and 4 geology/exploration holes (1,175 meters) designed to further define the geometry of Zone 2 diorite bodies.

Big Bend Zone (Central Granitoid)

Drilling included 6 holes (2,148 meters) on the Big Bend zone, including: 3 holes designed to further delineate/infill the gold zone (KBDD11160, KBDD11171, KBDD11172); 2 holes targeting the down plunge extension of the mineralization along the northwestern limb of the trough-like flexure (i.e. Big Bend) developed within the Central granitoid body (KBDD11169 to 170); and 1 hole (KBDD11161) drilled down the plunge of the zone to obtain additional structural information on the multiple en-echelon vein package system and to test the continuity of the mineralization down plunge.

Hole KBDD11172 consisting of a southwest trending borehole designed to further delineate the western extremity of the Big Bend zone, along the north-western limb of the trough-like flexure developed within the Central granitoid body, returned a high grade mineralized intercept grading 5.47 g/t gold over 17 meters, including 4 meters grading 12.66 g/t gold, from a down-hole depth of 127 meters. This mineralization exhibited good continuity with an intercept of 27.13 meters grading 2.12 g/t gold, including 4.01 g/t gold over 6.93 meters in KBDD10070, lying approximately 40 meters above and 20 meters to the south of the KBDD11172 intercept.

Hole KBDD11170 consisting of a deep exploratory borehole targeting the down plunge extension of the mineralization along the north-western limb of the trough-like flexure intersected several exploration significant intercepts distributed over an approximately 100 meter core-length from a down-hole depth of 243 meters, including 8 meters grading 1.10 g/t gold; approximately 175 meters down plunge from the KBDD11172 intercept.

Hole KBDD11161 was drilled down the plunge of the Big Bend zone, parallel to and approximately 75 meters to the southeast of similar down-plunge hole KBDD11134; with these down-plunge boreholes designed to obtain additional structural information on the multiple en-echelon vein package system, to test the continuity of the mineralization down plunge, and to serve as pilot holes to permit better targeting of deeper holes along the down plunge extension of the zone. The ENE-trending borehole (070 ^o /-55 ^o ) was collared along the inner footwall margin of the host granitoid body, along the eastern limb of the trough-like flexure, and allowed to run unaided down the plunge and diagonally across (down dip) the system of stacked, approximately 70 ^o northerly dipping, mineralization sheets. KBDD11161 remained within the confines of the host Central granitoid body for its entirety; with technical difficulties forcing the borehole to be abandoned within a new mineralization zone at a down-hole depth of 537 meters.

Hole KBDD11161 yielded multiple mineralized intervals, ranging from 10 meters to 45 meters in core length, reflecting the en-echelon style vein packages forming the Big Bend zone mineralization, including: 1.50 g/t gold over 28 meters from a down hole depth of 3 meters; 1.22 g/t gold over 20 meters from a down hole depth of 116 meters; 2.0 g/t gold over 45 meters from a down hole depth of 159 meters; 1.57 g/t gold over 35 meters from a down hole depth of 231 meters; and 1.40 g/t gold over 25 meters from a down hole depth of 283 meters (see Table 1). The array of mineralized intervals produced a length weighted average grade of 1.60 g/t gold over a cumulative core length of 185 meters, and the hole returned 1.03 g/t gold, including internal dilution, over a 305 meter core length (3 meters to 308 meters); exemplifying the down plunge continuity of the Big Bend zone gold mineralization.

Technical difficulties forced KBDD11161 to be abandoned at the 537 meter mark within a zone of typical Kibi-type quartz-albite-carbonate-sulphide veining; with the bottom 11 meters of the borehole returning 1.23 g/t gold, including 2 meters grading 2.79 g/t gold. This new mineralization zone lies at a vertical depth of approximately 400 meters, approximately 160 meters east of the deepest down plunge extent of the Big Bend zone, within the apparent fold nose developed within the Central Granitoid.

At the time, significant gold mineralization had been traced over an approximately 325 meter strike length and an approximately 500 meter down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicated that the Big Bend zone consisted of north-easterly plunging, en-echelon, mineralized vein packages appearing to be developed along a trough-like flexure within the Central granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

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East Dyke – North Zone

Drilling efforts on the East Dyke included a deep hole targeting the down plunge extension of the mineralized system and a delineation hole in the upper portion of the zone. KBDD11175 consisting of a deep, westerly trending borehole collared on the eastern, hanging wall flank of the East Dyke granitoid returned typical granitoid hosted quartz-albite-carbonate-sulphide veining intercepts grading 0.88 g/t gold over 7 meters and 1.14 g/t gold over 10 meters from down-hole depths of 359 meters and 385 meters; approximately 145 meters further down plunge than the previous extent of the mineralization.

To date, significant gold mineralization had been traced over an approximately 150 meter strike length and a 465 meter down plunge distance along the North zone of the East Dyke granitoid (i.e. East Dyke – North zone). Drilling to date indicated that the north zone consisted of a northerly plunging (approx. 65 ^o ) mineralized vein package appearing to be developed at a flexure in the host granitoid body.

Hole KBDD11176 designed to further define the northern extent of the East Dyke – North zone at a vertical depth of approximately 160 meters returned a significant mineralized intercept of 24.5 meters grading 3.43 g/t gold, including 4.70 g/t gold over 17 meters. This mineralization exhibited good continuity with an intercept of 14 meters grading 2.36 g/t gold in KBDD11106, approximately 45 meters to the east; and intercepts of 1.41 g/t gold over 26 meters and 1.62 g/t gold over 41 meters, including 20 meters grading 2.18 g/t gold, in holes KBDD11142 and KBDD11143, approximately 35 meters and 105 meters below the KBDD11176 intercept.

Mushroom Zone (Upper Central Granitoid)

Holes KBDD11151, KBDD11153 –KBDD11154, KBDD11157, and KBDD11158 were designed to further test the recently defined Mushroom zone; following a significant, near surface intercept of 4.88 g/t gold over 16 meters yielded by hole KBDD11117. Drilling to date appeared to indicate that the Mushroom zone consisted of a northeast plunging, en-echelon, vein system spatially related to a constriction in the south-eastern portion of the Upper Central granitoid body; with present hole KBDD11154 tracing the mineralization to a down-plunge depth of approximately 190 meters.

Hole KBDD11151 consisting of a southwest trending borehole targeting the down-plunge extension of the KBDD11117 intercept from a collar position on the north-eastern, hanging wall flank of the host granitoid body returned a mineralized intercept of 2.45 g/t gold over 15 meters from a down-hole depth of 110 meters, approximately 50 meters down plunge of the KBDD11117 intercept. The mineralization zone was also tested in a west-northwest direction by KBDD11157 which yielded an intercept of 2.82 g/t gold over 20 meters from a down-hole depth of 92 meters, approximately 20 meters below and 10 meters west of the KBDD11151 intercept.

Hole KBDD11154 consisted of the re-drilling (i.e. twinning) of KBDD11153 which was abandoned at 128 meters due to technical difficulties; with the boreholes having the same basic trace down to the 128 meter mark. KBDD11154 was drilled to a final depth of 344 meters. The northeast trending boreholes, drilled down the dip extension of the host granitoid body to obtain additional information on the structural controls of the mineralization, dissected the extensive system of south-westerly dipping, sheeted quartz veining in a down-plunge fashion along the mineralization shoot. These holes were collared adjacent to hole KBRC09060, a due east trending scout reverse circulation (RC) borehole, which returned an intercept from surface of 39.0 meters grading 9.23 g/t gold uncut (3.54 g/t gold cut). KBDD11154 returned a mineralized intercept of 81 meters grading 1.52 g/t gold from a down-hole depth of 3 meters, including 2.94 g/t gold over 13.5 meters, 2.56 g/t gold over 19 meters, and 2.21 gold over 10 meters. The borehole also yielded additional intercepts of 7 meters grading 2.20 g/t gold and 6.23 g/t gold over 1 meter from down-hole depths of 169 meters and 190 meters.

Double 19 Zone (Zone 3 Gold-In-Soil Anomaly)

Gold assay results for the first two trenches (109 meters) of an ongoing trenching program to follow-up on very encouraging 2008 trenching and 2009 scout reverse circulation (RC) drilling results on the Double 19 zone, located at the south-eastern extremity of the approximately 1,250 meter long Zone 3 gold-in-soil trend; approximately 600 meters southwest of the South Ridge zone on the Zone 2 gold-in-soil anomaly, are noted hereunder. The trenching program is designed to further define the geometry of the host diorite body and the structural controls of the mineralization in preparation for diamond drilling in the first quarter of 2012.

Trench TAD022 (58 meters) and road cut ADRS001 (51 meters) consisting of southeast and northwest trending excavations with a common start point yielded a combined channel sample intercept of 2.27 g/t gold over a 36 meters trench-length, including 2 meters grading 22.22 g/t gold, approximately 40 meters southwest of the TAD019 discovery trench. The Double 19 zone is characterized by an extensive system of granitoid-hosted, NE-trending, moderately NW-dipping, sheeted quartz veins exhibiting a spatial relationship with northeasterly trending shearing.

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For reference purposes, reverse circulation (RC) hole KBRC09019 targeting the TAD019 trench returned a mineralized intercept of 30 meters grading 3.52 g/t gold, including 6.47 g/t gold over 14 meters, from a down-hole depth of 8 meters; with the discovery trench yielding a channel sample intercept of 4.93 g/t gold over a 45 meters trench-length, including 12 meters grading 10.12 g/t gold.

As at the year ended December 31, 2011, 80 holes totaling 21,795 meters have been completed by our company in our 2011 drill program.

2012 Diamond Drill Program

In connection with our 2012 drill program or our Kibi gold project, we have received the assay results noted hereunder.

Initial Results of 2012 Drill Program

Highlights of the drill results reported from the initial 2012 drilling include:

• 25 meters grading 1.96 g/t gold, including 2.79 g/t gold over 9 meters, in KBDD12189 from 195 meters down- hole (Big Bend zone);

• 23 meters grading 1.50 g/t gold, including 2.80 g/t gold over 6 meters, in KBDD12187 from 331 meters down- hole (Big Bend zone);

• Work on an initial National Instrument 43-101 compliant mineral resource estimate on the Big Bend and East Dyke gold zones of the Kibi project’s Zone 2 has commenced by SEMS Exploration Services Ltd of Accra, Ghana.

The above drill results correspond to boreholes drilled in the latter part of 2011 and January 2012, designed to delineate/infill the Big Bend zone – Central granitoid and East Dyke –north zone; as well as to further test the southern portion of the East Dyke granitoid and a coincidental geophysical/geochemical anomaly lying to the south of the approximately 1,200 meter long by 500 to 800 meter wide Zone 2 gold-in-soil anomaly of our Kibi gold project. Holes reported above encompass KBDD11177 to KBDD12189 and KBDD12191, including: 6 holes (1,932 meters) on the Big Bend zone, 3 holes (537 meters) on the East Dyke - North zone, 2 holes (430 meters) on the southern extension of the East Dyke granitoid and 3 holes (435 meters) on the aforementioned induced polarization (IP) / gold-in-soil target. These 14 holes (3,334 meters) include 2 holes abandoned before reaching their targets due to technical difficulties, including: KBDD11182 (17.5 meters) which was re-drilled by KBDD11183; and KBDD11185 (83.5 meters) re-drilled by KBDD12186.

The present drilling includes 6 holes (1,932 meters) on the Big Bend zone, including: 4 holes designed to further delineate/infill the lower extension of the gold zone at vertical depths of approximately 190 meters to 315 meters, approximately 300 meters to 425 meters down plunge from surface; and 1 structural modeling hole designed to further establish the geometry/attitude of the mineralized en-echelon vein package system. Highlights from the down plunge delineation/infill drilling on the Big Bend zone include: 25 meters grading 1.96 g/t gold, including 2.79 g/t gold over 9 meters, from a down-hole depth of 195 meters in KBDD12189 and 23 meters grading 1.50 g/t gold, including 2.80 g/t gold over 6 meters, from a down-hole depth of 331 meters in KBDD12187.

Hole KBDD11183 consisting of a NE-trending (055 ^o /-73 ^o ) borehole collared within the central portion of the Big Bend zone was intentionally drilled down dip between mineralized sheets to help further establish the apparent, steep (70 ^o ), northerly dipping, en-echelon vein package geometry of the mineralized system. As designed KBDD11183 appears to have descended down dip between the mineralized sheets; with the borehole appearing to intermittently skirt and/or obliquely pierce the footwall of the auriferous vein package to the north. KBDD11183 yielded multiple mineralized intercepts, ranging from 5 meters to 30 meters in core-length, extending from a down-hole depth of 28 meters to 224 meters, including: 1.84 g/t gold over 17 meters from a down-hole depth of 28 meters, 1.74 g/t gold over 26 meters, including 7 meters grading 4.01 g/t gold, from a down-hole depth of 128 meters and 2.01 g/t gold over 30 meters, including 9 meters grading 4.53 g/t gold, from a down-hole depth of 195 meters.

To date significant gold mineralization has been traced over an approximately 325 meter strike length and an approximately 500 meter down plunge distance from surface along the Big Bend gold zone hosted by the Central granitoid body. Drilling to date indicates that the Big Bend zone consists of north-easterly plunging, en-echelon, mineralized vein packages appearing to be developed along a trough-like flexure within the Central granitoid body. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

Highlights from the initial 10 holes (2,293 meters) reported in Table 1 from the Double 19 zone on Zone 3 of our Kibi gold project and ongoing exploration activities reported include:

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• 12 meters grading 10.32 g/t gold in KBDD12198 from 18 meters down-hole on newly defined Double 19 zone (Zone 3 – East);

• 26 meters grading 3.06 g/t gold, including 5.67 g/t gold over 10 meters, in KBDD12205 from 33 meters down- hole (Double 19 zone);

• Drilling / trenching to date appears to indicate that the Double 19 zone consists of a ENE-plunging, en-echelon, mineralized vein system traced to date over an approximately 165 meter strike length and an approximately 150 meter down plunge distance from surface;

• Scout drilling on Zone 4 identifies prominent, pyritic/graphitic shear zone centred on quartz feldspar porphyry sill; mineralized shear traced over an approximately 300 meter strike length and a 160 meter down-dip extension to date by 5 boreholes (Orange No. 5 zone);

• Scout trenching and deep hand auger sampling scheduled to begin this week on newly defined 1,200 meter long by 150 to 250 meter wide Akwadum South and Akim Apapam gold-in-soil anomalies identified by the ongoing Phase II soil program.

A map depicting the location of the Double 19 zone in connection with the mineralization zones can be viewed on our company’s website at www.xtragold.com.

Double 19 Zone (Zone 3 – East Gold-In-Soil Anomaly)

The above drill results on the Double 19 zone correspond to a February 2012, 10 hole (2,293 meters) drill campaign designed to follow-up on very encouraging trenching and 2009 scout reverse circulation (RC) drilling results. With the present holes including: KBDD12192, KBDD12194, KBDD12198, KBDD12200 – KBDD12201, KBDD12203 – KBDD12206 and KBDD12208. The Double 19 zone lies at the south-eastern extremity of the approximately 1,250 meter long Zone 3 gold-in-soil trend, approximately 600 meters southwest of the South Ridge zone on the Zone 2 gold-in-soil anomaly. See the map depicting the location of the Double 19 zone in connection with the mineralization zones which is available for viewing on our company’s website. The drilling was designed to further define the mineralization along strike and at depth, gain additional insight on the mineralization’s structural setting, and further delineate the geometry of the host diorite body.

The above drilling tested the mineralized veining system over an approximately 100 meter strike distance and an approximately 80 meter down plunge extension from surface. Drilling highlights include: a near surface, saprolite (oxide) intercept of 16.5 meters grading 4.35 g/t gold from a down-hole depth of 4.5 meters in hole KBDD12208 designed to undercut the trench TKB022-ADRS003 mineralized intercept at the WNW extremity of the zone; a saprolite (oxide) intercept of 12 meters grading 10.32 g/t gold from a down-hole depth of 18 meters in KBDD12198 within the central portion of the zone; and intercepts of 19 meters grading 3.26 g/t gold and 26 meters grading 3.06 g/t gold from down-hole depths of 36 meters and 33 meters in holes KBDD12203 and KBDD12205 at the ENE extremity of the zone (drill fence with 30 meter collar separation). All holes, with the exception of KBDD12204 (NW-trending), consist of SE-trending boreholes with -50 ^o to -70 ^o inclinations. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite composition.

Current ongoing drilling has traced the mineralization an additional 50 meters to the ENE of the KBDD12201-KBDD12203-KBDD12205 section in holes KBDD12231, KBDD12233, and KBDD12234; with these holes still in the process of being logged and sampled. Drilling / trenching to date appears to indicate that the Double 19 zone consists of a ENE-plunging, en-echelon, mineralized vein system traced to date over an approximately 165 meter strike length and an approximately 150 meter down plunge distance from surface.

Orange No. 5 Shear Zone (Zone 4 Gold-In-Soil Anomaly)

Recent scout drilling efforts to test high priority geophysical, soil geochemical, and geological targets along the 3.5 kilometer long Zone 4 gold trend located within the south-western portion of the Apapam mining lease identified a prominent sulphide-bearing shear zone centered on a strongly iron-carbonate altered quartz feldspar porphyry sill emplaced along and/or proximate to the contact between intercalated greywacke/siltstone and graphitic phyllite rock sequences.

The NE-trending, pyritic/graphitic, Orange No. 5 shear zone has thus far been traced over an approximately 300 meter strike length and an approximately 160 meter down-dip extension from surface (approximately 125 meters vertical) by 5 boreholes. The mineralized structure exhibits a high chargeability / high conductivity induced polarization signature and is spatially associated with a prominent Versatile Time Domain Electromagnetic (VTEM) resistivity/conductivity break. The spatial relationship of the Orange No. 5 shear zone with a quartz feldspar porphyry sill body constitutes a classical orogenic lode gold setting and demonstrates the multi-style mineralization potential of our Kibi gold project. Assay results for the 5 holes are pending from the laboratory.

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Akwadum South / Akim Apapam Gold-In-Soil Anomaly Proofing

To date, the ongoing 2011 – 2012 Phase II Apapam soil sampling program has produced 2 prominent, tight/linear, gold-in-soil anomalies persistently traceable over lengths of 1,200 meters and extending over widths of 150 meters to 250 meters, including: the Akwadum South anomaly located at the southeast extremity of the Apapam mining lease, and the Akim Apapam anomaly located within the central portion of the namesake reconnaissance license.

These gold-in-soil anomalies exhibit spatial relationships with areas of structural complexity identified by an aeromagnetic (+/- VTEM, Radiometric) - based regional structure study conducted by SRK Consulting (Canada) Inc. in 2011 on behalf of Xtra-Gold; particularly with intersections between major D ₂ -D ₅ fault corridors and major, late, E-W trending D ₆ faults. A scout trenching and deep hand auger (5 meters) sampling program designed to test the subsurface geochemical signature and geological setting of the Akwadum South and Akim Apapam gold-in-soil anomalies is scheduled for initiation on or around April 27, 2012.

A mineralization map is available on our company’s website at www.xtragold.com.

Double 19 Gold Shoot on Zone 3

Recent diamond drilling indicates good down-plunge continuity of gold grades on the Double 19 Shoot on Zone 3 of our Kibi gold project. The assay results for a three hole (KBDD12231, KBDD12233 and KBDD12234) drill section totaling 489 meters successfully expanded the high grade Double 19 gold shoot to a down-plunge distance of approximately 150 meters from surface.

Highlights of the drill results and ongoing exploration activities reported include:

• 50.5 meters grading 2.03 g/t gold, including 4.71 g/t gold over 14 meters, in KBDD12231 from 57.5 meters down-hole (Double 19 Shoot);

• 28 meters grading 3.14 g/t gold, including 5.01 g/t gold over 12 meters, in KBDD12233 from 39 meters down-hole (Double 19 Shoot);

• drilling / trenching to date appears to indicate that the high grade Double 19 gold shoot consists of a moderately, ENE- plunging vein system centred on an apparent fold nose developed within the host diorite body; with the gold shoot having an asymmetrical convex geometry possibly reflecting a fold-hinge stockwork vein zone; and

• 2 new, typical Kibi-type, diorite – hosted, quartz stockwork systems discovered proximal to Double 19 gold shoot within Zone 3 – East gold-in-soil anomaly.

The Double 19 gold shoot lies at the south-eastern extremity of the approximately 1,250 meters long Zone 3 gold-in-soil trend, approximately 600 meters southwest of the South Ridge zone on the Zone 2 gold-in-soil anomaly. A map depicting the location of the Double 19 shoot in relation to the Zone 2 mineralization zones has been posted on our company’s website.

The present drilling located approximately 50 meters northeast of the KBDD12201-203-205 section was designed to further test the down-plunge extension of the mineralization and gain additional insight on the geometry and structural controls of the gold shoot. The KBDD12201-203-205 section yielded mineralized intercepts of 19 meters grading 3.26 g/t gold and 26 meters grading 3.06 g/t gold, including 5.67 g/t gold over 10 meters in holes KBDD12203 and KBDD12205 (see Table 1).

The 3 hole, scissor-pattern, drill section encompasses a SE-trending borehole (KBDD12231) and a pair of NW-trending, vertical fan boreholes (KBDD12233 to KBDD12234) collared approximately 80 meters to the southeast, and at a 30 meter lower elevation, than the KBDD12231 collar position. Hole KBDD12231 (-55 ^o ) returned a mineralized intercept of 50.5 meters grading 2.03 g/t gold, including 4.71 g/t gold over 14 meters, from a down-hole depth of 57.5 meters. The upper KBDD12233 borehole (-60 ^o ) of the KBDD12233-234 vertical fan pattern returned an intercept of 28 meters grading 3.14 g/t gold, including 5.01 g/t gold over 12 meters, from a down-hole depth of 39 meters, and the steeper KBDD12234 hole (-75 ^o ) yielded an intercept of 26.8 meters grading 2.69 g/t gold, including 4.73 g/t gold over 11 meters, from a down-hole depth of 35.5 meters, with both these intercepts cross-cutting the lower portion of the KBDD12231 mineralized intercept. Borehole KBDD12233 returned a second, deeper intercept of 10 meters grading 1.47 g/t gold from a down-hole depth of 138 meters but insufficient drilling information is available at this time to determine if this mineralization forms part of the Double 19 shoot or reflects a new deeper gold zone.

Drilling / trenching to date appears to indicate that the Double 19 shoot consists of a moderately, ENE-plunging vein system centred on an apparent fold nose developed within the host diorite body; with the gold shoot having an asymmetrical convex geometry possibly reflecting a fold-hinge stockwork vein zone. These drilling results extend the Double 19 shoot to a down-plunge distance of approximately 150 meters from surface; with the relatively shallow vertical depths of the mineralized intercepts reflecting the position of the zone along a steep slope exhibiting approximately 80 meters in topographical relief.

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Kibi Old Mine Prospect

In early 2012 four holes (491 meters) were drilled to better characterize the gold grade and structural setting of the Kibi Old Mine prospect located at the north-central extremity of the Apapam mining lease. The Kibi Old Mine structure was the focus of exploration and underground development work in the mid 1920’s and late 1930’s; including a main shaft sunk to a depth of 172 feet (~ 52.5 meters) with levels driven at depths of 65 feet and 150 feet (~ 20 meters and ~45.5 meters). Mineralization is hosted by an east-northeast striking, moderate southerly dipping, quartz-rich, composite structure emplaced within Birimian metasedimentary rock; spatially associated with a geophysically-interpreted dilational jog developed along a regional NE-trending structure.

Hole KBDD12199 consisting of a vertical hole intersected the Main Reef structure between the 65 foot and 150 foot levels at a depth of 26 meters; with a network of structure-parallel and shallow dipping extensional veins developed along the hanging wall flank of the main structure. The main fault vein returned 4.92 g/t gold over a 1.2 meter core length (26 meters – 27.2 meters); and the subsidiary vein system yielded a 15.5 meter intercept grading 0.71 g/t gold (10.5 meters – 26 meters). Holes KBDD12190, KBDD12193, and KBDD12195 targeted the down dip extension of the structure below the 150 foot level at vertical depths of approximately 60 meters to 145 meters; with the boreholes yielding mineralized intercepts grading 1.23 g/t gold over 6.3 meters, 0.94 g/t gold over 4.1 meters, and 0.62 g/t gold over 9 meters, respectively (see Table 1).

Orange No. 5 Shear Zone (Zone 4 Gold-In-Soil Anomaly)

Scout drilling efforts from March to May 2012 designed to test high priority geophysical and soil geochemical targets along the 3.5 kilometer long Zone 4 gold trend located within the south-western portion of the Apapam mining lease identified a prominent northeast trending shear zone centred on a strongly iron-carbonate altered QFP emplaced along and/or proximate to the contact between intercalated greywacke/siltstone and graphitic phyllite rock sequences.

The moderately southeast dipping, pyritic/graphitic, Orange No. 5 shear zone has been traced to date over an approximately 300 meter strike length and approximately 175 meter down-dip distance from surface by 7 boreholes (1,482 meters). A 3 hole NW-trending drill fence intersected the structural corridor over an approximately 100 meter down dip distance; with holes KBDD12219, KBDD12220, and KBDD12251 returning 6 meters grading 0.73 g/t gold from a down-hole depth of 85 meters, 19 meters grading 1.78 g/t gold from a down-hole depth of 134 meters, including 4.11 g/t gold over 6 meters, and 0.7 meters grading 41.40 g/t gold from a down-hole depth of 154.3 meters. The shear zone also yielded a significant mineralized intercept grading 2.24 g/t gold over 8.5 meters, including 5.76 g/t gold over 3 meters, from a down-hole depth of 99 meters in KBDD12252 located approximately 40 meters to the southwest of the aforementioned drill fence (see Table 1).

The mineralized structure exhibits a high chargeability / high conductivity induced polarization (IP) signature and is spatially associated with a prominent Versatile Time Domain Electromagnetic (VTEM) resistivity/conductivity break. The spatial relationship of the Orange No. 5 shear zone with a QFP body constitutes a classical orogenic lode gold setting and demonstrates the multi-style mineralization potential of the Kibi gold project.

South Ridge Zone (Zone 2 Gold-In-Soil Anomaly)

The South Ridge zone located at the north-western extremity of the approximately 1,200 meters long by 500 meters to 800 meters wide Zone 2 gold-in-soil anomaly was targeted by 801 meters of follow-up drilling to further define the structural controls of the mineralization and the contacts of the host granitoid body. Previous 2010 and 2011 drilling and trenching traced an extensive system of en-echelon extension vein arrays over approximately 440 meter strike and 400 down-dip distances along the SE-trending, moderately NE-dipping South Ridge granitoid body. The March to May 2012 drilling consisted of 6 vertical holes arranged in 2 staggered (50 meters apart), southeast trending arrays of 3 holes at 50 meter centres, designed to better target the combination of the moderate easterly dipping shearing and the shallow, westerly dipping extensional vein systems.

Five (5) out of the 6 holes returned significant, near surface mineralized intercepts, including: 36 meters grading 2.85 g/t gold, including 7.06 g/t gold over 7.7 meters, from a down-hole depth of 42.5 meters in KBDD12253; 20.5 meters grading 1.04 g/t gold from a down-hole depth of 13.5 meters in KBDD12210; and 4.46 g/t gold over 3.2 meters from a down-hole depth of 68.5 meters in KBDD12254. Gold mineralization is associated with quartz-albite-carbonate-sulphide veining developed within a rock body of quartz diorite to tonalite composition. The higher grade KBDD12253 intercept exhibits close spatial relationships with 2 mineralized intercepts from the 2010 drill program, including: 25 meters grading 0.73 g/t gold from a northeast trending, southeast dipping shear zone in KBDD10096 and 72 meters grading 0.93 g/t gold from an extensional vein system in KBDD10090 (see Table 1). Further trenching and drilling is required to further define the geometry and structural controls of this large footprint, near surface auriferous vein system.

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In November 2012, we reported gold results from initial trenching and surface channel sampling on a newly discovered high-grade shear zone lying within the recently defined Zone 5 gold-in-soil anomaly on our Kibi project. Highlights of the trenching and bedrock channel sampling results reported at that time include:

• 20.5 meters grading 7.26 g/t gold, including 12.26 g/t over 6.5 meters, in trench TCK001; and 6.7 meters grading 32.32 g/t gold, including 82.22 g/t over 2 meters, in trench TCK002 (High-Grade Gold Shoot);

• saw-cut channel sample composites grading 33.21 g/t gold over 2.4 meters in channel sample string KBCS023, 15.13 g/t gold over 4.3 meters in sample string KBCS024, 8.68 g/t gold over 4.9 meters in sample string KBCS025 and 6.74 g/t gold over 9 meters in string KBCS027 and rock chip channel sample composites grading 8.9 g/t gold over 4 meters in string KBLC010, 7.69 g/t gold over 4 meters in string KBLC012, 16.14 g/t gold over 3 meters in string KBLC014, and 40.6 g/t gold over 2.3 meters in string KBLC016 (High-Grade Gold Shoot);

• gold-bearing shear zone traced to date over an approximately 300 meter strike length, with present sampling defining a high-grade gold shoot over a minimum 70 meter strike distance. Auriferous shear zone spatially associated with the approximately 1.8 kilometer long, NE-trending Zone 5 gold-in-soil anomaly.

The high-grade shear zone was discovered during follow up prospecting of the Zone 5 gold-in-soil anomaly yielded by a recently completed property-wide soil geochemical survey. High-grade grab samples collected during the prospecting phase prompted the initiation of systematic outcrop channel sampling and first pass trenching. To date, the northeast striking gold-bearing structure has been traced by outcrop and trench sampling over an approximately 300 meter distance, with the shear zone exhibiting an apparent braided geometry locally attaining approximately 30 meters in width. Work to date has defined a high-grade gold shoot over a minimum 70 meter strike distance along the Zone 5 shear zone. The auriferous shear zone is spatially associated with an approximately 1.8 kilometer long, NE-trending gold-in-soil anomaly. A parallel, untested gold-in-soil anomaly, lying approximately 300 meters to the northwest, may reflect a parallel structure. Significant trench intercepts are presented in Table 2 and length weighted average grades for the composite channel sample strings are presented in Table 3.

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Trench TCK001, consisting of an easterly trending trench at an oblique angle to the NE-trending structural zone, returned a mineralized intercept of 20.5 meters grading 7.26 g/t gold, including 12.26 g/t over 6.5 meters. A second gold zone defined by the 4.98 g/t gold over 0.5 meter intercept at the 41 meter mark of trench TCK001 and outcrop chip channel sample string KBLC008 (4.32 g/t gold over 2.6 meters), located immediately north of the trench, is present along the southeast flank of the composite-type shear zone. Trench TCK002 consisting of a SE-trending trench centered approximately 20 meters northeast of trench TCK001 returned a high-grade mineralized intercept of 6.7 meters grading 32.32 g/t gold, including 82.22 g/t over 2 meters. The 3.45 g/t gold over 1 meter intercept at the south-eastern extremity of trench TCK002 (29.0 meters), in combination with outcrop chip channel strings KBLC019 and KBLC011, yielding 4.57 g/t gold over 1 meter and 2.31 g/t gold over 4 meters, define the second gold zone extending over an approximately 6.5 meter distance along the southeast flank of the high-grade gold shoot. Road Cut CCRS001, designed to test the strike extension of the structure approximately 50 meters to the southwest of the high-grade gold shoot outcrop area, returned a mineralized intercept of 12.5 meters, grading 1.28 g/t gold, including 6.98 g/t gold over 0.5 meter. Systematic trenching and/or drilling will be required to accurately determine the full mineralized width and grade of the braided, composite-type shear zone.

The surface channel sampling reported today corresponds to 178 bedrock samples collected along outcrops exposing an approximately 70 meter strike extension of the high-grade gold shoot. Channel sampling is semi-continuous along and/or across the structure reflecting the intermittent bedrock exposure. The present sampling comprises 50 saw-cut channel samples and 128 rock chip channel samples totaling 97 meters. In aggregate, these samples form 25 composite channel strings ranging from one to 9 meters in length, with individual channel samples averaging 0.55 meters in length.

Of the 178 bedrock surface channel samples collected: 35 (20%) returned less than 0.5 g/t gold; 55 (31%) returned gold values between 0.5 g/t to 3 g/t; 51 (29%) between 3 g/t and 10 g/t gold; 26 (14%) between 10 g/t to 30 g/t gold; 9 (5%) between 30 g/t and 50 g/t gold; and 2 samples returned values over 50 g/t gold (111.03 g/t maximum). The length weighted average grade of all the channel samples is 7.29 g/t gold.

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Trenching and systematic outcrop sampling is ongoing to further define the strike extension of the gold-bearing structure along the 1.8 kilometer long Zone 5 gold-in-soil anomaly, and detailed geological/structural mapping is in progress to further define the mineralization controls in the high-grade gold shoot. A detailed ground magnetometer survey covering the Zone 5 anomaly area has been initiated and an induced polarization (IP) survey is in the planning stage.

In December 2012, we announced the prospecting discovery of two new gold-bearing structures parallel to the recently delineated high-grade Zone 5 shear zone, in addition to further results from ongoing channel sampling from the Zone 5 shear, on our Kibi project. Highlights of the outcrop grab sampling and channel sampling results reported at that time included:

• prospecting which identified a new, parallel, gold-bearing structure lying approximately 325 meters northwest of the high- grade Zone 5 shear zone, with outcrop grab sampling returning gold values up to 13.2 g/t, 6.86 g/t, 6.37 g/t, 6.32 g/t, and 5.33 g/t;

• saw-cut channel sample composites grading 3.13 g/t gold over 7.6 meters in sample string KBCS028B-KBCS028 and 1.08 g/t gold over 6.5 meters in string KBCS012, from a newly exposed quartz-tourmaline vein zone along the main Zone 5 shear zone; and

• the newly discovered parallel structures confirmed a gold-bearing Zone 5 deformation / alteration corridor over an apparent 325 meter width, with the main Zone 5 shear zone traced to date over an approximately 300 meter strike length.

To date, ongoing reconnaissance mapping and prospecting of the approximately 1.8 kilometers long by 300 meters to 800 meters wide, NE-trending Zone 5 gold-in-soil trend has resulted in the discovery of 2 new, parallel, gold-bearing structures located approximately 250 meters and 325 meters northwest of the high-grade Zone 5 shear zone. Preliminary interpretation of the recently completed detailed ground magnetometer survey data appears to indicate a correlation between the mineralized structures discovered to date within Zone 5 and NE-trending magnetic gradients.

The north-westernmost structure of the 2 newly identified structures consists of an approximately 10 meters wide, NE-trending, braided shear zone traced over an approximately 50 meter distance along grubbed off outcrops. A total of 27 rock grab samples were collected from 4 separate, 0.4 meters to 1.0 meters wide, quartz-filled shears forming part of the composite-type structure. Of the 27 quartz veining and iron carbonate / pyrite altered wall rock samples collected: 4 yielded less than 0.1 g/t gold; 11 returned gold values between 0.1 g/t to 1.0 g/t; 5 between 1 g/t and 4 g/t gold; 6 between 4 g/t and 7 g/t gold; and one sample returned a high of 13.2 g/t gold.

The second, newly discovered structure located approximately 250 meters northwest of the main Zone 5 shear zone is characterized by an auriferous, spine-like, quartz vein outcrop spatially associated with an approximately 150 meters wide gold-in-soil anomaly; with the soil samples on either side of the vein outcrop yielding 0.5 g/t and 0.74 g/t gold. A single grab sample collected from this narrow, NE-trending, quartz vein exposure returned 1.77 g/t gold. Mechanized trenching has been initiated across the gold-in-soil anomaly to further define this structure.

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Mechanized outcrop stripping designed to follow-up on a previously released mineralized intercept of 12.5 meters grading 1.28 g/t gold in road cut CCRS001, located approximately 50 meters along strike to the southwest of the high-grade gold shoot on the main Zone 5 shear zone, exposed a NE-trending structural zone exhibiting strong quartz-tourmaline tension gash veining and iron carbonate / pyrite alteration over an approximately 45 meter strike-length. Two SE-trending, saw-cut channel sample composites located approximately 3 meters apart across the central portion of the veining exposure returned mineralized intercepts of 6.5 meters grading 1.08 g/t gold and 7.6 meters grading 3.13 g/t gold in sample strings KBCS012 and KBCS028B-KBCS028. Due to irregular bedrock surface, the reported intercepts are sample intersection lengths irrespective of mineralization topography and may not represent true width of mineralization. Systematic channel sampling is ongoing to test the full 45 meters length of the exposed vein zone.

Reconnaissance geology and prospecting is ongoing to further define the strike extensions of the three known gold-bearing structures and identify any additional prospective structures along the 1.8 kilometers long Zone 5 gold-in-soil trend. Trenching and outcrop stripping is also in progress to further exposed the 2 newly discovered auriferous structures in preparation for systematic channel sampling. Infill soil geochemical sampling on newly established 100 meters spaced grid lines designed to tighten-up the gold-in-soil anomaly and an induced polarization (IP) survey are also planned.

In March 2013, we announced channel sampling results from a new exposure of the main shear, in addition to initial channel sample results from six recently identified shear zones forming part of the Zone 5 gold corridor, on our Kibi project. Highlights of the channel sampling results and Zone 5 gold corridor expansion work reported today include:

• new gold shoot discovered along main shear approximately 350 meters southwest of discovery high-grade gold shoot; with shear consisting of braided (anastomosing) structure attaining 13 meters in width and encompassing four sinuous mylonitic branches ranging from approximately 0.4 meters to 4 meters in width. Highlights from channel sampling of mylonitic shear branches include: 2.5 meters grading 4.71 g/t gold and 3.9 meters grading 5.9 g/t gold in channel sample strings KBCS080-7 and KBCS080-9 (SE branch), 1.1 meters grading 14.77 g/t gold, including 26.1 g/t gold over 0.5 meters in KBCS080-18 (central Branch); and 1.5 meters grading 10.47 g/t gold, including 20.4 g/t gold over 0.5 meters and 1.6 meters grading 11.14 g/t gold, including 17.8 g/t gold over 0.8 meters in strings KBCS080-2 and KBCS080-5 (NW branch)

• geological mapping/sampling to date indicates that the Zone 5 gold corridor corresponds to a minimum 325 meters wide braided shear zone system encompassing at least 7 auriferous shear zones; with the main shear traced to date over an approximately 475 meter strike length. The auriferous shear zone system is spatially associated with an approximately 1.8 kilometers long by 300 meters to 800 meters wide, NE-trending, anomalous gold-in-soil trend; and

• extensive arrays of mineralized low-angle extensional quartz-tourmaline veins spatially associated with all seven shear zones; greatly enhancing the bulk mining potential of the Zone 5 gold corridor.

The present exploration results correspond to an ongoing mechanized outcrop stripping / trenching transect designed to test the southwestern strike extension of the main shear and define the full width extent of the NE-trending Zone 5 gold corridor. Approximately 65% (325 meters) of the planned 500 meters long, NW-trending transect located approximately 350 meters southwest of the discovery high-grade gold shoot has been completed to date; with the transect positioning based on favorable topography in combination with shallow overburden cover, previously identified gold-bearing structures, and priority geophysical targets.

Geological mapping and grab / channel sampling of the bedrock exposed to date along the transect has identified seven auriferous structures distributed over an approximately 325 meters width of the Zone 5 structural corridor; including the apparent southwestern strike extension of the main shear. The structures consist of sinuous anastomosing shear zones ranging from approximately 1 meter to 13 meters in width and containing irregular steeply dipping veins, stringers, and lenses of quartz plus/minus iron carbonate and tourmaline. Extensive arrays of mineralized low-angle extensional veins are spatially associated with the controlling vertical shear veining.

The apparent southwestern strike extension of the Main Shear was exposed over an approximately 55 meter strike length within the southeastern portion of the outcrop stripping / trenching transect, approximately 350 meters southwest of the discovery high-grade gold shoot. At this locality, the main shear consists of a braided (anastomosing) structure attaining 13 meters in width and encompassing 4 sinuous high shear strain branches ranging from approximately 0.4 meters to 4 meters in width; bounding relatively less deformed/altered rock lozenges. The NE-trending, steeply SE dipping, pinch and swell high strain branches range from silicified / carbonatized mylonitic rock containing irregular quartz-tourmaline veining / lenses to sericite-iron carbonate-pyrite schist hosting parallel quartz veining. Arrays of mineralized low-angle extensional quartz-tourmaline veins cross-cut the mylonitic zones and visually extend up to 10 meters into the wall rock.

A total of 152 bedrock saw-cut channel samples totaling 86 meters were collected over an approximately 40 meter strike distance of the new main shear exposure, including 52 vertical or steeply inclined channel samples (28 meters) collected on outcrop ledge faces to test low-angle extensional veining arrays. In aggregate these samples form 51 composite channel strings ranging from 0.20 meters to 7.6 meters in length, with individual channel samples averaging approximately 0.55 meters in length. Of the 152 channel samples collected: 5 (3%) yielded less than 0.01 g/t gold, 28 (19%) returned gold values from 0.01 g/t to 0.1 g/t, 58 (38%) between 0.1 g/t and 1.0 g/t gold, 18 (12%) between 1 g/t and 2 g/t gold, 23 (15%) between 2 g/t and 5 g/t gold, 14 (9%) between 5 g/t and 10 g/t gold, 4 (2.5%) between 10 g/t and 20 g/t gold; and 2 samples (1.5%) returned values over 20 g/t gold (26.1 g/t maximum).

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Highlights from a series of channel samples collected from the respective mylonitic branches over an approximately 20 meter strike length include mineralized intercepts of: 2.5 meters grading 4.71 g/t gold and 3.9 meters grading 5.9 g/t gold in channel sample strings KBCS080-7 and KBCS080-9 (SE branch), 1.1 meters grading 14.77 g/t gold, including 26.1 g/t gold over 0.5 meters in KBCS080-18 (central branch); 1.5 meters grading 10.47 g/t gold, including 20.4 g/t gold over 0.5 meters and 1.6 meters grading 11.14 g/t gold, including 17.8 g/t gold over 0.8 meters in strings KBCS080-2 and KBCS080-5 (NW branch); and 0.4 meters grading 2.08 g/t gold in sample string KBCS080-21(NW-2 branch). The highly accidented bedrock surface, including overburden filled crevices, is typically non-conducive to continuous channel sampling across the width of the structure; with the less deformed/altered rock between the shear branches typically being recessively weathering. Local sampling of the inter-shear branch rock where possible yielded gold values in the 0.1 g/t to 1.5 g/t range. See Table 4 for the full listing of significant mineralized intercepts from the respective mylonitic zones and intercepts yielded by vertical channel sampling targeting sub-horizontal extensional veining.

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A total of 428 bedrock saw-cut channel samples totaling 253 meters were collected from the remaining 6 shear zones emplaced within the Zone 5 gold corridor, including 25 vertical or steeply inclined channel samples (14.5 meters) collected on outcrop ledge faces to test low-angle extensional veining. In aggregate these samples form 123 composite channel strings ranging from 0.20 meters to 25 meters in length, with individual channel samples averaging approximately 0.60 meters in length. Sampling to date ranges from widespread scout channel sampling to detail channel sampling on 3 structures. Of the 428 channel samples collected: 12 (3%) yielded less than 0.01 g/t gold; 205 (48%) returned gold values from 0.01 g/t to 0.1 g/t, 159 (37%) between 0.1 g/t and 1.0 g/t gold, 18 (4%) between 1 g/t and 2 g/t gold, 23 (5%) between 2 g/t and 5 g/t gold; 10 (2%) between 5 g/t and 10 g/t gold and 1 sample returned a maximum value of 11.5 g/t gold.

The six parallel shear zones are characterized by widespread anomalous gold values in the 0.1 g/t to 1.0 g/t range (37% of samples) with localized higher grade values attaining 11.5 g/t gold. Channel sampling highlights on the respective structures include mineralized intercepts of: 1.2 meters grading 5.93 g/t gold and 1 meter grading 6.39 g/t gold in channel sample strings KBCS035 and KBCS045 (L7675 shear), 0.8 meters grading 8.83 g/t gold in sample string KBCS078-2 (L7600W shear); 0.5 meters grading 9.76 g/t gold in KBCS077-1 (Old Pit shear), 1.1 meters grading 3.83 g/t gold, including 6 g/t gold over 0.6 meters in KBCS076-31 (L7600E shear); and 0.8 meters grading 2.58 g/t gold in sample string KBCS076-50 (main-east shear). See Table 5 for the full listing of significant mineralized intercepts from these six shear zones.

Highlights of vertical channel sampling across low-angle extensional veining arrays spatially associated with the controlling vertical shear veining include: 1.1 meters grading 3.51 g/t gold and 0.8 meters grading 6.85 g/t gold in sample strings KBCS077-V1 and KBCS077-V2 (Old Pit shear), 0.4 meters grading 2.45 g/t gold in KBCS079-V1 (L7600W shear) and 1.3 meters grading 4.15 g/t gold in string TCK008-V-47.7 (L7700 shear). In the case of the L7700 shear a set of three vertical channel sample strings returned considerably higher gold values ranging from 1.17 g/t to 4.15 g/t over 0.7 meters to 1.3 meter lengths, than the 0.27 g/t gold over 2 meters yielded by the vertical shear vein.

In addition to channel sampling, a total of 137 rock grab samples were also collected from the seven shear zones as part of first pass sampling to guide subsequent channel sampling. Of the 137 quartz veining and silica-iron carbonate-pyrite altered wall rock grab samples collected: 26 (19%) yielded less than 0.01 g/t gold, 40 (29%) returned gold values from 0.01 g/t to 0.1 g/t, 24 (18%) between 0.1 g/t and 1.0 g/t gold, 26 (19%) between 1 g/t and 5 g/t gold, 14 (10%) between 5 g/t and 10 g/t gold and 7 (5%) samples returned gold values between 10 g/t and 19.85 g/t.

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Preliminary geological observation indicate that the Zone 5 gold corridor corresponds to a minimum 325 meters wide, multi-structure, braided shear zone system emplaced along a quartz feldspar porphyry (“QFP”) body; with the main shear traced to date over an approximately 475 meters strike length. The auriferous shear zone system is spatially associated with an approximately 1.8 kilometers long by 300 meters to 800 meters wide, NE-trending, anomalous gold-in-soil trend centered on a moderate magnetic / high radiometric airborne geophysical signature appearing to delineate the QFP body.

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Outcrop stripping / trenching continues on the planned 500 meters long transect to determine the full width extent of the Zone 5 gold corridor; as well as detail geological mapping and channel sampling of the auriferous shears identified to date. Infill soil geochemical sampling and prospecting is also in progress on newly established detail (100 meters) grid lines covering the 1.8 kilometers long Zone 5 gold-in-soil anomaly. A 30 kilometers pole-dipole induced polarization (IP) survey covering a 2.2 kilometers by 1.0 kilometer to 1.5 kilometers grid at 100 meters spacing was completed by Sagax Afrique S.A. in February 2013; with the final results and interpretation still pending.

Gold Intercept Reporting Criteria

Unless otherwise indicated, “Reported Intercepts” represent core-lengths; true width of mineralization is unknown at this time. Individual sample results were length weighted to yield average composite interval grades as reported. Unless otherwise indicated “Significant Intercepts” satisfy following criteria: greater than (>) 5.0 gram gold x meter product and > 0.5 g/t gold. “Anomalous” signifies at least one intercept > 2.0 gram gold x meter product and > 0.25 g/t gold. Unless otherwise indicated intercepts are constrained with a 0.25 g/t gold minimum cut-off grade at the top and bottom of the intercept, with no upper cut-off grade applied, and a maximum of five consecutive meters of internal dilution (less than 0.25 g/t gold). All internal intervals yielding above 15 g/t gold are indicated within the intersection.

Quality-Control Program

We have implemented a quality-control program to ensure best practice in the sampling and analysis of the drill core, reverse circulation (RC) samples and trench channel samples. Drill core is HQ diameter (63.5 millimeters) in upper oxidized material (regolith) and NQ diameter (47.6 millimeters) in the lower fresh rock portion of the hole. Drill core is saw cut and half the core is sampled in standard intervals. The remaining half of core is stored in a secure location. Reverse circulation (RC) samples are taken at one meter intervals under dry drilling conditions by experienced geologists, with all samples weighed on site. Trench samples consist of continuous, horizontal channels collected from a canal excavated along the bottom sidewall of the trench (~ 0.10 meter above floor). All samples are transported in security-sealed bags to ALS Ghana Limited, an ISO 9001:2000 certified laboratory. As of the date of this annual report, a 1000 gram split of the sample is pulverized to better than 85% passing 75 microns, and analyzed by industry standard 50 gram fire assay fusion with atomic absorption spectroscopy finish. Samples with observed visible gold and/or exhibiting typical Kibi-type granitoid hosted mineralization characterized by liberated, particulate gold grains are pulverized in their entirety to better than 85% passing 75 microns, and analyzed four times by industry standard 50 gram fire assay fusion with atomic absorption spectroscopy finish; with the arithmetic average of the four assays reported. Our company inserts a certified reference standard (low to high grade), analytical blank, and field duplicate sample in every batch of 20 drill core / reverse circulation (RC) chip / trench channel / saw cut channel samples. Validation parameters are established in the database to ensure quality control.

Recovery and Sale of Placer Gold

During 2010 and 2011, we negotiated with independent Ghanaian contract miners and operators in connection with their placer gold recovery operations at our Kibi project on fixed payment terms to our company. During 2010, 1,904.18 ounces of gold was recovered and produced by the contract miners from our Kibi project for which we received and sold 361.80 ounces of gold for gross proceeds of $461,649.62. During 2011, 1,617.39 ounces of gold was recovered and produced by the contract miners at this project for which we received and sold 307.30 ounces of gold for gross proceeds of $422,944.73. During 2012, we sold 26.53 ounces of gold for gross proceeds of $44,206.94 which was the remaining payament we had received from the contract miners during their 2010 and 2011 placer gold recovery operations at this project.

Future Exploration Plans

2013 Exploration Program

During 2013, we plan to:

• carry out a drill program of 3,000 meters targeting Zone 5 of our Kibi project at an estimated cost of $600,000; and

• conduct a field exploration program focusing on Zone 5 but also including additional high priority soil geochemical and geophysical targets on our Kibi project at an estimated cost of $250,000, consisting of:

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• ongoing reconnaissance geology and prospecting to further define the strike extensions of the seven known gold-bearing structures hosted by the Zone 5 gold corridor and to identify any additional prospective structures along the 1.8 kilometers long Zone 5 gold-in-soil trend;

• trenching and outcrop stripping to further expose the known auriferous structures in preparation for systematic geological mapping and channel sampling;

• infill soil geochemical sampling on newly established 100 meter spaced grid lines designed to tighten-up the Zone 5 gold-in-soil anomaly and an induced polarization (IP) survey; and

• scout trenching focusing on the prioritization of additional gold showings yielded by our recently completed property- wide soil geochemical survey, geological modeling, and VTEM targets.

Resources and Reserves

We have identified five deposits which are estimated to contain an indicated mineral resource of 278,000 ounces of gold at an average grade of 2.56 g/t and an additional inferred mineral resource of 147,000 ounces of gold at an average grade of 1.94 g/t. As at the date of this annual report, no mineral reserves have been identified on our Kibi project.

National Instrument 43-101 Compliant Mineral Resource Estimate

In November 2012, we announced the completion of an initial National Instrument 43-101 compliant mineral resource estimate on our Kibi project. The resource estimate encompasses the Big Bend, East Dyke, Mushroom, and South Ridge deposits in Zone 2 and the Double 19 deposit in Zone 3. All the above mineralized bodies remain open in several directions. In aggregate, these five gold deposits are estimated to contain an indicated mineral resource of 278,000 ounces of gold and an additional inferred mineral resource of 147,000 ounces of gold as tabulated below, with details presented in Table 7 noted below.

Table 6: Summary of Mineral Resources for Kibi Gold Project (October 26, 2012)

Resource Estimate Summary

The independent mineral resource estimate for our Kibi project was prepared by SEMS Exploration Services Ltd. of Accra, Ghana, in collaboration with our company’s personnel, in accordance with the Definition Standards for Mineral Resources and Mineral Reserves set out by the Canadian Institute of Mining, Metallurgy and Petroleum. This constitutes the first ever National Instrument 43-101 mineral resource estimate generated on a lode gold project within the underexplored Kibi Gold Belt. The effective date of the mineral resource estimate is October 26, 2012. The independent National Instrument 43-101 technical report supporting the resource estimate has been filed on www.sedar.com. Details for the mineral resource estimate are outlined in Table 7 below and the location of the deposits is depicted in Figure 1 noted below.

The initial mineral resource estimate for our Kibi project has identified five deposits collectively hosting 278,000 ounces of gold at an average grade of 2.56 g/t in the indicated category and 147,000 ounces of gold at an average grade of 1.94 g/t in the inferred category. All mineral resources have been reported at a 0.5 g/t gold cut-off grade, taking into account current economic conditions and typical likely costs and parameters of open pit extraction. An assay top cut of 20 g/t gold was statistically determined for all mineralized zones. The resource estimate is based on some 190 diamond drill and reverse circulation (RC) boreholes totalling approximately 34,810 meters, of which 88% are diamond drill meters, drilled by our company from August 2008 to May 2012. The resource modelling incorporates 106 trenches including some un-sampled trenches utilized mainly for geological mapping or drill hole planning.

The five mineralized bodies cover a combined strike length of approximately 1.6 kilometers within the Zone 2 and Zone 3 gold-in-soil anomalies. The Big Bend, East Dyke, Mushroom, and South Ridge deposits are located within Zone 2, with separations varying from almost contiguous to 200 meters. The Double 19 deposit lies approximately 500 meters southwest of Zone 2. Over 75% of the indicated mineral resource occurs within the Big Bend deposit, with the remaining portion of the indicated resource contained within the East Dyke deposit. Both of these deposits extend to 350 meters beneath the topography surface. The other three deposits are smaller, shallower and less advanced from an exploration perspective and their mineral resources have been classified as Inferred.

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Gold mineralization within the mineral resource is predominantly characterized by mineralized quartz vein sets hosted in belt-type granitoids. Over 20 significant gold occurrences hosted by Belt (Dixcove) and Basin (Cape Coast) type granitoids are known in Ghana, with a number constituting significant deposits. These deposits represent a relatively new style of gold mineralization for orogenic gold deposits within the West African Birimian terrain. Belt-type intrusive hosted gold deposits include Newmont Mining’s Subika deposit at their Ahafo mine and Kinross Mining’s Chirano deposits within the Sefwi gold belt, as well as Golden Star Resources’ Hwini-Butre deposit at the southern extremity of the Ashanti gold belt.

Table 7: Mineral Resource Estimates by Deposit, Material Type, and Classification

Notes:

• CIM Definition Standards were followed for the mineral resource estimate.
• All mineral resources have been reported at a 0.5 g/t gold cut-off grade, taking into account current economic conditions and typical likely costs and parameters of open pit extraction; and an assay top cut of 20 g/t gold was statistically determined for all mineralized zones.
• Resource estimation for main Big Bend and East Dyke deposits utilized a three-dimensional wireframe model defined on cross- sections ranging from 10 to 50 meter intervals (average 20 meters). The remaining three minor deposits were modelled using an automated method ( Leapfrog software). Grade interpolation for all resource models was undertaken using the inverse distance cube method in Datamine.
• Average specific gravity (SG) values of 1.6, 2.4, and 2.85 were used for Oxide, Transition, and Fresh (Sulphide) materials.
• Mineral resource tonnage and contained metal have been rounded to reflect the accuracy of the estimate, and numbers may not add due to rounding.
• Mineral resource tonnage and grade are reported as undiluted.

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• The figures for contained gold are in-situ mineral resources.
• 1 troy ounce equals 31.10348 grams.
• Mineral resources are not mineral reserves and by definition do not demonstrate economic viability. This mineral resource estimate includes inferred mineral resources that are normally considered too speculative geologically to have economic considerations applied to them that would enable them to be categorized as mineral reserves. There is also no certainty that these inferred mineral resources will be converted to the measured and indicated resource categories through further drilling, or into mineral reserves, once economic considerations are applied.

Xtra-Gold supplied SEMS with a comprehensive drilling and trenching database together with “Leapfrog” mineralized models for each deposit, wireframe lithological model for the host diorite body, and wireframes of oxidation states for Regolith, Transition, and Fresh rock domains. This database, 3D models, and wireframes formed the basis of the resource presented here; with all work carried out by SEMS utilizing Datamine software.

Modelling of the five separate mineralized bodies was achieved in two different formats. The main Big Bend and East Dyke deposits were modelled by sectional digitising of mineralization outlines from 10 to 50 meter intervals (average 20 meters), dependent upon drill section spacing and continuity. The remaining three minor deposits were modelled using an automated method ( Leapfrog software). Leapfrog models went through several iterations and refinements before being accepted. This involved visual checking of close spaced sections, comparison to manual interpretation, and elimination of excessive outliers.

Block models of the various zones were created within the mineralized solids using a parent cell block size of 5 x 5 x 5 meters (X,Y,Z), depleted to the topography, and densities set according to oxidation surfaces. Block grades were estimated using 1 meter down-hole composites utilizing an inverse distance cubed interpolation and classified as indicated or inferred dependent on drill section interval and sample proximity. Search ellipsoids for grade interpolation were created with 35 x 35 x 12 meter in the down dip, strike and minor width directions. The mineral resource has been constrained to several geological domains that limit the influence of grade interpolation. This is particularly relevant where secondary ore shoots parallel the main mineralized body. Individual search ellipsoids were assigned to each domain. Additionally, the mineral resource has been constrained to the diorite body, which is the predominant host rock of mineralization. The indicated resource estimate is considered to have reasonable prospects for eventual economic viability, being constrained by a 0.5 g/t gold cut-off taking into account current economic conditions and typical likely costs and parameters of open pit extraction.

The mineral resource estimate for our Kibi project has been prepared by Mr. Andrew Netherwood, AusIMM, Mr. Joe Amanor, AusIMM and Mr. Simon Meadows Smith, IOM3, all of SEMS Exploration Services Ltd. of Accra, Ghana, and all independent Qualified Persons for the purpose of National Instrument 43-101. SEMS Exploration Services Ltd. has conducted an audit of the sampling procedures and QA/QC data and is of the opinion that the data are of good quality and suitable for use in the resource estimates. The independent National Instrument 43-101 technical report supporting the resource estimate has been prepared by SEMS Exploration Services Ltd. and has been filed on www.sedar.com.

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Apapam Mining Lease

XG Mining’s interest in our Kibi project was previously held by a prospecting license granted by the Government of Ghana on March 29, 2004 covering a licensed area of 33.65 square kilometers. In May 2008, XG Mining applied to the Government of Ghana to convert the prospecting license to a mining lease. When our application received parliamentary approval, the Government of Ghana granted and registered the Apapam mining lease to XG Mining on the following terms and conditions.

The Apapam mining lease is dated December 18, 2008 and is owned and controlled by our company, as to a 90% interest; and is registered to our subsidiary, XG Mining, while the remaining 10% free carried interest in XG Mining is held by the Government of Ghana. The Apapam mining lease covers a lease area of 33.65 square kilometers and is located in the East Akim District of the Eastern Region of Ghana. The Apapam mining lease has a seven year term expiring on December 17, 2015 and can be renewed for a further 30 year term in accordance with the Mining Act (Ghana), by making application not less than six months before the expiration of this mining lease. We have been granted surface and mining rights by the Government of Ghana to work, develop and produce gold in the Apapam lease area (including the processing, storing and transportation of ore and materials).

With respect to the Apapam mining lease, we are:

• required to pay applicable taxes and annual rental fees to the Government of Ghana in the amount of approximately $19 (GH¢32.80); and

• committed to pay a royalty in each quarter to the Government of Ghana, through the Commissioner of Internal Revenue, based on the production for that quarter within 30 days from the quarter end as well as a royalty on all timber felled in accordance with existing legislation;

• required to:

• commence commercial production of gold within two years from the date of the mining lease;

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• conduct our operations with due diligence, efficiency, safety and economy, in accordance with good commercial mining practices and in a proper and workmanlike manner, observing sound technical and engineering principles using appropriate modern and effective equipment, machinery, materials and methods and paying particular regard to the conservation of resources, reclamation of land and environmental protection generally; and

• mine and extract ore in accordance with preceding paragraph, utilizing methods which include dredging, quarrying, pitting, trenching, stoping and shaft sinking in the Apapam lease area.

We are further required to furnish to the government authorities of Ghana, comprised of the Minister of Lands, Forestry and Mines, the Head of the Inspectorate Division of the Minerals Commission, the Chief Executive of the Minerals Commission and the Director of Ghana Geological Survey (the “government authorities”), with technical records which include:

• a report in each quarter not later than 30 days after the quarter end to the government authorities in connection with quantities of gold won in that quarter, quantities sold, revenue received and royalties payable;

• a report half-yearly not later than 40 days after the half year end to the government authorities summarizing the results of operations during the half year and technical records, which report shall also contain a description of any geological or geophysical work carried out by our company in that half year and a plan upon a scale approved by the Head of the Inspectorate Division of the Minerals Commission showing dredging areas and mine workings;

• a report in each financial year not later than 60 days after the end of the financial year summarizing the results of our operations in the lease area during that financial year and the technical records, which report shall further contain a description of the proposed operations for the following year with an estimate of the production and revenue to be obtained;

• a report not later than three months after the expiration or termination of the Apapam mining lease, to the government authorities giving an account of the geology of the lease area including the stratigraphic and structural conditions and a geological map on scale prescribed in the Mining Regulations;

• a report not less than 21 days in advance of the proposed alteration, issuance or borrowing to the government authorities (except for the Head of the Inspectorate Division of the Minerals Commission and the Director of Ghana Geological Survey) of any proposed alteration to our regulations,

• a report not less than 21 days in advance of the proposed alteration, issuance or borrowing to the government authorities (except for Head of the Inspectorate Division of the Minerals Commission and the Director of Ghana Geological Survey) on the particulars of any fresh share issuance or borrowings in excess of an amount equal to the stated capital of XG Mining;

• a copy of XG Mining’s annual financial reports to the government authorities (except for the Head of the Inspectorate Division of the Minerals Commission and the Director of Ghana Geological Survey) including a balance sheet, profit and loss account and notes thereto certified by a qualified accountant, who is a member of the Ghana Institute of Chartered Accountants, not later than 180 days after the financial year end; and

• such other reports and information in connection with our operations to the government authorities as they may reasonably require.

We are entitled to:

• surrender all of our rights in respect of any part of the lease area not larger in aggregate than 20% of the lease area by providing not less than two months’ notice to the Government of Ghana;

• surrender a larger part of the lease area by providing not less than 12 months’ notice; and

• terminate our interest in the Apapam mining lease if the mine can no longer be economically worked, by giving not less than nine months’ notice to the government authorities, without prejudice to any obligation or liability incurred before such termination.

The Government of Ghana has the right to terminate our interest in the Apapam mining lease if we:

• fail to make payments when due;

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• contravene or fail to comply with terms and conditions of the mining lease (however, we have 120 days to remedy from the notice of such event);

• become insolvent or commit an act of bankruptcy; or

• submit false statements to the government authorities.

The Apapam mining lease further provides that XG Mining shall report forthwith to the government authorities if it discovers any other mineral deposits apart from gold and silver in the lease area, who in turn will provide XG Mining with the first option to prospect further and to work the said minerals subject to satisfactory arrangements made between XG Mining and the government authorities.

Kwabeng Project

Our Kwabeng Project is also referred to in this annual report as the Kwabeng concession and is comprised of 44.76 square kilometers.

Location and Access

The Kwabeng concession is located in the East Akim District of the Eastern Region of Ghana, along the western, lower flank and base of the Atewa Range, approximately 8.5 kilometers north-northwest of our Kibi project which is located on the Apapam concession. The eastern boundary of the Kwabeng concession is demarcated by the Atewa Forest Reserve.

Access to our Kwabeng project can be gained by driving northwest from Accra on the Accra-Kumasi Trunk Road, for approximately 110 kilometers until arrival at Anyinam, making a left hand turn at the road sign that reads “Kwabeng” in the middle of the Town of Anyinam and driving in a southwesterly direction approximately 10 kilometers until arriving at a sign reading “Xtra-Gold Mining” before reaching the town of Kwabeng.

Historical Work

There has been very little exploration for lode source gold deposits at our Kwabeng and Pameng projects; however, there has been detailed exploration for placer gold deposits. Prior to the recovery of placer gold from our Kwabeng project during 2007 and 2008 and our Kibi and Pameng projects during 2010 and 2011, these projects contained approximately 12,583,000 bank cubic meters of auriferous gravels. As at the date of this annual report, historical non-compliant National Instrument 43-101 work indicates that there are approximately 6,920,650 bank cubic meters of mineralized material remaining on our Kibi, Kwabeng and Pameng projects at an average grade of 0.568 grams of gold/bank cubic meters. In addition to the mineralized material, there is potential to define reserves with further exploration.

The placer gold deposit currently located at our Kwabeng concession was mined by the former owner in the early 1990’s for 15 months and produced approximately 16,800 ounces of gold before operations were ceased due to mining difficulties as noted hereunder. The placer gold is contained in a gravel deposit distributed across the floor of the river valleys west of the Atewa Range which can easily be excavated.

2010 to 2012 Exploration Programs

No significant work program was carried out by our company on the Kwabeng concession during 2010 through to 2012.

Future Exploration Plans for 2013

As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months, however, we may consider doing so at a later date.

Recovery and Sale of Placer Gold

As at December 31, 2012, we have sold an aggregate of 8,814.82 ounces of placer gold recovered from the mineralized material at our Kwabeng project during 2007 and 2008. We did not have an exclusive agreement with any company or entity to buy the placer gold that was recovered. No placer gold recovery operations were conducted at this project during 2010 through 2012.

Resumption of Placer Gold Recovery Operations at our Kwabeng Project

As at the date of this annual report, we have resumed placer gold recovery operations at our Kwabeng project. As stated elsewhere in this annual report, we plan to focus our efforts and our financial resources primarily on planned exploration activities on our Kibi project (see “Kibi Project – 2013 Exploration Program”). Also, as at the date of this annual report, the gold price (approximately $1,605 per ounce as at March 27, 2013) is significantly greater compared to the gold price during the previous mining effort by the former operator of this project (approximately $300 per ounce). On the basis of an annual recovery of placer gold of approximately 360,000 bank cubic meters, we anticipate that recovery of placer gold operations at this project could be sustained for 20 years, however, this will depend upon numerous factors including the grade and commercial recoverability of the mineralized material and the selling gold price at the relevant time.

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Former Ownership

In the early 1990’s, the former mining lessee invested approximately $24,000,000 to open and operate a mine at the Kwabeng concession. The mining operation lasted for 15 months and 16,800 ounces of gold was produced before the mine was shut down due to a poor gold price, mining methodology and a lack of funds to continue mining operations.

Resources and Reserves

No mineral resources or mineral reserves have been identified on our Kwabeng project.

Kwabeng Mining Lease

The Kwabeng mining lease is dated July 26, 1989 and is owned and controlled by our company, as to a 90% interest; and is registered to our subsidiary, XG Mining, while the remaining 10% free carried interest in XG Mining is held by the Government of Ghana. The Kwabeng mining lease covers a lease area of 44.76 square kilometers and has a 30 year term expiring on July 26, 2019. We have been granted surface and mining rights by the Government of Ghana to work, develop and produce gold in the lease area (including processing, storing and transportation of ore and materials). See “Kibi Project – Apapam Mining Lease” for identical mining lease terms for the Kwabeng mining lease, except for the name of the mining lease, the lease registration particulars, the lease area and annual rental fees payable in the amount of approximately $19 (GH¢32.80) .

The Kwabeng mining lease further provides that XG Mining shall report forthwith to the government authorities if we discover any other minerals in the Kwabeng lease area and will provide XG Mining with the first option to prospect further and to work the said minerals subject to satisfactory arrangements made between XG Mining and the government authorities.

Ancillary Operations

Field Camp at Kwabeng Project

Our company possesses our fully operational and well maintained field camp comprised of an administrative office, living quarters and workshop facilities located on our Kwabeng concession which is accessible by paved road located approximately two hours drive from the capital city of Accra. Our field camp is the base of operations for the majority of our administrative activities and all of our exploration activities. All of our senior Ghanaian staff is accommodated in the field camp with our junior staff located in the surrounding towns and villages. XG Mining has rehabilitated the field camp which included installation of a communication system for Internet access, electronic mail, telephone and facsimile service and minor construction repairs. Our field camp is within cell phone coverage and is supplied with electricity from the national power grid, which lines run along the road accessing our field camp.

Fuel and Spare Parts Supply

We deliver fuel from Accra by tanker and discharge the fuel into and store the fuel in the fuel tank facility located within our field camp. We purchase spare parts for all of our equipment either locally or from suppliers overseas and store such parts in the secure spare parts warehouse located at our field camp.

Workspace

There is adequate office space at our field camp to accommodate our administrative, geology, surveying, equipment maintenance and other departments, as well as their technical support and our laborers.

Equipment Maintenance

Any maintenance of our excavators or other equipment which we may own will be carried out in the workshops located within our field camp.

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Capital Expenditures

We do not anticipate any significant capital expenditures in the next 12 months in connection with placer gold recovery operations as we have not planned to conduct such operations during this period.

Pameng Project

Our Pameng project is also referred to in this annual report as the Pameng concession and is comprised of 40.51 square kilometers.

The Pameng concession is located in the East Akim District of the Eastern Region of Ghana, along the western, lower flank and base of the Atewa Range, approximately 2 kilometers west-northwest of our Kibi project which is located on the Apapam concession. Access to our Pameng project can be gained by driving northwest from Accra on the Accra-Kumasi Trunk Road for approximately 125 kilometers until arrival at the village of Pameng where there is a road sign reading “Pameng”. Make a left hand turn at the Pameng sign and drive southwest approximately 2 kilometers to reach our Pameng concession. Our Pameng concession is located approximately 12.5 kilometers south-southwest from our field camp.

Historical Work

To the best of our knowledge, the Pameng concession has never been subjected to modern, systematic exploration for lode gold mineralization.

Prior Exploration by Xtra-Gold

2010 to 2012 Exploration Programs

No significant work program was carried out during 2010 through to 2011. Lode gold exploration efforts to date by our company on our Pameng project have been limited to a few reconnaissance geology/prospecting traverses. No significant lode gold exploration work was conducted in 2012 on this project.

Future Exploration Plans for 2013

As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months, however, we may consider doing so at a later date.

Recovery and Sale of Placer Gold

During 2010 and 2011, we negotiated with independent Ghanaian contract miners and operators in connection with their placer gold recovery operations at our Pameng project on fixed payment terms to our company. During 2010, 4,719.76 ounces of gold was recovered and produced by the contract miners from our Pameng project for which we received and sold 896.76 ounces of gold for gross proceeds of $1,128,451.34. During 2011, 5,621.16 ounces of gold was recovered and produced by the contract miners at this project for which we received and sold 1,068.02 ounces of gold for $1,489,058.18. During 2012, we sold 52.81 ounces of gold for gross proceeds of $87,997.30 which was the remaining payment we had received from the contract miners during their 2010 and 2011 placer gold recovery operations at this project.

Resources and Reserves

No mineral resources or mineral reserves have been identified on our Pameng project.

Pameng Mining Lease

The Pameng mining lease is dated July 26, 1989 and is owned and controlled by our company, as to a 90% interest; and is registered to our subsidiary, XG Mining, while the remaining 10% free carried interest in XG Mining is held by the Government of Ghana. The Pameng mining lease covers a lease area of 40.51 square kilometers and has a 30 year term expiring on July 26, 2019. We have been granted surface and mining rights by the Government of Ghana to work, develop and produce gold in the lease area (including processing, storing and transportation of ore and materials). See “Kibi Project – Apapam Mining Lease” for identical mining lease terms for the Pameng mining lease, except for the name of the mining lease, the lease registration particulars, the lease area and annual rental fees payable in the amount of approximately $19 (GH¢32.80) .

The Pameng mining lease further provides that XG Mining shall report forthwith to the government authorities if we discover any other minerals in the Pameng lease area, and will provide XG Mining with the first option to prospect further and to work the said minerals subject to satisfactory arrangements made between XG Mining and the government authorities.

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Banso Project

Our Banso project is also referred to in this annual report as the Banso concession and is comprised of 55.28 square kilometers.

Location and Access

The Banso concession is located in the East Akim District of the Eastern Region of Ghana, approximately 7 kilometers south-southwest from our field camp.

Both of the Banso concession and the Muoso concession lie in the Kibi-Winneba Gold Belt on the western flanks of the prominent Atewa Range, which is underlain by Birimian greenstone, phyllites, meta-tuffs, epi-diorite, meta-greywacke and chert. The valleys, over which this concession is located, are underlain by thick sequences of Birimian metasediments. The north-western end of the Atewa Range is the type-locality for the Birimian metasediments and metavolcanics. The area where both of our Banso and Muoso projects are located is one of the oldest placer gold mining areas of Ghana, dating back many centuries.

Access to the Banso concession is gained by driving northwest approximately 136 kilometers from Accra on the paved Accra-Kumasi Trunk Road.

Historic Work

Historical exploration and mining has mainly focused on placer gold. Before the acquisition of our interest in the Banso concession, to the best of our knowledge and based on mining records in Ghana, there has never been a detailed documented bedrock exploration program conducted on this concession.

Prior Exploration by Xtra-Gold

2010 to 2012 Exploration Programs

Our Banso project is at an early stage of evaluation. Before the period covered by this annual report, we had completed preliminary lode gold exploration programs including grid establishment, soil sampling, prospecting/geological mapping, pitting/trenching and geophysics, aimed at identifying lode gold (hardrock) mineral occurrences at our Banso project, the results of which are noted hereunder.

No significant lode gold exploration work was conducted by our company in 2010 to 2012 on our Banso project, however, Buccaneer Gold Corp. carried out exploration work during 2011 and 2012 as noted hereunder.

Future Exploration Plans for 2013

As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months, however, we may consider doing so at a later date.

Exploration Activities by Buccaneer Gold Corp. in 2011 and 2012

Buccaneer Gold Corp. conducted exploration activities on this project during 2011 and 2012 as part of the criteria to meet the required exploration expenditures to earn the 55% interest in our Banso project. During 2012, Buccaneer Gold Corp. has completed a drill program on this project and on our Muoso project. The Buccaneer drill program was designed to test several drill targets identified on the Banso and the Muoso concessions.

Resources and Reserves

No mineral resources or mineral reserves have been identified on our Banso project.

Banso Mining Lease

The Banso mining lease is dated January 6, 2011 and is owned and controlled by our company, as to a 90% interest; and is registered to XG Mining, while the remaining 10% free carried interest in XG Mining is held by the Government of Ghana. The Banso mining lease covers a lease area of 51.67 square kilometers and has a 14 year term expiring on January 5, 2025. We have been granted surface and mining rights by the Government of Ghana to work, develop and produce gold in the lease area (including processing, storing and transportation of ore and materials). See “Kibi Project – Apapam Mining Lease” for identical mining lease terms for the Banso mining lease, except for the name of the mining lease, the lease registration particulars, the lease area and annual rental fees payable in the amount of approximately $148 (GH¢260.00) .

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The Banso mining lease further provides that XG Mining shall report forthwith to the government authorities if we discover any other minerals in the Banso lease area, and will provide XG Mining with the first option to prospect further and to work the said minerals subject to satisfactory arrangements made between XG Mining and the government authorities.

Muoso Project

Our Muoso project is also referred to in this annual report as the Muoso concession and is comprised of 55.28 square kilometers.

Location and Access

The Muoso concession is located in the East Akim District of the Eastern Region of Ghana, approximately 1 kilometer north from our field camp.

Access to our Muoso project is gained by driving northwest approximately 80 kilometers from Accra on the paved Accra-Kumasi Trunk Road. This highway passes through the easternmost portion of the Muoso concession and shares a common boundary with the Kwabeng concession. From the town of Osino, one would drive northwest approximately 5 kilometers to the town of Anyinam, from which an all weather direct road heads south through the centre of the Muoso concession and onto the Banso concession, approximately 15 kilometers south of the Accra-Kumasi Trunk Road. The town of Muoso is approximately 10 kilometers from Anyinam. A number of dirt roads, trails and footpaths offer additional access to this concession.

Historic Work

Historical exploration and mining has mainly focused on placer gold. Before the acquisition of our interest in the Muoso concession, to the best of our knowledge and based on mining records in Ghana, there has never been a detailed documented bedrock exploration program conducted on this concession.

Prior Exploration by Xtra-Gold

2010 to 2012 Exploration Programs

Ankaase Trend Trenching Program

The trenching program encompassed 12 hand dug trenches, ranging from 30 meters to 68 meters in length and from 1.2 meters to 3.5 meters in depth and totaling 546.0 linear meters. This trenching program commenced on December 1, 2009 and was completed on February 20, 2010. The reconnaissance follow-up trenching was designed to better define the structural controls of the mineralization identified during the initial 2008 scout trenching program.

2011 Exploration Program

No significant lode gold exploration work was conducted by our company in 2011 on our Muoso project, however, Buccaneer Gold Corp. carried out exploration work in 2011 in preparation for a drill program conducted during 2012 as noted hereunder.

Future Exploration Plans for 2013

As at the date of this annual report, we have not planned for any additional exploration activities during the next 12 months, however, we may consider doing so at a later date.

Exploration Activities by Buccaneer Gold Corp. in 2011 and 2012

Buccaneer Gold Corp. conducted exploration activities on this project during 2011 and 2012 as part of the criteria to meet the required exploration expenditures to earn the 55% interest, including building a road in preparation for drilling and some limited trenching.

The hardrock, lode gold exploration technical information contained in this annual report relating to the exploration activities conducted by Buccaneer Gold Corp. on our Banso and Muoso projects during 2011 and 2012 is based upon information prepared by or the preparation of which was supervised by Dr. Guy Della Valle, P.Geo., Vice-President, Exploration of Buccaneer Gold Corp. Dr. Della Valle is a Qualified Person as defined by Canadian Securities National Instrument 43-101 concerning standards of disclosure for mineral projects.

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2012 Drill Program

Buccaneer Gold Corp.’s drill program, comprised of thirty drill holes totaling 5,123.2 meters of drilling, was completed from January 3 to May 21, 2012 on the Muoso and Banso concessions. The drill program was designed to test the presence of gold mineralization indicated by anomalous samples in soil and trenches in several drill targets identified on the Muoso and Banso concessions.

The initial drill target on the Muoso concession was a mineralized shear zone identified in trenches, over strong soil geochemical anomalies combined with geophysical interpretations.

Three zones were selected; namely Muoso East, Banso South and Banso North.

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Assay results are still pending for four holes, two holes have no significant results, and two short holes, lost and abandoned, are not to be assayed.

The samples were analyzed by Fire Assay at Intertek Laboratory, in Tarkwa, Western Ghana. Buccaneer Gold Corp. implemented a rigorous quality assurance / quality control (QA/QC) program to ensure best practices in sampling and analysis of drill core.

This first phase of exploration drilling demonstrated the presence of multi-style mineralization in the Banso and Muoso concessions, including the structurally controlled lode gold deposit, typical for the Kibi Gold Belt.

2012 Exploration Program

Buccaneer Gold Corp.’s 2012 exploration program consisted of compilation and interpretation of available data and ongoing field work, including geological mapping, soil geochemistry, trenching and ground magnetic survey. This program was designed to define the next drilling program that will include follow-up drilling on the known mineralization and testing of new selected exploration drill targets.

Soil Geochemistry

Gold soil geochemical surveys were undertaken on selected areas.

A total of 2,746 soil samples have been taken to date (1,866 samples from the Muoso concession and 880 samples from the Banso concession).

The spacing between samples was 25 meters, along the sampling lines. The interval between lines was 100 meters on the Muoso concession. The interval between lines in the Banso concession was 200 meters, in order to cover larger zones. A total of 46 kilometers of lines were cut and marked on the soil sampling grids.

Trenching

Trenches were dug at four different areas in Muoso East and Banso South, to confirm soil anomalies and the orientation of the veins before drilling was commenced. Chip samples were taken at the wall bottom of the trench. Sample length was 2 meters, or adjusted to the thickness of specific veins. A total of 330 meters of trenches were made and 169 samples were taken.

The gold mineralization encountered in Ankaase is typical for the Kibi Gold Belt and exhibits many similar features to Ghana’s main gold belt, the Ashanti Belt. It consists of lode gold deposit, with structurally controlled mineralization.

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Typical mineralization occurs in dioritic sills and in meta-volcanic host units, and is characterized by the presence of quartz-carbonate veining and sulphide mineralization.

Resources and Reserves

No mineral resources or mineral reserves have been identified on our Muoso project.

Muoso Mining Lease

The Muoso mining lease is dated January 6, 2011 and is owned and controlled by our company, as to a 90% interest; and is registered to XG Mining, while the remaining 10% free carried interest is held by the Government of Ghana. The Muoso mining lease covers an area of 55.28 square kilometers and has a 13 year term expiring on January 5, 2024. We have been granted surface and mining rights by the Government of Ghana to work, develop and produce gold in the Muoso lease area (including processing, storing and transportation of ore and materials). See “Kibi Project – Apapam Mining Lease” for identical terms for the Muoso mining lease, except for the name of the mining lease, the lease registration particulars, the lease area and annual rental fees payable in the amount of approximately $159 (GH¢280.00) .

The Muoso mining lease further provides that XG Mining shall report forthwith to the government authorities if we discover any other minerals in the Muoso lease area, and will provide XG Mining with the first option to prospect further and to work the said minerals subject to satisfactory arrangements made between XG Mining and the government authorities.

Assignment of Interest

Edum Banso Project

We previously held an interest, from 2005 through 2011, in the Edum Banso project, which is also referred to in this annual report as the Edum Banso concession and is comprised of 20.60 square kilometers. This concession lies at the southern extremity of the Ashanti gold belt in the Western Region of Ghana and is located approximately 235 kilometers west of Accra and 15 kilometers northwest of Takoradi, the regional capital. The north-western extremity of this concession falls within the grounds of the Banso Oil Palm Plantation.

In October, 2005, our wholly-owned subsidiary, XGEL, entered into an option agreement with Adom Mining Limited to acquire 100% of its right, title and interest in and to a prospecting license on the Edum Banso concession. Adom Mining Limited further granted XGEL the right to explore, develop, mine and sell mineral products from this concession. The prospecting license was renewed by Adom Mining Limited for a two year period expiring on July 21, 2013.

We paid $15,000 for the option agreement with additional payments of $5,000 to be paid on the anniversary date of the option agreement in each year during its term which was extended to November 11, 2013. Further net smelter royalty payments, based on proven and probable reserves and gold production, was also payable to Adom Mining Limited.

Assignment of Interest in Edum Banso Project

During 2011, we assigned our interest in the Edum Banso project to Discovery Gold Corporation (formerly Norman Cay Development, Inc.) and received:

• an initial payment of $125,000 (received);

• 1,000,000 shares of Discovery Gold Corporation (formerly Norman Cay Development, Inc.), valued at $260,000 on the date of issuance (issued); and

• a final option payment of $135,000 payable in six months from the date of assignment of the option interest (received).

If Discovery Gold Corporation (formerly Norman Cay Development, Inc.) did not exercise its six-month option, the project would revert to our company. Of the payments received, $20,000 reduced the carrying value of the Edum Banso project on the balance sheet and the balance reduced exploration spending in the third quarter of 2011.