In June 2008 the Company was granted two short term gold exploration permits in Mali (Baroya and Metedia-Est), West Africa ("the Permits"). The Permits granted the Company exclusive exploration rights for a period of three months in order to evaluate the potential of the Permits and the exclusive right to apply for long term prospecting licences over the Permits once evaluative exploration has been conducted.

GoldStone conducted exploration over the Permits and elected to exercise its exclusive right to apply for a prospecting licence over the Permits at the end of the three months exploration period by applying to the Malian Department of Mines and Geology ("DNGM") during August 2008. In addition and at the same time, the Company applied to the DNGM for a prospecting licence over the Yatia permit area which is an area adjacent to the Permits.

The Baroya, Metedia-Est and Yatia permit areas are adjacent to one another, together occupying a total area of 62 km² and are close to the international border with Senegal in the south-western gold belt of Mali. The Permit Areas are within eight kilometres of the Tabakoto/Segala gold mine, which was recently re-commissioned by Avion Resources (Figure 1).

Figure 1: The location of the Baroya, Metedia-Est and Yatia permits is within trucking distance of Avion's recommissioned Tabakoto/Segala gold mine in the south-western part of Mali.