EXPLORATION ACTIVITIES 2007:

 
Other exploration work completed in 2007, consisted of:
   
    •    775 line kilometres of line cutting,

    •    582 line kilometres of ground magnetic surveys,

    •    350 line kilometres of ground electro-magnetic InfiniTEM surveys,

    •    4,100 line-kilometres of helicopter-borne electro-magnetic VTEM surveys,

    •    15,230 metres of drilling at the Hudvam, Fon and Wim deposits,

    •    Murgor completed compilation studies of all available data on all properties,

    •    Murgor completed new 3D interpretations of the Hudvam and Wim deposits (Fon is underway),

    •    Murgor generated hundreds of new highly prospective exploration targets including never detected, never    
         tested geophysical targets adjacent to current deposits.  Some of these targets will be drill-tested in 2008.

Murgor’s exploration team is proud of its achievements in 2007, having met so many milestones in such a short period of time.

NEW PARTNERSHIPS AND TRANSACTIONS IN 2007:

Murgor entered into two strategic partnerships on its most advanced exploration projects in the province of Quebec: the Barry and Windfall properties.  These partnerships enabled Murgor to share expenditures and diminish the risks attached to these advanced exploration and development projects.  In one of the transactions, Murgor also optioned an interest of up to 70% in the Nelligan Project, also in Quebec.

Partnership with Metanor Resources Inc.:  Murgor completed a transaction with Metanor Resources Inc. for the development and mining of the Barry Gold deposit.  In a transaction completed in late August 2007, Murgor sold its 100% interest in the Barry Deposit and its 50% interest in the Barry United property, and optioned an interest of up to 70% in the Nelligan property.  The transaction is valued at more than $2.5 Million dollars in cash and shares of Metanor.  Murgor retains a 1% net smelter return royalty (NSR) at the Barry deposit, a 0.5% NSR royalty at the Barry United property and once Metanor fulfilled its obligations (work expenditures) at the Nelligan property, Murgor will retain a 30% interest in the property.

Partnership with Noront Resources Ltd.: Murgor completed a transaction with Noront Resources Ltd. on 29 claims of the Windfall property, where Noront can earn a 50% interest by completing exploration expenditures of $4 million over the next three years.  Exploration work will include an exploration ramp and a bulk sample of the F-17 mineralized zone.

THE FINANCES:

At the end of 2007, Murgor issued a total of 3,671,426 flow-through shares at an average price of $0.84, for total proceeds of $3,082,000.   Therefore, at year end, Murgor is a very healthy exploration company, with a treasury of $4.3 Million in cash and no debt. 

THE ROLLBACK:

The management at Murgor was faced with very difficult decisions in the fall of 2007.  In late August, under pressure from margin call selling, Murgor’s stock went down to $0.14.  The Corporation had more than 113,000,000 shares outstanding (146,000,000 fully diluted) and needed to finance its exploration.
In short, the options were to continue financing with a low share price, leading to an unmanageable number of shares outstanding, or to proceed with a share consolidation, thus reducing the number of shares and finance at a much higher price.

Faced with this very difficult decision, management suggested a consolidation of Murgor shares by a ratio of 1 for 6, and the proposal was adopted by shareholders at Murgor’s Annual General Meeting on October 25th, 2007.       As a result of this share consolidation and after raising $3,082,000 dollars for exploration in December 2007, Murgor finished the year with 22,617,293 shares outstanding.  This new share structure will allow Murgor’s stock to react much better and quicker to exploration and development news.

To make the decision of the rollback more attractive and fair to all Murgor shareholders, management decided to give each shareholder the opportunity to participate in the Corporation’s future success with a shareholder rights offering available as soon as possible after the consolidation.  This shareholder rights offering will allow each Murgor shareholder to participate in a financing by purchasing shares of the Corporation at a discounted price.

YEAR 2008:

Another very intensive year of exploration and development is planned for 2008.  Two drills are already turning at the Wim property and three more are scheduled to arrive at the Hudvam property during the week of the 14th of January.

A 13,000 metre drilling program is planned at the Wim, property and 8,000 metres will be drilled at the Hudvam property.  At least another 5,000 metres will be drilled on targets that were outlined during the exploration programs of 2007 at the Fon, Tyr, Snow-H and Flin-D properties.

Murgor has two pre-feasibility studies underway at the Hudvam and Wim properties with the objective to complete full feasibility studies at the end of 2008 at Hudvam and mid-2009 at Wim.

Other exploration activities will consist of 4,500 line kilometres of VTEM, additional deep penetrating ground EM surveys as well as geological mapping and prospecting programs on all properties in Manitoba and Saskatchewan. 

IN CLOSING:

In 2007, Murgor laid out the foundation for success in the near to mid-term by:

    •    Increasing and diversifying its resources to a total of 430 million pounds of Zinc, 143 million pounds of        
         Copper, 210,000 ounces of Gold and 2.5 million ounces of Silver (all 43-101 compliant).

    •    Completing a $4.9 Million exploration program in Manitoba and Saskatchewan and outlined hundreds of    
          highly potential exploration targets that will be tested over the upcoming drilling seasons.

    •    Growing its highly prospective portfolio of properties to twenty-four properties in Saskatchewan, Manitoba,
         Ontario, Quebec, New Brunswick and Peru (the focus being Manitoba and Saskatchewan).

    •    Increasing its number of strategic partnerships with different exploration partners to seven, with: HudBay
         Minerals, Metanor Resources, Freewest Resources Canada, Noront Resources, Trelawney Resources,
         Geodex Minerals and Teck-Cominco.

    •    Securing the services of a permanent, full time workforce to fourteen talented and dedicated individuals,
         including ten geologists or geological engineers.  Murgor has also secured the services of more than fifteen
         different contractors for work, such as line-cutting, prospecting, geophysics, drilling, 3D modelling of
         orebodies, 43-101 resource calculations, pre-feasibility studies and environmental assessments.
   
    •    Modifying its share structure by reducing its number of shares outstanding thus making its share price        
         much more responsive.

    •    Initiating two pre-feasibility studies at the Hudvam and Wim deposits in Manitoba.


                Respectfully submitted,
        
                André C. Tessier, P.Eng, P.Geo
                President, CEO
                January 08, 2008.