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NORONT RESOURCES LTD. MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE FOURTH QUARTER AND YEAR ENDED APRIL 30, 2008

CONTENTS

Cautionary Note Regarding Forward-Looking Statements 2 Company Overview 3 Overview of Activities 4 Summary of Financial Results 5 Overview of Properties and Projects 6

• Double Eagle Project, Ontario 6

• Windfall Lake, Quebec 14

• Burnt Hill, New Brunswick 16

• Other Exploration Projects 17

• Discontinued Projects 20 Option Agreements and Joint Ventures 20 Subsequent Events 26 Health and Safety 29 Selected Financial Information 29

• Summary of Annual Results 29

• Corporate G&A Expenses 31

• Summary of Quarterly Results 32

• Fourth Quarter Fiscal 2008 Results 33 Liquidity and Capital Resources 34 Contractual Obligations 36 Related Party and Other Transactions 36 Off-Balance Sheet Arrangements 36 Proposed Transactions 37 Critical Accounting Estimates 37 Adoption of New Accounting Standards 37 Future Accounting Changes 39 Financial and Other Instruments 40 Shareholders’ Equity 40 Outstanding Share Data 40 Shareholder Rights Plan 41 Stock Based Compensation 41 Disclosure Controls and Procedures 41 Risk Factors 43 Additional Disclosure for Venture Issuers without Significant Revenue 48 Additional Information 48

This management’s discussion and analysis (“MD&A”) of the results of operations and financial condition of Noront Resources Ltd. (“Noront” or the “Company”) describes the operating and financial results of the Company for the fourth quarter and year ended April 30, 2008. This document was prepared to enable a reader to assess material changes in the financial condition and results of operations of Noront as at and for the three months and year ended April 30, 2008, in comparison to the corresponding prior-year periods. The MD&A supplements, but does not form part of the financial statements of the Company and should be read in conjunction with Noront’s audited consolidated financial statements and related notes for the fiscal year ended April 30, 2008. The Company prepares and files its consolidated financial statements in accordance with Canadian Generally Accepted Accounting Principles. This MD&A contains certain forward looking statements based on management’s current expectations (please see “Cautionary Note Regarding Forward Looking Statements” below). Unless otherwise stated, all amounts discussed herein are denominated in Canadian dollars.

CAUTIONARY NOTE REGARDING FORWARD LOOKING STATEMENTS

This MD&A was prepared on August 28, 2008.This MD&A includes certain “forward-looking statements” within the meaning of applicable Canadian securities legislation. All statements, other than statements of historical facts, included in this MD&A that address activities, events or developments that the Company expects or anticipates will or may occur in the future, including such things as future business strategy, competitive strengths, goals, expansion and growth of the Company’s businesses, operations, plans and other such matters are forward-looking statements.

When used in this MD&A, the words “estimate”, “plan”, “anticipate”, “expect”, “intend”, “believe” and similar expressions are intended to identify forward-looking statements. These statements involve known and unknown risks, uncertainties and other factors which may cause the actual results, performance or achievements of the Company to be materially different from any future results, performance or achievements expressed or implied by such forward-looking statements.

Examples of such forward looking statements include statements regarding financial results and expectations for 2008, such as, but not limited to, availability of financing, interpretation of drill results, the geology, grade and continuity of mineral deposits and conclusions of economic evaluations, metal prices, demand for metals, currency exchange rates, cash operating margins, expenditures on property, plant and equipment, increases and decreases in exploration activity, changes in project parameters, joint venture operations, resources and anticipated grades and recovery rates and are or may be based on assumptions and/or estimates related to future economic, market and other factors and conditions.

Although the Company has attempted to identify important factors that could cause actual results to differ materially, there may be other factors that cause results not to be as anticipated, estimated or intended. There can be no assurance that such statements will prove to be accurate as actual results and future events could differ materially from those reliant on forward-looking statements. Factors that could cause actual results, developments or events to differ materially from those anticipated include, among others, the factors described or referred to elsewhere herein, and include unanticipated and/or unusual events. Many of such factors are beyond Noront’s ability to control or predict.

Readers of this MD&A are cautioned not to put undue reliance on forward-looking statements due to their inherent uncertainty. Noront disclaims any intent or obligation to update any forward-looking statements, whether as a result of new information, future events or results or otherwise. These forward looking statements should not be relied upon as representing management’s views as of any date subsequent to the date of this MD&A.

Additional information, including quarterly and annual consolidated financial statements, Management Information Circular and other disclosure documents, may also be examined and/or obtained through the Internet at the SEDAR website www.sedar.com at Company’s website located at www.norontresources.com, or at the Company’s investor relations hub located at www.agoracom.com/IR/Noront.

COMPANY OVERVIEW

Noront is an active resource exploration company listed on tier 2 of the TSX Venture Exchange (“TSX-V”) involved in the acquisition, exploration and development of properties prospective in base metals, chromium and gold. The primary focus of the Company is its Double Eagle Project at McFaulds Lake, in the Ring of Fire area (“ROF”) that is part of the James Bay Lowlands, Ontario, where Noront has had five discoveries, since August 2007. Noront also has exploration projects and properties in Ontario, Quebec and New Brunswick within Canada, and to a lesser extent, in Mexico and China.

The Company is actively drilling and working to define and delineate the scale of its nickel-copper-pgm and chromite discoveries at the Double Eagle Project. The Company is planning to continue drilling at the site of its Eagle One nickel-copper-pgm discovery for related deposits along what management believes is a magmatic conduit that could host other large sulphide bodies. Noront recently announced the filing of a Technical Report and resource estimate on the Eagle One Deposit.

At Eagle Two, a second nickel-copper discovery, the Company is drilling in search of the initial magmatic intrusion or feeder for the deposits discovered at Eagle Two. Additionally, Noront will be drilling to define the dimensions of its two recent chromite discoveries at Blackbird One and Blackbird Two, as well as other nearby high gravity targets believed to be further chromite deposits. Noront will also be drilling other anomalies identified elsewhere on its claims in the Ring of Fire area including anomaly target AT12 where early drilling visually identified disseminated and semi-massive nickel-copper deposits. The Company’s overall strategy is to concentrate its efforts primarily on defining the relative scale of its current discoveries and on its most promising geophysical targets.

In light of the Company’s recent discoveries at the Double Eagle Project, Noront’s focus is shifting away from developing assets to a prospective stage, with a view to attracting third parties interested in participating financially or otherwise. Instead, the Company is fully engaged in exploring and developing the Double Eagle Project and the Ring of Fire and in continuing to add to its already extensive land position in the Ring of Fire area through option agreements and other arrangements. Management’s intent is to expand Noront’s controlling interest in additional prospects in the Ring of Fire area. Over the next year, management of Noront anticipates being able to separate its assets that are outside the Ring of Fire area so as to finance and manage them distinctly from Noront’s primary Double Eagle properties.

OVERVIEW OF ACTIVITIES

The market reacted very positively to the Company’s significant nickel-copper-pgm discovery in August 2007, bringing the stock up to a 52 week high of $7.42 per share. A subsequent National Instrument 43-101 Report was prepared by an independent third party on this discovery, designated as Eagle One, identifying indicated resources of 1,834,000 tonnes and inferred resources of 1,087,000 tonnes of high grade nickel, copper and significant amounts of platinum, palladium and silver. This discovery was in the McFaulds Lake area of the James Bay Lowlands, in a region referred to as the “Ring of Fire”.

On November 27, 2007, the Company announced that it had entered into an agreement with

J.P. Morgan Securities Incorporated (“J.P. Morgan”). J.P. Morgan will work alongside coadvisor IBK Capital Corp. to evaluate strategic alternatives to enhance the development and funding of the Company’s various exploration projects and assets including the McFaulds Lake discoveries as well as its high-grade gold discovery at Windfall Lake in Quebec and for the less advanced exploration sites in Canada, Mexico and China.

Support for Noront’s view that the Ring of Fire area is a highly mineralized area was further evidenced by subsequent nickel-copper discoveries at Eagle Two in February, 2008 along with encouraging early drilling results at Noront’s AT 12 target in July 2008, visually showing disseminated and semi-massive nickel-copper-iron sulphides.

In addition to the Eagle One and Two nickel-copper discoveries, in May 2008 Noront announced that it had discovered massive chromite beds while drilling at Eagle Two. This first chromite discovery was designated as Blackbird One. In July 2008, a second chromite discovery was announced, Blackbird Two, identified through gravity surveying, indicating a one kilometre long, high-gravity anomaly. Early drilling at this location has indicated massive chromite beds similar to those found at Blackbird One. Early assay results from Blackbird One identified that there is a high grade of chromite (the ore mineral of Cr2O3) in this mineralized zone averaging over 40 percent, with a chromium to iron ratio above 2.0. The chromium mineralization is a massive chromitite in a talc-carbonate host and would be classified as “hard lump” ore which could potentially be directly shipped. This grade, quality and structure of chromite can usually be directly fed to smelters without further processing. These grades are consistent with the richer deposits around the world in Turkey and India, with higher grades than the chromite typically found in the world’s largest producer, South Africa.

The Company continues to identify many additional electromagnetic and high gravity “drill ready” targets in the immediate area of McFaulds Lake and elsewhere throughout its parcel of claims directly held and optioned land claims covering approximately 300,000 acres in the Ring of Fire area. The Company currently has three drills operating in the McFaulds Lake area as well as a fourth team operating out of the Oval Lake camp in the upper part of the Ring of Fire. The Company plans to add additional drills and crews to its drill program as warranted.

The Company intends to continue identifying and testing targets and delineating resources in addition to those identified to date at Double Eagle project. Noront is in the process of shifting from a diverse exploration company to one that is focused on identifying additional nickel-copper-pgm and/or chrome resources at McFaulds Lake and elsewhere in the Ring of Fire. The Company is also beginning to assess direct shipping and other developmental options in respect of its recent discoveries at McFaulds Lake. It is anticipated that Noront will continue to experience a relatively high rate of expenditure in the foreseeable future.

SUMMARY OF FINANCIAL RESULTS

Noront’s net loss for the period was $2,298,463 or $0.02 per share. This operating loss was net of $1,018,988 in interest income earned and gains on the sale of mineral interests (net of costs) in the amount of $1,576,177. The Company was able to raise approximately $60 million during the year, primarily sourced from a $26,000,000 private placement and the exercise of warrants, stock options and advances from joint venture partners. The Company’s stock price over the year has reflected a number of successful projects regarding the discoveries at its Double Eagle project at McFaulds Lake, in the Ring of Fire area that is part of the James Bay Lowlands.

As a result of its discoveries in the McFaulds Lake area and continued drilling and exploration both at the Double Eagle Project and in the Ring of Fire area, the Company’s use of cash increased significantly during the year. This spending trend is expected to continue to rise, as the rate of expenditure increases commensurate with the need to further study and explore the mineralization both at the Double Eagle Project and generally in the Ring of Fire area.

In part to address the exploration activities’ financial requirements and to fund further exploration of Noront’s large land holdings in the Ring of Fire area, Noront has optioned some of its claims to third parties in areas that Noront will be unable to commit resources to on a priority basis, in exchange for the opportunity for such parties to earn an interest in their particular optioned parcel. All of these transactions are at arm’s length. Noront remains the operator of these projects and will, even upon successful earn-in by these third parties, hold at least a 50% interest. The Company received $3.6 million in payment from these third parties during fiscal year 2008. These additional monies are not included in cash and cash equivalents as their use is restricted to exploration work on the optioned properties. In a few exceptional cases, Noront has entered into options as the optionee with third parties and has incurred commitments in order to earn at least a 50% interest in other properties in the Ring of Fire, which management of Noront considers prospective. This combined approach enables Noront to effectively control and explore a larger proportion of the entire Ring of Fire than it could if the Company was utilizing only its own funds.

The Company closed a private placement of 6,500,000 units for aggregate gross proceeds of $26 million in February of 2008. Each unit was priced at $4.00 and consisted of one common share and one-half of one common share purchase warrant. Each whole warrant entitled the holder to purchase one common share of Noront at an exercise price of $5.00 for a period of two years from the date of issue, subject to an accelerated expiry, being 30 days after the common shares of Noront had closed at or above a price of $6.00 for ten consecutive trading days on the TSX-V. On March 12, 2008 the Company announced that the condition required for the acceleration of the 3,250,000 warrants had occurred resulting in an early expiry date of April 10, 2008. Additional gross proceeds of approximately $12.5 million were realized from the accelerated exercise of these warrants.

In total, over the past fiscal year, the Company has brought in over $60 million through financing activities via the private placement, advances from joint venture partners and the exercise of warrants and stock options. Investment in mining properties and exploration before write-downs on abandoned projects was approximately $20 million with the remaining proceeds going to bolster the Company’s cash position and pay operating expenses. At the end of the year the Company had a cash position (cash and equivalents) of over $52 million. The Company continues to have a strong cash position but Noront is dependent on future financing alternatives to fund this high level of exploration activity.

OVERVIEW OF PROPERTIES AND PROJECTS

• DOUBLE EAGLE PROJECT, ONTARIO
• WINDFALL LAKE, QUEBEC
• BURNT HILL PROPERTIES, NEW BRUNSWICK
• OTHER EXPLORATION PROJECTS
• DISCONTINUED PROJECTS

DOUBLE EAGLE PROJECT (RING OF FIRE AREA - McFaulds Lake, James Bay Lowlands, Ontario)

Noront controls land claims, held directly or indirectly, through joint ventures, optioned claims and earn-in programs consisting of 178 claims for a total of approximately 41,700 hectares in the Double Eagle Property. This includes 100% interest in two claims consisting of 8 units adjoining the Company’s Double Eagle project that were earned from Condor Diamond Corp. (“Condor”) and Greenstone Exploration Company Ltd (“Greenstone”) during the year. These two claims are subject to 1% net smelter royalty (“NSR”), payable to Condor and Greenstone, which may be purchased by the Company at any time upon payment of $500,000 and/or at the Company’s option, issuance of an equivalent value in number of common shares of the Company.

In total Noront controls land claims, held directly or indirectly an area of approximately 120,000 hectares (300,000 acres) in the Ring of Fire area located in the James Bay Lowlands in Northeastern Ontario.

Eagle One Deposit (Nickel-Copper-PGM discovery)

On August 28, 2007, the Company announced visual results of the first two holes of the diamond drilling program started August 24, 2007 on the recently optioned claims of the Company’s Double Eagle project.

On September 10, 2007, the Company announced assay results from the first hole of the diamond drilling program started on August 24, 2007. This first hole assayed averaged 1.53 % copper, 1.84 % nickel, 1.04 g/t Pt and 2.87g/t Pd and 0.127 g/t Au over 36 metres between 56 and 92 metres downhole. This discovery was named Eagle One.

On September 27, 2007 the Company reported the final assay results from the fifth hole of the diamond drilling program at Eagle One. Diamond drill Hole NOT-07-05 final assay results included 68.3 metres averaging 5.9% nickel, 3.1% copper, 2.87 g/t platinum, 9.78 g/t palladium, 0.61 g/t gold and 8.5 g/t silver, indicating a massive sulphide mineralization.

Eagle One Selected Assays

Noront’s drill results have returned high grade assay results:

NOT-07-27 112.8 159.0 46.2 6.3% 2.8% 1.9 10.2 3.0 7.3

NOT-07-27 (including) 116.8 152.4 35.6 7.9% 3.5% 1.7 12.8 3.9 9.3

The Company has a rigorous QA/QC program in place for its assays. After continued and extensive drilling (thirty-five holes were drilled for a total of 5,387 metres on the Eagle One

Deposit) the Company was able to determine that the Eagle One Ni-Cu-PGE occurrence was a massive sulphide magmatic nickel mineralized body, surrounded in part by net textured sulphides in peridotite within a much larger variably mineralized steeply dipping peridotite that has an 80 degree dip to the west, with a steep plunge along a southerly strike.

Noront recently announced the filing of a Technical Report and resource estimate on the Eagle One Deposit, Double Eagle Property, McFaulds Lake Area, James Bay Lowlands Ontario. The Technical Report was prepared by P&E Mining Consultants Inc., who are independent “qualified persons” within the meaning of NI 43-101. The Technical Report states that the Eagle One Deposit contains:

• an Indicated Resource of 1.834 million tonnes averaging 1.96% Ni, 1.18% Cu, 1.12 g/t Pt, 3.91 g/t Pd, 0.15 g/t Au and 3.81 g/t Ag;
• an Inferred Resource of 1.087 million tonnes averaging 2.39% Ni, 1.27% Cu, 1.37 g/t Pt, 4.5 g/t Pd, 0.13 g/t Au, and 4.21 g/t Ag.

The Technical Report identifies that the Eagle One Deposit remains open along strike and down dip for further expansion. These potential extensions will be the subject of an exploration program that has commenced.

The Eagle One Deposit resource model contained in the Technical Report was derived from delineation drilling conducted during 2007/2008 that outlined a mantle derived, ultramafic intrusion (the “Ring of Fire Intrusion”) hosting an elongated, steeply dipping lens of dominantly disseminated sulphides which encapsulated a smaller lens of high grade massive sulphides.

Within the report, it is explained that significant sulphide mineralization was outlined on nominal 50-metre spaced sections over dip lengths of up to 225 metres that can be projected to 200 metres of strike length. Twenty-three (23) drill holes that intersected mineralization on these five sections form the basis of the resource estimate while an additional six (6) holes were incorporated to build the total geological model. Inverse distance squared grade interpolation was utilized to determine block model grades.

The identification of significant high grade massive and disseminated sulphide resources at the Eagle One Deposit indicates that the systematic exploration of the many other targets in the Ring of Fire area will be the most significant creator of value for Noront.

The discovery of the Eagle One Deposit, just seven metres below the surface along with the high grade of the massive sulphides, averaging over 6% Ni, 4% Cu, 2 g/t Pt, 12 g/t Pd and 9 g/t Ag, provides Noront the opportunity to ship the massive sulphides directly to a smelter without further processing.

The following table is a summarized excerpt from the Technical Report for the Eagle One Deposit. The full report is available on the Internet at the SEDAR website www.sedar.com at Company’s website located at www.norontresources.com, or at the Company’s investor relations hub located at www.agoracom.com/IR/Noront.

Eagle One: NI 43-101 Resource Estimate

„ In July 2008, Noront released the initial results of its NI 43-101 compliant resource estimate. The detailed technical National Instrument Report is now filed.

„ High nickel grades (6% to 7%) within the massive sulphide zone of Eagle One make it possible for Noront to consider the option of direct shipment of unprocessed ore to one of the existing concentrator/smelter facilities outside the project area. Operating cash flow generated from this direct shipping arrangement could then be used to fund the possible construction of an on site concentrator and further exploration.

„ At this time, no scoping study has been prepared for Eagle One.

NI 43-101 Compliant Resource Estimate

Source: P&E Mining Consultants

With these new mineral resources identified at Eagle One in the McFaulds Lake area, Noront now has achieved the first milestone in the potential development of this discovery. Noront is entering the pre-production phase for this occurrence and plans on commencing a scoping study to assess the economic viability of developing the Eagle One Deposit that may lead to a feasibility report.

The Eagle One Deposit was Noront’s first discovery at McFaulds Lake. Subsequent discoveries at Eagle Two (Nickel-Copper) occurrence, the adjacent large chromite deposit, Blackbird One, and a second chromite occurrence, Blackbird Two, discussed in detail below, have led to the formulation of a geological model indicating that this area is a very rich mineralized zone with a number of concentrated deposits and targets existing in close proximity to each other that may be part of a large system of deposits extending along the structural horizon that has been named the Ring of Fire. As a result, this mineralized area will continue to be the centre of a highly focused exploration program by Noront.

Eagle Two (Nickel-Copper) and the Blackbird One (Chromite) Deposit (located at AT2)

The target AT2 anomaly is a coincident magnetic and conductive feature that was recognized as paired linear AeroTEM conductors striking parallel to the margins of a highly magnetic body several kilometres long. The magnetic body is connected directly to the Eagle One magmatic massive sulfide deposit and as such was considered a prime target for further discoveries of peridotite-hosted magmatic sulfide mineralization.

In February 2008, the Company announced that drill holes had encountered extensive Ni-rich sulphide mineralization hosted by shear zones parallel to the contact between the ultramafic rocks and their felsic plutonic (granodiorite, sensu lato) host rocks. The sulphide deposit at the AT2 anomaly area was named the Eagle Two deposit. The Eagle Two deposit is located two kilometres south-west of Eagle One.

Later, while continuing to drill at the Eagle Two site during the winter of 2008, Noront encountered massive chromite mineralization in boreholes drilled to further test the airborne (VTEM) anomaly at AT2 on the Double Eagle Property.

The Company announced the occurrence of massive chromite with it first assay of drill hole NOT-08-1G17 with an apparent width of 49.4 metres averaging 39.1% Cr2O3 and a chromium to iron ratio of 2.34. This chromite mineralization zone has been named the Blackbird One Deposit. The Blackbird One mineralization consists of massive chromite layers interbedded with chromite-rich metadunite, now entirely replaced by talc carbonate minerals, chromite, and minor ferritchromite overgrowths. Continued drilling has intersected massive chromite mineralization to depth.

The massive layers of chromite reach apparent thicknesses exceeding 70 metres and true thicknesses exceeding 30 metres. Within the massive layers there are occasional xenoliths and thin beds of talc after olivine. The chemical composition of the chromite mineralization has been assessed by three methods: whole-rock assay by instrumental neutron activation analysis (INAA), electron microprobe analysis of individual chromite grains (EMP), and handheld semi-quantitative X-ray fluorescence spectrometry (HXRF).

Available assay results through the chromite zone are shown below. The main mineralized zone remains well above 40% Cr2O3 for more than 30 metres true thickness, and includes a zone greater than 5 metres wide that averages well above 45% Cr2O3. Similar visual results have been reported in deeper holes, and further assay results are pending. The Cr/Fe elemental weight percent ratio in the chromite zone is consistently above 2.0 and averages about 2.6 over the massive chromite interval.

Blackbird One: Chromite Highlights

„ Massive chromite (Cr2O3) beds were discovered at Blackbird One next to Eagle Two.

„ The chromite discovered is relatively high grade compared to other global deposits, has a favorable chrome/iron ratio and a desirable “lumpy” consistency (large crystals).

Selected Assay Results from Blackbird One released July 30/08:

The chromite mineralization does not have a notably strong magnetic susceptibility, compared with serpentinized dunite and peridotite which are both common in the area around Eagle One, Eagle Two, and the Blackbird One Deposits. Chromite is an electrical insulator; hence there is no electromagnetic expression from the chromite deposit despite the presence of traces of interstitial sulfide minerals in the massive chromite. A useful characteristic of chromite is its high density, around 4.5, which is similar to that of magnetite and pyrrhotite. Massive chromite therefore has an anomalously high density compared even with ultramafic rocks and is detectable by gravity survey when it exists in sufficient tonnages.

Blackbird Two (Chromite) Occurrence

The demonstration of a detectable gravitational response to the massive chromite at the Blackbird One Deposit has been used to infer the presence of another body of chromite some 900 metres long striking 60° away from the AT2 area. A single diamond drill hole through the highest part of the density anomaly cut two bodies of massive chromite, each with apparent thicknesses exceeding 20 metres. Blackbird Two lies between the Eagle One and Eagle Two discoveries

Significance of Noront’s Chromite Discoveries

Lump ore chromite prices are reported in units called dry metric ton units (dmtu). The price of an ore is found by multiplying the concentration of Cr2O3 in wt% by the price in dmtu; for example, a Turkish lump ore containing 39% Cr2O3 was sold in May 2008 at a price of USD14.97/dmtu for a price of $583/Mt ex ports (http://www.asianmetals.com). The value of lump ore increases dramatically as the grade increases above 30%. There is no significant international trade that takes place at grades below this value. The value of a concentrate containing 50% Cr2O3 is approximately $750/ton (http://www.asianmetals.com). Recent prices have further increased in the third quarter of 2008 both for high grade ore and concentrate.

The smelting process adds considerable value to chromite ores if a deposit is large enough to justify the capital cost of a smelter. The product of smelting is high carbon ferrochrome alloy, whose price has rapidly increased in recent years due to interruptions and shortages in the electricity supply for the large global producers in South Africa (the world’s largest producer of ferrochrome) and due to escalating demand for stainless steel production, especially from China. Ferrochrome is what makes stainless steel, stainless. There is no substitute for ferrochrome. The Q3 contract price for high-carbon 65% ferrochrome is $US$2.05 per pound with the spot price reaching $2.40 per pound. The contained metal value in a ton of chromite ore at 40% Cr2O3 that produces high-carbon 65% ferrochrome is $1,850 a tonne which is a considerable increase over the May 2008 lump chromite ore value of about $600 ex ports noted in the previous paragraph.

The closest geological analogs to the Blackbird One Deposit are the Kemi Mine in Finland, the Ipueira-Medrados Deposit in Brazil, and the Sukinda Valley Deposit in India. All consist of massive chromite bodies up to several tens of metres thick and hundreds of metres long, hosted by ultramafic rocks predominantly consisting of dunite and harzburgite All the deposits are currently being mined. The Kemi Mine is the best described of these similar deposits. It is series of 11 chromite deposits up to 40 metres thick. Chromite Ore reserves in January 2006 were 41.1 million tonnes grading 24.5% Cr2O3 with Inferred Resources of 86.1million tonnes at 29% Cr2O3. Average mine production is running at 26% Cr2O3 with the Cr/Fe elemental weight percent ratio at 1.53. These grades are significantly lower than what has been found at Blackbird One.

Grades at Noront’s Blackbird One compare favorably with those of the world's most important global chromite producers. The Noront deposit is the latest example of the Kemi Deposit type, represented by important producing mines on three continents that collectively account for approximately one third of global chromite production. Blackbird One combined with the geophysical anomaly known as Blackbird Two indicate that the presence of massive chromite persists in the area and additional high gravity targets indicate that the potential exists for a multimillion ton resource comparable in size to the Kemi, Sukinda Valley, or Ipueria-Medrados Deposits.

Double Eagle Geological and Mineralization Program

On-going exploration work on the Double Eagle Property is partly predicated upon a conceptual model of the mineralizing mafic and ultramafic magmatic systems associated with the Ring of Fire. This model has been formulated by incorporating recent drill data along with geophysical, geological and other technical survey results.

The Ring of Fire model features a mantle-derived strongly magnetic ultramafic intrusion (the “Ring of Fire Intrusion” or “RFI”). The magmatic intrusion lies between a granodiorite pluton and the surrounding Sachigo greenstone belt rocks. The RFI is magnetically distinct allowing it to be traced more or less uninterrupted, for tens of kilometres along the granodiorite margin. It appears that a series of conduits cutting across the granodiorite have acted as feeders to the main RFI. On a world-wide basis ultramafic intrusions, such as the RFI, are known to host several types of deposits:

• Layered chromite deposits
• Nickel-Copper deposits and
• Platinum Group Metals (PGM) deposits.

Recent drilling within the Ring of Fire area confirms that both PGM-rich Ni-Cu deposits (Eagle One and Two) and now chromite deposits, (Blackbird One and Two) are associated with the RFI and its related conduit feeder systems.

According to the conceptual model, the high-grade Eagle One Deposit is interpreted as occurring well within a conduit feeder, at some distance from the main RFI. The Eagle Two discovery on the other hand is interpreted as occurring near or within the “throat” or “mouth” portion of the conduit where it empties into the main RFI. The mineralization at this point in the system consists of mineralized zones that contain numerous thin Ni-Cu bearing sulphide layers or “fingers” that “feather” out into the main RFI.

Noront management believes that the drill results obtained to date at Eagle Two are consistent with the conceptual model which would suggest that there is significant potential for the discovery of another Eagle One - type deposit as the Eagle Two mineralization is traced westward into a possible feeder conduit.

In July 2008, the Company announced early visual results on two recent two drill holes that had been completed on Anomaly AT12, which returned encouraging widths of visual copper-nickel-iron sulphide mineralization up to 29.2 metres in peridotite host rock and disseminated mineralization over 66 metres. Assays are pending.

Several other anomalies have been identified within 5 kilometres of Eagle One exhibiting similar geophysical expressions as Eagle One. These are all high priority targets and plans are being made for drill testing in the next few quarters. The Company’s claims cover numerous coincident airborne magnetic and conductive anomalies around the Ring of Fire. Ground follow-up programs of line cutting and magnetometer and horizontal loop surveys were initiated covering some of the nearby (to Eagle One) airborne anomalies and are designed to prioritize the anomalies for immediate diamond drilling during 2008 and early 2009. Two new drills were contracted and arrived on site in late January 2008. The Company has entered into additional option agreements during the year with various third parties covering a portion of the Company’s extensive land position in the Double Eagle project. These are reviewed in detail in the “Option Agreements and Joint Ventures” section of this document.

The Company has announced that it intends to increase its land position and staking continues around the “Ring of Fire”. Noront initiated a large airborne survey which was followed up by a very intense ground geophysical program to identify drill ready targets. Noront’s exploration staff will continue its high priority exploration efforts on its very large land position around the potentially prolific Ring of Fire. Several diamond drills are contracted and will be testing nearby and outlying geophysical targets over the remainder of 2008 and into 2009.

WINDFALL LAKE PROJECT, Urban Township, Quebec

The property is situated in Urban Township, approximately 100 km due east of Lebel-sur-Quevillon and 200 km northeast of Val d’Or in Quebec’s Abitibi region. It is accessible from Lebel-sur-Quevillon over 112 km of gravel roads that are maintained in part by the Company. Resources Metanor Inc. has recently brought their Barry gold mine, situated 8 km SW of Windfall, to full production and trucks the ore approximately 130 km northwards to their Bachelor Lake mill.

The Windfall project comprises four, contiguous, staked claim blocks as follows:

Block Claims Area (ha) Area (acres)

Windfall Lake 33 528 1,320 Alcane 57 912 2,280 South 38 608 1,520 Murgor-Freewest Option 29 464 1,160

Total 157 2,512 6,280

Claims in the Windfall Lake and Alcane blocks are subject to small Net Smelter Return (“NSR”) royalties. The South block was acquired by staking in late 2007 and is not subject to any royalty obligations.

The Company gained the option (as of 31 January 2007) to earn a 50% interest in 29 claims owned jointly by Murgor Resources Inc. (“Murgor”) and Freewest Resources Canada Inc. (“Freewest”) in return for 750,000 shares of Noront (then valued at $607,500) and a commitment to match, within four years, the cumulative expenditures of Murgor and Freewest, deemed to be $4 million. Upon reaching the deemed expenditure, Noront may earn a further 10% interest by funding a positive feasibility study. As operator, Noront may also propose additional exploration and development programs in which the Freewest-Murgor joint venture may participate pro rata or be diluted.

Approximately 70,750 metres of drilling in 338 holes of all types are recorded on the combined properties since the early 1990’s following the discovery of a visible gold in outcrop by Alto Minerals Inc. The drilling has focused on an 800 metre square area and has yielded many high grade gold intersections culminating in a section reporting 1,307 g/t Au over 4.8 metres or 38.1 troy ounces per tonne gold over 15.7 feet core length in hole NOT-06-100 in late 2006. Reviews of cumulative diamond drill data by the Company’s qualified person in early 2006 and again in 2007 confirms that gold mineralization occurs in parallel zones that trend 240° and is vertical or dips steeply to the north.

In early 2007, Noront elected to carry out an underground exploration program to investigate the NOT-06-100 intersection by way of a ramp. Genivar Société en Commandite (“Genivar”) of Val d’Or, QC was retained to successively prepare options for a ramp (15 degree decline), complete detailed engineering studies, support permitting, complete geotechnical and hydro geological studies tender, and provide engineering and supervisory support to the project.

Noront elected to complete the underground exploration program in two phases; the first entering the F-11, F-17 and W-3 (including the NOT-06-100 area) zones and the second several other zones lying to the west. The first phase is expected to cost $10 million and be completed by September 2008.

The surface facilities include ore and acid-generating waste dumps, an integrated runoff catchment ditch, settling and polishing ponds all of which are underlain by an impermeable, plastic geomembrane designed to contain drainage that is required to meet provincial water quality specifications prior to discharge. Analytical data suggest that when rock containing more than 2% pyrite is oxidized the pH of drainage may not fall within provincial water quality standards. Rounds suspected of containing significant amounts of pyrite are to be mucked to the acid pad where the overall pyrite content will be estimated and if necessary sampled for analysis. Material containing more than 2% pyrite will be retained on the acid pad.

The four claims on which the ramp portal, dumps and effluent drainage facilities are situated, were taken to lease to meet permitting requirements. These claims form part of the Murgor-Freewest option and contain the F-11 and F-17 mineralized zones.

The project operates subject to permits, certificates of approvals and regulations including the following. The permit to take a 25,000 tonne bulk sample was granted by Ministère des Ressources naturelles et de la Faune (“MRNF”) of Quebec for a one year term starting 1 September 2007 and is renewable upon application. The discharge of effluent is subject to standards set in Loi 19 (enforced by Ministère du Développement durable, de l'Environnement et des Parcs (“MDDEP”) and by mining effluent regulations under the Canada Fisheries Act (enforced by Environment Canada). The Company is required to sample the effluent discharge at prescribed intervals, complete specific analyses and to submit reports to MDDEP. Workplace safety is monitored by the Commission de la santé et de la sécurité du travail (“CSST”). The regional CSST inspector has inspected the site on two occasions.

Mining regulations require on-going monitoring of effluents and restoration of the site upon completion of work. The Company is required to submit a restoration plan and to post a bond for $385,046 representing 70% of the estimated cost of the work.

The project area also falls within the traditional territory of the Waswanipi Cree First Nation, includes parts of two traplines and lies on Category III lands, established under the James Bay and Northern Quebec Agreement (JBNQA) of 1975. Noront has signed a memorandum of understanding under which the Company agrees to compensate the Cree for disturbance to the traplines, to make available business and employment opportunities and to enter into an Impact Benefits Agreement (IBA) prior to commencing production.

As of April 30, 2008, the surface facilities and portal were complete and the underground contractor had completed the 100 metres on the Main ramp and had begun the F-11 access ramp and main sump.

BURNT HILL TUNGSTEN PROPERTIES, Stanley Parish, York County, New Brunswick

The properties straddle the Southwest Miramachi River some 70 km NNW of Fredricton. The properties contain tungsten, molybdenum and tin mineralization mainly in quartz veins that cut argillic sediments on the periphery of granitoid plutons. There has been minor historic production from the Burnt Hill area during the First and Second World Wars.

The Company optioned the core property of 53 claims in four separate blocks to Cadillac Ventures Inc. (Cadillac) in 2007. Cadillac has earned a 51% interest in exchange for 2,300,000 shares, a $150,000 payment to the Company and completion of a $1.5 million work commitment on the property. Cadillac has the right to gain a further 14% interest by making an additional payment of $500,000 or the equivalent amount in Cadillac shares. During June 2007 the Company gained a further 1,500,000 shares in Cadillac by funding a $1.5 million exploration program.

The property now comprises 652 contiguous staked claims (10,432 ha or 26,080 acres) including the original 53 claims which were optioned from the Company. The four blocks, Burnt Hill (26 claims), McLean Brook (9), Tin Hill (9) and Todd Mountain (9) contain 848 ha (2,120 acres). Cadillac and the Company are negotiating the inclusion of the 599 additional claims in the option agreement.

In early 2008 Cadillac released a technical report, that describes the property and reports that the Burnt Hill area contains four quartz-tungsten-molybdenum vein zones that underlie a 335 metre by 152 metre area and that have been traced for 285 metres below surface. As this project is currently under option, it is not considered a priority for management focus or allocating funds at this time.

OTHER PROPERTIES

Lizar Project, Ontario (New)

In June 2007, the Company acquired the Lizar gold and base-metal property (the “Lizar Property”) located in north western Ontario. The Property was optioned from Freewest, whose exploration activities over the last 5 years on it, resulted in the discovery of several new high-grade gold occurrences. The Lizar property consists of 504 claim units, or 81 square kilometres and is situated in Lizar, Breckenridge, Namiegos and Mosambik townships, 500 kilometres east of Thunder Bay and 90 kilometres east of the Hemlo gold mining operations near Marathon.

Noront completed a program of diamond drilling comprising in excess of 2000 metres, to test the best gold and base metal occurrences on the Lizard Property. The results of sampling of drill core during the 2007 exploration program yielded anomalous values of gold (up to 1.67 g/t over 0.8 metres), copper (up to 1,596 parts per million) and zinc (up to 996 parts per million). The Company is currently evaluating these results in order to plan future work.

Under the terms of the option agreement with Freewest, Noront may earn a 60% interest in the Property by incurring $1,000,000 of exploration expenditures over a three-year period and making an one-time cash payment of $20,000.

Garden Island, Quebec (New)

In July 2007, the Company entered into an agreement with a private Quebec company, TSR Resources Inc. (TSR) to acquire an interest in TSR’s Garden Island gold, base-metal property.

The Garden Island property is located approximately 15 km northeast of Val d’Or, Quebec and is comprised of 296 mining claims, most of which are in Pascalis and Senneville Townships, which lie along a northwest-southeast trending Abitibi volcanic greenstone belt.

Under the terms of the option agreement with TSR, Noront may earn up to a 33 1/3% interest in the Garden Island property by incurring $500,000 of exploration work by December 31, 2007. This money has been spent thereby earning Noront an undivided 25% interest in the project. Thereafter at Noront’s option, the Company has the right to earn an additional 8 1/3% interest by paying to TSR a further $250,000 or at Noront’s option, the equivalent dollar value in Noront’s common shares on or before December 31, 2008.

Initial funding of TSR allowed for the completion of a deep penetrating airborne geophysical survey which located numerous targets warranting further ground investigation along the NW-SE geological trend.

Reconnaissance work to date consisting of prospecting and bedrock sampling with the aid of a small drill has indicated areas for further follow-up. In particular a detail grid is being established in the southeast portion of the property to cover a large gossanous area containing stringers of massive iron sulphides with minor copper and zinc mineralization in mafic volcanics indicative of a stringer zone commonly occurring adjacent to base metals deposits. Any geophysical conductors located in this immediate surrounding area will be the subject of an immediate diamond drill testing program. Reconnaissance exploration will continue along the volcanic belt where previously untested airborne targets exist.

Iron Lake Project, Quebec (New)

In July 2007, the Company entered into a letter of intent covering the optioning of a 97 leased claim grid units in Kating & Killins Township, located within the District of Algoma, northern Ontario.

The agreement calls for payment of $5,000 to the optionors and expenditures including all lease payments of $50,000 during the first year of the agreement, which will earn the Company an 80% interest in the claim group. An optional second payment of a further $10,000 to the optionors during the second year of the agreement will earn the Company the balance of the projects (100%).

Escondida Project, Mexico (New)

The Escondida project agreement called for a series of cash and stock payments totalling $175,000 US and 300,000 shares for a 100% interest in the mineral claims subject to a NSR equal to 2%. The NSR may be purchased outright at a cost of $500,000 US for each 0.5% or $2,000,000 US for the 2% NSR. Noront has the right of first refusal on any offer for the NSR by a third party.

The Company has entered into an amending agreement which provides for a one time payment of 40,000 shares to acquire a 100% in the property. The terms of the net smelter royalty remain unchanged. The vendor will retain a 2% NSR that may be purchased for $2,000,000 US or $500,000 for each one half per cent. Noront has a right of first refusal on any third party offers for the NSR.

The Company had agreed (subject to all regulatory approvals) to pay a finders fee of 18,115 common shares of the Company to Exploration Canada de Oro SA de CU, a Mexican exploration company for the introduction to the property and subsequent option agreement. The shares, payable pursuant to the Amending agreement, are currently held In Trust with the Company’s lawyers pending the transfer of the claim group to the Company’s wholly owned Mexican subsidiary.

Noront is not planning for any additional work on this project at this time

Volcan 1 Property, Baja, Mexico

The original agreement called for a series of payments totalling $70,000 US in cash, 350,000 shares and a work commitment of $15,000 US on or before December 15, 2007. The Optionor would retain a 2% net smelter royalty (NSR). Half of that NSR or 1% may be purchased by Noront at any time for $1 million US. The Company has entered into an Amending Agreement with the Vendor. The Amendment Agreement calls for a one time stock payment of 40,000 shares in exchange for a 100% interest in the project subject to a 2% NSR. Half of the NSR or 1% may be purchased at any time for $1 million US.

This is an early stage exploration property. A detailed ground magnetometer survey has been completed, yielding several anomalies located along a north-south trend where previous trenching in 1968 discovered significant copper-nickel sulphide mineralization across widths up to 16 metres in a series of trenches along a 400 metre strike length. No diamond drilling, to Noront’s knowledge, has ever been completed on the project. Before drill testing of the magnetic anomalies is considered, further trenching is required, which is dependent on obtaining additional surface rights.

Noront is not planning for any additional work on this project at this time.

El Verde Project, Mexico

The El Verde property agreement called for payments totalling $745,000 US, 650,000 shares and work costs of at least $600,000 on or before November 10, 2010. By executing these payments and performing the required work programs, Noront would earn a 100% interest in the claims subject to a 1.5% NSR. Noront would have the right to purchase 2/3 of the NSR or 1% at any time by paying $1.5 million US.

The Company has entered into an amending agreement which calls for a one time payment of 60,000 shares in exchange for a 100% interest in the claims subject to a 1.5% NSR. Two thirds of the NSR or 1% may be purchased at any time by Noront for $1.5 million US.

Noront is not planning for any additional work on this project at this time.

Tie Jiang Ying Zi Property, Inner Mongolia, China

Noront owns a 100% interest in this property, which consists of a mineral rights permit comprising 5.16 square kilometres. The Company formed a foreign investment company in Inner Mongolia to carry out mineral exploration and development. BaoTou Noront Mineral Development Co. Ltd. (“BaoTou”).

In February 2006, Noront announced that it’s wholly owned China subsidiary BaoTou received an exploration permit covering its China One Copper/Gold project. Noront also agreed in principle with private individuals (“China Group”) to grant them the option to earn a 50% interest in the project.

On November 21, 2006 Noront announced that it had been advised that its Option Agreement with the "China Group" had been transferred to Newport Gold Inc. ("Newport")(OTCBB: NWPG). Newport agreed to assume all of the obligations contained in Noront's agreement with the China Group. Newport has an option to earn a 50% interest in this property by spending $750,000 over 3 years and delivering 800,000 shares to Noront. The initial 300,000 shares were delivered to Noront. Newport was unable complete the planned diamond drill program in 2007 and negotiated an extension with Company. Subsequent to the year end, additional land claims were secured for a further $20,000, half from each partner. Newport is preparing to drill a number of identified targets during fiscal 2009.

Noront will be monitoring and advising Newport during the course of the drill program.

DISCONTINUED PROJECTS

During the course of the year, the Company wrote off investments and exploration expenditures in the amount of $780,476, on the following properties.

Mid-Matra Project, Hungary

Noront disposed of its interest in this property to Jamie Frontier Resources Inc. (“Jamie”). Noront retains a 1.5% NSR in the event that Jamie completes its obligations in respect of the property. The NSR is subject to a 0.5% buyback for the consideration of $500,000.

Hunters Point Package, Atwater and Booth Townships, Quebec (Closed)

Management has concluded that the results of the program did not warrant making the next stage of payments on the property and the project was returned to the vendor in exchange for a disengagement fee of $101,369 paid subsequent to year end. Accordingly, all costs associated with this project have been written off.

North Williams, Larder Lake District, Ontario (Closed)

During the year, management concluded that further work on this project was not warranted. Accordingly, all costs associated with this project have been written off.

Lawson Township Project, Ontario (Closed)

During the year, management concluded that further work on this project was not warranted. Accordingly, all costs associated with this project have been written off.

OPTION AGREEMENTS AND JOINT VENTURES

The following option agreements are on claims that are part of the Ring of Fire area located in the James Bay Lowlands, which include the site of the Double Eagle Project at McFaulds Lake.

WSR Gold Inc. Option

On November 1, 2007, WSR Gold Inc. and the Company entered into an option agreement pursuant to which WSR has been granted the option to acquire a 50% legal and beneficial interest in a property. The property includes 15 Claim Blocks, approximately 4,400 hectares (9,600 acres) along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

In order to acquire its interest in the property, WSR is required to:

1. Issue to Noront an aggregate of 400,000 common shares once both parties have received all required approvals including TSXV and Board of Directors approval of the Option Agreement;

2. Incur aggregate exploration expenditures on the property of $5,000,000 over a three year period (of which $1,500,000 must be expended in the first year);

3. Make cash payments to Noront totaling $400,000 within two years of receiving the above noted approvals of the Option Agreement (of which $200,000 must be paid in the first year, and any portion of the aggregate of $400,000 may be satisfied at the option of Noront, by the issuance to Noront of up to 800,000 common shares of WSR at a deemed price of $0.50 per share).

Upon WSR earning its 50% interest in the property, WSR and Noront shall form a joint management committee to further develop the property and Noront shall act as Operator. WSR has announced that a 2,500 metre drill program has commenced on this property

Hawk Uranium Inc. Option

On November 21, 2007, Hawk Uranium Inc. entered into an option agreement with the Company pursuant to which Hawk has the option to acquire a 50% legal and beneficial interest in a property. The property includes 10 Claims (covering a total of 160 claim units, or approximately 6340 acres) along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario, near Noront's Eagle One nickel copper discovery.

To earn its interest in the property, Hawk is required to:

1. Issue 400,000 common shares of Hawk to Noront immediately following approval of the option agreement by the TSXV;

2. Complete an aggregate of $3,500,000 in exploration expenditures on the property over a three year period (of which $1,000,000 must be incurred in the first year); and

3. Make aggregate cash payments to Noront of $400,000 within two years of entering into the option agreement (of which $200,000 must be paid in the first year). The cash payments may be satisfied, at the option of Noront and subject to the approval of the TSXV, by the issuance to Noront of 800,000 common shares of Hawk (at a deemed price of $0.50 per share).

Upon Hawk earning its 50% interest in the property, Hawk and Noront shall form a joint management committee to further develop the property as a joint venture with Noront continuing to act as the operator.

Noront has recently advised Hawk Uranium Inc. that Noront has commenced the 2008 Exploration Field Program

Southampton Ventures Inc. Option

On January 3, 2008, Southampton Ventures Inc. and the Company entered into an option agreement pursuant to which Southampton has been granted the option to acquire a 50% legal and beneficial interest in 12 claim blocks (covering a total of 168 units or approximately 6,720 acres along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario, near Noront’s Eagle One nickel copper discovery.

In order to acquire its interest in the property, Southampton is required to:

1. At Southampton’s option, make a payment to Noront of $200,000 or issue to Noront an aggregate of 266,667 common shares of Southampton, on both parties receiving all required approvals, including any TSXV approval and Board of Directors approval of the Option Agreement as may be required;

2. Incur aggregate exploration expenditures on the property of $3,500,000 over a three year period (of which $1,000,000 is firm for the first year);

3. Make total cash payments to Noront totaling $400,000 within two years of receiving the above noted approvals of the option agreement (of which $200,000 must be paid in the first year, and any portion of the aggregate of $400,000 may be satisfied at the option of Noront, by the issuance to Noront of up to 533,334 common shares of Southampton at a deemed price of $0.75 per share).

The transaction remains subject to required approvals on both sides including the approval of the TSXV and Southampton’s Board of Directors (received subsequent to January 31, 2008)

Upon Southampton earning its 50% interest in the property, Southampton and Noront shall form a joint management committee to further develop the property as a joint venture with Noront continuing to act as the operator.

Seafield Resources Ltd. Option

On January 15, 2008, Seafield Resources Ltd. and the Company entered into an option agreement pursuant to which Seafield was granted the option to acquire a 50% legal and beneficial interest in 6 claim blocks, (covering a total of 96 claim units or approximately 3,840 acres). The property is located along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

The Seafield property covers an 8 km stretch of the “Ring” which is interpreted to be underlain by metavolcanic and mafic to ultramafic intrusive rocks. Initial exploration over the property will include a state of–the-art detailed heli-borne magnetic and EM geophysical survey expected to commence later this month, to define targets for follow up drilling.

In order to acquire its interest in the property, Seafield is required to:

1. Make an initial payment to Noront of $120,000 or issue to Noront an aggregate of 342,857 common shares of Seafield. Both parties are required to receive all approvals, including any TSXV approval and Board of Directors approval of the Option Agreement;

2. Incur aggregate exploration expenditures on the property of $2,100,000 over a three year period (of which $600,000 must be expended in the first year); and

3. Make total cash payments to Noront of $240,000 within two years of receiving the above noted approvals of the option agreement (of which $120,000 must be paid by the first anniversary, and any portion of the aggregate of $240,000 may be satisfied at the option of Noront, by the issuance to Noront of up to 685,714 common shares of Seafield at a deemed price of $0.35 per share).

Upon Seafield earning its 50% interest in the property, Seafield and Noront shall form a joint management committee to further develop the property as a joint venture with Noront continuing to act as the operator.

Lund Gold Ltd. Option

On February 4, 2008, Lund Gold Ltd. and the Company entered into an option agreement pursuant to which Lund has been granted the option to acquire a 50% legal and beneficial interest in 13 claim blocks covering a total of 169 units along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

In order to acquire its interest in the property, Lund is required to:

1. Issue to Noront an aggregate of 400,000 common shares of Lund, on both parties receiving all required approvals, including any TSXV approval and Board of Directors approval of the Option Agreement;

2. Incur aggregate exploration expenditures on the property of $3,500,000 over a three year period (of which $1,000,000 is firm for the first year); and

3. Make total cash payments to Noront totaling $400,000 within two years of receiving the above noted approvals of the Option Agreement (of which $200,000 must be paid in the first year, and any portion of the aggregate of $400,000 may be satisfied at the option of Noront, by the issuance to Noront of up to 1,600,000 common shares of Lund at a deemed price of $0.25 per share).

Upon Lund’s earning its 50% interest in the property, Lund and Noront shall form a joint management committee to further develop the property as a joint venture with Noront continuing to act as the operator.

Intrinsic Minerals Ltd. Option

On February 5, 2008, Intrinsic Minerals Ltd. entered into an option agreement with the Company pursuant to which Intrinsic was been granted an option to acquire a 50% legal and beneficial interest in a property consisting of 9 claim blocks (covering a total of 144 claim units) along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

To earn and maintain its interest in the property, Intrinsic is required to:

1. Pay to Noront a sum of $180,000 consisting of $90,000 in cash and 180,000 common shares of Intrinsic;

2. Fund $3,150,000 of exploration expenditures on the property over a three year period (of which $900,000 must be incurred in the first year); and

3. Make additional aggregate cash payments to Noront of $360,000 within two years of entering into the option agreement. The cash payments may be satisfied, at the option of Noront through the issuance to Noront of 720,000 common shares of Intrinsic.

Upon Intrinsic earning its 50% interest in the property, Intrinsic and Noront shall form a joint management committee to further develop the property as a joint venture with Noront acting as the operator.

Intrinsic Minerals Ltd. Second Option

On February 11, 2008, Intrinsic Minerals Ltd. entered into a second option agreement with the Company pursuant to which Intrinsic was been granted an option to acquire a 50% legal and beneficial interest in 2 properties consisting of a total of 17 claim blocks (covering a total of 212 claim units) for a total area of 3,392 hectares along the Ring of Fire located in the McFaulds Lake area in northeastern Ontario. This is the second such agreement between Intrinsic and Noront.

To earn and maintain its interest in the property, Intrinsic is required to:

1. Pay to Noront a sum of $260,000 payable in the form of 520,000 common shares of Intrinsic;

2. Fund $4,550,000 of exploration expenditures on the property over a three year period (of which $1,300,000 must be incurred in the first year); and

3. Make additional aggregate cash payments to Noront of $520,000 within two years of entering into the option agreement. The cash payments may be satisfied, at the option of Noront, through the issuance to Noront of 1,040,000 common shares of Intrinsic.

Upon Intrinsic earning its 50% interest in the property, Intrinsic and Noront shall form a joint management committee to further develop the property as a joint venture with Noront acting as the operator.

Temex Resources Corp, Noront Resources Ltd. and Baltic Resources Inc. Acquisition

On December 11, 2007, Noront, Baltic Resources Inc. (“Baltic”) and Temex Resources Corp. (“Temex") announced that they had completed a significant land acquisition campaign in the McFaulds Lake area in the James Bay Lowlands region of northeastern, Ontario. The new properties, located in the general area of Noront’s Double Eagle Ni-Cu-PGE discovery, were acquired by Temex on behalf of Temex, Noront and Baltic collectively the Staking Syndicate (the “Staking Syndicate”). A total of 120 mining claims comprising 1900 claim units totaling 76,000 acres (the “Claims”) were acquired on behalf of the Staking Syndicate.

Subsequent to the staking campaign, Temex, Noront and Baltic have entered into a binding Letter of Agreement whereby each party has agreed to grant the other two parties a 100% interest in one third of the total claims staked, with each of the parties retaining a 1% NSR royalty in the claims granted to the other parties. Therefore each party has a 100% interest in one third of the claim units and a 1% NSR royalty in two thirds of the claim units. Temex acted as operator of the Staking Syndicate.

The Claims cover features that these companies believe represent a geological environment similar to the geological setting near the Noront Ni-Cu-PGE discovery. It is believed that the newly acquired Claims have never been subjected to any previous exploration for Ni-Cu-PGE mineralization, and for the most part, the Claims have not been covered by a modern magnetic and electromagnetic geophysical survey.

Bold Ventures Inc. Option

On April 8, 2008, the Company announced it had entered into an option agreement with Bold Ventures Inc. ("Bold") pursuant to which Bold has been granted the option to acquire a 50% legal and beneficial interest in 6 claim blocks covering a total of 3800 acres strategically located along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario, approximately 30 km north of Noront’s Eagle One nickel, copper, PGM discovery.

To earn and maintain its interest in the property, Bold is required to:

1. Pay to Noront $120,000 or issue to Noront a total of 240,000 common shares of Bold at a deemed price of $0.50 per common share;

2. Fund $2,100,000 exploration expenditures over a three year period (of which $600,000 must be incurred in the first year); and

3. Make additional aggregate cash payments to Noront of $240,000 within two years of entering into the option agreement. The payments may be satisfied at the option of Noront, by the issuance to Noront of up to 480,000 common shares of Bold at a deemed price of $0.50 per share.

Upon Bold earning its 50% interest in the property, Bold and Noront shall form a joint management committee to further develop the property as a joint venture, with Noront continuing to act as the operator.

SUBSEQUENT EVENTS

Noront Resources Ltd. and Freewest Resources Canada Inc., Joint Exploration Agreement

On May 14, 2008 the two companies announced a joint exploration agreement to explore a key airborne geophysical anomaly, situated in the Eagle One deposit locale in the McFaulds Lake area. The McFaulds Lake area exploration play is situated in the Sachigo greenstone belt, 300 kilometres north of Nakina in the James Bay Lowlands of northern Ontario.

Under the terms of the agreement Freewest will contribute 68 acres (27.5 hectares) comprising a small portion of their 100%-owned property. Noront in turn, will contribute 70 acres (28.3 hectares) of their adjoining land to collectively form the joint-venture property. Freewest and Noront shall share exploration costs on a 50%-50% basis and will share any mineralization found on the Property on a similar basis. Freewest will act as the operator of the initial exploration program which is to be agreed upon by both parties.

Passport Metals Inc. Option

On July 16, 2008, the Company announced that it had entered into an option agreement with Passport Metals Inc. ("Passport"). The agreement allows Passport the option to earn a 50% legal and beneficial interest in 4.5 claims making up 72 units that encompass approximately 2,850 acres along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario. Named the Inner Rim Property, this group of claims is located approximately 60 kilometres north-west of Noront’s Eagle One copper-nickel-PGM discovery and 6 kilometres west-southwest of the recently announced WSR Gold Inc. - Metalex Ventures Ltd. - Arctic Star Diamond Corporation discovery of sulphide mineralization.

To earn and maintain its interest in the property, Passport is required to:

1. Pay to Noront a sum of $90,000 in the form of common shares of Passport at a deemed price of $0.40 per share;

2. Fund $1,575,000 of exploration expenditures on the property over a three year period ending June 10, 2011(of which $450,000 must be incurred by June 10, 2009); and

3. Make additional aggregate cash payments to Noront of $180,000 within two years of entering into the option agreement. The cash payments may be satisfied, at the option of Noront, through the issuance to Noront of common shares of Passport based on the 10 day moving average closing price of Passport common shares.

Noront will act as the operator and plans to complete a work program of airborne surveys, geological compilation and geophysics. Should the exploration results warrant, a follow up diamond drilling program will be carried out. Upon Passport earning its 50% interest in the claims then Noront and Passport will form a joint venture management committee to develop the property with Noront continuing to act as the operator.

Sureshot Minerals Inc. Option

On July 17, 2008, the Company entered into an option agreement with Sureshot Minerals Inc. ("Sureshot"). The agreement allows Sureshot the option to earn a 50% legal and beneficial interest in 14 claims making up 224 units along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

To earn and maintain its interest in the property, Sureshot is required to:

1. Pay to Noront $100,000, and a further payment of $180,000 to be settled in cash or, at the option the Sureshot, in its common shares with a deemed price of $0.50 per share;

2. Fund $4,900,000 in exploration expenditures on the property over a 3 year period ending July 15, 2011 (of which $1,400,000 must be incurred by July 15, 2009); and

3. Make additional aggregate cash payments to Noront of $560,000 within two years of entering into the option agreement. The cash payments may be satisfied, at the option of Sureshot, through the issuance to Noront of common shares of Sureshot based on at a price of $0.50 per share.

Noront will act as the operator.

Private Company (6897631 Canada Inc.) Option

On July 18, 2008, the Company entered into an option agreement with a private company. The agreement allows private company the option to earn a 50% legal and beneficial interest in 10 claims making up approximately 160 units along the Ring of Fire located in the James Bay Lowlands of northeastern Ontario.

To earn and maintain its interest in the property, The Private Company is required to:

1. Pay to Noront $130,000;

2. Fund $2,275,000 in exploration expenditures on the property over a 3 year period ending March 27, 2011 (of which $650,000 must be incurred by March 27, 2009); and

3. Make additional aggregate cash payments to Noront of $260,000 within two years of entering into the option agreement.

Noront will act as the operator.

East West Resources Corp. Option (Fishhook Property)

On July 31, 2008, the Company entered into an option agreement with East West Resource Corporation (“East West”) and Temex Resources Corp. The agreement permits Noront to earn up to a 60% interest in the group of claims, collectively know as the “Fishhook Property”, by making payments of $600,000 in cash and expending $4.5 million on the Fishhook Property over a three year period, subject to certain extensions as permitted by the agreement. Noront will act as operator, and East West will manage the exploration program and related project matters.

Golden Valley Mines Ltd Option with WSR Gold Inc.

On August 19, 2008, the Company was assigned by WSR Gold Inc. (“WSR”), the option to earn a 35% interest in the property located in the James Bay lowlands (the “Golden Valley Property”) owned by Golden Valley Mines Ltd. (“Golden Valley”). WSR has entered into a letter of intent with Golden Valley whereby it has the option to earn a 70% interest in the Golden Valley Property (the “Option”), and Noront can earn half of WSR’s interest in the Golden Valley Property as further described below.

In order to acquire its 35% interests in the Property, Noront will be required to:

1. Pay to Golden Valley $175,000 (or $350,000 in the aggregate with the payments from WSR), payable in cash and/or by the issuance of common shares of Noront (and WSR) based on the ten day volume weighted average price of such shares for the ten trading day period

2. In addition to these payments, WSR and Noront will also be required to fund exploration expenditures on the property of $5,000,000 over a three year period (of which $1,000,000 must be expended in the first year).

Upon WSR and Noront earning their collective 70% interest in the Property, WSR, Noront and Golden Valley shall enter into a joint venture agreement. The Joint Venture Agreement will require WSR and Noront to fund all project costs up to the start of commercial production from the Property. Following the commencement of commercial production, any cash flow after payment of operating expenses and third party financing costs will be distributed to Noront and WSR until such time as the aggregate of their project costs, including interest, up to the commencement of commercial production have been repaid, following which such cash flow shall be distributed to the parties on a pro rata basis.

HEALTH AND SAFETY

Noront recognizes that operating its business under health, safety and environmental best practices benefits the employees and the communities in which Noront operates and is essential to the success and continued development of the Company. This principle is an integral part of the operating philosophy in conducting the Company’s business of mineral exploration. The health and safety of the employees, contractors and visitors is important to the Company. A major focus is placed on the development and implementation of strategies and standards at the exploration camps designed to minimize occupational health and safety risks and continually improve performance.

SELECTED FINANCIAL INFORMATION

SUMMARY OF ANNUAL RESULTS

YEAR ENDED APRIL 30, 2008 VERSUS YEARS ENDING APRIL 30, 2007 AND 2006.

When contrasted against the years ended April 30, 2007 and 2006 the Company reported significantly higher interest income and increased expenses. The Company benefited from a private placement in February 2008 which added $26 million to its interest bearing cash reserves, resulting in a corresponding increase in interest income. Furthermore, the rise in the Company’s share price has also yielded additional funding as warrant and option holders have exercised their securities, resulting in more than $32 million of additional funding to the Company in fiscal 2008 compared to only $900,000 in fiscal 2007.

An increase of $3,719,273 in the aggregate expenses reported for the year ended April 30, 2008 over the comparative year ended April 30, 2007 is a function of:

Corporate G&A Expenses including stock based compensation for the Fourth Quarter and the Year Ending April 30, 2008.

During the year ended April 30, 2008, the Company saw an increase in its general corporate expenses over comparative years, primarily due to the following:

a) The Company incurred an Ontario Employer Health Tax liability created by the value of the employee stock options being exercised. In the comparable fiscal years, there was little activity and no such costs incurred.

b) In fiscal 2008, the Company completed its flow-through financing exploration expenditure requirement associated with the December 2006 flow-through private placement. Accordingly, $246,473 was incurred and paid in related statutory taxes.

c) Shortly after the start of the fiscal year, the Company secured comprehensive Directors’ and Officers’ insurance coverage. The additional coverage increased the overall insurance expense when contrasted against comparative periods.

d) The combination of the rise in the number of shareholders, coupled with the overall increase in activity of the Company during this past fiscal year has led to significantly higher printing and reproduction costs. As the number of shareholders has increased and the number of projects under administration and management has increased, so has the cost of printing and reproduction.

e) Travel expenses have increased with the demands associated with administering the Company’s growing portfolio of active projects.

f) The Company invested in its corporate website with the intent of improving both the format and content, resulting in a marked increase in website expenses.

SUMMARY OF QUARTERLY RESULTS

The following tables set out financial performance highlights for the last eight quarters.

FOURTH QUARTER FISCAL 2008 RESULTS

In the three months ended April 30, 2008, the Company continued to see increases in its interest income over the third and prior quarters in 2008, primarily as a result of an inflow of proceeds from the $26,000,000 private placement in February 2008, as well as the associated exercise of warrants associated with this private placement in April 2008. These funds are invested in a blend of high interest savings accounts and a guaranteed investment certificate in order to provide liquidity while minimizing risk.

The Company does not hold investments with exposure to the sub-prime lending market, asset backed commercial paper, nor any derivative thereof.

On a net basis, the Company saw expenses in the fourth quarter decline over the third quarter of fiscal 2008. However, once the gain on sale of properties of $1,576,177 is factored out, fourth quarter expenses rose to $3,280,792, for an increase of $885,761 over the third quarter of 2008. While declines were seen in some individual expense categories, the write-down of Hunter’s Point property expenditures of $573,851 combined with statutory flow-through financing taxes of $246,473 served to increase the reported expenditures in the fourth quarter.

Moderate increases in regulatory and filing fees have also occurred as these costs are activity and market capitalization based. The Company has also seen an increase in shareholder information costs, which include costs associated with mailings, press releases and sundry shareholder communication. Understandably, the increase in the number of issued and outstanding shares associated with the private placements, coupled with the significant increase in exploration activity, have meant the Company has had to communicate with more shareholders on a more frequent basis.

Management and consulting fees have also increased as the Company adds to its management team and consultants in the field to accommodate the rise in activity in its core exploration programs and overall corporate growth.

Professional fees have significantly increased over prior years as the size and complexity of the Company and its operations have grown substantially over the prior year, resulting in a greater need for legal, accounting and financial services.

When comparing the current year fourth quarter operating results of the Company to that of the fourth quarter of 2007, the fundamental change in the Company and its operations within the last twelve months becomes evident. In order to administer, fund and support the level of activity required to operate the number of successful and expanding projects during the 2008, significant investments in management, infrastructure and general operations had to be undertaken. As such, expense categories in all areas have increased over the comparative 2007 fourth quarter. Furthermore, as the Company’s undertook to secure additional operational funding for the projects by means of private placement, it also saw the benefit from a greater yield from its increased investment asset base.

LIQUIDITY AND CAPITAL RESOURCES

Noront reported working capital as at April 30, 2008 of $55,516,525 (April 30, 2007 – $16,043,182) and cash & cash equivalents of $55,830,632 (April 30, 2007 – $15,323,039). The comparative improvement in the Company’s working capital position is a result of the cash proceeds received from a private placement of 6,500,000 common shares and from the exercise of its issued and outstanding stock options and warrants.

The Company spent $25.1 million for the acquisition of mining properties and exploration activities during the fiscal year compared to $4.5 million in fiscal year 2007. The higher expenditure rate in 2008 reflects the commencement of a number of successful drilling programs in the McFaulds Lake area in the James Bay Lowlands, specifically on the Double Eagle property, as well as the development of an exploration ramp at the Windfall Lake project and the active acquisition of properties during the year. Costs reflect the contracting of equipment, engineering and geological services. The expenditure rate is expected to increase in 2009, to approximately $60 million a year, as the Company further expands its drilling programs in the McFaulds Lake area.

The Company’s finances were buoyed by the private placement of 6,500,000 units for gross proceeds of $26 million, with each unit consisting of one common share and one half common share purchase warrant exercisable at $5.00. The warrants were subject to an accelerated expiry clause, being 30 days after the common shares of the common shares of the Company had closed on the TSX-V at or above the price of $6.00 for ten consecutive trading days. On March 12, 2008, the terms of the acceleration clause were met, resulting in a revised expiry date for these warrants of April 10, 2008. The Company received additional gross proceeds of $12.1 million from the exercise of the warrants.

In addition to the equity financing of its operations, the Company has also chosen to enter into a number of joint venture agreements in relation to its properties. These option agreements provide additional financial resources and provide the benefit of adding the resources of other entities to the overall exploration effort.

The Company has financed a portion of its exploration activities through the issue of flow-through shares, which transfer the tax deductibility of exploration expenditures to the investor. Proceeds received from the issue of such shares have been credited to capital stock and the related exploration costs have been charged to mining and resource properties. Proceeds raised are being used for continued exploration of Noront’s properties. Resource expenditure deductions for income tax purposes related to exploration and development activities funded by flow-through share arrangements are renounced to investors in accordance with income tax legislation. When these expenditures are made, temporary taxable differences created by the renunciation will reduce share capital.

Noront has no credit facilities with financial institutions, so its financial instruments consist of cash, marketable securities, accounts receivable and accounts payable and accrued liabilities. Unless otherwise noted, the Company does not expect to be exposed to significant interest, currency or credit risks arising from these financial instruments. Noront estimates that the fair value of cash and cash equivalents, accounts receivable, accounts payable and taxes payable approximate the carrying values.

Although the Company has sufficient capital resources to meet its current obligations, the Company will need to raise additional funding to finance future exploration programs. The timing and ability to do so will depend on the liquidity of the financial markets as well as the acceptance of investors to finance resource based junior companies, in addition to the results of the Company’s exploration programs and the acquisition of additional projects. At this time, the Company is not anticipating an ongoing profit from operations, therefore it will rely on its ability to obtain equity or debt financing for growth.

The Company has received the Technical Report, which has identified a resource estimate for the Eagle One discovery of 1,834,000 tonnes of indicated resources and 1,087,000 tonnes of inferred resources of high grade nickel, copper and PGMs. It has not yet determined whether its resource assets contain reserves that are economically recoverable but the Company is in the process of doing so. The recoverability of the carrying values of exploration properties is dependent upon the discovery of economically recoverable reserves, the ability of the Company to obtain necessary financing to complete the development and future profitable production there from or alternatively upon the Company's ability to dispose of its interests on an advantageous basis. Changes in future conditions could require material write downs of the carrying values.

A total budget of $12.3 million is being considered to perform follow up drilling at the site of the Eagle One Deposit in search of related deposits and to continue defining and delineating the other deposits on the property such as Eagle Two, Blackbird One and Blackbird Two, as well as drilling other targeted geophysical anomalies. The large budget is warranted, given that the Double Eagle project is now entering a predevelopment stage and will require considerable infrastructure upgrades and advanced studies in order to proceed to the next level. Geophysical indications are that the Ring of Fire Intrusion continues across the entire Double Eagle Property, and that Noront should have continued success at intersecting mineralization in areas within several kilometres from the Eagle One Deposit.

Management is confident that it will be able to raise sufficient capital to further explore and develop its properties and projects in the coming year. The ability of the Company to develop its existing assets into commercial and profitable operations, however, will require participation by outside parties for capital or will require additional financing from other outside sources. There can be no guarantee that the Company will be able to secure any required financing.

CONTRACTUAL OBLIGATIONS -SITE REMEDIATION PROVISION

In accordance with the requirements of the Quebec Ministry of Natural Resources, the Company has developed a site remediation and restoration plan for its Windfall Lake project operations. The Company has established a provision of $485,046, representing the estimated present value of its future obligations in respect of this project.

RELATED PARTY AND OTHER TRANCACTIONS

During the year ended April 30, 2008, $155,646 (April 30, 2007 - $64,809) was paid as remuneration to Richard Nemis, the Chief Executive Officer of the Company. The Chief Executive Officer was also paid for out of pocket expenses that occurred in the normal course of operations.

During the year, a vehicle owned by the Company was sold to Richard Nemis, the Chief Executive Officer of the Company, for cash consideration of $10,000. The sale price was based on an independent fair market value assessment provided by the original dealership from which the vehicle was purchased. As a result of this transaction, the Company has recognized a gain on disposition of $316 in these consolidated financial statements.

During the year ended April 30, 2008, $102,466 (April 30, 2007 - $7,311) was paid to a company controlled by a Director of the Company for consulting services. The Director was also reimbursed for out of pocket expenses which were incurred in the normal course of operations. In addition, for the year ended April 30, 2008 legal fees in the amount of $265,807 (2007 - $78,425) were paid to a law firm in which an officer of the Company, the Corporate Secretary is a partner. Included in accounts payable and accrued liabilities is the amount of $250,000 (2007 - $NIL). These transactions are in the normal course of operations and reflect the amount of consideration established and agreed to by the related parties.

OFF-BALANCE SHEET ARRANGEMENTS

Noront does not have any off-balance sheet arrangements that have, or are reasonably likely to have, an effect on the results of operations or financial condition of the Company.

PROPOSED TRANSACTIONS

There is no imminent decision by the Board of Directors of the Company with respect to any significant transactions other than pending option agreements under review and negotiation over the normal course of business.

CRITICAL ACCOUNTING ESTIMATES

On an annual basis, the Company reviews the carrying value of deferred mining property acquisition and exploration expenditures to assess whether there has been an impairment in value. The Company recognizes write-downs for impairment where the carrying value of the mining property exceeds its estimated long term net recoverable value. Recoverable value is estimated based upon current exploration results and upon management's assessment of the future probability of positive cash flows from the property or from the sale of the property.

The Black-Scholes option valuation model used by the Company to determine fair values for stock-based compensation was developed for use in estimating the fair value of freely traded options. This model requires input of highly subjective assumptions including future stock volatility and expected time until exercise. Changes in the subjective input assumptions can materially affect the fair value estimate, and therefore the existing model does not necessarily provide a reliable single measure of the fair value of the Company's stock options granted during the year.

ADOPTION OF NEW ACCOUNTING STANDARDS

The first quarter of 2008 saw the adoption of a number of new accounting standards, the most significant being those related to financial instruments, and the recognition in the statements of a new category of income referred to as comprehensive income. In terms of their immediate impact on the Company, these new standards effectively require the Company to calculate the market value of its marketable securities and record the theoretical gain or loss should those marketable securities have been sold on the financial statement date. The resulting theoretical gain or loss is presented on a separate statement of comprehensive income (loss) whereby the change in the market value of these investments for the period is shown, along with its impact on the normal net income (loss) of the Company. On the balance sheet, there is a new line item called “accumulated other comprehensive income” which effectively represents the difference from original cost of the Company’s marketable securities since adoption of the new standard, and the market value of these investments at the financial statement reporting date. In conjunction with the adoption of these new accounting standards, marketable securities have been recorded at their market value on the financial statements for the current quarter. As adoption of these standards is prospective, commencing May 1, 2007, the comparative value of marketable securities for the period ended April 30, 2007 remains at original cost.

Canadian Institute of Chartered Accountants ("CICA") Handbook Section 1506, "Accounting Changes" prescribes the criteria for changing accounting policies, changes in accounting estimates and the correction of errors. The Company has adopted these new standards effective May 1, 2007.

Financial Instruments - Recognition and Measurement

Section 3855 prescribes when a financial instrument is to be recognized on the balance sheet and at what amount. It also specifies how financial instrument gains and losses are to be presented. This Section requires that:

All financial assets are measured at fair value on initial recognition and certain financial assets to be measured at fair value subsequent to initial recognition;

All financial liabilities are measured at fair value if they are classified as held for trading purposes. Other financial liabilities are measured at amortized cost using the effective interest method; and all derivative financial instruments be measured at fair value on the balance sheet, even when they are part of an effective hedging relationship.

Comprehensive Income

Section 1530 introduces a new requirement to temporarily present certain gains and losses from changes in fair value outside net income. It includes unrealized gains and losses, such as: changes in the currency translation adjustment relating to self-sustaining foreign operations; unrealized gains or losses on available-for-sale investments; and the effective portion of gains or losses on derivatives designated as cash flow hedges or hedges of the net investment in self-sustaining foreign operations.

Hedges

Section 3865 provides alternative treatments to Section 3855 for entities which choose to designate qualifying transactions as hedges for accounting purposes. It replaces and expands on Accounting Guideline 13 “Hedging Relationships”, and the hedging guidance in Section 1650 “Foreign Currency Translation” by specifying how hedge accounting is applied and what disclosures are necessary when it is applied.

Impact upon adoption of Sections 1530, 3855 and 3865

The primary impact on the financial statements resulting from the adoption of sections 1530 and 3855 is as follows:

(1)

The Company’s marketable securities are classified as “available-for-sale” and are measured at fair value. Changes in fair value are recognized in other comprehensive income until their disposition, at which time they are transferred to net income. Investments in securities having quoted market values and which are publicly traded on a recognized securities exchange and for which no sales restrictions apply are recorded at values based on the current bid prices. The Company’s investments in equity securities that do not have a quoted market price in an active market are measured at cost.

(2)

The Company has recorded the following transition adjustments in its financial statements as at May 1, 2007 resulting from the adoption of sections 1530 and 3855:

(i)

an increase of $629,000 representing a fair value adjustment to the value of marketable securities;

(ii)

an increase in accumulated other comprehensive income of $629,000, representing the fair value adjustment to the value of marketable securities, net of taxes of $113,597 and a recovery of non-capital loss carry forwards amounting to $113,597.

(3)

The Company has evaluated the impact of section 3865 on its financial statements and determined that no adjustments are currently required.

FUTURE ACCOUNTING CHANGES

Capital Disclosures and Financial Instruments – Disclosures and Presentation

0n December 1, 2006, the CICA issued three new accounting standards: Handbook Section 1535, Capital Disclosures, Handbook Section 3862, Financial Instruments – Disclosures, and Handbook Section 3863, Financial Instruments – Presentation. These new standards are effective for interim and annual financial statements for the Company's reporting period beginning on May 1, 2008.

Section 1535 specifies the disclosure of (i) an entity’s objectives, policies and processes for managing capital; (ii) quantitative data about what the entity regards as capital; (iii) whether the entity has complied with any capital requirements; and (iv) if it has not complied, the consequences of such non-compliance.

The new Sections 3862 and 3863 replace Handbook Section 3861, Financial Instruments — Disclosure and Presentation, revising and enhancing its disclosure requirements, and carrying forward unchanged its presentation requirements. These new sections place increased emphasis on disclosures about the nature and extent of risks arising from financial instruments and how the entity manages those risks.

The Company is currently assessing the impact of these new accounting standards on its consolidated financial statements.

International Financial Reporting Standards (“IFRS”)

In January 2006, the CICA’s Accounting Standards Board ("AcSB") formally adopted the strategy of replacing Canadian generally accepted accounting principles with IFRS for Canadian enterprises with public accountability. The current conversion timetable calls for financial reporting under IFRS for accounting periods commencing on or after January 1, 2011. On February 13, 2008, the AcSB confirmed that the use of IFRS will be required in 2011 for publicly accountable profit oriented enterprises. For these entities, IFRS will be required for interim and annual financial statements relating to fiscal years beginning on or after January 1, 2011. The Company is currently assessing the impact of IFRS on its consolidated financial statements.

Goodwill and Intangible Assets

In October 2007, the CICA issued Handbook Section 3064, Goodwill and Intangible Assets which replaces the existing Handbook Sections 3062, Goodwill and Other Intangible Assets and 3450 Research and Development Costs. This standard is effective for interim and annual financial statements relating to fiscal years beginning on or after October 1, 2008, with earlier application encouraged. The standard provides guidance on the recognition, measurement and disclosure requirements for goodwill and intangible assets. The Company is currently assessing the impact of this new accounting standard on its consolidated financial statements.

FINANCIAL AND OTHER INSTRUMENTS

The Company is not involved in any hedging program, nor is it a party to any financial instruments that may have an impact on its financial position.

SHAREHOLDERS’ EQUITY (at April 30, 2008)

OUTSTANDING SHARE DATA

Noront shares trade on Tier 2 of the TSX-V under the symbol “NOT”. The Company is authorized to issue an unlimited number of common shares without par value. On August 19, 2008, there were 129.8 million common shares issued and outstanding, 5.0 million stock options outstanding with a weighted average exercise price of $2.50 expiring between 2008 and 2013, and 4.8 million warrants outstanding with a weighted average exercise price of $0.75 expiring in December 2008.

SHAREHOLDER RIGHTS PLAN

On June 19, 2007, the shareholders of the Company voted to approve the adoption of a shareholder rights plan (the “Rights Plan”). The Rights Plan was adopted in order to reflect developments in Canada with respect to shareholder rights plans and is designed to encourage the fair treatment of shareholders in connection with any take-over bid for the Company. The plan provides the Board and shareholders with more time to fully assess any unsolicited take-over bid without undue pressure, and to pursue, if appropriate, other alternatives to maximize shareholder value and allow additional time for competing bids to emerge. The plan was not proposed in response to any acquisition or take-over offer and is not intended to prevent one. The rights become exercisable only when a person or party acquires or announces an intention to acquire 20% or more of the outstanding shares of the Company without complying with the “Permitted Bid” provisions of the plan. The Plan is subject to reconfirmation every third annual meeting of shareholders until the plan expires in 2016.

STOCK BASED COMPENSATION

Under the provisions of the Company's 2007 Incentive Stock Option Plan, an aggregate maximum of 10% of the issued and outstanding common shares may be issued for granting of options to directors, senior officers, full time employees of the Company, affiliates or subsidiaries, or any consultants to the Company. The terms of the awards under the Plan are determined by the Board of Directors.

As at April 30, 2008, there were 2,700,000 options outstanding (2,970,000 at April 30, 2007) with an average exercise price of $1.51 ($0.44 at April 30, 2007) with a Black-Scholes value of $2.9 million ($1.0 million at April 30, 2007).

In June and August 2008, the Company issued an aggregate of 2,130,000 stock options to directors, officers and consultants with exercise prices ranging from $3.30 to $3.90, expiring in five years from the date of issue.

DICLOSURE CONTROLS AND PROCEDURES

Management has established processes, which are in place to provide them with sufficient knowledge to support management representations that they have exercised reasonable diligence that:

(i)

the audited annual financial statements do not contain any untrue statement of material fact or omit to state a material fact required to be stated or that is necessary to make a statement not misleading in light of the circumstances under which it is made, as of the date of and for the periods presented by the audited annual financial statements: and

(ii)

the audited annual financial statements fairly present in all material respects the financial condition, results of operations and cash flows of the Company, as of the date of and for the periods presented by the audited annual financial statements.

In contrast to the certificate required under Multilateral Instrument 52-109 Certification of Disclosure in Issuers' Annual and Interim Filings (MI 52-109), the Company utilizes the Venture Issuer Basic Certificate which does not include representations relating to the establishment and maintenance of disclosure controls and procedures (DC&P) and internal control over financial reporting (ICFR), as defined in MI 52-109. In particular, the certifying officers filing the Certificate are not making any representations relating to the establishment and maintenance of:

i) controls and other procedures designed to provide reasonable assurance that information required to be disclosed by the issuer in its annual filings, interim filings or other reports filed or submitted under securities legislation is recorded, processed, summarized and reported within the time periods specified in securities legislation; and

ii) a process to provide reasonable assurance regarding the reliability of financial reporting and the preparation of financial statements for external purposes in accordance with the issuer's GAAP.

The Company’s certifying officers are responsible for ensuring that processes are in place to provide them with sufficient knowledge to support the representations they are making in this certificate. Investors should be aware that inherent limitations on the ability of certifying officers of a venture issuer to design and implement on a cost effective basis DC&P and ICFR as defined in MI 52-109 may result in additional risks to the quality, reliability, transparency and timeliness of interim and annual filings and other reports provided under securities legislation.

Noront has historically outsourced the preparation of its accounts to an outside service provider that has significant experience and expertise in working with junior exploration companies and their contractors over the validation and management of expenses. Regular reconciliations of cash flows and the vetting of supporting documentation for payments is an integral part of these services. Recently, Noront has begun to hire management and staff to supplement these external services. These processes, no matter how well designed and operated, can provide only reasonable, not absolute, assurance with respect to the reliability of financial reporting and financial statement preparation.

RISK FACTORS

RISKS AND UNCERTAINTIES

Noront’s business of exploring mineral resources involves a variety of operational, financial and regulatory risks that are typical in the natural resource industry. The Company attempts to mitigate these risks and minimize their effect on its financial performance, but there is no guarantee that the Company will be profitable in the future, and Noront common shares should be considered speculative.

MINERAL EXPLORATION

The business of exploration for minerals and mining involves a high degree of risk. A relatively small proportion of properties that are explored are ultimately developed into producing mines. At present, there are no known bodies of commercial ore on any of the mineral properties in which the Company holds interest or intends to acquire an interest and the proposed exploration program is an exploratory search for ore. Unusual or unexpected formations, formation pressures, fires, power outages, labour disruptions, flooding, cave-ins, landslides and the inability to obtain suitable or adequate machinery, equipment or labour are other risks involved in the conduct of exploration programs. The Company has limited experience in the development and operation of mines and has relied on and may continue to rely upon consultants and others for exploration and operating expertise. The economics of developing gold, base metal and other mineral properties is affected by many factors including the cost of operations, variation of the grade of ore mined, and fluctuations in the price of any minerals produced.

ADDITIONAL FUNDING REQUIREMENTS and POTENTIAL DILUTION

Noront has no current or foreseeable prospect of generating significant revenues. Accordingly, the success of the Company is dependent, among other things, on obtaining sufficient funding to enable the Company to explore and develop its properties. There can be no assurance that the Company will be able to obtain adequate financing in the future or that the terms of such financing will be favourable. Failure to obtain such additional financing could result in delay or indefinite postponement of further exploration and development of its projects with the possible loss of such properties.

The Company will require new capital to continue to operate its business and to continue with exploration on its mineral properties, and there is no assurance that capital will be available when needed, if at all. It is likely such additional capital will be raised through the issuance of additional equity, which will result in dilution to the Company’s shareholders.

As at August 19, 2008, the Company had outstanding 129.8 million common shares, 5.0 million options and 4.8 million warrants, to purchase common shares of the Company. The issuance of common shares of the Company upon the exercise of options and/or warrants will dilute the ownership of the Company’s current shareholders. Noront may also issue additional securities convertible into common shares of Noront in the future, the conversion of which would result in further dilution to the shareholders of the Company.

CONTINUATION OF OPERATING LOSSES

The Company does not have a long historical track record of operating upon which investors may rely. Consequently, investors will have to rely on the expertise of the Company’s management. Further, the Company’s properties are in the exploration stage and are not commercially viable at this time. The Company does not have a history of earnings or the provision of return on investment, and there is no assurance that it will produce revenue, operate profitably or provide a return on investment in the future.

TITLE TO MINERAL PROPERTIES (OWNERSHIP RIGHTS)

Although title to the Properties has been reviewed by or on behalf of Noront, no assurances can be given that there are no title defects affecting the Properties. Title insurance generally is not available for mining claims in Canada and Noront’s ability to ensure that it has obtained secure claim to individual mineral properties or mining concessions may be limited. Noront has not conducted surveys of the claims in which it holds direct or indirect interests; therefore, the precise area and location of such claims may be in doubt. It is possible that the Properties may be subject to prior unregistered liens, agreements, transfers or claims, including native land claims and title may be affected by, among other things, undetected defects. In addition, Noront may be unable to operate the Properties as permitted or to enforce its rights with respect to its Properties.

RESOURCE ESTIMATES

The resources presented in this document are estimates and no assurance can be given that the anticipated tonnages and grades will be achieved or that the expected level of recovery will be realized. Such figures have been determined based upon assumed metal prices. Future production could differ dramatically from estimates due to mineralization or formations different from those predicted by drilling, sampling and similar examinations or declines in the market price of the metals may render the mining of some or all of the resources as uneconomic.

ECONOMIC

Even if the Company’s exploration programs are successful, factors beyond the control of the Company may affect the marketability of any mineral products discovered. The prices of mineral products have historically fluctuated widely and are affected by numerous factors beyond the Company’s control, including international, economic and political trends, expectations for inflation, currency exchange fluctuations, interest rates, global or regional consumption patterns, speculative activities and worldwide production levels. The effect of these factors cannot accurately be predicted.

COMMODITY PRICE RISK

The ability of the Company to develop its mining properties and the future profitability of the Company is directly related to the market price of gold and base minerals.

COMPETITION

The mining industry is intensely competitive in all its phases. The Company competes with many companies possessing greater financial resources and technical facilities than itself for the acquisition of mineral interests as well as for the recruitment and retention of qualified employees, contractors and consultants.

ENVIRONMENTAL

The Company’s operations are subject to environmental regulations promulgated by local, provincial and federal government agencies from time to time. Environmental legislation provides for restrictions and prohibitions of spills, releases or emissions of various substances produced in association with certain mining industry operations, such as seepage from tailing disposal areas, which could result in environmental pollution. A breach of such legislation may result in the imposition of fines and penalties. In addition, certain types of operations require submissions to and approval of environmental impact assessments. Environmental legislation is evolving in a manner, which means stricter standards and enforcement, and fines and penalties for non-compliance are more stringent. Environmental assessments of proposed projects carry a heightened degree of responsibility for companies and directors, officers and employees. The cost of compliance with changes in governmental regulations has a potential to reduce the profitability of operations. The Company intends to fully comply with all environmental regulations.

Failure to comply with applicable laws, regulations, and permitting requirements may result in enforcement actions, including orders issued by regulatory or judicial authorities causing operations to cease or be curtailed, and may include corrective measures requiring capital expenditures, installation of additional equipment, or remedial actions. Parties engaged in mining operations may be required to compensate those suffering loss or damage by reason of the mining activities and may have civil or criminal fines or penalties imposed for violations of applicable laws or regulations and, in particular, environmental laws.

FIRST NATIONS

Noront is committed to working in partnership with our local communities and First Nations in a manner which fosters active participation and mutual respect. Noront works towards minimizing negative project impacts, encouraging certain joint consultation processes, addressing certain decision making processes and towards maintaining meaningful ongoing dialogue not only for the Company but for all participants in the Ring of Fire region.

Many of Noront’s contractors and suppliers live and work in the local communities. The Company regularly consults with communities proximal to the Company’s exploration activities to advise them of plans and answer any questions they may have about current and future activities. The objective is to operate to the benefit of the shareholders and the local communities using the resources and the environment today without compromising the long-term capacity to support post exploration and ultimately post mining land uses

First Nations in Ontario are increasingly making lands and rights claims in respect of existing and prospective resource projects on lands asserted to be First Nation traditional or treaty lands. Should a First Nation make such a claim in respect of the Properties and should such claim be resolved by government or the courts in favour of the First Nation, it could materially adversely affect the business of Noront.

JOINT VENTURES AND OPTION AGREEMENTS

Noront Resources enters into option agreements and joint ventures as a means of gaining property interests are raising funds. Any failure of any partner to meet its obligations to Noront or other third parties, or any disputes with respect to third parties’ respective rights and obligations could have a material adverse affect on such agreements. In addition, Noront may be unable to exert direct influence over strategic decisions made in respect to properties that are subject to the terms of these agreements.

LEGAL

Amendments to current laws, regulations and permits governing operations and activities of mining companies, or more stringent implementation thereof, could have a material adverse impact on Noront Resources and cause increases in expenditures or exploration costs or reduction in levels of activities on our exploration projects, or require abandonment or delays in the development of new exploration properties.

REGULATIONS AND PERMITTING

The operations of the Company may require licenses and permits from various local, provincial and federal governmental authorities. There can be no assurance that the Company will be able to obtain all necessary licenses and permits that may be required to carry out exploration, development, or mining operations, at its projects.

UNINSURABLE RISKS

The mining industry is subject to significant risks that could result in damage to, or destruction of, mineral properties, personal injury or death, environmental damage, delays in exploration, and monetary losses and possible legal liability. Where Noront considers it practical to do so, it maintains insurance in amounts believed to be reasonable, including coverage for directors and officers’ liability and fiduciary liability and others.

Such insurance, however, contains exclusions and limitations on coverage. Accordingly, Noront’s insurance policies may not provide coverage for all losses related to Noront’s activities (and specifically do not cover environmental liabilities and losses). The occurrence of losses, liabilities or damage not covered by such insurance policies could have a material and adverse effect on Noront’s results of operations and financial condition. Noront cannot be certain that insurance will be available to the Company, or that appropriate insurance will be available on terms and conditions acceptable to the Company. In some cases, coverage is not available or considered too expensive relative to the perceived risk

DEPENDENCE ON KEY EMPLOYEES, CONTRACTORS AND MANAGEMENT

Noront currently has a small executive management group, which is sufficient for the Company’s present stage of activity. Given that our success to date has depended, and in the future will continue to depend, in large part on the efforts of the current executive management group, the loss of a significant number of the members of this group could have a material adverse effect on the Company, its business and its ability to develop its projects. Noront does not maintain key person life insurance. Accordingly, the loss of the services of one or more of such key management personnel could have a material adverse on the Company.

The mining industry has been impacted by increased worldwide demand for critical resources including industry consultants, engineering firms and technical experts. These shortages have caused increased costs and delays in planned activities. Noront is also dependent upon a number of key personnel, including the services of certain key employees and contractors. Noront’s ability to manage its activities, and hence its success, will depend in large part on the efforts of these individuals. Noront faces intense competition for qualified personnel, and there can be no assurance that Company will be able to attract and retain such personnel.

CONFLICT OF INTEREST

Certain directors or proposed directors of the Company are also directors, officers or shareholders of other companies that are similarly engaged in the business of acquiring, developing and exploiting natural resource properties. Such associations may give rise to conflicts of interest from time to time. The directors of the Company are required by law to act honestly and in good faith with a view to the best interests of the Company and to disclose any interest, which they may have in any project opportunity of the Company. If a conflict of interest arises at a meeting of the board of directors, any director in a conflict will disclose his interest and abstain from voting on such matter. In determining whether or not the Company will participate in any project or opportunity, the directors will primarily consider the degree of risk to which the Company may be exposed and its financial position at that time.

ADDITIONAL DISCLOSURE FOR VENTURE ISSUERS WITHOUT SIGNIFICANT REVENUE

The balance of Mining Properties and Deferred Exploration Expenditures increased to $25,104,331 on April 30, 2008 (April 30, 2007 - $4,452,201), details of which are provided in the consolidated financial statements.

ADDITIONAL INFORMATION

Additional information relating to Noront is available on the Internet at the SEDAR website www.sedar.com at Company’s website located at www.norontresources.com, or at the Company’s investor relations hub located at www.agoracom.com/IR/Noront.