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<SEC-DOCUMENT>0001028277-03-000012.txt : 20030421
<SEC-HEADER>0001028277-03-000012.hdr.sgml : 20030421
<ACCEPTANCE-DATETIME>20030421113418
ACCESSION NUMBER:		0001028277-03-000012
CONFORMED SUBMISSION TYPE:	20-F
PUBLIC DOCUMENT COUNT:		3
CONFORMED PERIOD OF REPORT:	20020930
FILED AS OF DATE:		20030421

FILER:

	COMPANY DATA:	
		COMPANY CONFORMED NAME:			TASEKO MINES LTD
		CENTRAL INDEX KEY:			0000878518
		STANDARD INDUSTRIAL CLASSIFICATION:	GOLD & SILVER ORES [1040]
		IRS NUMBER:				000000000
		FISCAL YEAR END:			0930

	FILING VALUES:
		FORM TYPE:		20-F
		SEC ACT:		1934 Act
		SEC FILE NUMBER:	000-19476
		FILM NUMBER:		03656473

	BUSINESS ADDRESS:	
		STREET 1:		1020-800 W. PENDER STREET
		CITY:			VANCOUVER BC CANADA V6C 2V6
		STATE:			A1
		ZIP:			00000
		BUSINESS PHONE:		(604) 684-6365

	MAIL ADDRESS:	
		STREET 1:		1020-800 W. PENDER STREET
		STREET 2:		V6C 2V6
		CITY:			VANCOUVER
		STATE:			A1
		ZIP:			00000
</SEC-HEADER>
<DOCUMENT>
<TYPE>20-F
<SEQUENCE>1
<FILENAME>tkoform20f.txt
<DESCRIPTION>FORM 20F ANNUAL REPORT SEP30 2002
<TEXT>

                                  UNITED STATES
                       SECURITIES AND EXCHANGE COMMISSION

                             WASHINGTON, D.C. 20549

                                    FORM 20-F



[ ]  REGISTRATION STATEMENT PURSUANT TO SECTION 12(b) or 12(g) OF THE SECURITIES
     EXCHANGE ACT OF 1934
                                       OR

[x]  ANNUAL REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES  EXCHANGE
     ACT OF 1934
                  For the fiscal year ended SEPTEMBER 30, 2002
         (with other information to March 15, 2003 except where noted)

                                       OR

[ ]  TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES
     EXCHANGE ACT OF 1934
     For the transition period from _______________ to _______________


                         Commission file number 0-19476
                                  CIK# 878518


                              TASEKO MINES LIMITED
- --------------------------------------------------------------------------------
               (Exact name of Registrant specified in its charter)

                              TASEKO MINES LIMITED
- --------------------------------------------------------------------------------
                 (Translation of Registrant's name into English)

                            BRITISH COLUMBIA, CANADA
- --------------------------------------------------------------------------------
                 (Jurisdiction of incorporation or organization)

                       SUITE 1020, 800 WEST PENDER STREET
                  VANCOUVER, BRITISH COLUMBIA, CANADA, V6C 2V6
- --------------------------------------------------------------------------------
                    (Address of principal executive offices)

                         COMMON SHARES WITHOUT PAR VALUE
- --------------------------------------------------------------------------------
                                (Title of Class)

          Securities registered or to be registered pursuant to Section
                               12(b) of the Act.

          Title of Each Class Name of each exchange on which registered
- --------------------------------------------------------------------------------
                               None Not applicable

 Securities registered or to be registered pursuant to Section 12(g) of the Act

                         Common Shares without Par Value
- --------------------------------------------------------------------------------
                                (Title of Class)

 Securities for which there is a reporting obligation pursuant to Section 15(d)
                                of the Act

                                      None

      Number of outstanding shares of Taseko's only class of capital stock
                           as on September 30, 2002.

                   33,921,663 Common Shares Without Par Value

  Indicate by check mark whether Registrant (1) has filed all reports required
    to be filed by Section 13 or 15(d) of the SECURITIES EXCHANGE ACT OF 1934
   during the preceding 12 months (or for such shorter period that Registrant

   was required to file such reports), and (2) has been subject to such filing
                       requirements for the past 90 days.

                                 NOT APPLICABLE

        Indicate by check mark which financial statement item Registrant
                             has elected to follow:

                             Item 17 [x] Item 18 [ ]

 (APPLICABLE ONLY TO ISSUERS INVOLVED IN BANKRUPTCY PROCEEDINGS DURING THE PAST
                                   FIVE YEARS)

 Indicate by check mark whether Registrant has filed all documents and reports
   required to be filed by Sections 12, 13 or 15(d) of the SECURITIES EXCHANGE
      ACT OF 1934 subsequent to the distribution of securities under a plan
                              confirmed by a court.

                                 NOT APPLICABLE

                           Currency and Exchange Rates

 All monetary amounts contained in this Registration Statement are expressed in
   Canadian dollars unless otherwise indicated. On March 15, 2003, the Federal
        Reserve noon rate for Canadian Dollars was US$1.00:Cdn$1.48 (see
            Item 4 for further historical Exchange Rate Information).





                                     <page>

                          T A B L E   O F   C O N T E N T S

                                                                            PAGE

ITEM 1             IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS       1
ITEM 2             OFFER STATISTICS AND EXPECTED TIMETABLE ..............      1
ITEM 3             KEY INFORMATION ......................................      1
ITEM 4             INFORMATION ON THE COMPANY ...........................      5
ITEM 5             OPERATING AND FINANCIAL REVIEW AND PROSPECTS .........     30
ITEM 6             DIRECTORS AND SENIOR MANAGEMENT ......................     36
ITEM 7             MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS ....     42
ITEM 8             FINANCIAL INFORMATION ................................     44
ITEM 9             THE OFFER AND LISTING ................................     44
ITEM 10            ADDITIONAL INFORMATION ...............................     46
ITEM 11            QUANTITATIVE AND QUALITATIVE DISCLOSURES
                      ABOUT MARKET RISK .................................     58
ITEM 12            DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES     59
ITEM 13            DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES ......     59
ITEM 14            MATERIAL MODIFICATIONS TO THE RIGHTS OF
                      SECURITY HOLDERS AND USE OF PROCEEDS ..............     59
ITEM 15            [RESERVED] ...........................................     59
ITEM 16            [RESERVED]
ITEM 17            FINANCIAL STATEMENTS .................................     59
ITEM 18            FINANCIAL STATEMENTS .................................     60
ITEM 19            EXHIBITS .............................................     60





<page>

                                     PART 1

ITEM 1   IDENTITY OF DIRECTORS, SENIOR MANAGEMENT AND ADVISERS

Not applicable (this is an Annual Report only)


ITEM 2   OFFER STATISTICS AND EXPECTED TIMETABLE

Not applicable (this is an Annual Report only)



<page>

ITEM 3   KEY INFORMATION

A.       SELECTED FINANCIAL DATA

The following  constitutes  selected financial data for Taseko for the last five
fiscal  years ended  September  30,  2002,  in Canadian  dollars,  presented  in
accordance with Canadian generally accepted  accounting  principles  ("GAAP") on
the Financial Statements and United States GAAP.

<table>
<caption>
(Cdn$)                                                                As at September 30
Balance Sheet Data                       2002             2001            2000            1999            1998
- -----------------------------------------------     ------------     -----------     -----------     -----------
<s>                               <c>              <c>              <c>             <c>             <c>
Total assets (CDN GAAP) .......   $  60,310,281    $  32,070,394    $ 79,498,986    $ 91,873,796    $ 29,365,584
Total assets (US GAAP) ........      60,310,281       32,070,394      79,498,986      91,873,796      29,365,584
Total liabilities
(US & CDN GAAP) ...............      39,738,456       35,628,589      33,395,657      52,191,070       2,399,126
Share capital (CDN GAAP) ......     118,531,148       87,897,199      87,897,199      80,067,309      67,328,776
Share capital (US GAAP) .......     119,975,148       88,795,199      88,686,199      80,576,309      67,693,776
Convertible debenture
(US & CDN GAAP) ...............      17,000,000       17,000,000       8,500,000       4,000,000            --
Deficit (CDN GAAP) ............    (114,959,323)    (108,455,394)    (50,293,870)    (44,384,583)    (40,362,318)
Deficit (US GAAP) .............    (116,403,323)    (109,353,394)    (51,082,870)    (44,893,583)    (40,727,318)
- -----------------------------------------------     ------------     -----------     -----------     -----------


(Cdn$ except number of shares) .                                      As at September 30
Period End Balances (as at)                2002             2001            2000            1999            1998
- -----------------------------------------------     ------------     -----------     -----------     -----------
Working capital (deficiency) ..   $  (4,276,520)   $    (187,678)   $ 13,871,838    $ 12,802,127    $ (1,718,775)
Plant and equipment, net ......      10,158,525       10,872,590      11,587,447      12,304,449           9,881
Mineral property interests ....      28,813,296          602,001      44,826,214      38,856,910      28,660,010
Shareholders' equity (deficit)       20,571,825       (3,558,195)     46,103,329      39,682,726      26,966,458
Weighted average number of
outstanding common shares .....      30,338,098       25,067,697      23,402,726      17,969,886      15,029,736

No cash or other dividends have been declared

(Cdn$) Year ended September 30
Statement of Operations Data               2002             2001            2000            1999            1998
- -----------------------------------------------     ------------     -----------     -----------     -----------
Investment and other income ...   $     551,842    $   1,110,431    $    678,014    $    360,842    $     10,340
General and administrative
  expenses (CDN GAAP) .........       2,686,374        4,106,158       2,122,302       2,375,198         845,552
General and administrative
  expense (US GAAP) ...........       3,232,374        4,215,158       2,402,302       2,519,198       1,210,552
Refinery project ..............       1,698,826        3,571,942            --              --              --
Exploration expenditure .......       2,071,885        3,860,176       4,464,999       2,002,610       4,112,206
Write down of mineral property
  interests, inventory,
  investments and land ........        (598,686)     (47,733,679)           --              --              --
Loss according to financial
  statements (CDN GAAP) .......      (6,503,929)     (58,161,524)     (5,909,287)     (4,022,265)     (4,936,031)
Loss according to financial
  statements (US GAAP) ........      (7,049,929)     (58,270,524)     (6,189,287)     (4,166,265)     (5,301,031)
                                                                                                           (0.25)
- -----------------------------------------------     ------------     -----------     -----------     -----------

Loss from continuing operations
   per common share (CDN GAAP).           (0.21)          (2.32)           (0.25)          (0.22)          (0.33)
- -----------------------------------------------     ------------     -----------     -----------     -----------
Loss per share (US GAAP)(2) ...           (0.23)           (2.32)          (0.26)          (0.23)          (0.35)
- -----------------------------------------------     ------------     -----------     -----------     -----------
</table>

Notes:

(1)      Under Canadian GAAP applicable to junior mining exploration  companies,
         mineral  exploration   expenditures  may  be  deferred  on  prospective
         properties until such time as it is determined that further exploration
         is not  warranted,  at which time the  property  costs are written off.
         Taseko  has  expensed  the  exploration  costs  as  incurred,  which is
         consistent  with U.S. GAAP,  whereby all exploration  expenditures  are
         expensed until an independent feasibility study has determined that the
         property is capable of economic commercial production.

(2)      Stock  options  and  warrants  outstanding  were  not  included  in the
         computation  of  diluted  loss per  share as their  inclusion  would be
         antidilutive.

See Item 17 for  accompanying  consolidated  financial  statements  prepared  in
accordance with Canadian  generally accepted  accounting  principles for further
details, including note 12, which reconciles Canadian GAAP to US GAAP.


<page>

B.       CAPITALIZATION AND INDEBTEDNESS

Not applicable (this is an Annual Report only)

C.       REASONS FOR THE OFFER AND USE OF PROCEEDS

Not applicable (this is an Annual Report only)

D.       RISK FACTORS

NO ORE.

Taseko's three projects have large tonnage, low grade  mineralization,  which at
current metals prices and other economic  considerations cannot be classified as
"ore." Unless gold (herein  sometimes  "Au") and copper (herein  sometimes "Cu")
prices improve,  this measured and indicated  mineralized  material may never be
"ore" and may not be capable of commercial mining.

ADDITIONAL FUNDING REQUIREMENTS.

Taseko's  operations  consist almost  exclusively  of cash consuming  activities
given that its three main mineral  projects are either in the exploration  stage
or are in standby mode related to a former  producing mine, which is on care and
maintenance  awaiting  better  copper  prices.   Taseko  will  need  to  receive
significant  (approximately  $1-2  million) new equity  capital or other funding
annually in order to fund these continuing operations,  and failing that, it may
cease to be economically viable.

UNCERTAIN PROJECT REALIZATION VALUES.

Taseko  capitalizes  acquisition costs incurred in connection with its projects.
Due to the extended  depressed price  conditions in the metals markets of recent
years, and in accordance with the its accounting  policy, the Company wrote down
the acquisition costs of each of the Prosperity and Gibraltar projects to $1,000
during fiscal 2001.

TASEKO HAS NO HISTORY OF EARNINGS AND NO FORESEEABLE EARNINGS.

Taseko has a 35 year history of losses and there can be no assurance that Taseko
will ever be  profitable.  Taseko  has paid no  dividends  on its  shares  since
incorporation  and does  not  anticipate  paying  dividends  in the  foreseeable
future.


<page>

GOING CONCERN ASSUMPTION.

Taseko's  consolidated  financial  statements have been prepared assuming Taseko
will continue as a going concern; however, unless additional funding is obtained
this  assumption  will have to change and Taseko's assets may need to be written
down to asset prices realizable in insolvency or under distress circumstances.

The  auditors  report on the 2002  consolidated  financial  statements  includes
additional  comments  that state that the financial  statements  are affected by
conditions and events that cause  substantial  doubt about the Company's ability
to continue as a going  concern.  The  financial  statements  do not include any
adjustments that might result from the outcome of that uncertainty.

GENERAL MINING RISKS.

Factors  beyond the  control of Taseko  will  affect  the  marketability  of any
substances discovered.  Metal prices, in particular gold and copper prices, have
fluctuated  widely in recent years.  The mining industry in general is intensely
competitive and there is no assurance that, even if commercial quantities of ore
are discovered,  a profitable market may exist for the sale of minerals produced
by Taseko.  The  marketability  of metals is also  affected  by  numerous  other
factors  beyond the control of Taseko.  These other factors  include  government
regulations relating to price,  royalties,  allowable production,  and importing
and  exporting  of metals.  The  operations  of Taseko may require  licenses and
permits from various governmental  authorities.  There can be no assurances that
Taseko will be able to obtain all  necessary  licenses  and permits  that may be
required to carry out  exploration,  development and operations at its projects.
Environmental concerns about mining in general are also a factor that may affect
Taseko.  Taseko  also  competes  with  many  companies  possessing  far  greater
financial resources and technical  facilities than itself for the acquisition of
mineral concessions,  claims, leases and other mineral interests, as well as for
the recruitment and retention of qualified employees.

TASEKO'S SHARE PRICE IS VOLATILE.

The market price of a publicly traded stock, especially a junior resource issuer
like  Taseko,  is  affected  by  many  variables  not  directly  related  to the
exploration success of Taseko,  including the market for junior resource stocks,
the strength of the economy  generally,  the availability and  attractiveness of
alternative investments, and the breadth of the public market for the stock. The
effect of these and other  factors on the market  price of the common  shares on
the TSX Venture Exchange and NASDAQ's  Over-the-counter  Bulletin Board suggests
Taseko's shares will continue to be volatile.  Taseko shares have ranged between
approximately Cdn$0.36 and Cdn$20.00 in the last 10 years.


<page>

TASEKO'S  DIRECTORS  AND  OFFICERS  ARE  PART-TIME  AND SERVE AS  DIRECTORS  AND
OFFICERS OF OTHER COMPANIES.

All of the directors and officers of Taseko serve as officers  and/or  directors
of other resource exploration  companies and are engaged and will continue to be
engaged in the search for additional resource  opportunities on their own behalf
and on behalf of other companies. Situations may arise where these directors and
officers will be in direct competition with Taseko. Such potential conflicts, if
any,  will be dealt with in accordance  with the relevant  provisions of British
Columbia  corporate  and common law. In order to avoid the possible  conflict of
interest,  which may arise  between  the  directors'  duties to Taseko and their
duties to the other  companies on whose  boards they serve,  the  directors  and
officers of Taseko expect that participation in exploration prospects offered to
the directors will be allocated between the various companies that they serve on
the basis of prudent business judgment and the relative financial  abilities and
needs of such companies to participate. The success of Taseko and its ability to
continue  to carry on  operations  is  dependent  upon its ability to retain the
services of certain key employees and members of its board of directors.

LIKELY PFIC STATUS HAS CONSEQUENCES FOR U.S. INVESTORS.

Potential  investors who are U.S.  taxpayers should be aware that Taseko expects
to be a passive foreign investment company ("PFIC") for the current fiscal year,
and  may  also  have  been a PFIC  in  prior  years  and  may  also be a PFIC in
subsequent  years.  If  Taseko is a PFIC for any year  during a U.S.  taxpayer's
holding period,  then such U.S. taxpayer will generally be required to treat any
so-called  "excess  distribution"  received  on its common  shares,  or any gain
realized upon a disposition of common shares,  as ordinary  income and to pay an
interest charge on a portion of such  distribution or gain,  unless the taxpayer
makes a qualified  electing fund ("QEF") election or a  mark-to-market  election
with respect to the shares of Taseko. In certain  circumstances,  the sum of the
tax and the  interest  charge may  exceed the amount of the excess  distribution
received,  or the amount of proceeds of disposition realized, by the taxpayer. A
U.S. taxpayer who makes a QEF election  generally must report on a current basis
its share of Taseko's  net capital  gain and  ordinary  earnings for any year in
which  Taseko is a PFIC,  whether or not Taseko  distributes  any amounts to its
shareholders. A U.S. taxpayer who makes the mark-to-market election,  generally,
must  include as  ordinary  income in each year,  the excess of the fair  market
value of the common shares over the taxpayer's tax basis therein.


<page>

SHARES OF TASEKO MAY BE AFFECTED ADVERSELY BY PENNY STOCK RULES.

Taseko's  stock may be subject to U.S.  "Penny Stock" rules,  which may make the
stock more  difficult to trade on the open market.  Taseko's  common shares have
traded on the TSX Venture Exchange ("TSXV")  (successor exchange to the Canadian
Venture  Exchange  and the  Vancouver  Stock  Exchange)  since  March 10,  1969,
(symbol-TKO)  and since March 1992 on the  National  Association  of  Securities
Dealers Automated  Quotation (NASDAQ) System,  "Regular Market." On November 30,
1994, the shares of Taseko were listed on the NASDAQ  National  Market and since
July 6, 2001 have traded on the Over-the-Counter  Bulletin Board (symbol TKOCF).
For further  details on the market  performance  of Taseko's  common stock,  see
"Item 5 Nature of Trading Market."  Although Taseko's common stock trades on the
TSXV, Taseko's stock may be subject to U.S. "penny stock" rules. A "penny stock"
is defined by regulations of the U.S. Securities and Exchange Commission ("SEC")
as an equity  security  with a market  price of less  than  US$5.00  per  share.
However,  an equity  security  with a market  price  under  US$5.00  will not be
considered a penny stock if it fits within any of the following exceptions:

         (i)      the  equity  security  is  listed  on  NASDAQ  or  a  national
                  securities exchange;

         (ii)     the  issuer  of the  equity  security  has been in  continuous
                  operation  for less than three  years,  and either has (a) net
                  tangible assets of at least $5,000,000,  or (b) average annual
                  revenue of at least $6,000,000; or

         (iii)    the  issuer  of the  equity  security  has been in  continuous
                  operation  for more than  three  years,  and has net  tangible
                  assets of at least $2,000,000.

If an investor  buys or sells a penny stock,  SEC  regulations  require that the
investor receive,  prior to the transaction,  a disclosure  explaining the penny
stock market and associated risks. Furthermore, trading in Taseko's common stock
is  currently  subject  to Rule  15g-9 of the  Exchange  Act,  which  relates to
non-NASDAQ and non-exchange listed securities.  Under this rule,  broker/dealers
who recommend  Taseko's  securities to persons other than established  customers
and accredited  investors must make a special written suitability  determination
for the purchaser and receive the purchaser's written agreement to a transaction
prior to sale.  Securities are exempt from this rule if their market price is at
least US$5.00 per share.


<page>

Penny stock  regulations will tend to reduce market liquidity of Taseko's common
stock,  because  they  limit  the  broker/dealers'   ability  to  trade,  and  a
purchaser's ability to sell, the stock in the secondary market. The low price of
Taseko's  common  stock has a negative  effect on the amount and  percentage  of
transaction  costs paid by  individual  shareholders.  The low price of Taseko's
common stock also limits Taseko's ability to raise additional capital by issuing
additional  shares.  There are several  reasons for these  effects.  First,  the
internal policies of certain  institutional  investors  prohibit the purchase of
low-priced stocks. Second, many brokerage houses do not permit low-priced stocks
to be used as  collateral  for margin  accounts  or to be  purchased  on margin.
Third, some brokerage house policies and practices tend to discourage individual
brokers from dealing in low-priced  stocks.  Finally,  broker's  commissions  on
low-priced  stocks usually represent a higher percentage of the stock price than
commissions  on higher priced stocks.  As a result,  Taseko's  shareholders  pay
transaction  costs that are a higher  percentage of their total share value than
if Taseko's share price were substantially higher.

The rules  described  above  concerning  penny stocks may  adversely  affect the
market  liquidity  of  Taseko's  securities.  Taseko can  provide no  assurances
concerning  the  market  liquidity  of its stock or that its  stock  will not be
subject to "penny stock" rules. For more information about penny stocks, contact
the Office of Filings,  Information and Consumer Services of the U.S. Securities
and Exchange Commission,  450 Fifth Street, N.W., Washington,  D.C. 20549, or by
telephone at (202) 272-7440.

SIGNIFICANT POTENTIAL EQUITY DILUTION.

Taseko had 175,000  stock options (of which nil were in the money) and 677,250
warrants (of which nil are in the money) as of March 15, 2003.  In addition,
Taseko had shares issuable upon conversion of the Boliden Debenture (see Item 4,
Gibraltar  Mine - Acquisition  Terms) and  7,446,809  shares  issuable  under an
arrangement  to  acquire  a  copper  refining   engineering   research  business
(described  in items 4 and 5b).  Together  these  will  likely  act as an upside
damper on the trading range of Taseko's shares.  As a consequence of the passage
of time since the date of their original sale and issuance,  no shares of Taseko
remain subject to any hold period  restrictions  in Canada or the United States.
The  unrestricted  resale of  outstanding  shares from the  exercise of dilutive
securities, including the Boliden Debenture, may have a depressing effect on the
market for Taseko's shares.  Dilutive securities represent  approximately 37% of
Taseko's currently issued shares. Taseko received  shareholders' approval at its
March 28, 2002 annual  shareholders'  meeting to increase its  capitalization of
outstanding shares by up to 50 million shares to be issued for cash, property or
services to fund Taseko's continuing operations.


<page>

ITEM 4   INFORMATION ON THE COMPANY

SUMMARY

A. HISTORY AND DEVELOPMENT OF THE COMPANY

1. The legal name of the  company,  which is the  subject of this Form 20-F,  is
"Taseko Mines Limited" (herein "Taseko" or the "Company").

2. Taseko was  incorporated in British  Columbia  ("B.C."),  Canada on April 15,
1966.

3. Taseko was incorporated  under and continues to subsist under the laws of the
Province of British  Columbia,  Canada.  Taseko's natural  resource  exploration
activities are limited to British Columbia,  consequently the primary corporate,
commercial,  and other laws  pertinent  to Taseko are those of the  Province  of
British Columbia.  Taseko's principal business office is at Suite 1020, 800 West
Pender Street,  Vancouver,  British Columbia V6C 2V6, although Taseko also has a
field office at its Gibraltar Mine site in McLeese Lake near Williams Lake, B.C.

4. The principal business events in Taseko's 35 year history are (most important
and recent matters first):

         (i) the  acquisition  of the Gibraltar Mine in July 1999. The Gibraltar
         Mine is located in British  Columbia  and was a copper  producer  under
         different  owners from 1972 to 1998. As a relatively  low grade deposit
         with sulphide mineralization  averaging 0.311% copper, copper prices of
         US$0.90  or  more  per  pound  are  required  under  current   economic
         circumstances  for the Gibraltar Mine,  which is still largely equipped
         and maintained on stand-by, to recommence conventional operations; and

         (ii) the  acquisition  of the  Harmony  Project  in October  2001.  The
         Harmony Project is an undeveloped  resource located in British Columbia
         and has  measured  and  indicated  mineralized  material  of 64 million
         tonnes grading 1.53 grams Au/tonne,  as estimated at a cut-off grade of
         0.60 grams Au/tonne, for a total of 3 million ounces.

         (iii) the  acquisition and legal  settlement  respecting the Prosperity
         Project in British  Columbia  (1960's to 1993) and the  advancement  of
         exploration  and  pre-feasibility  engineering  thereof (1991 to date).
         Exploration  expenses to the extent of approximately $41.5 million have
         been  incurred  by  Taseko  on  the  Prosperity   Project,   which  has
         demonstrated  continuity  of a  low  grade  copper/gold  deposit  (over
         155,000  metres  of  drilling  by  Taseko  and its  predecessors)  with
         estimated  measured and indicated  mineralized  material of 1.0 billion
         tonnes  grading 0.41 grams Au/tonne and 0.24% Cu, at a cut-off of 0.14%
         Cu.


<page>

5. The Company's  principal  capital  expenditures  (there have been no material
divestitures)  over the three  fiscal  years  ended  September  30,  2002 are as
follows:



(i) Amounts Deferred (capitalized or invested)

                    GIBRALTAR       PROSPERITY       HARMONY          WESTGARDE
         YEAR            MINE          PROJECT       PROJECT            PROJECT
         ----       ---------        ---------        ----------      ----------
         2002               -                -       $28,811,296(1)           -
         2001               -                -                 -      $       1
         2000      $2,964,224      $ 3,005,080                 -              -


(ii) Amounts Expensed as Exploration Expenses

                    GIBRALTAR       PROSPERITY       HARMONY          WESTGARDE
         YEAR            MINE          PROJECT       PROJECT            PROJECT
         ----       ---------        ---------        ----------      ----------
         2002       2,337,742          (35,858)                -       (229,999)
         2001       3,262,265          386,935                 -        210,976
         2000       3,388,576        1,076,423                 -              -
         ----       ---------        ---------        ----------      ----------


- ----------
(1)  these  are  non-cash  capitalized  amounts  from  the  issuance  of  equity
securities in a subsidiary


6.  Subject  to  Taseko  sourcing  additional   funding,   the  following  table
illustrates  the principal  capital  expenditures  by property (all of which are
located in British  Columbia,  Canada)  that Taseko would  ideally  incur in the
ensuing year:

                               GIBRALTAR            PROSPERITY           HARMONY
                                  MINE                 PROJECT           PROJECT
- --------------------------------------------------------------------------------
2003 Activities          Geophysical Surveys                -                  -
                          Diamond drilling
                             $2,315,000



<page>

B.       BUSINESS OVERVIEW

1.       TASEKO'S BUSINESS STRATEGY AND PRINCIPAL ACTIVITIES

Taseko is  focused on  acquiring  ownership  of and  advancing  exploration  and
related   activities  on  known  mineral  deposits  that  have  as  their  basic
characteristic,  large tonnage (based on extensive drill testing for continuity)
mineralization which, under metals price assumptions that fall within historical
averages,  are potentially capable of supporting a mine for 10 years and longer.
Taseko  endeavors to apply advanced mining and recovery  techniques to ascertain
the maximum  potential  for  eventual  production  of these  deposits.  Taseko's
Prosperity  Project,  Gibraltar  Mine  Project and Harmony  Project are all such
larger tonnage  mineral  resources.  None of them can currently be  economically
mined due to prevailing metal prices. Current metal prices are relatively low by
reference to past metals cycles (low prices which, it is  acknowledged,  may not
recover).  Taseko believes the investment  value in its common shares is derived
from appreciating the large amount of contained metals on its projects which has
value for  investors  who share Taseko  management's  view that there will be an
ongoing  demand for copper and gold,  resulting in a continuing  need to replace
depleted reserves. Taseko's management remains optimistic that metal prices will
eventually  recover  sufficiently  to support  mining at these  Projects at some
future time.

Taseko does not have any  operating  revenue  although  historically  it has had
annual interest revenue as a consequence of investing  surplus funds pending the
completion  of  exploration  programs.  Subject  to having  sufficient  start-up
capital  (estimated  at  Cdn$25  million),  the  Gibraltar  Mine is  capable  of
producing  copper  concentrate  at a cost of  approximately  US$0.90  per pound.
However,  the cost of copper production would be reduced if the copper refinery,
which has been the subject of  feasibility-level  engineering  studies in fiscal
2001 and 2002, is built at a capital cost of  approximately  Cdn$109.5  million.
The resource  extraction  business has  historically  been cyclical.  The prices
received for copper and gold have been volatile  and, in the case of gold,  have
been affected by factors and sentiments  outside of the cost of production.  The
mining  business  operates in a  world-wide  market and prices are derived  from
relatively  pure market forces so competition to sell any metals or concentrates
produced is not an issue if metals prices warrant production.

Taseko and its  subsidiaries  own their mining  projects  outright but potential
mining operations are nevertheless subject to extensive  government  regulation.
Management  believes that the Gibraltar  Mine will be able to obtain  government
permitting  to  restart  mining  operations  as soon as the  necessary  start-up
capital is available and copper prices  strengthen.  The  Prosperity  Project is
well advanced in the requisite preparatory  engineering and analysis for a final
request to government for mine development permitting, although the capital cost
of placing the  Prosperity  Project  into  production  of  Cdn$400-$800  million
(dependent on a final rate of mineralized material through-put  decision) is not
obtainable by Taseko in the current  circumstances.  The Harmony Project has not
been significantly  moved towards mine development  permitting since a period of
more active exploration in the late 1990's. The provincial government of British
Columbia and the federal government of Canada both have jurisdiction over a wide
variety  of  activities  and  persons   affected  by  mining   including   local
communities, habitat users and others claiming to hold a stake in the outcome of
mining  activity.  British  Columbia  has  not  recently  been  perceived  as  a
mining-friendly  jurisdiction although recently operating British Columbia mines
with  comparable  grades have been ranked amongst the world's most efficient and
responsible operations.


<page>

2.  FUNDING INITIATIVES

GIBRALTAR MINE SURPLUS EQUIPMENT AND SUPPLIES SALE

As a  requirement  of the  Gibraltar's  Reclamation  Permit M-40,  the mine site
equipment was pledged as security against future  reclamation  costs.  Gibraltar
has received authorization from the B.C. Ministry of Energy and Mines to sell up
to  $4,000,000  of redundant  equipment and supplies that are not expected to be
required  for the  restart of the mine.  This will still  leave  $13,000,000  of
equipment and supplies as security.

GIBRALTAR MINE RECLAMATION DEPOSITS RELEASED

As a result of  progressive  reclamation  work and a landfill  project  reducing
liability  costs  at  Gibraltar,   $2.5  million  was  released  from  the  cash
reclamation  fund subsequent to year-end,  in December 2002. This will leave the
reclamation deposit at approximately $16,100,000, including interest.

C.       ORGANIZATIONAL STRUCTURE

Taseko operates  directly and also through one principal  subsidiary,  Gibraltar
Mines  Ltd.  ("Gibraltar").  Taseko  itself  owns the  Prosperity  Project,  and
Gibraltar owns both the Gibraltar Mine and the Harmony  Project.  Both companies
are British Columbia,  Canada companies and all operations of both companies are
in British Columbia.

D.       PROPERTY, PLANT AND EQUIPMENT

The  Gibraltar  Mine was  acquired  in July 1999,  approximately  one year after
commercial  mining operations were suspended due to  then-prevailing  low copper
prices.  The  Gibraltar  Mine was acquired  with mill and mining  equipment  and
supplies valued at approximately $19 million.  The purchase of the mine included
an  environmental  deposit for $8 million  (which was later  increased  to $18.4
million in 2001,  and then  decreased  to $15.9  million in  December  2002) and
mineral  property  interests  valued at $3.3 million.  The Gibraltar Mine has an
estimated  $32.7  million  liability to reclaim and manage the area should it be
determined  that operations  must  permanently  cease and the area be reclaimed.
(See Item 4, Gibraltar Mine - Acquisition Terms and Environmental Matters.)

Neither the Prosperity  Project nor the Harmony Project have any mining plant or
equipment located thereon,  although both projects have field  accommodation and
miscellaneous  exploration  equipment,  which is of little  realizable value, on
site.


<page>

                   FURTHER PARTICULARS OF TASEKO'S PROPERTIES

GLOSSARY In this Form 20-F,  the  following  terms have the  meanings  set forth
herein:

E.       GEOLOGICAL TERMS

Bio-oxidation              A process  employing  oxidation of elements caused by
                           bio-organisms;  it is  enhanced  in a  gold  recovery
                           process by providing the optimum temperature, acidity
                           (pH) and level of oxygen  for the  natural  oxidation
                           process to work more effectively.

Epithermal                 deposit A mineral  deposit formed at low  temperature
                           (50-200oC),  usually  within  one  kilometre  of  the
                           earth's  surface,  often as  structurally  controlled
                           veins.

Induced  Polarization      A geophysical survey used to identify a feature that
("IP")  Survey             appears to be different from the typical or
                           background  survey results when tested for levels of
                           electro-conductivity; IP detects  both  chargeable,
                           pyrite-bearing rock and non-conductive rock that has
                           high content of quartz.

Mineral Symbols            Au - Gold; Cu - Copper; Pb - Lead; Ag - Silver;
                           Zn - Zinc; Mo - Molybdenum.

Porphyry deposit           A type of mineral deposit in which ore minerals are
                           widely disseminated,  generally of low
                           grade but large tonnage.

Solvent Extraction         A metal  extraction  technique in which a copper
Electrowinning             oxide is dissolved into solution,  then an
("SX-EW")                  electric current is induced through the solution
                           between a pair of electrodes (anode & cathode),  and
                           metal is  deposited  on the  cathode.
                           Since this ion  deposition is selective,  the cathode
                           product is generally  high grade and requires  little
                           further  treatment before it is used in manufacturing
                           processes.


<page>

F.       CURRENCY AND MEASUREMENT

All  currency  amounts in this Form 20F are stated in  Canadian  dollars  unless
otherwise indicated.

Conversion of metric units into imperial equivalents is as follows:

            Metric Units           Multiply by        Imperial Units
            ------------           -----------        --------------
            hectares                    2.471         = acres
            metres                      3.281         = feet
            kilometres                  0.621         = miles (5,280 feet)
            grams                       0.032         = ounces (troy)
            tonnes                      1.102         = tons (short) (2,000 lbs)
            grams/tonne                 0.029         = ounces (troy)/ton

The following table sets out the exchange rates,  based on the noon buying rates
in New York City for cable  transfers in foreign  currencies  as  certified  for
customs  purposes by the Federal Reserve Bank of New York, for the conversion of
Canadian  dollars  into  United  States  dollars  in  effect  at the  end of the
following  periods,  and the average exchange rates (based on the average of the
exchange  rates on the last day of the month in such  periods)  and the range of
high and low exchange rates for such periods.

                                              For year ended September 30
                                        ----------------------------------------
                                         2002      2001      2000   1999    1998
                                        -----     -----     -----   ----    ----
End of the period ................      1.585     1.592     1.522   1.44    1.47
Average for the period ...........      1.573     1.548     1.485   1.47    1.42
High for the period ..............      1.613     1.595     1.542   1.53    1.47
Low for the period ...............      1.511     1.499     1.448   1.44    1.37


<page>

THE GIBRALTAR MINE

ACQUISITION TERMS

On July 21, 1999,  Taseko's  subsidiary,  Gibraltar  Mines Ltd.,  purchased  the
Gibraltar Mine from Boliden Westmin (Canada) Limited  ("Boliden") and certain of
its affiliates, including all mineral interests, mining and processing equipment
and facilities, and assumed responsibility for ongoing reclamation.  Pursuant to
the terms of the acquisition,  Gibraltar  acquired mining  equipment,  parts and
supplies inventories valued at $19 million, an existing Government environmental
deposit  of $8  million,  and  mineral  interests  valued at $3.3  million,  and
received $20.1 million in cash over 18 months from closing, of which $17 million
was received pursuant to a 10-year  non-interest  bearing convertible  debenture
issued  to  Boliden.  Gibraltar  assumed  the  estimated  reclamation  liability
pertaining  to the  Gibraltar  Mine  of  $32.7  million  and  Taseko  guaranteed
Gibraltar's  obligations  to  Boliden.  The  principal  sum  advanced  under the
debenture is convertible into Taseko common shares in the first year at Cdn$3.14
per Taseko share. The conversion price escalates  Cdn$0.25 per Taseko share each
year over the 10-year  term of the  debenture on each July 19th  anniversary  of
closing.  The  conversion  price at  September  30, 2002 is Cdn$3.89  per Taseko
share. The debenture is due on July 19, 2009. After five years the debenture can
be  converted at Taseko's  option at  then-prevailing  market  prices for Taseko
shares or, paid out in cash, at Taseko's election. Taseko retains certain rights
of first  refusal  respecting  any proposed  sale of shares  acquired by Boliden
under the debenture.  As part of Gibraltar's  acquisition of the Gibraltar Mine,
Taseko  issued  400,000  shares and 180,000  one-year  share  purchase  warrants
exercisable at Cdn$3.14 to  arm's-length  parties who assisted in completing the
acquisition  as a  consequence  of having had a prior  agreement to purchase the
Gibraltar  Mine.  Taseko's  shareholders  approved  the  issuance of the Boliden
debenture at the annual meeting held March 20, 2000.

LOCATION, ACCESS AND INFRASTRUCTURE

The Gibraltar Mine area consists of 206 mineral  claims,  27 mining leases,  and
some  ancillary fee simple real estate held by Gibraltar,  and 37 mineral claims
and 3 mining leases held by Gibraltar's 70% owned subsidiary  Cuisson Lake Mines
Ltd.  The mine site  covers  approximately  109 square km,  located at  latitude
52(Degree)30'N  and  longitude  122(Degree)16'W  in the Granite  Mountain  area,
approximately 65 km north of the City of Williams Lake in south-central  British
Columbia, Canada. Access to the Gibraltar Mine from Williams Lake is via Highway
97 to McLeese  Lake.  From  McLeese  Lake, a paved road  provides  access to the
Gibraltar  Mine site.  The total road distance from the City of Williams Lake to
the Gibraltar  Mine is 65 km and motor vehicle travel time is  approximately  45
minutes.

The British  Columbia  Railway  services  Williams  Lake and has rail service to
facilitate the shipping of bulk commodities from Williams Lake to Vancouver,  or
copper  concentrates  through to the Pacific  Ocean port of North  Vancouver.  A
siding  for the  shipment  of  concentrate  from  the  Gibraltar  Mine  has been
established  adjacent to Highway 97 at MacAllister,  6 km north of McLeese Lake.
Electricity is obtained from the British Columbia Hydro and Power Authority ("BC
Hydro").  Natural gas is provided by Avista  Energy and BC Gas. The community of
Williams  Lake is  sufficiently  close and is  capable  of  supplying  goods and
services to the Gibraltar Mine and its personnel.

The  Gibraltar  Mine mineral  claims cover an area of gentle  topography;  local
relief is in the order of 200 m. The plant site is located  at an  elevation  of
approximately  1,100  m  above  sea  level.  The  project  area  has a  moderate
continental climate with cold winters and warm summers.  Ambient air temperature
ranges  from  a  winter  minimum  of  -34(Degree)  C  to  a  summer  maximum  of
35(Degree)C.  Annual precipitation at the site averages 51 cm, of which about 17
cm falls as snow.  Maximum  snow depth is about 1 m, most of which falls in late
February.


<page>

HISTORY

The earliest  record of work at the Gibraltar  Mine is found in the 1917 British
Columbia  Minister of Mines Annual  Report,  which  describes the  activities of
Joseph Briand and partners exploring  copper-bearing  quartz veins (a tabular or
sheet-like mineral deposit with identifiable  walls, often filling a fracture or
fissure) on the Rainbow group of mineral  claims.  These  original  showings are
believed to lie about 60 m west of the current Pollyanna pit.

The early 1960s marked the entry of the major mining  companies into the Granite
Mountain area and the subsequent  introduction of modern exploration techniques,
which  ultimately  led to the  discovery of the mineral  deposits.  Of the seven
Gibraltar  mineral deposits that are now known,  only Gibraltar West offered any
exposure of surface mineralization; Pollyanna and Gibraltar East had a few minor
exposures of leached limonitic capping;  Granite Lake,  Gibraltar West Extension
and the Sawmill Zone were completely covered by overburden. In this environment,
the most effective  exploration tools were soon found to be Induced Polarization
("IP") geophysics and diamond drilling.

Mine  production  began in March 1972.  Mining reserves as estimated on December
31, 1971 (at a 0.25% copper cut-off),  were  approximately 300 million tonnes of
0.37% copper at a 2.15:1 waste-to-mineralized material strip ratio.

PROPERTY GEOLOGY

The Gibraltar Mine generally  consists of seven separate  mineralized zones. Six
of these - Pollyanna,  Granite Lake,  Connector,  Gibraltar East, Gibraltar West
and Gibraltar West Extension - occur within the Granite Mountain  batholith in a
broad zone of shearing and alteration.  A seventh copper  mineralized  body, the
Sawmill zone,  lies about 6 kilometres to the south,  along the southern edge of
the  batholith,  within a complex  contact zone between the  batholith and Cache
Creek Group rocks.

Two major structural orientations have been recognized at Gibraltar:  the Sunset
and Granite Creek mineralized systems.  The Sunset system strikes  northwesterly
with one set of structures  dipping  35(Degree) to 45(Degree) to the south and a
conjugate set, known as the Reverse Sunset,  dipping 50(Degree) to 60(Degree) to
the north.  The Granite Creek system  strikes  east-west and dips  20(Degree) to
40(Degree) to the south with a subordinate set of structures  dipping steeply in
a northerly direction.  Structures of the Sunset system that host mineralization
are mainly shear zones,  with minor  development  of  stockwork  and  associated
foliation   lamellae.   Host   structures   of  the  Granite  Creek  system  are
predominantly oriented stockwork zones.

The  Granite   Creek  system   provides  the  major   structures   that  control
mineralization  of Pollyanna,  Granite Lake and the Sawmill zones.  These bodies
have  the   characteristic   large  diffuse  nature  of  porphyry   copper  type
mineralization.   The  Gibraltar   East  deposit  is  essentially  a  system  of
interconnected  Sunset  zones,  which  create  a large  body of  uniform  grade.
Gibraltar  West and Gibraltar  West  Extension  deposits are contained  within a
large complex shear zone.


<page>

Geological modelling,  geophysical surveys (dominantly Induced Polarization) and
diamond drilling have been the primary  exploration  tools used at the Gibraltar
Mine in order to delineate  sulphide (a compound of sulphur and another element,
typically a metallic sulphide compound) resources.  Since start-up, mining phase
exploration  has added 363 million  tonnes grading 0.285% copper to the sulphide
mineral  resource  and 95  million  tonnes  grading  0.305%  copper  and  0.010%
molybdenum  to the  sulphide  ore  resource.  Further  exploration  activity  is
warranted depending on available funds to outline new mineralized zones.

Oxide copper  mineralization was recognized during early exploration programs at
Gibraltar. The potential economic benefit from this mineralization, however, was
not realized until late 1986 when a solvent  extraction-electrowinning plant was
commissioned to treat acidic copper  solutions  draining from existing low grade
mineralized  material pits. Data collected during a sulphide copper  exploration
program  in the  1990's  between  the  Gibraltar  East and  Pollyanna  open pits
(Connector  Zone) indicate that there is potential for substantial  oxide copper
mineralization in this zone.

Exploration during mine operation has been limited and focused  predominantly in
and around  existing  pits.  A number of  excellent  targets to explore  for new
deposits occur near the existing open pits (Gibraltar West Extension, Connector,
Gibraltar  East  Extension,  Crusher) and on other parts of the  property  (e.g.
Sawmill).  These target zones require testing by drilling;  the remainder of the
Gibraltar  property requires  exploration  utilizing a comprehensive  program of
geological mapping,  induced polarization  geophysical surveying and geochemical
sampling. This work began in 2000.

MINERALIZATION TYPES

Pyrite  and  chalcopyrite  (a  sulphide  mineral  of  copper  and  iron) are the
principal  primary  sulphide  minerals  of the  Gibraltar  Mine  mineralization.
Fine-grained  chalcopyrite,  generally  barely  visible  without  magnification,
accounts for 60 percent of the copper  content and  constitutes  the single most
important form of copper  mineralization.  Coarser grained  chalcopyrite usually
occurs in quartz veins and shear zones.

Small concentrations of other sulphides are present in Gibraltar mineralization.
Bornite  (a  sulphide  mineral  of copper and iron:  Cu5FeS4),  associated  with
magnetite  and  chalcopyrite,  occurs on the  extremities  of the  Pollyanna and
Sawmill deposits.  Molybdenite  (molybdenum sulphide MoS2; an ore of molybdenum)
is  a  minor  but  economically  important  associate  of  chalcopyrite  in  the
Pollyanna, Granite Lake and Sawmill deposits.


<page>

There  is a close  spatial  relationship  between  sulphide  mineralization  and
alteration in the Gibraltar  deposits.  The  principal  alteration  minerals are
chlorite,  sericite,  epidote, carbonate and quartz. Higher-grade mineralization
is associated mainly with sericite and chlorite.

ESTIMATES OF MINERALIZATION

The  Gibraltar  Mine is a typical open pit  operation  that  utilizes  drilling,
blasting,  cable shovel loading and large-scale  truck hauling to excavate rock.
The mine is planned to enable  excavation  of sulphide  mineralized  material of
sufficient  grade  that  it can  be  economically  mined,  crushed,  ground  and
processed to a saleable  product by froth  flotation.  (Flotation is a method of
mineral separation after crushing and grinding ore whereby a froth, created in a
slurry by a variety of reagents,  causes some finely  crushed  minerals to float
whereas others sink).

The flotation overflow,  or concentrate  (mineralization,  which is increased in
purity by primary  production  techniques  that include  crushing,  grinding and
flotation to eliminate  portions of valueless rock), has a copper grade of about
100 times that of the rock from which it was  processed  and is sold to smelters
for  further  treatment  to provide  high purity  copper  metal.  The  flotation
underflow,  or  tailings,  has had its  minerals  removed  and is  pumped to the
tailings storage facility.

During the mining process,  unmineralized  and  insufficiently  mineralized rock
must be  excavated to expose the  economically  mineralized  material.  This low
grade  material  contains  either  sulphide or oxide  copper  mineralization.  A
portion of the low-grade  sulphide and all of the oxide  material can be leached
with sulphuric acid assisted by bacterial action.  The resultant copper sulphate
solution can be  processed to cathode  copper in the  Gibraltar  Mine's  solvent
extraction/electrowinning (SX/EW) plant.

The  sulphide  mineralized  rock,  which forms the basis for mine  planning,  is
considered  the  "Sulphide  Inventory."  The  leachable,  low-grade  mineralized
material  is not  included  in the  "Sulphide  Inventory"  and  constitutes  the
"Leachable Copper Inventory."

Much of the rock adjacent to the Gibraltar  mine pits or within the mine's claim
boundaries is mineralized  and has been  delineated and  quantified.  At present
metal prices and  operating  costs this  material  has not been  included in the
current  mine  plan in the  "Sulphide  Inventory"  or in the  "Leachable  Copper
Inventory".  This mineralized  material has been called "Additional  Mineralized
Material."

There are  approximately  760 million  tonnes (837 million tons) of measured and
indicated  resources  currently outlined at Gibraltar and described in detail in
the following  sections.  This includes a total sulphide  (in-pit  inventory and
additional  material)  resource of about 743 million  tonnes (821 million  tons)
grading  0.287%  copper and 0.008%  molybdenum  at a 0.2% copper  cut-off and an
oxide and leachable  copper  resource of 16.4 million tonnes (18.1 million tons)
grading 0.2% copper at a 0.1% acid soluble copper cut-off.


<page>

(a)      Sulphide Inventory

The  Gibraltar  Mine  operated  almost  continuously  from  1972 to 1998.  Total
production  to the end of 1998 totals  845,825  tonnes  (1.86  billion  lbs.) of
copper and 8,938  tonnes  (19.7  million  lbs.) of  molybdenum  from 305 million
tonnes (336 million tons) milled. In addition, 38,430 tonnes (84.7 million lbs.)
of cathode copper has been produced from  low-grade rock dumps.  During the past
operating mine life,  reconciliation studies on a number of open pit stages have
demonstrated good correlation between reserve estimates and actual production.

As of November 1998, the in-pit  sulphide  mineralization  of the Gibraltar mine
was estimated to be 148.6 million  tonnes  (163.9  million tons) grading  0.305%
copper and 0.010% molybdenum. The estimate was conducted by Gibraltar mine staff
and audited by G. Arseneau,  Ph.D., P.Geo., of Roscoe Postle and Associates.  In
2001, the mineralized  material was re-estimated,  by George Barker,  P.Geo., in
conjunction  with the  engineering  studies on the proposed  copper refinery and
based on a 15-year mine plan. The measured and indicated mineralized material in
pits outlined for this plan was estimated to be 189 million  tonnes (208 million
tons) grading 0.311% copper and 0.010%  molybdenum.  A detailed breakdown of the
sulphide inventory by category is outlined below:

                            IN-PIT SULPHIDE INVENTORY
- --------------------------------------------------------------------------------
               RESOURCE                     TONS                         CUT-OFF
ZONE           CATEGORY                  (000's)        CU (%)    MO (%)   (%CU)
                                         -------         -----     -----    ----
POLLYANNA      Measured ......            41,733         0.315     0.010    0.20
               Indicated .....             2,910         0.288     0.010    0.20
                                         -------         -----     -----    ----
               SUBTOTAL ......            44,643         0.313     0.010    0.20
                                         =======         =====     =====    ====

CONNECTOR      Measured ......            47,616         0.294     0.011    0.20
               Indicated .....             9,521         0.281     0.014    0.20
                                         -------         -----     -----    ----
               SUBTOTAL ......            57,137         0.292     0.012    0.20
                                         =======         =====     =====    ====

GRANITE LAKE   Measured ......            95,917         0.319     0.009    0.20
               Indicated .....            10,713         0.324     0.007    0.20
                                         -------         -----     -----    ----
               SUBTOTAL ......           106,630         0.320     0.009    0.20
                                         =======         =====     =====    ====

               TOTAL .........           208,410         0.311     0.010    0.20
                                         =======         =====     =====    ====


The average waste-to-mineralized material strip ratio is 1.90:1.


<page>

(b)      Leachable Copper Inventory

In addition to copper  production in  concentrate,  the Gibraltar  Mine has also
produced  cathode  copper by leaching both low-grade dump material and leachable
oxide  material from the pits using  sulphuric  acid and natural  bacteria.  The
copper is  recovered  from  solution  by the  solvent  extraction-electrowinning
(SX/EW)  process.  SX/EW plant  operations  are  expected to resume when further
oxide material is mined from the Pollyanna and Connector pits.

Over the mining life since 1972, Gibraltar stockpiled  approximately 339 million
tonnes (374 million tons) of waste rock in five main storage areas. Much of this
material contains copper, though at grades lower than the milling cut-off grades
which  have  ranged  between  0.16% and 0.25% Cu.  The  stockpiles  have  become
chemically and biologically  active, and naturally discharge small quantities of
acidified water, containing copper, in dilute solution.  Prior to 1986, and more
recently since the SX/EW plant has been shut down, these and all other mine area
drainage waters have been collected in ditches and ponds and  neutralized  prior
to safe disposal in the tailings impoundment.  Since February 1999, these waters
have been discharged to the completed Gibraltar East Pit.

From  October 1986 to the time the SX/EW plant was shut down,  acidic  solutions
draining  from the dumps were  treated in the solvent  extraction-electrowinning
plant. To date,  some 38,430 tonnes (84.7 million  pounds) of electrowon  copper
have been  produced.  Future  recovery of electrowon  copper will be mainly from
engineered leach pads.

The in-pit leachable copper mineralization, as estimated by Gibraltar mine staff
at November 1998,  totals 14.8 million tonnes (16.3 million tons) of material at
0.148% Cu. In 2001, the leachable copper  inventory was also  re-estimated by G.
Barker,  P.Geo.,  and based on the 15-year mine plan totals 16.4 million  tonnes
(18.1  million  tons) of measured and  indicated  mineralized  material  grading
0.146% acid  soluble  copper.  Cut-off in both the 1998 and 2001  estimates  was
0.10%.


<page>

Details  of the  leachable  mineralization  by  category  are  tabulated  in the
following:

                        IN-PIT LEACHABLE COPPER INVENTORY
- -------------------------------------------------------------------------------
                                                                       CUT-OFF%
                                                               ACID       ACID
                                               TONS         SOLUBLE    SOLUBLE
PIT             CATEGORY                     (000's)       COPPER %    COPPER
- --------------  --------------------  --------------  --------------  ---------
Pollyanna       Measured ...........          2,295           0.139      0.10
                Indicated ..........            160           0.185      0.10
                                             ------           -----      ----

PGE Connector   Measured ...........         14,693           0.148      0.10
                Indicated ..........            949           0.128      0.10
                                             ------           -----      ----

SUB TOTAL       MEASURED ...........         16,988           0.147      0.10
                INDICATED ..........          1,109           0.136      0.10
                                             ------           -----      ----
TOTAL                                        18,097           0.146      0.10
                                             ======           =====      ====

(c)      Additional Mineralized Material

In addition to the sulphide and leachable inventories, Gibraltar has significant
other  mineralized  material (mineral  resource).  As of November 1998, the mine
staff  (working for a predecessor  in title)  reported the  additional  measured
mineralized  material of 401 million  tonnes (442 million tons)  grading  0.288%
Total Cu and 0.007% Mo and indicated  mineralized material of 195 million tonnes
(215 million tons) grading 0.27% Total Cu and 0.008% Mo.

The 2001  re-estimate of the additional  material totals 554 million tonnes (611
million tons), and includes measured  mineralized material of 367 million tonnes
(404 million  tons) grading  0.288% Cu and 0.007% Mo and  indicated  mineralized
material of 187 million  tonnes (206 million  tons)  grading 0.27% Cu and 0.008%
Mo. The cut-off used varied  according to location  and  characteristics  of the
material that was  estimated;  the cut-off for the Connector  area was 0.16% Cu,
for Gibraltar East area was 0.17% Cu and for all other areas was 0.20% Cu.


<page>

GIBRALTAR ENVIRONMENTAL MATTERS

On acquiring the Gibraltar Mine in 1999, Gibraltar received both independent and
government assessments of the reclamation and water management liability for the
Gibraltar Mine and concluded that $32.7 million was the appropriate estimate.

In October and  November  of 1999,  in  compliance  with  provincial  government
requests,  an environmental soil geochemical  sampling and exploration  sampling
program was conducted along the Gibraltar Mine  concentrate haul route corridor.
The program  involved the  collection and analysis of some 1,800 soil samples in
order to ascertain the concentration of metals in soils along the corridor. Data
from this program was provided to Pottinger Gaherity  Environmental  Consultants
Ltd. and a baseline risk evaluation  study was completed.  Further  testwork was
carried out in 2001 to assess  correlation  of metals in soils to vegetation and
terrestrial species.  Metal mobility testwork was also done. Preliminary results
indicated no  relationship  between  metals in soils and that in vegetation  and
terrestrial species.

The  reclamation  plan for  Gibraltar  involves a water  management  program and
establishment  of  grass/legume  vegetative  covers  for all  areas  in order to
protect  against  wind and water  erosion.  Areas around the pits and waste rock
storage  areas will be  re-sloped,  dressed  with  overburden,  and seeded.  The
beaches  and  slopes  of the  tailing  storage  area will  also be  seeded.  The
objective  is to promote  re-establishment  of  indigenous  species,  and evolve
toward a self-sustaining ecosystem.

At September 30, 2002, approximately $18.4 million (including interest) had been
set aside in a reclamation fund deposit,  which continues to accumulate interest
at  approximately  5% per  annum,  and is  estimated  to be  adequate  to handle
necessary water management.  It is anticipated that additional reclamation costs
of approximately  $14.85 million would be covered from the residual value of the
plant and equipment on site. The Company has committed to carry out  reclamation
totalling  about $4.0  million  over four years,  of which $2.1 million has been
completed  in the  latter  part of the  calendar  year and is still  subject  to
governmental  approval.  Construction  of a landfill  will  provide  reclamation
credits to the land it occupies.  The reclamation plan is reviewed  periodically
and revised as necessary.  In December 2002,  the Company  received a release of
$2.5 million from the reclamation deposits.


<page>

RECENT EXPLORATION, ENGINEERING AND OTHER INITIATIVES

During  1999-2000,  Gibraltar  geologists  and engineers  actively  explored for
additional  mineralized  material and to better defining known  resources.  They
have also been  maintaining  the  Gibraltar  Mine for  re-start  and  completing
on-going  reclamation work. All mining and process equipment has been maintained
in a  ready-to-go  state and  operating/environmental  permits have been kept in
good standing.

A  drill  program  with  combined   environmental  and  geological   information
objectives was conducted in November and December of 1999. The program comprised
25 drill  holes (4  diamond  and 21 reverse  circulation)  and,  while  aimed at
obtaining  information  pertaining  to regional  groundwater  flow,  allowed for
collection  of much  geological  information  including  lithology,  alteration,
mineralization and structure. In total 1,635 m of drilling was completed and the
core was analyzed for copper content.  The analytical  results increased deposit
information and will assist in future geological and engineering activities.

SAMPLING AND ANALYSIS

In 1999, 25 holes totalling 650 m were drilled on the Gibraltar  property.  Four
of these were core  holes.  The core holes were  sampled as at  Prosperity  (see
"Prosperity - Sampling and  Analysis"),  and standards from the Prosperity  were
used for quality  control  purposes.  Copper,  molybdenum and total copper assay
related analyses were done.

SECURITY OF SAMPLES

At  Gibraltar,  whole core samples from drilling in the main mine area are taken
for analysis,  but a library of  representative  samples of the  different  rock
types and mineralization is retained in an on-site core facility.

Core from  drilling by  Gibraltar  in 1999 was split and  sampled.  Samples were
analysed by off-site  facilities that retain the pulps and rejects for one year.
The remaining core is stored on site.  After one year, the Company  acquires the
pulps and  rejects  and stores this  material  in its  warehouse  at Port Kells,
British Columbia.

Exploration

In  December  1999  and  January  2000,  the  digital   database  of  geological
information on the Gibraltar  property was expanded to include  information from
both inside and outside the pit areas. All historic  geophysical and geochemical
data  contained in archive  files,  field reports and maps were  digitized and a
series of maps  illustrating  geophysical and  geochemical  data were generated.
Drill collar coordinates and downhole survey information, including hole length,
geology,  sample intervals and assay (a quantitative test of minerals and ore by
chemical and/or fire techniques) results for drill holes that had not previously
been in  digital  form were  added.  Data for some 200 drill  holes,  comprising
24,000 m were added.  Plans  identifying the location of drill holes relative to
known geophysical and geochemical data and anomalies were generated.

Subsequent to the completion of the  geological  compilation  described  above a
property-scale  Induced  Polarization ("IP") geophysical survey was designed and
initiated in August 2000.  Field  activities,  which  included 237 kilometres of
line-cutting  and some 220 km of IP survey.  Interpretation  of the  results was
completed in the spring of 2001. Several deposit scale anomalies were identified
including one 800 m wide by 4,200 m long anomaly, which to date, has been tested
by only 7 drill  holes.  Additional  drill  holes  to test the  quality  of this
anomaly and other geophysically  significant locations will be undertaken in the
future.


<page>

Engineering

Gibraltar  engineers developed several mine plans based on a plan of 148 million
tonnes  (163  million  tons) to be mined  over 12 years  with the  objective  of
maximizing the profitability of future operations. In addition, in February 2000
Rescan  Engineering,  a unit of Hatch Associates Ltd., was retained by Gibraltar
and the  government  of  British  Columbia  (BC Job  Commission)  to  conduct an
independent  assessment of the viability of the Gibraltar operation.  This study
involved Taseko and Gibraltar  management and engineers,  and provided direction
for further investigations toward re-starting and operating the mine. This study
was  completed  in April 2000,  and  concluded,  "the  operation  represents  an
opportunity to participate  profitably in period of buoyant copper prices. Given
a favourable  price regime,  the mine has the  minerals,  physical and technical
resources in place to operate to the  exhaustion  of its  currently  established
resources base, that is for the 12 years or more". In 2001, in conjunction  with
studies for the  hydrometallurgical  refinery,  a re-estimate of the mineralized
material at Gibraltar was completed based on a 15-year mine plan. (see Estimates
of Mineralization).

Dependent on availability of funds,  Gibraltar  intends to re-commence  open pit
development work and exploration in two areas of the Gibraltar  property.  These
areas are the Connector  Stage II pit and the  Pollyanna  Stage IV pit. In 1999,
some  overburden in the Connector II Pit was removed.  Dependent on the price of
copper,  these  areas are  expected  to provide  the  initial  mill feed for the
re-start mine plan.  Open pit  development  work in the  Connector  Stage II pit
during 1999 consisted of pre-stripping  approximately  500,000 tonnes of glacial
till overburden. The glacial till overburden was placed in a one-metre lift over
the  Number 3 waste  rock  dump to  provide  the base  for a  vegetative  cover.
Removing overburden from the Stage II pit reduces the strip ratio and adds value
to the ore below.  This portion of the work plan  commenced in August 1999,  and
will proceed  co-incidentally with the Pollyanna Stage IV Pit work when the mine
re-starts.  Once the  decision is made to re-start  the mine,  planned  open pit
pre-development work in the Pollyanna pit area will consist of mining 10 million
tonnes of waste rock. Waste rock removal will require drilling and blasting. The
pre-development  work in the  Pollyanna  pit will expose  material  allowing for
continuous  mill feed.  Re-sloping  of the  Number 3 and Number 5 waste  storage
areas  was  carried  out in 2000  and  2001 to  meet  reclamation  requirements.
Reclamation  work in 2002 was focused on  re-grading  and seeding of tailings to
stabilize the material in these areas.

A scoping study (preliminary  review of capital and operating costs to determine
the  viability  of a  project  at an  accuracy  of  plus  or  minus  25-30%)  to
investigate  the concept of  building  and  operating  a copper  refinery at the
Gibraltar  site,  using  a  hydrometallurgical   process  developed  by  Cominco
Engineering  Services  Ltd.  (CESL)  to  recover  copper  from  concentrate  was
completed  in  August  2000.  The  study,  undertaken  by  Gibraltar  and  CESL,
considered existing infrastructure,  general site layouts, capital and operating
costs, and resulting cash flows. The economic assumptions used were copper price
of  US$0.90/lb;  exchange rate of  US$:Cdn$=$0.68;  negotiated  power  reduction
costs; reduced labour rate for 3 years following construction; refinery recovery
of 95.8%; and concentrator  recovery increase of 6% due to decrease  concentrate
grade to 24%.  The cash  flow  analysis  was  conducted  in  constant  July 2000
Canadian  dollars  without  consideration  for  inflation  and before any income
taxes.  The results of the study were an internal rate of return of 18.4% with a
net present value at an 8% discount of Cdn$68.4  million (that is, the amount of
net present value  resulting  from the  investment  of the needed  capital costs
described below).

<page>

The scoping  study  projected  that the capital cost for the  refinery  would be
Cdn$95.0  million  including  contingencies.  Development  of the refinery could
reduce  the  operating  costs of the mine by up to  US$0.20  per pound of copper
produced due to elimination of transporting  concentrate off-site and other site
efficiencies.

The scoping study also  determined the cost to re-start the Gibraltar  Mine. The
cost,  including  working capital,  was estimated to be Cdn$25.0  million;  this
amount would cover concentrator  modifications required for the refinery and six
months of pre-production stripping in the Pollyanna pit.

After the details of the study were reviewed,  a decision was made to proceed to
the  feasibility-level  engineering  and  analysis  stage.  On  October 6, 2000,
Gibraltar and CESL signed a Memorandum of Agreement  ("Gibraltar/CESL MOA"). The
Gibraltar/CESL MOA outlined a work plan that included:

o   shipping 600 tonnes of mineralized material to the CESL pilot concentrator;
o   producing 6 tonnes of concentrate at the CESL pilot concentrator;
o   conducting  metallurgical  testwork  to confirm an increased copper recovery
    could be achieved in the Gibraltar mine concentrator by lowering the
    concentrate grade;
o   running 6 tonnes of 24% copper concentrate through the CESL pilot plant; and
o   engaging an independent engineering firm to conduct an engineering study.

The MOA defined management and funding  arrangements for the work plan and, upon
satisfactory results and receipt of requisite approvals, the project management,
construction,  commissioning  and operation of a refinery at the Gibraltar  mine
site. Under the terms of the agreement, Gibraltar and CESL would each pay 50% of
the Cdn$2.7 million cost of the MOA work plan.

In late 2000,  Gibraltar shipped 900 tonnes of mineralized material from site in
south-central British Columbia to CESL's pilot concentrator in Vancouver, BC. As
this  material  was  produced  in the CESL  pilot  concentrator,  tailings  were
back-hauled to the Gibraltar site for disposal. Seven tonnes of concentrate were
produced,  comprising 3.5 tonnes of 18% copper concentrate and 3.5 tonnes of 24%
copper concentrate.

Concurrently,   Gibraltar   Mines   Ltd.   conducted   metallurgical   tests  on
representative  samples of Gibraltar  mineralized  material at G&T Metallurgical
Services in  Kamloops  BC, in order to develop  parameters  for lock cycle tests
that would  definitively  confirm an  increase in mill  copper  recovery  with a
decrease in  concentrate  copper  grade.  Tests done to date indicate up to a 6%
increase in mill copper  recovery may be available with minor  modifications  to
the mill circuit and a decrease in  specifications  for the  concentrate  copper
grade.


<page>

In early 2001, the concentrate  that was produced at the pilot  concentrator was
run through the CESL process pilot plant. The run  successfully  produced London
Metal  Exchange  grade  cathode  copper and  proved  that the CESL  process  was
adaptive to the Gibraltar  material.  It was also found that the CESL process is
more amenable to the 24% concentrate than the 18%  concentrate.  The pilot plant
program provided the process design criteria for a Process  Engineering  Package
that formed the basis for a feasibility-level capital and operating cost study.

Feasibility-level  work for the  refinery  was  carried  out in 2001  under  the
direction of Gibraltar  Engineering  Services  Limited ("GESL")  Partnership,  a
Taseko-sponsored  investment  vehicle,  which raised funding on behalf of Taseko
and Gibraltar, and CESL.

During the latter  half of the 2001  fiscal  year,  Bateman  Engineering  Pty of
Australia was engaged to conduct an engineering feasibility-level cost study for
the  construction  and operation of a  hydrometallurgical  copper utilizing CESL
technology at the Gibraltar mine. The study involved engineering and design work
sufficient to determine  the capital and operating  costs for the facility to an
accuracy of -5% to +15%.  The refinery  would be capable of  processing  130,000
tonnes of 24% copper  concentrate  and  producing  30,000 tonnes of London Metal
Exchange grade copper cathode annually. The study estimated the refinery capital
cost to be $109.5  million and the annual  operating cost to be $16.3 million or
US$0.147 per pound copper produced.

The study also identified several synergies with the existing Gibraltar mill and
treatment  facilities.  For example,  as acid would be produced in the refinery,
less acid would need to be procured for the heap leach facility at the Gibraltar
site. In addition,  heating the leach solution with excess heat generated by the
refinery would enhance copper recovery from the heap leach. Implementing some of
these  additional  opportunities  would result in cost savings  beyond the $17.4
million per annum savings  associated  with  changing the Gibraltar  mine from a
concentrate producer to a cathode producer.

In 2001, GESL had the mandate of raising  financing to advance  engineering work
on the Gibraltar  Refinery for use of the CESL  technology at the Gibraltar Mine
and in other similar  operations.  This limited partnership raised $1.85 million
in late 2001 and was  purchased by Taseko,  with TSX Venture  Exchange  consent,
under a takeover bid, for 4.967 million shares in February 2002. GESL then owned
about 39% of the  engineering  business  with the balance owned by an affiliated
limited partnership that was acquired in April 2003. GESL and the affiliate used
their funds to advance  technical and economic  feasibility  studies of the CESL
process. (See Item 5B)


<page>

PROSPERITY PROJECT

LOCATION, ACCESS AND INFRASTRUCTURE

The  Prosperity  Project  consists of 196 mineral  claims  covering  the mineral
rights underneath  approximately 85 square km of south central British Columbia,
Canada. The property is located at latitude 51o 28'N and longitude 123o 37' W in
the Clinton  Mining  Division,  approximately  125 km  southwest  of the City of
Williams  Lake.  Access to the  Prosperity  Project  from  Williams  Lake is via
Highway #20 to Lee's Corner at  Hanceville.  From Lee's Corner,  an  all-weather
main line logging  haulage road provides  exploration  access to the  Prosperity
Project.  Under present road  conditions,  the total road distance from Williams
Lake to the  Prosperity  Project  is 192 km and  motor  vehicle  travel  time is
approximately 3 hours.

The British  Columbia  Railway  services  Williams Lake and has rolling stock to
facilitate shipping bulk commodities from Williams Lake to Vancouver,  or copper
concentrates through to the Pacific Ocean ports of Squamish and North Vancouver.
The community of Williams Lake is sufficiently close and is capable of supplying
goods and services to a possible mine, and its personnel.

Multiple   high-voltage   transmission  lines  from  the  existing  Peace  River
hydroelectric  power grid are situated 118 km east of the Prosperity  Project. A
124-km  conventional  power line was  designed to connect to the  existing  B.C.
Hydroelectric  power grid and should be capable of supplying the required  power
to service a large mine and mill complex at the Prosperity Project site. A major
natural  gas  transmission  pipeline,  which  could also be  accessed to provide
energy for mine  production,  is situated  112 km  northeast  of the  Prosperity
Project. Ample water is available nearby.

EXPLORATION HISTORY

In the early 1930's prospectors, C.M. Vick and E.A. Calep conducted trenching of
feldspar porphyry (igneous rock containing  conspicuous  crystals or phenocrysts
in a fine-grained  groundmass) dykes with stringers,  containing copper and gold
values,  about 1.5 km east of the  centre of the  porphyry  deposit as it is now
known.   In  the  late   1950's,   George   Renner   did   additional   work  on
gold-silver-copper  mineralized shear zones located northeast of the deposit. In
1960,  Phelps Dodge Corp.  located  float and  subcropping  mineralization  that
indicated a porphyry  environment.  That company  later carried out a program of
induced polarization (IP), geochemical and magnetic surveys, hand trenching, and
diamond drilling in eight short holes north of the presently known deposit.  The
Prosperity  Project  was  optioned  by  several  operators  from  1970 to  1989,
beginning  with  Nittetsu  Mining  in 1970 and  followed  by  Quintana  Minerals
Corporation,  which drilled  approximately  4,700 m in 23 core holes in 1973 and
1974. Bethlehem Copper (1979-1981) and Cominco Ltd. (1982-1989) further expanded
the deposit-area with another 121 holes, totalling almost 19,000 m.

Up to 1991,  exploration  programs at the Prosperity  Project included extensive
IP, magnetic and soil geochemical  surveys, and 176 percussion and diamond drill
holes, totalling  approximately 27,200 m. This work helped define the Prosperity
Project  mineralization  to a  depth  of  200  m,  and  outlined  a  copper-gold
mineralized zone  approximately 850 m in diameter within which Cominco estimated
a geological  resource of 208 million tonnes grading 0.23% copper and 0.41 grams
Au/tonne.


<page>

In 1991,  Taseko drilled 10 holes,  totalling  7,506 m, in a "cross"  pattern to
test  the  core  of the  deposit  over a  north-south  distance  of 550 m and an
east-west distance of 500 m. All of the holes intersected continuous significant
copper and gold grades and extended the mineralization to 810 m below surface. A
scoping-level  metallurgical testwork program was completed by Melis Engineering
Ltd. The testwork  demonstrated that acceptable gold and copper recoveries could
be achieved by bulk sulphide  flotation (method of mineral  separation whereby a
froth,  created in a slurry by a variety of reagents  floats some finely crushed
minerals but not others  (other  material  sinks))  followed by  regrinding  and
conventional  copper flotation.  Baseline  environmental and monitoring  studies
were also initiated by the Company.

By the end of 1992,  126 HQ and NQ  diameter  vertical  drill  holes,  totalling
68,064 m, had been drilled,  expanding  the deposit to 1,400 m east-west,  600 m
north-south  and to 850 m  below  surface.  G.  Giroux,  P.Eng.,  of  Montgomery
Consultants Limited reported mineralized material  (unclassified) of 976 million
tonnes at an average grade of 0.23% Cu and 0.48 grams Au/tonne.

In 1993, eight additional holes,  totalling 2,104 m, were completed.  Subsequent
to the Pre-feasibility Study (see "Metals Recovery,  Pre-Feasibility Work"), the
Company  completed a 12-hole (4,605 m) inclined core drilling program in 1994 to
investigate   the   distribution   of  fracture   controlled   gold  and  copper
mineralization in the deposit.  In addition,  22 holes (3,171 m) were drilled to
investigate  geotechnical  conditions in the proposed Project development areas.
Melis Engineering Ltd. completed additional metallurgical testwork.

In 1996 and 1997, an additional  107 holes (49,465 m) were completed in order to
upgrade the  confidence  limits of the  deposit.  Of this  total,  20 holes were
drilled  vertically (2,203 m) and 87 holes were inclined (47,262 m). These holes
significantly increased the density of pierce points in the deposit and added to
the geotechnical and geochemical characterization of the rock in the deposit.


<page>

Over the 34-year period from 1963 to 1997, a total of 154,631 m has been drilled
in 452 holes on the Prosperity  Project.  Of this total,  273 holes were drilled
vertically  (83,453 m) and 174 holes were  inclined  (71,178 m).  Sizes of cored
holes have included BQ, HQ and NQ totalling 148,321 m; the balance of 6,310 m is
from percussion drilling. A summary of the length and number of holes drilled by
each of the companies over this period is shown below:

<table>
<caption>
                          DRILLING SUMMARY: 1963 - 1997
- ------------------------------------------------------------------------------------------
                          Percussion Drilling      Diamond Drilling           All Drilling
                          -------------------    ------------------     ------------------
                           number                number                 number
                               of                    of                     of
Year   Company              holes      meters     holes      meters      holes      meters
- -----  -----------------  -------   ---------     -----  ----------      -----  ----------
<s>                            <c>   <c>            <c>  <c>               <c>  <c>
1963   Phelps - Dodge           0        0.00         6      611.12          6      611.12
1964   Phelps - Dodge           0        0.00         2      112.16          2      112.16
1969   Taseko .......          12    1,264.92         6    1,036.30         18    2,301.22
1970   Nittetsu .....           0        0.00         4      235.80          4      235.80
1972   Taseko .......           0        0.00         2      156.40          2      156.40
1973   Quintana .....           0        0.00        14    2,972.30         14    2,972.30
1974   Quintana .....           0        0.00         9    1,732.50          9    1,732.50
1979   Bethlehem ....          14    1,106.40         0        0.00         14    1,106.40
1980   Bethlehem ....          22    2,118.60         0        0.00         22    2,118.60
1981   Bethlehem ....           0        0.00        37   10,445.50         37   10,445.40
1982   Cominco ......          19    1,619.55        12      707.06         31    2,326.61
1984   Cominco ......           0        0.00         5    1,002.60          5    1,002.60
1989   Cominco ......           0        0.00        12    1,997.00         12    1,997.00
1991   Taseko .......           0        0.00        10    7,506.03         10    7,506.03
1992   Taseko .......           0        0.00       116   60,558.32        116   60,558.32
1993   Taseko .......           0        0.00         8    2,104.04          8    2,104.04
1994   Taseko .......           1      199.95        34    7,679.77         35    7,879.72
1996   Taseko .......           0        0.00        69   28,422.45         69   28,422.45
1997   Taseko .......           0        0.00        38   21,042.33         38   21,042.33
                            -----   ---------     -----  ----------      -----  ----------
TOTAL DRILLING                 68    6,309.42       384  148,321.68        452  154,631.00
                            =====    ========     =====  ==========      =====  ==========
</table>


In 1998, G. Giroux,  P.Eng.,  estimated the mineral  resource for the Prosperity
Project for the detailed engineering studies that took place in 1999-2000.  Four
holes  (1,150 m) were  also  drilled  under the  direction  of  Kilborn  Pacific
Engineering  Ltd. in 1998,  which  verified  the grade and geology in a proposed
pit.


<page>

PRIOR TITLE DISPUTE AND 1991-93 SETTLEMENTS

By agreement dated August 10, 1979,  Taseko  optioned the Prosperity  Project to
Bethlehem Copper Corp. (which later became part of Cominco Ltd. ("Cominco"), and
is now Teck  Cominco  Ltd.).  Under  that  agreement,  Cominco  was  granted  an
exclusive option to acquire an 80% interest in the Prosperity  Project by giving
notice to Taseko  before  November 30, 1984,  of Cominco's  intention to proceed
with commercial production from the Prosperity Project.  Cominco was entitled to
extend  its  option  on a yearly  basis  if  Cominco  concluded  that it was not
economically  feasible to place the Prosperity Project in commercial  production
and if an independent consultant supported this conclusion. Cominco extended the
option  in 1984 and  again in 1985,  based on an  evaluation  of the  Prosperity
Project prepared by Cominco in 1984.  Cominco's  extension of the option in 1985
was supported by a June 1986 report from Wright Engineers  Limited of Vancouver,
British  Columbia.   That  report,  based  on  data  obtained  from  mining  and
metallurgical  studies provided by Cominco,  confirmed Cominco's evaluation that
the Prosperity Project was not commercially feasible at that time.

Taseko subsequently sued Cominco, arguing that Cominco had not complied with all
of the terms necessary to enable it to extend the option,  and  specifically had
not had a proper  feasibility study prepared to determine the economic viability
of the Prosperity  Project.  Cominco  successfully  defended its position at the
trial and appeal courts.  Cominco and Taseko  resolved their dispute by entering
into a  settlement  agreement  dated  April  25,  1991  (the  "First  Settlement
Agreement").   Cominco   entered   into  the  First   Settlement   Agreement  in
consideration  of the issuance by Taseko of 1,000,000 common shares (issued over
the  period  May 31,  1991 to March  31,  1992),  and for the grant of a general
release of Cominco by Taseko from the  litigation  claims made by Taseko against
Cominco.  The First  Settlement  Agreement  provided that Taseko had a five-year
option to sell the Prosperity Project,  either directly or by way of a take-over
of Taseko,  in which event the proceeds would be split in a certain ratio with a
maximum of Cdn$48 million to Cominco.

By agreement dated December 1, 1993 (the "Second Settlement Agreement"),  Taseko
acquired the exclusive right to purchase from Cominco all of Cominco's  residual
interest  in the  Prosperity  Project.  Taseko  acquired  the  balance of a 100%
interest  in the  Prosperity  Project  by paying to Cominco  Cdn$2,000,140  from
working  capital and issuing to Cominco  1,636,364  common shares from treasury.
Cominco sold 1,607,400 of these shares to net Cdn$23,000,000,  and 28,964 shares
were  returned to treasury in April 1994.  As a result of the Second  Settlement
Agreement, Taseko acquired 100% of the Prosperity Project free whatsoever of any
royalties or third party interests.


<page>

GEOLOGY

The  Prosperity  Project  is  near  the  northeastern  edge  of the  Coast  Belt
tectonized  belt of the North American West Coast and subcrops under a 5 to 65 m
thick blanket of surficial cover.  Outcrops (exposed bedrocks projecting through
the soil and other  overburden) in the  deposit-area  are rare, and as a result,
all deposit geology has been interpreted from drill core descriptions  contained
in the 1963 to 1997 drill hole database.

The deposit is predominantly hosted in Cretaceous  andesitic  volcaniclastic and
volcanic rocks. In the western portion of the deposit,  the host rocks have been
intruded by the multi-phase,  steeply  south-dipping Fish Creek Stock. The stock
is  surrounded  by an east-west  trending,  south-dipping  swarm of  subparallel
quartz-feldspar  porphyritic  dikes.  The  stock  and  dikes  comprise  the Late
Cretaceous Fish Lake Intrusive Complex that is spatially and genetically related
to the deposit.  Post  mineralization  (post-ore)  porphyritic diorite occurs as
narrow dikes that cross-cut all host rocks.  The central  portion of the deposit
is cut by two major  faults (a fracture  or fracture  zone along which there has
been  displacement  of  the  sides  relative  to  one  another  parallel  to the
fracture), striking north-south and dipping steeply to the west.

Pyrite and chalcopyrite are the principal sulphide minerals in the deposit. They
are  uniformly  distributed  as  disseminations,  fracture-fillings,  veins  and
veinlets  and  may  be  accompanied  by  bornite  and  lesser   molybdenite  and
tetrahedrite  (copper iron  antimony  sulphide)-tennantite  (copper iron arsenic
sulphide).  Native gold occurs as inclusions in, and along  microfractures with,
copper-bearing  minerals and pyrite.  Pyrite to chalcopyrite  ratios  throughout
most of the  proposed pit area range from 0.5:1 to 1:1 and rise to 3:1 or higher
around the periphery of the deposit which  coincides  with the  propylitic  and,
locally, the phyllic alteration zones.

Numerous  faults were  intersected in drill core  throughout  the  deposit-area.
Faults are usually indicated by strongly broken core,  gouge,  sheared textures,
cataclastic textures and, rarely,  mylonitic textures. All of the aforementioned
features  can occur across  intervals of less than 1 cm to over 20 m.  Utilizing
all  available  data,  two  major  faults  (the QD and East  Faults)  have  been
delineated.

The QD and East Faults are  subparallel,  strike  north-south and dip steeply to
the west,  becoming near vertical down-dip.  They cut the central portion of the
deposit and are approximately 230 m apart near surface and 330 m apart at depth.
The  western-most of the two major faults,  the QD Fault,  trends  approximately
355(0) and has a steep  westward  dip of 82(0) to 86(0).  This  fault  marks the
eastern  boundary of the Fish Creek  Stock.  The  eastern-most  of the two major
faults, the East Fault,  strikes  approximately  360(0) and has a steep westward
dip of 85(0) to 87(0).

Gold-copper  mineralization  within the Prosperity Project is intimately related
to potassium silicate alteration. A later, superimposed, sericite-iron carbonate
alteration is prevalent  within a central,  east-west  trending  ovoid zone that
hosts the majority of the estimated  mineralized  material.  Chalcopyrite-pyrite
mineralization  and associated  copper and gold  concentrations  are distributed
relatively  evenly  throughout  the host  volcanic  and  intrusive  units in the
deposit.  Sulphide  minerals show the  thoroughly  dispersed  mode of occurrence
characteristic  of  porphyry  copper  deposits  and  occur in  relatively  equal
concentrations  as  disseminations,  blebs and  aggregates  in mafic  sites,  as
fracture  fillings and as  veinlets.  Native gold occurs as  inclusions  in, and
along microfractures with copper-bearing minerals and subordinately in pyrite.


<page>

ESTIMATES OF MINERALIZATION

In  1998,  G.  Giroux,   P.Eng.,   reported  estimated  measured  and  indicated
mineralized  material  (mineral  resource)  of 1.0 billion  tonnes at 0.41 grams
Au/tonne  and 0.24% Cu and  mineralization  (inferred  resource)  of 0.2 billion
tonnes grading 0.25 grams Au/tonne and 0.21% Cu at $3.25/tonne NSR cut off.

SAMPLING AND ANALYSIS

Since the current Taseko management group took over the project in 1991, 127,000
m of HQ and NQ core  has been  drilled  in 275 bore  holes,  and a single  200-m
percussion hole. Core recovery averaged 95.7%. Drill company personnel boxed all
core and delivered it to Taseko's  logging compound at the Prosperity site twice
daily.  Taseko  geological and  engineering  staff based at the Prosperity  site
supervised  drilling,  logging and sampling. A total of 57,778 core samples were
taken, each sample was generally 2 m in length.

In 1991-1994, drill core was mechanically split, one half of which was submitted
for  preparation  and  analysis.  In  1996-97,  42% was  subject  to whole  core
sampling, 44% was sampled as sawn half-core,  5% of samples comprised the larger
portion of core sawn 80:20. The remaining 9% was cored overburden, which was not
generally sampled.  Half of the core remaining after splitting is stored in core
racks at site.

Samples  were bagged and shipped by  commercial  surface  transport to Vancouver
area laboratories, where it was prepped. Samples were dried at temperatures less
than 65(degree) C. In 1991-1993,  primary  comminution to approximately 1/4 inch
(6.4 mm) size by a jaw crusher with  secondary  roll crushing to obtain minus 15
mesh. In 1994-1997,  samples were crushed in a single stage so that greater than
60% passed a 10 mesh  screen  and 500 gram assay  splits  were  riffled  out for
crushing.  Coarse rejects were retained until year 2000 at HDI in a warehouse in
Port  Kells,  British  Columbia.  Ring  and  puck  pulverization  was  used.  In
1991-1993,  approximately  95%  of the  sample  passed  a 120  mesh  screen.  In
1994-1997, greater than 90% of the sample passed a 150 mesh screen. Pulp rejects
are retained indefinitely at the Port Kells warehouse.

All assays and analyses were performed by Min-En Laboratories. Gold analysis was
done by lead collection fire assay, using a 30 g charge and an Atomic Absorption
Spectroscopy (AAS) finish. Copper analysis was done by Aqua Regia digestion on a
2  g  sample,  AAS  finish.  Mercury  analysis  was  done  by  Cold  Vapour  AA.
Multi-element  analysis by  Inductively  Coupled  Plasma  Emission  Spectroscopy
(ICP-ES) was also done on all samples.

In order to assess quality  control,  duplicate and standard  reference  samples
were  submitted  for assaying,  representing  more than 10% of the total assays.
Random  duplicates were derived from 5% of all rejects.  Every twentieth  sample
was shipped to either Chemex Labs Ltd (now ALS Chemex) or  International  Plasma
Laboratories  Ltd. for riffle splitting of the coarse reject,  pulverization and
analysis  for  gold and  copper.  In  1994-1997,  project-based,  bulk  standard
reference  materials  were  created  and  submitted  within the  mainstream  and
duplicate analytical streams.


<page>

SECURITY OF SAMPLES

For  Prosperity,  drill core is stacked  and stored on the  property.  Pulps and
rejects from core samples are generally  stored by the  analytical  facility for
one year, then acquired by the Company and stored in a secured  facility in Port
Kells. All rejects are discarded after two years.

METALS RECOVERY, PRE-FEASIBILITY WORK

In  1993,   Melis   Engineering  Ltd.  was  retained  by  Taseko  to  carry  out
comprehensive  metallurgical  tests on drill core  samples  from the  Prosperity
Project to evaluate  the  metallurgical  variability  of the  deposit.  The test
program included batch flotation tests and eleven lock-cycle  flotation tests on
various  composites,  and provided detailed  copper-gold  concentrate  analyses,
grindability assessments, tailings settling tests and environmental data.

The results from the variability  testwork  demonstrated  that copper recoveries
ranged from 83.0% to 88.4% with copper  concentrate grades ranging from 22.2% Cu
to 28.8% Cu. Gold recoveries ranged from 66.1% to 79.8% with grades ranging from
26.0 grams Au/tonne to 71.3 grams Au/tonne reporting to the copper  concentrate.
Bond rod  mill  and ball  mill  grindability  tests  of  drill  hole  composites
indicated a variation of hardness  within  individual  levels and an increase in
hardness with depth. Work indices ranged between 16.4 to 20.4.

The  conceptual   concentrator  design  was  conventional,   consisting  of  SAG
(Semi-Autogenous  Grinding) and ball mill  grinding;  bulk  sulphide  flotation;
regrind and  rougher/scavenger  flotation;  cleaner  flotation;  and concentrate
dewatering.

Late in 1993,  Kilborn  Engineering  Pacific Ltd. was  contracted  to complete a
detailed  Project  Pre-feasibility  Study,  which  was  successfully  tabled  in
mid-1994. The Kilborn Pre-feasibility Study, which considered a 60,000 tonne per
day milling rate,  addressed  most aspects of the Project at the level of detail
and analysis greater than that normally  attributed to a pre-feasibility  study.
It confirmed that the Prosperity Project compared favourably with open pit mines
currently  operating  in  the  region  and  provided  excellent  benchmarks  for
productivity and cost comparisons.

For the  Pre-feasibility  Study, a mine plan encompassing  mineralized  material
(mineral  resource) of 675 million  tonnes at an average  grade of 0.236% copper
and 0.434 grams Au/tonne was outlined, containing 9.4 million ounces of gold and
3.5  billion  pounds of copper.  The  geometry  and  continuity  of the  deposit
provided  for  efficient  open pit mining with an overall  life of mine waste to
mineralized  material  stripping  ratio  (ratio  of  waste  rock to  mineralized
material to be removed) of 1.57:1.  At a milling  rate of 60,000  tonnes per day
(21.9  million  tonnes per year),  average  annual  production  would be 222,360
ounces  of gold,  99  million  pounds  of copper  and  530,000  ounces of silver
contained in 185,000 tonnes of concentrate.

In October 1997,  Lakefield Research Limited completed pilot plant metallurgical
programs and bulk sample  processing to confirm final process  design  criteria.
The program focused on finalizing  detailed  process  criteria for a feasibility
study,   including  copper  and  gold  recovery  into  a  copper-gold  flotation
concentrate, assessment of grindability characteristics and detailed concentrate
and  environmental  analyses.  Results  from the  50-tonne  pilot plant  program
results  compared  favourably  with  the  Pre-feasibility   Study  metallurgical
results.


<page>

DETAILED ENGINEERING WORK

Detailed  investigative  work has included a review of all major  facilities and
their construction requirements, unit costs for labour, materials and equipment.
Along  with  the  construction  aspects  of  the  project,  the  deposit's  mine
development  plan has undergone a series of  optimization  studies that analyzed
how the mining  should best progress in  consideration  of the most recent metal
price and  exchange  rate  forecasts.  Milling  reviews  examined  the  original
Lakefield Research investigations, pilot plant program and the more recent modal
analyses by G&T  Metallurgy  to determine if they offered any changes that would
result  in cost  savings.  Upon  completion  of the  multitude  of  studies,  an
all-encompassing  project analysis was conducted in preparation for completing a
project  feasibility  report.  During 1999,  consulting  geotechnical  engineers
Knight Piesold Ltd.  focused their attention on rock waste and tailings  storage
studies.  At the same  time,  Merit  Consultants  reviewed  the  parameters  for
construction of major  structures.  The tailings  storage  studies  investigated
holding  capacities  from 490 million tonnes to 810 million  tonnes,  methods of
embankment  design  from  impervious  to free  draining,  filling  by cyclone or
spigot, and various tailings pumping scenarios. Knight Piesold Ltd. designed the
embankment, tailing and reclaim water pipeline system, freshwater supply system,
open pit dewatering and slope, waste dumps,  geotechnical foundation and surface
water  run-off  control  systems.  Triton  Environmental  Consultants  developed
management for environmental and socio-economic permitting,  planning, fisheries
compensation,   mitigation  and  reclamation.  Merit  Consultants  International
continued to review  construction  and project  management  criteria.  They also
provided details and rates for alternative  collective  bargaining  construction
agreements.

All major building structures for the crusher,  process plant,  service complex,
etc were assessed with respect to pre-engineered  versus custom engineering plus
labour  productivity and cost,  material unit rates and  construction  equipment
content.  Project  construction  productivity  and costs were  adjusted to those
recently experienced on BC mine projects. Mine engineers examined mining/milling
rates of 60,000 and 90,000  tonnes per day along with a reduced mine plan of 400
million  tonnes  and  stripping  ratio of 1:1,  respectively.  The intent was to
determine which production rate and plan was better suited for a mine production
schedule and mill throughput  that  considered  current metal price and exchange
rate forecasts.  Following the 60,000 and 90,000 tonnes per day  investigations,
Taseko  engineers  and  outside  consultants   conducted  detailed  optimization
investigations for mine production schedules and milling rates of 70,000, 75,000
and 80,000 tonnes per day. A series of pit development plans were  investigated,
along with decreasing cut-off grade and stockpiling strategies. Waste excavation
deferral  programs  were  also  examined.   Mine-related   activities   included
compilation  of the  Prosperity  economic  model with the most recent  operating
costs,  smelter  charges,  treatment  terms,  metal  prices  and  exchange  rate
forecasts. As previously noted, operating costs were rationalized by using those
experienced for identical activities at Gibraltar Mine. Facilities would require
only  one  primary  crusher  and a single  overland  conveyor  to a  coarse  ore
stockpile  rather than the dual system  originally  considered  necessary.  This
large cost saving has been incorporated into the economic evaluations.


<page>

In March 2000,  subsequent  to economic  analyses  and mining plan  optimization
studies undertaken by Taseko, a revised processing rate of 70,000 tonnes per day
was adopted for a detailed study of the Prosperity Project.  The study addressed
mining,  processing,  environmental,  ancillary  facilities  and  infrastructure
required  for  completion  of the  financial  and  technical  evaluation  of the
Project. It includes a project management plan and summary project schedule, and
cost estimates to bring the Project into  operation,  and an economic  analysis.
The 2000 work was  based on an in-pit  resource  estimated  to be 490.8  million
tonnes grading 0.22% copper and 0.43 grams Au/tonne at a $3.25/tonne net smelter
return cut-off. This material is within the grade model constructed by Giroux in
1998  from the  geological  interpretation  and rock  modelling  done by  Taseko
personnel.  The open pit mine design,  mine plans,  mining capital and operating
costs were prepared by Nilsson Mine  Services  Ltd.  with the  assistance of the
engineering  staff of Gibraltar Mines Ltd. Kilborn developed the mill flow sheet
in  conjunction  with  the  Gibraltar  engineering  staff.  Butterfield  Mineral
Consultants  Ltd.  conducted  a  study  of the  saleability  of  the  Prosperity
concentrate.  Pilot plant tailings aging tests  continued until August 2000 when
the 36-month  analyses were  completed.  The tailings aging tests tables for the
1998 Pilot Plant report were also updated for environmental  requirements of the
Project  Reporting.   Electrical   transmission  design  engineers  Ian  Hayward
International  Ltd. designed the 230 kilovolt (kV) transmission  line,  provided
the detailed  material  take-off and selected the  right-of-way to the site from
the BC Hydro Dog Creek substation.

The latest mining/milling optimization work has detailed much of the engineering
work beyond that  conducted  previously by  considering  two major  initiatives.
Firstly,  environmental  analyses  were  reviewed  and the  waste  rock  storage
criteria  revised,  enabling  reduced  truck  haulage  requirements.   Secondly,
application  of current and actual  Gibraltar  mine  equipment  operating  costs
resulted in reduced overall mining costs.

The most suitable waste rock and tailings storage designs were incorporated into
the  development.  Reduced milling costs were achieved by increasing the primary
grind  specification  from 160  microns to 200  microns.  This  improvement  was
determined through additional metallurgical reviews. Cost effective construction
criteria, investigated by Merit Consultants, were applied to all major structure
cost estimating.

Environmental   studies  and  agency  liaison   activities   continued  for  the
governmental   review  and  project   certification/permitting.   Reactive  rock
classification  analyses  led  to  better-defined  waste  handling  and  storage
requirements for the benefit of the mine operation schedules.

The  Prosperity  Project  continued its public  communication  and  consultation
program.  Its Williams Lake Project  office was relocated to the Gibraltar  mine
site in 1999 to improve operational efficiencies. Extensive information exchange
and  dialogue  on  the  Prosperity  Project  has  occurred,  fully  meeting  the
requirements set forth in the Project Report Specifications.


<page>

HYPOTHETICAL OPERATING SCENARIO, ECONOMICS

Engineering work by Kilborn and others has determined that Prosperity deposit is
technically  amenable to open pit mining.  A four phase mining plan was designed
in which the life of mine strip ratio would be 0.72:1.  Under the 70,000  tonnes
per day  scenario,  the  project  would  have a 16-year  mine life and a 20-year
project  life,  producing,  on average,  235,920  ounces of gold and 102 million
pounds of copper per year.  Low-grade  mineralized material mined over the first
14 years would be stockpiled  and processed in the last four years.  Mineralized
material  and waste  rock  would be mined by  conventional  drilling,  blasting,
loading and truck hauling methods.

Gold and  copper  would  be  recovered  as  concentrate  employing  conventional
crushing,  grinding and stage flotation  technologies.  Recoveries would average
70.2% gold and 86.6% copper.  A  concentrated  grading 24.5% copper,  38.8 grams
Au/tonne and 89 grams  Ag/tonne would be produced.  Average  annual  concentrate
production  would be  188,885  tonnes  (dry).  Tailing  and waste  rock would be
storied in an impoundment on site in Fish Lake. Reclamation plans include a fish
enhancement  plan to compensate for fish habitat lost in Fish Lake.  Concentrate
would be  transported  to the Port of  Vancouver  BC, and shipped  overseas  for
smelting and refining. Supplies would be trucked to site. Power will be supplied
by BC Hydro; annual  requirements are estimated to be 819.5  gigawatt-hours/year
via a  230-kilovolt  transmission  line that would require  construction  over a
distance of 124 km to the site.

Cost engineering and economic  analyses  demonstrate that the mine-mill  complex
would have an average life of mine estimated site operating cost of Cdn$4.99 per
tonne of mineralized material and a net smelter return (monies actually received
for concentrate  delivered to a smelter net of  metallurgical  recovery  losses,
transportation costs, smelter treatment-refining charges and penalty charges) of
Cdn$7.82  per  tonne.  Initial  capital  cost  for  the  mine,  mill,  ancillary
facilities and  infrastructure is estimated to be Cdn$684 million (capital costs
varies from Cdn$400 - $800 million depending on throughput assumptions of 60,000
to 120,000 tonnes/day). The pre-tax discounted cash flow rate of return (DCFROR)
of 3.1% was determined  using long-term  average price  projections.  These are:
gold at US$350/oz; copper at US$1.00/lb;  silver US$6.50/oz and an exchange rate
of US:Cdn  $0.68.  A  sensitivity  analysis  indicates  that the  DCFROR is most
sensitive to the currency rate exchange  variable.  For example, a 20% reduction
in the  exchange  rate  results in a DCFROR of 11.9% and a 20%  increase  in the
exchange  rate would result in a DCFROR of -5.2%.  It is also  sensitive to gold
head grade, gold recovery,  copper variables and operating cost. For example,  a
20% decrease in operating cost gives a DCFROR of 7.6% and a 20% increase reduces
the DCFROR to -2.4%.  It is least sensitive to smelter terms and initial project
capital cost.  These rates of return are not sufficient to justify  construction
of a mine at the Prosperity Project given current copper and gold prices.

A draft report on the detailed engineering studies was provided in December 2000
by Kilborn Engineering Pacific Ltd.  Engineering studies will continue,  but are
not expected to be  completed to a definitive  result for some time while Taseko
focuses its resources on the Gibraltar  project  which,  because of  established
mine plant and equipment, has some likelihood for near term feasibility.


<page>

HARMONY PROJECT

Pursuant to an Arrangement  Agreement dated February 22, 2001 (the  "Arrangement
Agreement")  among Taseko,  Misty Mountain Gold Limited  ("Misty  Mountain") and
Gibraltar Mines Ltd. ("Gibraltar"),  Taseko's wholly-owned subsidiary, Gibraltar
agreed to  purchase  the  Harmony  Project  from Misty  Mountain  as part of the
reorganization   of  Misty   Mountain  under  a  statutory  (BC  law)  "plan  of
arrangement"   (a  form  of   reorganization).   Misty  Mountain  is  a  company
incorporated  under the laws of  British  Columbia,  and its  common  shares are
listed on the TSX  Venture  Exchange  and  quoted on  NASDAQ's  Over-the-counter
bulletin  board,  and  has  been  renamed   Continental   Minerals   Corporation
("Continental")  (TSX Venture:  KMK) (KMKCF. BB, CIK#782879).  Misty Mountain is
related to Taseko with a majority common directors,  and each company is under a
management  services  agreement with Hunter  Dickinson Inc. The  transaction was
completed in October 2002. (See Item 7B).

LOCATION AND ACCESS

The Harmony Gold Project is located at latitude 53o 31' N and longitude 132o 13'
W in the Skeena Mining Division, on Graham Island, Queen Charlotte Islands-Haida
Gwaii, B.C., Canada.  Graham Island is the largest island in the Queen Charlotte
archipelago.  The Queen Charlotte  Islands-Haida  Gwaii, are approximately 89 km
west of the British  Columbia  mainland,  159 km southwest of the city of Prince
Rupert, and approximately 770 km northwest of Vancouver.

The "Specogna Deposit" is the name of the principal zone of gold  mineralization
on the mineral claims  comprising the Harmony Gold Project,  and is located near
the centre of Graham  Island.  The deposit lies within an area of gently rolling
small hills to the east of steeper, more mountainous terrain.  Elevations in the
area range from 70 to 225 m. The terrain is covered by second growth forest.

The Harmony Gold Project is easily reached by existing high capacity  industrial
logging roads from the towns of Port Clements,  Masset and Queen Charlotte City.
By road, the Property is approximately 40 km from Queen Charlotte City and 30 km
from Port Clements.  Graham Island is readily accessed by ferries and commercial
barges and shipping from both Prince Rupert and Vancouver.  There are also daily
commercial   flights  from  Vancouver.   Misty  Mountain  has  established  camp
accommodation,  administration and transportation  facilities on the site and in
the town of Port Clements, British Columbia.

The regional climate is moderate, with the average winter temperature being 1.7o
C and the average for the warmest  summer  month being 14.4o C.  Average  annual
precipitation is 2 m.


<page>

MINERAL CLAIMS

The Harmony Gold Property  comprises of 50 four post mineral claims, 37 two post
mineral  claims and one fractional  claim,  totalling 970 claim units and 24,250
ha. The deposit-area claims are in good standing until June 29, 2009.

HISTORY AND PREVIOUS EXPLORATION

Jarositic  (ochre or brown  coloured  alunite  mineral)  gossan and  spectacular
quartz  stockwork  (a network of veins at variable  orientations)  veining  were
discovered in 1970 by Efrem  Specogna and Johnny Trico while  prospecting  along
the trace of the  Sandspit  fault zone.  The vein and wallrock  samples  carried
gold, and claims were located to cover the prospect in 1970.

Several of the Harmony Gold Project claims were optioned by different  companies
during the period 1970 to 1975. Kennco  Exploration  (Western) Limited conducted
the first  geological  mapping,  geochemical  surveys and  drilled two  packsack
diamond drill holes  totalling  55.2 m (181 ft). In 1972,  Cominco Ltd.  drilled
nine holes,  totalling 501 m (1,634 ft),  before  relinquishing  its option.  In
1973, Placer Development  Limited explored the Property,  and from 1974 to 1975,
Quintana  Minerals  Corporation  drilled 18  percussion  holes,  totalling 603 m
(1,978 ft), four packsack diamond drill holes, totalling 58 m (187 ft), and five
BQ holes, totalling 718 m (2,356 ft).

In 1977, Consolidated Cinola Mines Ltd. ("Consolidated Cinola"), entered into an
option agreement to purchase certain claims from Mr. Specogna,  who was at arm's
length.  Misty  Mountain  exercised the option to acquire title to the claims in
1979. In 1979,  Consolidated  Cinola entered into a joint venture agreement with
Energy Reserves Canada Ltd.  ("Energy  Reserves") to explore the Property,  with
Consolidated Cinola acting as operator. By 1984,  Consolidated Cinola, on behalf
of the joint venture,  had completed 231 drill holes,  totalling  about 30,116 m
(98,806 ft) of drilling.  In 1981, 465 m of an  underground  drift and crosscuts
were excavated for a  metallurgical  bulk sample.  A 45 tonne per day pilot mill
was  established  on the Property  and about 5,200  tonnes from the  underground
workings were treated on site. In September 1982, the joint venture  completed a
feasibility  study using a 13,000 to 15,000 tonnes per day throughput  with gold
extraction based on a complex roasting process. The joint venture,  however, did
not proceed to develop a mine on the Property.  In August 1984,  Misty Gold Inc.
("Misty  Gold")  acquired  Energy  Reserve's  interest  in the  Property  and in
November 1985,  Consolidated  Cinola acquired 100% of the issued and outstanding
shares of Misty Gold by the issuance of 1,500,000 shares of Consolidated Cinola.

On December 6, 1986, a significant  interest in Consolidated Cinola was acquired
by  Australian  interests  and its name was changed to City  Resources  (Canada)
Limited ("City Resources"). From 1986 to 1988, City Resources drilled 83 diamond
drill holes and 64  reverse-circulation  drill holes, totalling 13,356 m (43,819
ft), re-logged 182 previously  drilled core holes,  carried out specific gravity
measurements  on 418 core  samples,  completed  117.6 m (386 ft) of  underground
development   in  order  to  obtain  a  bulk  sample,   conducted   bench  scale
metallurgical  testing,  and developed proposed tailings disposal areas and open
pit  scenarios.  In  December  1987,  Wright  Engineering  Limited  completed  a
feasibility  study for City  Resources  who elected not to proceed  with further
development due to financial problems in Australia.

In 1989, Barrack Mines Limited ("Barrack") became the principal  shareholder and
manager of City Resources,  through a wholly-owned Canadian subsidiary,  Barrack
Mine  Management  Inc. and  commissioned  Dr. Peter Dowd (Leeds  University)  to
complete a re-evaluation of the Property's reserves.  The study was completed in
March 1990 and resulted in a new estimate of the geological resource.  Following
a  feasibility  study  prepared  by Davy McKee,  Barrack  Mine  Management  Inc.
discontinued  further work due to corporate financial  problems.  Misty Mountain
had  expended  approximately  Cdn$30.3  million on the Harmony Gold Project (the
Property) to December 31, 1993.

In December 1993, Barrack's  controlling interest in City Resources was acquired
by another group of Australian  investors who  re-organized  the corporation and
renamed the  corporation,  Misty  Mountain  Gold Limited  ("Old Misty") in March
1994. In 1994,  Romulus Resources Ltd.  ("Romulus") was granted an option on the
Property  and on November 6, 1995,  Romulus and Old Misty  merged  pursuant to a
Plan of Arrangement  and the  corporation  continued  operations  under the name
Misty  Mountain  Gold  Limited.  From  October  1995 to the end of  1996,  Misty
Mountain drilled 147 NQ sized (1 7/8" diameter)  diamond drill holes,  totalling
34,628 m, on a systematic grid pattern. The combined exploration and development
expenditures  of Romulus  and Misty  Mountain  on the  Harmony  Gold  Project in
1995-1996 were approximately Cdn$10.34 million. The diamond drill program better
defined the distribution of gold throughout the deposit.

In 1997, Misty Mountain  completed four diamond drill holes,  totalling 1,999 m,
targeted on the down dip extension of the ore-hosting structure, and these holes
confirmed the presence of the structure.  Concurrently, forty line-km of Induced
Polarization  geophysical and soil  geochemical  surveys were completed over the
northern  strike  extension of the Sandspit fault from the Specogna  Deposit and
over two  targets  south of the  deposit.  In  addition,  metallurgical  scoping
studies were conducted on a 700 kg  representative  sample  collected from drill
core  throughout  the  deposit.  This was followed by  collection  of a 1,700 kg
sample from the existing  underground  adit for a second phase of  metallurgical
testwork. Misty Mountain expended approximately Cdn$3.28 million on the Property
in 1997.

In 1998,  four  diamond  drill holes,  totalling  575 m, were drilled to test an
induced  polarization-resistivity  target coincident with the projected northern
strike  extenuation  of the  deposit.  Second phase  metallurgical  studies were
concluded on the 1,700 kg sample  collected  in 1997.  In 1998, a third phase of
test work that required collection and advanced testing on a 4,000 kg sample was
completed.  A total of Cdn$1.19  million was expended in 1998 by Misty Mountain.
In 1999,  Misty Mountain  continued at a minimal cost, the review of the various
options for mining and processing  scenarios with a view to future  preparedness
should metals prices strengthen.


<page>

REGIONAL GEOLOGY

The Queen  Charlotte  Islands-Haida  Gwaii are  within the  Insular  Belt of the
Canadian  Cordillera.  The Islands are separated from the Pacific Ocean plate by
the  Queen  Charlotte  Transform  Fault  and are  included  within  the  Pacific
Continental  Shelf.  The  physiographic  region has been  divided into the Queen
Charlotte Ranges, Skidegate Plateau and Queen Charlotte Lowlands. The boundaries
between each of these  physiographic units follow major northwest trending fault
zones.

The Queen  Charlotte  Ranges  extend from Cone Head on Rennell Sound to Cape St.
James and include  most of Moresby  Island,  but only a small  portion of Graham
Island.  The range consists of a chain of rugged  mountains  rising steeply from
sea level to 1,125 m, and most of the range is underlain  by granitoid  rocks of
Early Jurassic to Late  Cretaceous  ages. Many of the higher peaks are formed of
Triassic volcanic rocks and some are granitic.

The  Skidegate  Plateau  extends  across most of Graham Island and consists of a
complex package of Jurassic volcanic and Cretaceous  sedimentary  sequences that
are covered by a thick pile of Early  Tertiary  lavas.  These lavas form much of
the plateau  surface and erosion has exposed older rocks locally  throughout the
region.

The Queen Charlotte  Lowlands flanks the Skidegate  Plateau on the northeast and
extends from Langara  Island in the north to Gray Bay in the south.  It includes
the largest part of Graham Island.  The northwest  portion  consists of Jurassic
and Cretaceous sedimentary rocks cut by large Tertiary dykes and plutons. To the
east  relatively  flat-lying  Early Tertiary lavas occur in a slightly  uplifted
peneplain  (land surface worn down to nearly flat or undulating  plain) which is
overlapped  further  eastward  by Early  Tertiary  sedimentary  rocks.  The Late
Tertiary  faulting  along the Sandspit and related  faults was the mechanism for
the uplifting and downwarping forming the basin.

Epithermal  gold deposits,  like Specogna,  have been explored and developed all
over the world  and are most  prevalent  along  the  Pacific  Rim.  Pacific  Rim
epithermal  gold  deposits  are  associated  with  Tertiary   subduction-related
(related  to process  of one  lithospheric  plate  descending  beneath  another)
volcanoplutonism,  commonly  within island arcs  occurring at  convergent  plate
boundaries.  In tectonic settings of oblique convergence,  the plates slide past
each other and major transcurrent fault systems (series of near-vertical  faults
with displacement  parallel to strike) accommodate much of the displacement (eg.
Queen Charlotte fault).  Numerous subsidiary,  parallel faults also develop as a
result of this oblique plate convergence (eg. Sandspit fault).  Other subsidiary
fault  structures  also form between the strike slip faults and often  represent
sites of compression (forces and stresses that tend to decrease the volume of or
shorten a substance) or dilation  (opening) due to the differential  movement of
these transcurrent  faults. It is these dilational settings within fault systems
that are favourable for epithermal gold mineralization (eg. Specogna Deposit).


<page>

PROPERTY GEOLOGY AND MINERALIZATION

Work by previous  operators and  geologists  provided a detailed  account of the
lithologies present at the Specogna Deposit.

The Sandspit fault  controls the Specogna  Deposit  structurally.  It is a right
lateral  transverse-normal  fault of significant but unknown  lateral  movement,
with its eastern side down dropped at least several hundred metres. It has a dip
of 40 to 60o to the  east.  The  western  side  and  footwall  of the  fault  is
underlain by Cretaceous Haida Formation mudstones. The eastern side of the fault
is  underlain  by  Miocene  Skonun  Formation  sandstones,  siltstones  and more
dominant conglomerates.

Dacite dykes of Tertiary  age have  intruded  along the fault.  Contemporaneous,
pervasive   silicification   (addition  of  silica),   hydrothermal  brecciation
(physical  change brought about by the  introduction  of  hydrothermal  fluids),
stockwork and banded quartz veining and gold mineralization have developed along
the hangingwall of the fault. This extends for a strike distance of at least 800
m,  eastwards  from the  fault at least  200 m and to a depth of at least 240 m.
Silica sinters  observed close to surface  indicate that not much of the deposit
has been eroded.

Pyrite  and  marcasite  (iron  sulphides,  marcasite  is white  pyrite)  are the
dominant metallic minerals. Gold occurs as native gold and electrum (an alloy of
gold),  which are  commonly  visible.  Silver is alloyed  with  gold.  No silver
minerals other than gold-silver alloys have been identified in the deposit.

Gold is  present  in  anomalous  concentrations  in the  outer  rims  of  finely
disseminated  pyrite in  wallrock  within a broad zone of  potassic  (related to
potassium)  alteration and  silicification.  Higher  concentrations  of gold are
associated with hydrothermal veins and breccias.  Free gold occurs dominantly in
quartz veins,  often at or near their margins.  The veins are typically of light
grey quartz and  secondarily  of banded light and dark grey quartz.  Many of the
veins  containing   visible  gold  are  less  than  five  cm  wide.  Within  the
hydrothermal breccia,  visible gold grains occur in brown/grey chalcedonic (very
fine-grained)  quartz  matrix.  Visible gold is also seen in quartz veins within
wallrock fragments incorporated in hydrothermal breccia.

A wide spectrum of technical scoping studies and investigations of environmental
considerations   have  been   ongoing  to  provide  a  framework  to  develop  a
comprehensive   Specogna  Deposit  Scoping  Study.   These  activities   include
socio-economic   considerations,   environmental  analyses,  deposit  modelling,
resource  estimates,  site  facilities  location,  mine designs,  infrastructure
planning,  mineralogy  and  metallurgical  studies.  Conventional  metallurgical
processes  for the  recovery  of gold have  been  evaluated  including  gravity,
flotation, biooxidation, leaching and heap leaching.

Structural  and  geological  analyses of the Harmony  Gold  Project  claims have
identified areas with further  exploration  potential.  To take advantage of the
favourable  geological  features  in the  region,  claims  were  staked by Misty
Mountain to cover  approximately  25.7 km of strike  length of the key  Sandspit
fault.


<page>

ESTIMATES OF MINERALIZATION

The Specogna  deposit  contains  estimated  measured and  indicated  mineralized
material (mineral resource) of 64 million tonnes grading 1.53 grams Au/tonne and
21 million  tonnes of  mineralization  (inferred  resource)  grading  1.04 grams
Au/tonne. These estimates were calculated using a 0.60 grams Au/tonne cut-off.

The  mineralized  material was estimated in 1997 by M. Nowak,  P.Eng.,  based on
81,500 m of diamond  drilling in 543 drill holes,  including  151 diamond  drill
holes  (36,325 m) completed by the Company.  G.  Giroux,  P.Eng,  M. Nowak,  and
others  reported  the  detailed   classification  of  the  mineralized  material
(resource) in February 2001. Also in 1997,  Independent  Mining Consultants Inc.
of Tucson,  Arizona  estimated in-pit material of 64 million tonnes grading 1.52
grams Au/tonne using a 0.60 grams Au/tonne cut-off. For the in-pit estimate,  it
was assumed no rock grading less than 0.60 grams Au/tonne (0.018 ounces per ton)
would be processed,  yielding an overall  waste to ore  stripping  ratio of 0.82
tonnes of waste to 1 tonne of ore for an open pit mine model.

SAMPLE ANALYSIS AND SECURITY

During the period from 1971 to 1989, the companies  conducting  exploration sent
either  split or sawn  half  core  samples  for  assaying.  Samples  were  taken
continuously  over lengths  ranging  between 1.5 to 2.0 m,  crossing  lithologic
boundaries in most instances.  Early gold analyses included chemical  extraction
followed  by  gravimetric  or Atomic  Absorption  (AA)  finish.  Check  assaying
procedures were included at various laboratories including Chemex, Bondar Clegg,
General Testing and Bell-White Labs.

Drill core sample  lengths  chosen by Misty  Mountain were varied to selectively
isolate  vein  material  and to avoid  sampling  across  lithologic  boundaries.
Samples,  totalling  22,421 in number from  35,652 m of core,  for the most part
ranged between 1.75 and 2.25 m (actual range 0.06 - 6.10 m) in length. Whole NQ2
core rather than half core was sampled to obtain maximum assay precision.

Sample  preparation was carried out at Min-En  Laboratories in North  Vancouver,
B.C.,  where drill core was crushed to 60% passing 10 mesh and pulverized to 90%
- - 150 mesh.  Prepared samples were sent to Chemex Labs Ltd. for mainstream assay
and to CDN Labs for check  assay.  A one assay ton charge was used for gold fire
assay with an AA finish;  a one gram  sample was  assayed  for silver by AA. All
samples  were sent for 32  element  ICP  analysis.  A total of  23,690  prepared
samples was  analysed at Chemex and 1,132  prepared  samples was analysed at CDN
using a similar assaying procedure.

Three  property  standards  were  prepared to  approximate  lithologic  type and
corresponding  gold grade, and one of three was inserted into the sample stream.
Approximately one in 20 standards was randomly inserted in the mainstream pulps,
while one in 13 was inserted in the duplicate  pulps.  Performance  of the three
standards assayed, along with the mainstream samples at Chemex, was monitored by
comparing the results over time with the mean and tolerance limit values. Of the
1,209 primary results, a total of 48 or 4% were outside of the set tolerances. A
re-run  of the  batches  containing  the  offending  standards  was  re-assayed,
resulting in 15 or 1.2% outside of the set tolerances.


<page>

SAMPLE SECURITY

Sample  pulps are  stored in the  Company's  warehouse  at Port  Kells,  British
Columbia. Drill core is stored at site.

METALLURGY

Metallurgical  testwork  completed  prior to 1987 fell short of  arriving  at an
economically and  environmentally  viable ore treatment/gold  extraction process
for the Specogna Deposit. Since 1996, Misty Mountain has pursued a comprehensive
program of extending  the  previous  testwork and  exploring  other  potentially
viable process options for the recovery of gold,  including gravity,  flotation,
bio-oxidation   of   flotation   concentrate,   bio-oxidation   of  whole   ore,
carbon-in-leach  cyanidation and thiosulphate leaching. This work has included a
reassessment of the ore deposit mineralogy,  geology and characteristics of gold
mineralization.  The reassessment of pre-1987  metallurgical sampling discovered
that the previous pilot plant bulk sample material was  unrepresentative  of the
overall deposit, having been collected predominantly from a thin horizontal unit
that comprises only about 7% of the overall in-pit rock.

Metallurgical  samples for the 1997 and 1998 testwork were carefully selected so
as to be representative  of the overall in-pit rock units.  Bench scale tests of
these samples have revealed  acceptable gold recoveries both through  collection
and treatment of a sulphide  concentrate  and through  direct  bio-oxidation  of
whole ore followed by gold  leaching.  Work is required  optimize the  processes
from an economical  perspective  and confirm  initial  results by applying these
same processes to larger, representative samples.

ENVIRONMENTAL CONSIDERATIONS

Perceptions  of possible  acid rock  drainage  have been the main  environmental
concern relating to the Harmony Gold Project,  based on the previously  proposed
large  scale,  open pit mine  plan.  The  location  and size of waste rock sites
proposed in that plan was also a concern.  The previous  mine plan was a concern
of First Nations and other community  people,  however,  local citizens have not
prevented  any  development  work.  The  area has been  extensively  logged  and
permitting efforts by former operators on the Property were well advanced. Misty
Mountain  initiated  base  line  environmental,  wildlife,  fisheries,  climate,
hydrology and vegetation monitoring studies. These studies were initiated before
the  commencement of the 1995  exploration work in order to establish both Misty
Mountain's  intention and desire for the utmost integrity of the database and to
establish a firm  foundation for future  permitting,  as the Company  recognized
that   successful   development   of  the  project  must  be  done  in  a  safe,
environmentally  responsible  manner,  which will maximize  benefits to regional
communities.  The open, co-operative consultation process with all stakeholders,
with specific attention to the First Nations  community,  merged with successful
exploration  results and  utilizing  low  impact,  proven,  conventional  mining
methods,  applicable to gold  production  from  epithermal  gold  mineralization
initiated by Misty Mountain would also be the intention of Taseko.


ABORIGINAL (OR "FIRST NATIONS") ISSUES

The Queen  Charlotte  Islands-Haida  Gwaii,  including the area  surrounding the
Harmony Gold Project, are subject to aboriginal peoples' land claims. Aboriginal
land claims are subject to the B.C. Treaty  Commission  Legislation and the B.C.
Treaty  Commission,  both  established in 1993. The Commission  facilitates  and
manages a six stage process whereby the Government of Canada,  the Government of
British Columbia and a First Nation negotiate a treaty  settlement.  The Council
of Haida Nations (the First Nation  claiming  jurisdiction  over the area of the
Harmony  Gold  Project)  is  presently  in the  second  stage,  Preparation  for
Negotiations.   The  British  Columbia  government  has  stated  a  policy  that
settlements will not adversely affect existing tenures in the settlement areas.

In late  1999,  the First  Nations  people on Graham  Island  launched a lawsuit
against the Government of British Columbia  (Ministry of Forests).  In the suit,
the  First  Nations  peoples  challenged  the  ability  of  government  to issue
effective permits for resource  development on the Queen Charlotte Islands.  Due
in part to this uncertainty,  Misty Mountain's  management deferred further work
on the project,  as has  Taseko's.  In late 2000, a decision was rendered on the
lawsuit.  The First Nations lost its  application  to have the permit set aside.
However  the  Court  went on to  create  a new  moral  duty  on the  part of the
exploration  companies to consult with First Nations,  and also  introduced some
new  uncertainties.  Although  the  decision  did not decide  whether  the First
Nations hold aboriginal title to the Queen Charlotte Islands, the judge accepted
to some degree that at least some of the lands are subject to  aboriginal  title
or rights and contingent on future land claims negotiations.


<page>

ITEM 5   OPERATING AND FINANCIAL REVIEW AND PROSPECTS

OVERVIEW

Taseko is currently an expenditure-based organization whose business strategy is
to acquire,  explore and conduct detailed  engineering and economic  analysis of
mineral  deposits which have large tonnage and multi-year  operation  potential.
None of Taseko's  currently held or to be acquired  mineral  deposits  currently
hosts mineralized material which can be said to be "ore" or feasibly economic at
current metals prices,  although the Gibraltar Mine, taken out of production and
put on standby in 1998 is capable  of near term  reactivation  if copper  prices
strengthen  significantly,  subject to $25  million in restart  costs  using its
current processing facilities. In addition, in 2000-2001, the Gibraltar Mine has
been the subject of research work,  described herein,  which could significantly
reduce  the  operating  cost per pound of copper  produced  but would  require a
significant (in excess of $100 million) capital investment.

Under Taseko's accounting policies (which are acceptable under Canadian and U.S.
generally     accepted     accounting      principles),      exploration     and
corporate/administrative   expenses   are  written   off  yearly  and   property
acquisition  expenses  deferred (or  capitalized).  Such  acquisition  costs are
written off when Taseko seeks to abandon a property due to  exploration  program
results that appear to warrant  abandonment or when it appears that the deferred
costs may not be recoverable. Acquisition costs and exploration expenditures are
usually financed through a combination of cash and common share issuances.

As an  expenditure-based  corporation,  Taseko's results of operations are often
evaluated on an "event  driven"  basis.  Results of operations  are difficult to
quantify  given that the  product of these  expenditures  relates to the nature,
extent and  statistical  confidence  (primarily  from diamond drill  exploration
programs) in a deposit's  size and  continuity.  It is difficult to evaluate the
success of operations in a fiscal year by reference to the financial statements,
given that  results  are more  appropriately  measured by an  evaluation  of the
minerals discovered and/or confirmed. Taseko's operating activities do not occur
on a regular or periodic  basis and are  subject to the  economic  realities  of
metals prices and equity financing  conditions for natural resource  exploration
issuers.  Accordingly,  it may not be  meaningful to seek  observable  trends in
financial  operating  statistics.  Although Taseko calculates an annual loss per
share  (which  has  varied  over a range of $0.21 to $2.32  over the last  three
fiscal  years),  Taseko  is of the view that its  share  price  does not vary in
accordance with the loss per share statistic but rather Taseko share prices vary
with the price of the underlying  market for copper and gold and the outlook for
these metals.


<page>

Taseko's financial statements are prepared on the basis that it will continue as
a going concern.  Given that Taseko has no source of significant  revenue,  this
assumption is always subject to the further  assumption that there will continue
to be investment interest in funding large tonnage metal deposits, which are not
known to be economic in the current  environment.  Taseko can give no  assurance
that it will  continue  to be able to raise  sufficient  funds and  should it be
unable to continue to do so, may be unable to realize on the  carrying  value of
its resource  project and the net realizable value could be materially less than
Taseko's liabilities with a potential for total loss to Taseko shareholders.

Taseko  does not  believe  that it is  significantly  impacted by the effects of
inflation and the Canadian dollar has fluctuated in a relatively  narrow band to
the United States dollar (US$1.00:  Cdn$1.61 to $1.45) during these three years.
During the years  presented,  the Company has not entered into foreign  currency
forward  contracts or other  derivatives to mitigate the impact of exchange rate
fluctuations on its operating  results.  For additional  details  respecting the
five-year   historical   exchange  rates,  see  Item  4.  Taseko  has  not  been
significantly  affected by government  economic,  fiscal,  monetary or political
policies,  and the outlook for Taseko's assets  primarily  relate to the outlook
for gold and  copper.  For  information  relating to the  historical  prices for
copper and gold, see "Item D, Trend Information" below.

OPERATING RESULTS

FISCAL 2002 COMPARED WITH FISCAL 2001

During the 2002 fiscal year,  Taseko received  $551,842 in interest  income,  as
compared to $1,110,431 for the 2001 fiscal year.  Interest  income  decreased in
2002 due to lower yields on investments.

Expenditures  in  fiscal  2002  were  $6.5  million,  which  were  significantly
decreased  from the $11.5  million spent in fiscal 2001.  The main  decreases in
fiscal 2002 were for exploration (2002 - $2.1 million;  2001 - $3.9 million) and
the refinery project (2002 - $1.7 million; 2001 - $3.6 million). Essentially all
of the exploration  expenditures in 2002 related to Gibraltar for mine planning,
associated with the monitoring concentrate contracts and other opportunities for
re-start of the mine,  and assessing  other  projects such as the landfill site;
and site activities, including reclamation and equipment maintenance.

Expenditures  also decreased in the following areas in fiscal year 2002:  legal,
accounting  and audit (2002 - $0.3  million;  2001 - $0.5  million),  consulting
(2002 - $0.1 million; 2001 - $1.8 million) and office and administration (2002 -
$0.2 million; 2001 - $0.7 million).

The  Company's  loss for the year is $6.5 million  compared to $58.2  million in
2001. The loss in 2001 was due primarily to asset write downs. Taseko previously
held an interest in the Harmony  project that was valued at $0.6  million.  This
interest was written down as part of the  acquisition of the remaining  interest
in the project in fiscal 2002, and constitutes part of the loss for the year.

FISCAL 2001 COMPARED WITH FISCAL 2000

During the 2001 fiscal year,  Taseko received $1.11 million in interest  income,
an increase  from $0.68  million  earned in the same  period of 2000,  due to an
increase in funds on deposit for future reclamation. The Company has spent $3.86
million on exploration and Gibraltar Mine care and maintenance  expenses,  $1.75
million on consulting  fees and $3.57 million on testwork and  feasibility-level
engineering  studies  related to the  Gibraltar  Refinery,  and $2.36 million on
corporate administration.

The  Company's  loss  before  other  items for  fiscal  2001 is $10.43  million,
compared to $5.91  million in fiscal  2000.  The  increase is largely due to the
expenditures on the Gibraltar  Refinery studies.  Due to the extended  depressed
conditions in the metal markets,  and in accordance with its accounting  policy,
the  Company  wrote down the  acquisition  costs of each of the  Prosperity  and
Gibraltar  projects to $1000 and wrote the inventory at Gibraltar  down to a net
realizable value (described above).

Office and administrative  costs (2001 - $0.68 million) have decreased over that
spent in fiscal 2000 (2000 - $0.80  million) as activities  have been focused on
Gibraltar.  Corporate  capital tax increased from $0.09 million in 2000 to $0.21
million in 2001,  as the 2001 balance  includes some capital for 2000 related to
the Gibraltar Mine.

Legal,  accounting and audit costs have increased in 2001 (2001 - $0.48 million;
2000 - $0.20 million) related to the costs for the Misty  transaction,  and also
to  additional  funding  activities,  documentation,  auditing  and legal  costs
associated with the Gibraltar Refinery studies.

Consulting  fees also  increased  from  $0.10  million  in fiscal  2000 to $1.75
million  in 2001,  and are  related  primarily  to fees for  services  to obtain
financial assistance for the Gibraltar CESL Refinery project. Approximately $1.4
million was paid and later  expensed  to Procorp  Services  Limited  Partnership
("Procorp"),  a  related  entity,  for  technical,   financial,  management  and
marketing  services for  development of the proposed  refinery at Gibraltar (see
Item 7B(b) and Liquidity and Capital  Resources - Fiscal 2001 Compared to Fiscal
2000 below).

Expenditures on exploration  and maintenance  over in fiscal 2001 have decreased
to $3.86  million  from $4.46  million in 2000.  The  breakdown  of  exploration
expenditures  to September 30, 2001 is $3.26 million on Gibraltar  (2000 - $3.38
million),  $0.39 million on Prosperity (2000 - $1.08 million), and $0.21 million
on the Westgarde property (2000 - $Nil).

Expenditures  on  Gibraltar in 2001 were  divided  between care and  maintenance
activities at site and engineering studies related to the  feasibility-level and
scoping-level  studies of the  hydrometallurgical  refinery described above. The
refinery  expenditures at fiscal year-end are reported separately (see paragraph
one above, and at December 31, 2001 see Liquidity and Capital Resources - Fiscal
2001 Compared to Fiscal 2000 below).  Site activities  ($2.50  million)  include
reclamation,  monitoring and  maintenance of tailing pond and plant  facilities,
and ongoing  water  treatment and  administrative  costs.  Care and  maintenance
costs, approximately $0.2 to $0.3 million per month, are expected to continue as
long as the mine is on standby.

Expenditures  on  geological  work for Gibraltar to September 30, 2001 are $0.55
million (2000 - $0.35 million); most expenses were incurred in the first half of
the year.  Activities  included direction of the geophysical (IP) survey at site
as well as interpretation of results and planning for follow up exploration, and
assessment of samples for metallurgical  testing and  environmental  studies for
the refinery.  A re-estimate  of the mineral  resources was also done during the
year.

Spending on Prosperity has decreased substantially from 2000 and early 2001 when
detailed engineering studies were underway. Mine planning (2001 - $0.15 million;
2000 - $0.11 million) and some  geological  work (2001 - $0.07  million;  2000 -
$0.03  million) were done in  conjunction  with these studies  mainly during the
first six months of the fiscal year.


<page>

B.       LIQUIDITY AND CAPITAL RESOURCES

OVERVIEW

Historically  Taseko's sole source of funding was the sale of equity  securities
for cash primarily  through private  placements to  sophisticated  investors and
institutions. As a consequence of the acquisition of the Gibraltar Mine in 1999,
Taseko also received  funding  pursuant to a $17 million  convertible  debenture
financing  commitment  executed  by Boliden  Westmin  (Canada)  Ltd. Of this $17
million  commitment,  Taseko received $4 million in fiscal 1999, $4.5 million in
fiscal  2000 and the $8.5  million  balance in fiscal  2001.  Taseko also issued
common  share  capital  in each of  fiscal  2000 and 1999  pursuant  to  private
placement financings and upon the exercise of warrants and/or options.  Taseko's
access to exploration  financing when it is not  transaction  specific,  such as
with  the  Gibraltar  Mine  acquisition,  is  always  uncertain.  Taseko  has no
assurance of continued access to significant equity funding.

FISCAL 2002 COMPARED TO FISCAL 2001

As a  consequence  of the  acquisition  of the  Gibraltar  Mine in 1999,  Taseko
received  funding  pursuant to a $17 million  non-interest  bearing  convertible
debenture  financing by Boliden Westmin (Canada) Ltd. Due to the  convertibility
of the debenture into common shares at the holder's or Taseko's option,  the $17
million  Gibraltar  debenture  is  classified  in the  equity  rather  than debt
accounts of Taseko's balance sheet.

The asset shown as reclamation  deposits,  totalling  $18.6  million,  including
interest,  is to be used at a later date for  reclamation  purposes at Gibraltar
and Harmony. As a result of progressive  reclamation work and a landfill project
reducing  liability costs at Gibraltar,  $2.5 million was released from the cash
reclamation fund subsequent to year-end, in December 2002.

At September  30,  2002,  the  reclamation  liability  was $32.7  million and is
secured by reclamation  deposits and plant and equipment.  The equity item shown
as  tracking  preferred  shares  is the book  value of the  12,483,916  tracking
preferred shares of Gibraltar which were part of the cost to acquire the Harmony
gold project from Misty  Mountain  Gold Ltd. The tracking  preferred  shares are
designed to track and capture the value of the  Harmony  gold  property  and are
convertible into common shares of the Company upon a realization event such as a
sale to a third party or commercial production at the Harmony gold property.

On March 28, 2002, the Company  announced that it had agreed to privately  place
2.1 million  shares with arm's length  creditors in order to settle  $840,000 of
liabilities,  and subsequently  received approval from the TSX Venture Exchange.
The settlement was completed during the third quarter of fiscal 2002.

At the end of August 2002,  the Company  completed a $190,815  financing (net of
issue costs) to privately  place 414,850 units at a price of $0.50 per unit with
sophisticated  investors  and  institutions  outside  of  Canada.  Each unit was
comprised of one common share and a common share purchase warrant exercisable at
$0.55 until December 27, 2003.  The common share purchase  warrants were subject
to a regulatory four month hold period and are subject to an accelerated  45-day
expiry if the  closing  price of the common  shares as traded on the TSX Venture
Exchange is at least $0.83 for any 10 consecutive trading days.

At September 30, 2002, Taseko had a working capital  deficiency of $4.3 million,
as compared to a deficiency  of $3.59  million at the end of the third  quarter.
The Company had 33,921,663 issued and outstanding common shares.

Subsequent  to  year-end,   in  December  2002,  Taseko  closed  equity  private
placements with Canadian investors of its securities totaling $4.24 million. The
placements  included $655,500 of common shares at a subscription  price of $0.30
per  common  share,  $1,269,600  of  units at a price of  $0.30  per  unit,  and
$2,315,000  of  flow-through   units  at  a  subscription  price  of  $0.40  per
flow-through   unit.   Each  unit   consisted   of  one  common  share  and  one
non-transferable common share purchase warrant. Each flow-through unit consisted
of one flow-through common share and one-half of a non-transferable common share
purchase warrant.

Each whole common  share  purchase  warrant  entitles the holder to purchase one
common  share at a price of $0.50 until  December  31,  2004.  The common  share
purchase  warrants  are  subject to a  regulatory  four month hold  period and a
45-day accelerated expiry if the closing price of the common shares as traded on
the TSX Venture Exchange is at least $0.75 for any 10 consecutive  trading days,
in which event the holder will be given notice of the expiry of the warrants.

Dundee  Securities  Corporation,   to  the  extent  of  $1,725,000,  and  Strand
Securities Corporation and certain other agents, to the extent of $250,000, have
collectively  acted as Agents for the private  placement of flow-through  units.
The Agents'  compensation  included a cash fee equal to 6% of the gross proceeds
and broker  warrants  entitling  them to purchase that number of common  shares,
which is equal to 6% of the  number  of  flow-through  units  sold.  The  broker
warrants  are  exercisable  at $0.40 per common share and expire on December 31,
2003.

The common shares, the flow-through common shares, the warrant common shares and
the broker warrant  common shares are subject to a hold period in Canada,  which
expires May 1, 2003.

The net proceeds of the units and common shares will be used for general working
capital and corporate  purposes.  Taseko will utilize the gross  proceeds of the
flow-through  financing  to  undertake  a program to follow up on  deposit-scale
targets outlined by geophysical surveys completed on the Gibraltar property, and
to evaluate other potential exploration projects that may be of interest.

The Gibraltar  Engineering Services Limited Partnership ("GESL Partnership") was
formed to conduct  engineering  and  contract  operation  service  support for a
determination of the feasibility of the CESL hydrometallurgical  copper refinery
process to be potentially  used at Gibraltar and possibly,  other similar copper
deposits in British  Columbia,  owned by third  parties,  but which also produce
copper in concentrate.

Partnership business expenses are shown in the Consolidated Schedule of Refinery
Project  Expenses.  As previously  disclosed,  $4.85 million was expended on the
Gibraltar Refinery Project in fiscal 2001 and in the 3 months ended December 31,
2001.  This amount  represents  work carried out by Taseko,  Gibraltar,  and HDI
personnel  and third party  contractors  retained by the GESL  Partnership,  and
billed by all those parties to the GESL Partnership. Of this work, $1.85 million
was actually  funded by GESL  Partnership  investors as of December 31, 2001 and
the  balance  by HDI,  which is owed the funds at that date by Hunter  Dickinson
Group  Inc.("HDGI")  a private  company  owned by family  trusts of  certain  of
Taseko's insiders..  HDGI had an investment in the GESL Refinery Process ("GRP")
Partnership,  and owned the majority of the remaining  outstanding  units of the
GESL  Partnership.  HDGI  subsequently  sold its interest in GESL in 2002 at its
cost of $3 million,  payable in tranches  until 2005,  to Vancouver  businessman
Norman  Cressey in an  arms-length  transaction.  As a  consequence  of Taseko's
decision to purchase this interest in GESL from Mr. Cressey in 2003, Taseko will
record a net decrease in its accounts  payable at that time of the equivalent to
about $3 million. As at September 30, 2002, the Company had incurred accumulated
expenditures of $5.3 million for the Refinery Project,  compared to $3.6 million
at September 30, 2001.

FINANCIAL INSTRUMENTS

Taseko  financed its  activities  from 1966 through 1999  primarily  through the
issuance of equity shares through private and public  distributions.  Certain of
these  financings  were structured to provide a Canadian income tax incentive to
make the  securities  more  attractive.  The  INCOME TAX ACT  (Canada)  provides
certain  incentives to encourage  exploration  on Canadian  resource  properties
including  the  deductibility  of  a  defined  class  of  "Canadian  Exploration
Expenses" and "Canadian  Development Expenses" which provide deductible pools of
resource  expenditures  deductible  against  other  sources of income.  In 1999,
Taseko also issued a convertible  debenture in conjunction  with the acquisition
of the Gibraltar Mine, which raised $17 million with a 10-year repayment horizon
and with  provisions  that  permit  the  debenture  to be  repaid at any time on
conversion  of the  liability  into common  shares or repaid in cash at Taseko's
option after the fifth year.  Accordingly,  the  debenture  has been recorded as
part of shareholders'  equity in the accompanying  financial  statements  rather
than a liability as would a conventional debenture.

Taseko keeps its financial instruments  denominated in Canadian dollars and does
not  engage in any  hedging  operations  with  respect  to  currency  or in-situ
minerals.  Funds that are  excess to  Taseko's  current  needs are  invested  in
government  of Canada or like debt  obligations  and other  short term near cash
investments pending the need for the funds.

Taseko does not have any  material  commitments  for capital  expenditures  and,
accordingly,  can remain somewhat flexible in gearing its exploration activities
to the  availability  of funds (although  administrative  expenses are likely to
remain at $200,000 per month and Gibraltar Mine standby costs will likely remain
in the  $200,000 to $300,000 per month  range).  As of the fiscal 2002 year end,
Taseko  estimates  that the cost of  maintaining  its  corporate  administrative
activities at approximately  $130,000 per month, and the minimum monthly cost to
ensure  that the  Gibraltar  Mine  remains  on care and  maintenance  (including
routine  environmental  monitoring)  is  approximately  $200,000 per month.  The
Company and its financial  advisors are actively targeting sources of additional
funding  through  alliances with  financial,  exploration and mining entities or
other  business  and  financial  transactions  which would  generate  sufficient
resources to assure  continuation  of the Company's  operations and  exploration
programs.  However,  there can be no  assurances  that the  Company  will obtain
additional  financial  resources  and/or achieve  profitability or positive cash
flows. If the Company is unable to obtain  adequate  additional  financing,  the
Company  will be  required to curtail  operations  and  exploration  activities.
Furthermore,  failure to  continue as a going  concern  would  require  that the
Company's assets and liabilities be restated on a liquidation basis, which would
differ significantly from the going concern basis.

Subsequent to year-end in December 2002, Taseko closed equity private placements
of its securities totalling $4.24 million.


<page>

C.       RESEARCH EXPENDITURES

Taseko is a resource  expenditure based corporation and,  accordingly,  does not
have a program of  intellectual  property  development or patenting or licensing
issues. Taseko has effectively incurred, in conjunction with Cominco Engineering
Services Ltd., and via Gibraltar  Engineering Services Ltd. Limited Partnership,
$5.3   million  to  explore   the   feasibility   of   employing   an   advanced
hydrometallurgical  process at the Gibraltar  Mine.  These  expenditures,  while
funded by third party investors, were eventually borne by Taseko as it purchased
the businesses that incurred the  expenditures  for shares of Taseko in 2002 and
2003.

D.       TREND INFORMATION

As a natural  resource  exploration  company,  Taseko's  activities are somewhat
cyclical as metals prices have  traditionally been cyclical in nature. The trend
for gold  prices  over the past few years has been  negative,  but in early 2002
there have been some price  improvements and widely read business  journals vary
in their  predictions for the gold price.  Copper is a metal used extensively in
the housing and automotive  industries;  demand for copper varies  directly with
general economic  conditions.  Although Taseko's management is not in a position
to forecast  economic  trends,  it is aware that as of March  2003,  widely read
business  periodicals  continue to predict economic  softness until at least mid
year, and hence Taseko does not anticipate a significant  change in the price of
copper or gold in the near term.  Taseko  believes  it has  sufficient  funds to
carry a minimum  level of activity  for the next two years,  which may provide a
period of time to seek additional sources of financing.

Copper  prices  decreased in 2002 due to the global  economic  slowdown.  Copper
prices  fluctuated  over the year in 2002 and  averaged  US$0.71 per pound,  but
began to  improve  at  year-end.  Prices  are  projected  to  increase  to about
US$0.90/lb by 2004.

The gold price increased  significantly in 2002, averaging US$308/oz compared to
about US$270/oz in 2001. Gold has continued its uptrend in early 2003,  reaching
as high as  US$380/oz  in January,  before  dropping  off to about  US$340/oz in
February and March 2003.

<page>

ITEM 6   DIRECTORS AND SENIOR MANAGEMENT

A.       DIRECTORS AND SENIOR MANAGEMENT

                                                                          SHARES
                                                                    BENEFICIALLY
NAME, POSITION AND                   PERIOD A DIRECTOR                  OWNED OR
PLACE OF RESIDENCE                   OF THE ISSUER                 CONTROLLED(1)
- ----------------------------------   --------------------------   --------------
Robert George Hunter(2)              Since January 19, 1991       225,800 Shares
Co-Chairman of the Board
and Director
Vancouver, B.C., Canada

Robert Allan Dickinson(3)            Since January 19, 1991        62,982 Shares
Co-Chairman of the Board
and Director
Lions Bay, B.C., Canada

Ronald William Thiessen              Since October 25, 1993        82,300 Shares
President, Chief Executive Officer
and Director
West Vancouver, B.C., Canada

Jeffrey Robert Mason                 Since March 21, 1994               - Shares
Chief Financial Officer,
Corporate Secretary and
Director
Vancouver, B.C., Canada

David James Copeland                 Since March 21, 1994          51,800 Shares
Director
Vancouver, B.C., Canada

Scott Dibblee Cousens                Since October 19, 1992       233,000 Shares
Director
Vancouver, B.C., Canada

T.  Barry Coughlan                   Since February 1, 2001             - Shares
Director
Vancouver, B.C., Canada

Thomas E. Milner                     Since March 28, 2003          24,812 Shares
Director
Williams Lake, B.C., Canada


- ----------
(1)  The  information  as to shares  beneficially  owned or controlled  has been
     furnished by insiders and is as of January 31, 2003.

(2)  All of these  shares are held in the name of 455501  B.C.  Ltd.,  a company
     controlled by Robert G. Hunter.

(3)  All of the shares are held  indirectly in the name of United Mineral
     Services Ltd., a company controlled by Robert A.  Dickinson.

(4)  As of January  31,  2003,  the total  beneficial  security  holdings of the
     current  directors  and  officers  are  655,882  shares  (which  represents
     approximately  1.4% of the  current  issued and  outstanding  shares)  plus
     30,000 options (one director) exercisable at $0.50 per share until June 26,
     2003, and 2,400,000 options exerciseable at $0.50 per share until September
     24, 2004 and 276,596 warrants at $0.58 per share until October 19, 2003 and
     183,333  warrants  exerciseable at $0.50 per share until December 31, 2004.
     (See Item 13)


<page>

PRINCIPAL OCCUPATION OF CURRENT MANAGEMENT OF TASEKO

RONALD W. THIESSEN, C.A.  - PRESIDENT, CHIEF EXECUTIVE OFFICER AND DIRECTOR

Ronald W. Thiessen is a Chartered Accountant in Canada and, for the past several
years has had, as his principal occupation, serving as a director and/or officer
of several  publicly-traded  mineral  exploration  companies.  Mr.  Thiessen  is
contracted by Hunter Dickinson Inc. (see Item 7), a company providing management
and  administrative  services  to several  publicly-traded  companies  including
Taseko,  and  he  focuses  on  directing  corporate  development  and  financing
activities. He is also a director of Hunter Dickinson Inc.

ROBERT G. HUNTER - CO-CHAIRMAN OF THE BOARD AND DIRECTOR

Robert G. Hunter has been active as a mining promoter headquartered in Vancouver
for a number of years and continues to be active in the mining business although
he now  semi-retired.  Mr.  Hunter does not have any  technical  credentials  in
mining but through years as a businessman and insurance executive, has developed
a network of venture capitalists in the mining field. Mr. Hunter has served as a
director of other public  companies listed at one time on the NASDAQ or Over the
Counter  Bulletin  Board,  TSX Inc.,  and TSX Venture  Exchange.  Mr.  Hunter is
Co-Chairman of Hunter Dickinson Inc.

ROBERT A. DICKINSON, B.SC., M.SC. - CO-CHAIRMAN OF THE BOARD AND DIRECTOR

Robert  A.  Dickinson  is an  economic  geologist  who  serves  as a  member  of
management of several mineral  exploration  companies,  primarily those for whom
Hunter Dickinson Inc. provides  services.  He holds a Bachelor of Science degree
(Hons.  Geology)  and a Master of  Science  degree  (Business  Administration  -
Finance) from the University of British  Columbia.  Mr.  Dickinson has also been
active  in  mineral  exploration  over 36  years.  He is a  director  of  Hunter
Dickinson  Inc. He is also  President  and Director of United  Mineral  Services
Ltd., a private investment company.

JEFFREY R. MASON, CA - CHIEF FINANCIAL OFFICER, CORPORATE SECRETARY AND DIRECTOR

Jeffrey R. Mason  holds a Bachelor of Commerce  degree  from the  University  of
British  Columbia  and  obtained  his  Chartered  Accountant  designation  while
specializing  in  the  mining,   forestry  and  transportation  sectors  at  the
international  accounting firm of Deloitte & Touche.  Following  comptrollership
positions at an  international  commodity  mercantilist and the Homestake Mining
Group of companies including  responsibility for North American Metals Corp. and
the Eskay  Creek  Project,  Mr.  Mason has  spent  the last  several  years as a
corporate   officer  and   director  to  a  number  of   publicly-traded   (TSX,
NASDAQ/OTCBB,  TSX Venture)  mineral  exploration  companies.  Mr. Mason is also
employed as Chief  Financial  Officer and director of Hunter  Dickinson Inc. and
his principal occupation is the financial administration of the public companies
for which Hunter Dickinson Inc. provides services.

SCOTT D. COUSENS - DIRECTOR

Scott D. Cousens  provides  management,  technical and  financial  services to a
number of publicly  traded  companies.  Mr. Cousens' focus for the past 14 years
has been the development of relationships  within the  international  investment
community.   Substantial   financings  and  subsequent   corporate  success  has
established  strong ties with North American,  European and Asian investors.  In
addition to financing initiatives he also oversees the corporate  communications
programs for the public  companies for which Hunter  Dickinson Inc. (to which he
is a director) provides services.

 DAVID J. COPELAND, P.ENG.  - DIRECTOR

David J.  Copeland is a geological  engineer who  graduated in economic  geology
from the University of British Columbia.  With over 30 years of experience,  Mr.
Copeland  has  undertaken  assignments  in  a  variety  of  capacities  in  mine
exploration,  discovery and  development  throughout the South Pacific,  Africa,
South  America and North  America.  His  principal  occupation  is President and
Director of CEC Engineering Ltd., a consulting engineering firm that directs and
co-ordinates advanced technical programs for exploration on behalf of Taseko and
other companies for which Hunter Dickinson Inc. provides services.  He is also a
director of Hunter Dickinson Inc.

T. BARRY COUGHLAN, B.A.

T. Barry Coughlan is a self-employed  businessman and financier who, for over 18
years, has been involved in the financing of companies on the Vancouver, Toronto
and NASDAQ Stock Exchanges.  His principal  occupation is President and Director
of TBC Investments Ltd., a private investment company. He is not employed by nor
is he a director of Hunter  Dickinson Inc. Mr.  Coughlan  served as president of
the general partner of Concentrated Exploration Limited Partnership.

THOMAS E. MILNER, P.ENG.

Tom  Milner  is a  Professional  Engineer  with  a  Bachelors  degree  in  Civil
Engineering  and a Masters  Degree in  Mining  Engineering,  who has 30 years of
experience in mine project development and mine operations management in British
Columbia and the Philippines.  Mr. Milner has been with the Gibraltar Mine since
1994, and is currently Chief  Operating  Officer and Director of Gibraltar Mines
Ltd., a wholly-owned subsidiary of Taseko Mines Limited.


<page>

B.       COMPENSATION

During  Taseko's  financial year ended  September 30, 2002 the aggregate  direct
remuneration paid or payable to Taseko's directors and senior officers by Taseko
and its  subsidiaries,  all of whose financial  statements are consolidated with
those of Taseko, was $185,204.  This figure includes any portion of remuneration
received by the named person as an officer or employee of Hunter  Dickinson Inc.
that is  attributable  to  Taseko's  affairs.  The direct  remuneration  paid or
payable to Company's  directors and senior  officers by  subsidiaries of Taseko,
whose financial statements are not consolidated with those of Taseko, except for
Mr. Milner who was appointed a director after the 2002 year end, was nil.

Robert G.  Hunter,  Co-Chairman  of the Board of  Directors  and a  director  of
Taseko,  Robert  A.  Dickinson,  Co-Chairman  of the  Board of  Directors  and a
director of Taseko, Ronald W. Thiessen, President, Chief Executive Officer and a
director  of Taseko,  Jeffrey R.  Mason,  Taseko's  Secretary,  Chief  Financial
Officer and a director of Taseko, and Thomas E. Milner,  Chief Operating Officer
and  Director of  Gibraltar  Mines Ltd, a  wholly-owned  subsidiary,  are each a
"Named  Executive   Officer"  of  Taseko  for  the  purposes  of  the  following
disclosure.


<page>

The  compensation  paid to each of the Named Executive  Officers during Taseko's
three most recently completed financial years is as set out below:

<table>
<caption>

                                            SUMMARY COMPENSATION TABLE
- ------------------------------------------------------------------------------------------------------------------------------------
                                                  ANNUAL COMPENSATION                       LONG TERM COMPENSATION
                                          ----------------------------------  ------------------------------------------------------
                                                                                         AWARDS                   PAYOUTS
                                                                             --------------------------- ---------------------------
                                                                             SECURITIES
                                                                                  UNDER      RESTRICTED
                                                                        OTHER  OPTIONS/       SHARES OR
                                                                       ANNUAL      SARs      RESTRICTED        LTIP        ALL OTHER
NAME AND PRINCIPAL                            SALARY      BONUS  COMPENSATION   GRANTED     SHARE UNITS     PAYOUTS     COMPENSATION
POSITION                            YEAR         ($)        ($)        ($)                         ($)         ($)             ($)
- ------------------------------------------------------------------------------------------------------------------------------------
<s>                                 <c>       <c>        <c>          <c>       <c>              <c>         <c>            <c>
Robert G  Hunter                    2002      14,463       --          --       400,000            --          --               --
Co-Chairman of the                  2001      12,539       --          --          --              --          --               --
Board and Director                  2000      18,694       --          --          --              --          --               --
- ------------------------------------------------------------------------------------------------------------------------------------
Robert A  Dickinson                 2002       9,256       --          --       400,000            --          --               --
Co-Chairman of the                  2001       8,025       --          --          --              --          --               --
Board and Director                  2000      11,964       --          --          --              --          --               --
- ------------------------------------------------------------------------------------------------------------------------------------
Ronald W  Thiessen                  2002      14,463       --          --       400,000            --          --               --
Chief Executive                     2001      12,539       --          --          --              --          --               --
Officer, President                  2000      18,694       --          --          --              --          --               --
and Director
- ------------------------------------------------------------------------------------------------------------------------------------
Jeffrey R  Mason                    2002      14,463       --          --       400,000            --          --               --
Secretary and Chief                 2001      12,539       --          --          --              --          --               --
Financial Officer                   2000      18,694       --          --          --              --          --               --
and Director
- ------------------------------------------------------------------------------------------------------------------------------------
Thomas E  Milner                    2002        --         --       101,920      50,000            --          --               --
Chief Operating                     2001        --         --       100,955        --              --          --               --
Officer and                         2000        --         --       107,560        --              --          --               --
Director of
Gibraltar Mines
Ltd, a wholly-owned
subsidiary
- ------------------------------------------------------------------------------------------------------------------------------------
</table>


The foregoing  table is exclusive of US$128,000  received by each person (except
Mr.  Milner) in 2000 as a  consequence  of a payment  made to a non-arms  length
partnership  in which they were involved  which was seeking to raise  additional
funding and provide technical,  financial,  management and marketing services to
pursue a copper refining  technology of potential use at the Gibraltar Mine (see
item 6b). On September 28, 2000 Robert A. Dickinson retired as President and CEO
of Taseko Mines  Limited,  and was elected  Co-Chairman.  Ronald W. Thiessen was
appointed  President and CEO on September 28, 2000 but was not a Named Executive
Officer during 1999 and 1998.

Share options  granted to Executive  Officers  during the  financial  year ended
September  30, 2002 total  2,800,000.  No options  were  exercised  by the Named
Executive Officers during the financial year ended September 30, 2002. The value
of the  unexercised  in-the-money  options  was Nil at  September  30,  2002 and
$170,100 at January 31, 2003.


<page>

TERMINATION OF EMPLOYMENT, CHANGE IN RESPONSIBILITIES AND EMPLOYMENT CONTRACTS

There  are no  compensatory  plans or  arrangements  with  respect  to the Named
Executive  Officers  resulting  from the  resignation,  retirement  or any other
termination  of employment  of the officer's  employment or from a change of the
Named Executive Officer's responsibilities following a change in control.

SECURITIES HELD BY INSIDERS

As at  January  31,  2003,  the  directors  and  officers  of  Taseko  and their
affiliates held as a group, directly and indirectly, own or control an aggregate
of 655,882 common shares (1.4%) and hold 2,430,000  options and 459,259 warrants
to acquire an  additional  2,889,259  common  shares.  To the  knowledge  of the
directors  and  officers  of  Taseko,  as at such  date,  there  were no persons
exclusive of directors  and officers  holding more than 10% of the issued common
shares.

C.       BOARD PRACTICES

All directors were  re-elected at the March 28, 2002 annual general  meeting and
have a term of office expiring at the next annual general meeting of Taseko held
on March 28,  2003.  All  officers  have a term of office  lasting  until  their
removal or replacement by the Board of Directors.

There are no arrangements  under which directors were  compensated by Taseko and
its  subsidiaries  during the financial year ended  September 30, 2002 for their
services  in their  capacity  as  directors  and  consultants  except  as herein
disclosed.  For the year  ended  September  30,  2002,  Taseko  compensated  its
directors  directly for  services by paying them an  aggregate of $83,284  cash.
Taseko paid $16,175 to a private  engineering company owned by David J. Copeland
for engineering services provided during the year.

Ronald W.  Thiessen,  David J.  Copeland and Scott D. Cousens are members of the
Company's  audit  committee.  The audit  committee  is elected  annually  by the
directors of Taseko at the first meeting of the board held after Taseko's annual
general meeting.  Its primary function is to review the financial  statements of
the  Company  before they are  submitted  to the board for  approval.  The audit
committee  is also  available  to assist  the  board if  required  with  matters
relating to the  appointment of the Company's  auditor and the overall scope and
results of the audit, internal financial controls, and financial information for
publication for various purposes.  The Company has no remuneration or nomination
committee.

D.       EMPLOYEES

At January  31,  2003,  Taseko had 9 direct  employees  working  for  Gibraltar.
Taseko's  administrative  and exploration  functions are primarily  administered
through Hunter Dickinson Inc. (see Item 7).


<page>

E.       SHARE OWNERSHIP

As at January 31, 2003, an aggregate of 4,250,000  shares have been reserved for
issuance  pursuant to Taseko's Share  Incentive  Plan,  described  below,  which
reserves up to 4,440,000 shares for issuance.

(a)      INCENTIVE OPTIONS

<table>
<caption>
                                   NUMBER OF     EXERCISE
OPTIONHOLDER                          SHARES  NOTE  PRICE   DATE OF GRANT   EXPIRY DATE
- ---------------------------------  ---------  ----  ------  --------------  --------------
<s>                                   <c>          <c>     <c>             <c>
Directors and Officers of the         30,000       $ 0.50  June 26, 2001   Jun 26, 2003
Corporation and its Subsidiaries   2,400,000       $ 0.50  May 22, 2002    Sept  24, 2004

Employees and Consultants             35,000 (1)   $ 0.50  Dec  19, 2002   Sept  24, 2004
                                      15,000 (2)   $ 0.50  Feb  12, 2001   Sept  24, 2004
                                      50,000 (5)   $ 0.50  Jun 11, 2001    June 11, 2003
                                      65,000 (3)   $ 0.50  June 11, 2001   Sept  24, 2004
                                      35,000 (4)   $ 0.50  Dec  20, 2001   Sept  24, 2004
                                   1,445,000       $ 0.50  May 22, 2002    Sept  24, 2004
                                     175,000       $ 0.40  Dec  10, 2002   Dec  20, 2004
                                   ---------
                                   4,250,000
                                   =========
</table>


No share incentive options were exercised in fiscal 2002.

On May 22, 2002:

1.       35,000  options were  repriced from $1.25 to $0.50 per share and expiry
         changed from Sept. 29, 2002 to Sept. 24, 2002.

2.       15,000  options were  repriced from $1.24 to $0.50 per share and expiry
         extended to Sept. 24, 2004.

3.       65,000  options were  repriced  from $1.01to $0.50 per share and expiry
         changed from June 11, 2003 to Sept. 24.

4.       35,000  options were  repriced from $1.01 to $0.50 per share and expiry
         changed from Sept. 27, 2002 to Sept. 24, 2004.

On December 24, 2001:

5.       50,000 options were repriced from $1.01 to $0.50 per share


<page>

(b)      SHARE INCENTIVE PLAN

In order to provide incentive to directors, officers, employees,  management and
others who provide  services to Taseko to act in the best  interests  of Taseko,
Taseko has adopted a Share Incentive Plan (the "Plan").  The Plan was originally
approved by  shareholders  at Taseko's  annual general  meeting held on March 8,
1999, and a resolution  increasing  the number of shares  available for issuance
under the Plan was approved by shareholders on March 20, 2000 (the "2000 Plan").
Under the 2003 Plan,  a total of  8,200,000  shares of Taseko were  reserved for
share  incentive  options to be granted at the  discretion of Taseko's  board of
directors  to  eligible  optionees  (the  "Optionees").  At  the  date  of  this
Registration  Statement,  a total  of  4,250,000  share  incentive  options  are
outstanding  under the Plan of which  2,430,000  options  have been  granted  to
insiders,   and  3,950,000  shares  remain  available  for  issuance  to  future
Optionees.

MATERIAL TERMS OF THE 2000 PLAN

ELIGIBLE OPTIONEES

Under TSX Venture  policy,  to be eligible  for the  issuance of a stock  option
under the 2000 Plan an Optionee  must either be a director,  officer,  employee,
consultant or an employee of a company providing management or other services to
Taseko or its subsidiary at the time the option is granted.

Options  may be granted  only to an  individual  or to a company  that is wholly
owned by individuals eligible for an option grant. If the option is granted to a
company,  the company must provide TSX Venture with an undertaking  that it will
not permit any transfer of its shares,  nor issue further  shares,  to any other
individual  or entity as long as the  incentive  stock option  remains in effect
without the consent of TSX Venture.

MATERIAL TERMS OF THE PLAN

The following is a summary of the material terms of the 2000 Plan

(1)      all  options  granted  under  the  2000  Plan  are  non-assignable  and
         non-transferrable and are up to a period of 10 years;

(2)      for stock options granted to employees or service providers  (inclusive
         of management company employees),  Taseko is required to represent that
         the  proposed  Optionee  is a bona fide  employee  or service  provider
         (inclusive of a management  company  employee),  as the case may be, of
         Taseko or of any of its subsidiaries;

(3)      The Company has a share purchase  option  approval plan approved by the
         shareholders  that allows it to grant  options,  subject to  regulatory
         terms  and  approval,  to  its  employees,   officers,   directors  and
         non-employees. The exercise price of each option can be set equal to or
         greater than the closing  price of the common shares on the TSX Venture
         on the day  prior  to the  date of the  grant  of the  option  less the
         applicable  discount  according to TSX Venture policy.  An option has a
         maximum  term  of ten  years  and  terminates  30  days  following  the
         termination  of  the  optionee's  employment,  except  in the  case  of
         retirement or death. In the case of retirement,  it terminates 30 to 90
         days, at management's discretion,  following retirement. In the case of
         death,  it terminates at the earlier of one year after the event or the
         expiry of the option.  Vesting of options is done at the  discretion of
         the Board at the time the  options  are  granted;  and (d) the  minimum
         exercise  price of an  option  granted  under the 2000 Plan must not be
         less than the closing price for Taseko's common shares as traded on the
         TSX Venture on the last  trading day before the date that the option is
         granted less  allowable  discounts as permitted by TSX Venture of up to
         25% (depending on the price at the time of grant).

Taseko has obtained  "disinterested"  shareholders' approval and therefore under
TSX Venture  policy:

o        the number of options  granted to  Insiders of Taseko may exceed 10% of
         Taseko's  outstanding  listed shares; o the aggregate number of options
         granted to Insiders  of Taseko  within a one year period may exceed 10%
         of Taseko's outstanding listed shares; and

o        the number of options  granted to any one  Insider  and such  Insider's
         associates  within  a  one  year  period  may  exceed  5%  of  Taseko's
         outstanding listed shares.

but always subject to the aggregate limit of 4,440,000 shares.

DISINTERESTED SHAREHOLDER APPROVAL ("DSA")

"Disinterested  shareholder  approval"  means the  approval by a majority of the
votes cast by all shareholders of Taseko at the shareholders'  meeting excluding
votes  attached to listed  shares  beneficially  owned by  "Insiders"  of Taseko
(generally  officers  and  directors)  to whom the DSA Options have been granted
under the 2000 Plan and Associates of those Insiders.


<page>

ITEM 7   MAJOR SHAREHOLDERS AND RELATED PARTY TRANSACTIONS

A.       MAJOR SHAREHOLDERS

Taseko's  securities  are  recorded  on the  books  of  its  transfer  agent  in
registered form. However, the majority of such shares are registered in the name
of  intermediaries  such as brokerage  houses and  clearing  houses on behalf of
their respective brokerage clients, and Taseko does not have knowledge or access
to  information  about  of the  beneficial  owners  thereof.  To the best of its
knowledge,  Taseko  is not  directly  or  indirectly  owned or  controlled  by a
corporation or foreign government. As of January 31, 2003, Taseko had authorized
100,000,000  common shares without par value of which 46,434,164 were issued and
outstanding.

As of January 31, 2003, the only  registered  holder of 5% or more of the common
shares of Taseko are brokerage clearinghouses.

As of January 31, 2003,  directors and officers of Taseko as a group (7 persons)
owned or  controlled  an  aggregate  of  655,862  shares  (1.4%) of  Taseko,  or
3,545,121 shares (7.6%) on a fully diluted basis.

Under  the  British  Columbia  SECURITIES  ACT  insiders  (generally   officers,
directors,  holders of 10% or more of  Taseko's  shares)  are  required  to file
insider  reports of changes in their  ownership in the next 10 days  following a
trade in Taseko's  securities.  Copies of such reports are  available for public
inspection at the offices of the British  Columbia  Securities  Commission,  701
West Georgia Street, Vancouver,  British Columbia V7Y 1L2 (phone (604) 899-6500)
or at the British Columbia Securities Commission web site (www.bcsc.bc.ca).

As of January 31, 2003, there were 632 registered shareholders of record holding
a total of 46,434,164 common shares of Taseko. To the best of Taseko's knowledge
there were 174 registered  shareholders of record with  registered  addresses in
Canada,  444  shareholders  of record with  registered  addresses  in the United
States  and 14  shareholders  of  record  with  registered  addresses  in  other
countries  holding  approximately  30,873,527  (66.5%),  15,177,686  (32.7%) and
382,951  (0.80%)  of  the  outstanding  common  shares,   respectively.   Shares
registered  in  intermediaries  were assumed to be held by residents of the same
country in which the clearing house is located.

The only  potential  change  of  control  affecting  Taseko  is the  convertible
debenture for $17 million issued to Boliden (see Gibraltar - Acquisition Terms).
Taseko has no reason to believe  Boliden has any  intention  of  converting  the
debenture  or  exercising  any control  over Taseko in the  foreseeable  future.
Boliden does not have, and has not requested,  representation  on Taseko's board
of directors.  As a consequence  of Taseko's  decision in March 2003 to purchase
for $3.5 million the 61% portion of the GESL business,  which it did not acquire
in 2002,  Vancouver  businessman  Norman Cressey will receive  7,446,809  common
shares of Taseko in April 2003.  Mr Cressey has no stated  intention to exercise
any control over Taseko and has no representative on the board.


<page>

B.       RELATED PARTY TRANSACTIONS

No director or senior  officer,  and no associate or affiliate of the  foregoing
persons,  and no  insider  has or has  had  any  material  interest,  direct  or
indirect, in any other transactions, or in any other proposed transaction, which
in either such case has materially  affected or will materially affect Taseko or
its predecessors during the year ended September 30, 2002, except as follows:

(a) Arrangements with Hunter Dickinson Inc.

Taseko does not have full-time  management or employees.  Hunter  Dickinson Inc.
("HDI")  provides  management  and  other  services  to  Taseko,  pursuant  to a
geological and  administrative  services  agreement dated for reference December
31, 1996.  HDI is one of the larger  independent  mining  exploration  groups in
North America and as of December 31, 2002 employs or retains on a  substantially
full-time   basis,   16    geoscientists    (of   which   6   are   professional
geoscientists/P.Geo.,  3 are geological engineers/P.Eng.  and 2 have a Ph.D.), 1
licensed  professional  mining engineers  (P.Eng.),  7 accountants  (including 4
Chartered   Accountants   and  1  Certified   Management   Accountant)   and  16
administrative  staff. It has supervised mineral exploration  projects in Canada
(British Columbia,  Manitoba, Ontario and Quebec) and internationally in Brazil,
Chile,  Nevada and Alaska USA, Mexico and South Africa.  HDI allocates the costs
of staff input into  projects like  Gibraltar  based on time records of involved
personnel.  The  shares of HDI are owned  equally  by each of the  participating
corporations  (including  Taseko)  as long as HDI  services  are being  provided
however such participant  surrenders its single share at the time of termination
of the "Services  Agreement" described below. HDI is managed by the directors of
Taseko and who are generally the  controlling  directors of the other  corporate
participants in the arrangements with of HDI.

During the fiscal year ended  September 30, 2002 Taseko paid $574,892 to HDI for
services  pursuant to this  Agreement.  During  fiscal 2002,  HDI also  provided
engineering and other services,  including  contracting with  independent  third
party contractors  covering concentrate  production,  metallurgy and pilot plant
testwork, in the amount of $1.7 million (as compared to $3.6 million in 2001) to
the Gibraltar  Engineering  Services  Limited  Partnership at industry  standard
rates. (See Item 5B).

(b) Initiatives respecting copper refining technology research

Taseko insiders have had a financial  interest in two initiatives to advance the
copper refining engineering for potential use with a possible  recommencement of
Gibraltar Mine  operations.  By agreement  dated for reference  October 31, 2000
between Taseko and Gibraltar and a British  Columbia  limited  partnership to be
renamed  Procorp  Services  Limited  Partnership  ("Procorp"),  Procorp  was  to
establish a specialized  exploration  limited  partnership to provide technical,
financial,  management and marketing  services with the objective of securing up
to $60  million  which  would be used to fund  the  estimated  restart  costs at
Gibraltar ($30 million) and  approximately $30 million to fund Gibraltar's share
of  construction  and initial  operations of a refining plant which would employ
the CESL technology being reviewed by the Company together with CESL pursuant to
the Memorandum of Agreement described herein.  Procorp was initially established
by the  directors of Taseko  (excluding  Mr Milner)  whose family trusts are the
initial  beneficial  limited  partners  with  a view  that  Procorp  would  seek
additional  investment via additional  limited  partners who would fund business
expenses in  furtherance  of the restart  and CESL costs  entitling  them to tax
deductions for initial  expenses as well as a share of profits in the event of a
successful  Gibraltar Mine restart.  Procorp  received a payment of US $900,000,
which was charged to income as an administrative expense in 2002. These insiders
also have an interest in HDGI and its  transactions in respect of GESL described
in Items 4 and 5b.

(c)      Acquisition of the Harmony Project

On March 29, 2001,  shareholders of Taseko approved the acquisition by Taseko of
a 100% interest in the Harmony Project from Continental (see Item 4). A majority
of directors  of Taseko are also  directors  and  shareholders  of  Continental.
Robert A.  Dickinson,  a director of Taseko,  is a  shareholder  of  Continental
(481,620 shares) and a former  director.  (See Item 4 and Taseko's Annual Report
on Form 20-F for the year ended September 30, 2000 for further details.)

C.       INTERESTS OF EXPERTS AND COUNSEL

Not applicable.


<page>

ITEM 8   FINANCIAL INFORMATION

A.       CONSOLIDATED STATEMENTS AND OTHER FINANCIAL INFORMATION

See "Item 17 Financial Statements".

LEGAL PROCEEDINGS

Taseko is not involved in any  litigation or legal  proceedings  and to Taseko's
knowledge,  no material legal  proceedings  involving Taseko or its subsidiaries
are to be initiated against Taseko.

DIVIDEND POLICY

The Company has not paid any  dividends on its  outstanding  common shares since
its  incorporation and does not anticipate that it will do so in the foreseeable
future. All funds of Taseko are being retained for exploration of its Projects.

B.       SIGNIFICANT CHANGES

There have been no significant changes to the accompanying  financial statements
since September 30, 2002 which are not disclosed in those statements. ITEM 9 THE
OFFER AND LISTING


<page>

A.       OFFER AND LISTING DETAILS

TRADING MARKETS

TSX VENTURE: TKO - Trading in Canadian Dollars
- -----------------------------------------------------------------------------
                                                            High         Low
                                                            ----        ----
ANNUAL
2002 ..................................................     0.85        0.36
2001 ..................................................     1.69        0.36
2000 ..................................................     3.10        1.20
1999 ..................................................     5.45        1.80
1998 ..................................................     4.25        1.45
1997 ..................................................     8.25        3.50
1996 ..................................................    11.00        5.80

BY QUARTER
Calendar 2000
   First Quarter ......................................     3.10        1.50
   Second Quarter .....................................     2.34        1.45
   Third Quarter ......................................     1.60        1.20
   Fourth Quarter .....................................     2.00        1.30

Calendar 2001
   First Quarter ......................................     1.69        1.00
   Second Quarter .....................................     1.55        0.85
   Third Quarter ......................................     1.15        0.52
   Fourth Quarter .....................................     0.66        0.36

Calendar 2002
   First Quarter ......................................     0.60        0.36
   Second Quarter .....................................     0.85        0.36
   Third Quarter ......................................     0.63        0.40
   Fourth Quarter .....................................     0.47        0.36

Calendar 2003
    First Quarter  (to Mar. 15) .......................     0.64        0.40

MONTHLY

March 2003 (to Mar. 15) ...............................     0.50        0.43
February 2003 .........................................     0.57        0.44
January 2003 ..........................................     0.64        0.40
December 2002 .........................................     0.42        0.36
November 2002 .........................................     0.42        0.37
October 2002 ..........................................     0.47        0.39
September 2002 ........................................     0.50        0.46
August 2002 ...........................................     0.59        0.45


NASDAQ: TKOCF - Trading in United States Dollars
- -----------------------------------------------------------------------------
                                                            High         Low
                                                            ----        ----
ANNUAL
2002 ..................................................     0.60        0.20
2001 ..................................................     1.16        0.24
2000 ..................................................     2.25        0.56
1999 ..................................................     4.00        1.00
1998 ..................................................     3.00        0.94
1997 ..................................................     6.00        2.41
1996 ..................................................     8.13        4.25

BY QUARTER
Calendar 2000
   First Quarter ......................................     2.25        1.00
   Second Quarter .....................................     1.56        1.00
   Third Quarter ......................................     1.28        0.56
   Fourth Quarter .....................................     1.31        0.78

Calendar 2001
   First Quarter ......................................     1.16        0.59
   Second Quarter .....................................     1.05        0.56
   Third Quarter ......................................     0.71        0.35
   Fourth Quarter .....................................     0.41        0.24

Calendar 2002
    First Quarter .....................................     0.40        0.23
    Second Quarter ....................................     0.60        0.24
    Third Quarter .....................................     0.44        0.26
    Fourth Quarter ....................................     0.31        0.20

Calendar 2003
   First Quarter (to Mar. 15) .........................     0.41        0.25

MONTHLY

March 2003 (to Mar. 15) ...............................     0.33        0.30
February 2003 .........................................     0.38        0.30
January 2003 ..........................................     0.41        0.25
December 2002 .........................................     0.27        0.20
November 2002 .........................................     0.28        0.22
October 2002 ..........................................     0.31        0.23
September 2002 ........................................     0.35        0.28
August 2002 ...........................................     0.37        0.28



B.       PLAN OF DISTRIBUTION

Not applicable.

C.       MARKETS

The shares of Taseko  have  traded in Canada on the  Canadian  Venture  Exchange
(successor  Exchange to the  Vancouver  Stock  Exchange)  since March 10,  1969,
(symbol-TKO)  and since March 1992 on the  National  Association  of  Securities
Dealers Automated  Quotation (NASDAQ) System,  "Regular Market." On November 30,
1994, the shares of Taseko were listed on the NASDAQ  National  Market and since
July 6 2001,  have been listed in the  Over-the-Counter  Bulletin  Board (symbol
TKOCF).

D.       SELLING SHAREHOLDERS

Not applicable.

E.       DILUTION

Not applicable.

F.       EXPENSES OF THE ISSUE

Not applicable.


<page>

ITEM 10  ADDITIONAL INFORMATION

A.       SHARE CAPITAL

Taseko's share capital consists of one class only,  namely common shares without
par value,  of which  100,000,000  shares are authorized  and 33,921,663  common
shares without par value are issued and outstanding as of September 30, 2002 and
46,434,164  outstanding  as at March 15,  2003.  The  notes to the  accompanying
audited financial  statements provide details of all share issuances effected by
Taseko in the issue price per share for the three previous  fiscal years.  There
are no shares of Taseko that are held by or on behalf of Taseko. There have been
no  changes  in  the   classification   of  common  shares   (reclassifications,
consolidations,  reverse splits or the like) within the previous five years. All
common  shares of Taseko  rank pari passu for the payment of any  dividends  and
distributions  in  the  event  of a  windup.  A  summary  of  Taseko's  dilutive
securities (convertible or exercisable into common shares) is as follows:

(A)      WARRANTS

The following share purchase warrants are outstanding as of the date hereof. All
warrants were issued as part of a unit private placement  comprising a share and
a warrant. All warrants are non-transferable.

NO. OF           EXERCISE     EXPIRY
WARRANTS            PRICE     DATE          REF
- ---------        --------     ------------- ---
  276,596        $   0.58     Oct 19, 2003
  375,000        $   0.40     Jan 8, 2006
  302,250        $   0.40     Dec. 31, 2003 (2)
7,393,751        $   0.50     Dec. 31, 2004 (2)
  414,850        $   0.55     Dec. 27, 2003 (3)

- ----------
NOTES:

(1)  Each Warrant is exercisable into one Share of Taseko.

(2)  If anytime after May 1, 2003 the closing trading price of the Taseko common
     shares on the TSX  Venture is greater  than or equal to a trigger  price of
     $0.75 per share for 10  consecutive  trading days, the holder will be given
     notice that the  warrants  will expire 45 days  following  the date of such
     notice.

(3)  The  warrants  are subject to an  accelerated  expiry in the event that the
     Company's common share trade a trigger price, which is a 50% premium to the
     warrant  price  based on the  10-day  average  closing  trade  price of the
     Company's  common  shares.  If the  trigger  price is  achieved  before the
     one-year expiry date, but after the four-month hold period,  holders of the
     warrants will e notified in writing and the remaining  term of the warrants
     of the Company will be shortened to 45 days, but the exercise price will be
     unaffected.

 OTHER POTENTIAL SHARE ISSUANCES

A summary of Taseko's diluted share capital as follows:

(a)        issued as of January 31, 2003      46,434,164
(b)        options outstanding                 4,250,000
(c)        warrants outstanding                8,762,447
(d)        Boliden convertible debenture
           (maximum issuable)                  4,370,180
                                            ------------
Fully diluted at March 15, 2003               63,816,791
                                            ============

See Item 6E for information regarding Taseko's Share Incentive Plan.

The number of Taseko shares potentially  issuable on conversion of the Gibraltar
Shares  pursuant  to  the  Harmony  Project   Acquisition  cannot  currently  be
determined  exactly  due to the  uncertainty  of future  events  at the  Harmony
Project,  however the figure is in the range of 2 to 18 million  Taseko  Shares.
(See Item 4 -Acquisition  of the Harmony  Project).  See also Item 7B - proposed
transaction  with  Procorp  which may  result  in the  issuance  of 3.4  million
warrants exercisable at a price of $1.70 each.

B.       MEMORANDUM AND ARTICLES OF ASSOCIATION

Taseko's corporate constituting documents comprising Articles of Association and
Memorandum are registered with the British Columbia Registrar of Companies under
Corporation No. 69082. A copy of the Articles of Association and Memorandum were
filed as an exhibit with Taseko's initial registration statement on Form 20-F in
1994.

OBJECTS AND PURPOSES

Taseko's Memorandum of Incorporation and Articles of Association ("Articles") do
not specify  objects or purposes.  Under  British  Columbia  corporate  law (the
British Columbia COMPANY ACT or herein "BCCA"),  a British Columbia  corporation
generally  has all the  legal  powers  of a  natural  person.  British  Columbia
corporations  may not undertake  certain  limited  business  activities  such as
operating  as a trust  company or railroad  without  alterations  to its form of
articles and specific government consent.

DIRECTORS - POWERS AND LIMITATIONS

Taseko's  Articles do not specify a maximum  number of  directors  (the  minimum
under  British  Columbia  law for a public  company  is  three).  The  number of
directors is fixed, annually, by shareholders at the annual Shareholders meeting
and  all   directors  are  elected  at  that  time  -  there  are  no  staggered
directorships. Under the BCCA, directors are obligated to abstain from voting on
matters in which they may be financially  interested after disclosing in writing
such  interest.  Directors'  compensation  is not a matter  on which  they  must
abstain.  Directors must be of the age of majority  (18),  and meet  eligibility
criteria including being mentally competent,  not an undischarged  bankrupt,  no
fraud related convictions in the previous five years and a majority of directors
must be  ordinarily  resident in Canada.  There is no mandatory  retirement  age
either under Taseko's Articles or under the BCCA.

Directors'  borrowing powers are not generally restricted where the borrowing is
in Taseko's  best  interests,  but the  directors  may not  authorize  Taseko to
provide  financial  assistance  for any reason  where Taseko is insolvent or the
providing of the guarantee would render it insolvent. Directors need not own any
shares of Taseko in order to qualify as directors.

The  Articles  specify  that the  number  of  directors  shall be the  number of
directors  fixed by  shareholders,  annually,  or the number  which are actually
elected  at  a  general  shareholders   meeting.  The  number  of  directors  is
determined, annually, by shareholders at the annual Shareholders meeting and all
directors  are  elected at that  time.  Under the  Articles  the  directors  are
entitled  between  successive  annual  general  meeting to  appoint  one or more
additional  directors  but not more than  one-third  of the number of  directors
fixed  at  a  shareholders   or  actually   elected  at  the  preceding   annual
shareholders'  meeting.  Directors  automatically  retire at the commencement of
each annual meeting but may be re-elected thereat.

Under the Articles, a director who is any way directly or indirectly  interested
in a proposed  contract  or  transaction  with Taseko or who holds any office or
possesses  any property  whereby  directly or indirectly a duty might be created
which would  conflict  with his duty or interest as a director  shall declare in
writing the nature and extent of such interest in such contract or  transaction.
A director  shall not vote in respect of any such contract or transaction if the
company in which he is  interested  and if he should  vote his vote shall not be
counted but shall be counted in the quorum  present at the  meeting.  Similarly,
under the BCCA  directors  are  obligated  to abstain  from voting on matters in
which they may be financially  interested  after fully disclosing such interest.
Directors must abstain from voting in such circumstances both under the Articles
and under the BCCA.

CHANGES TO RIGHTS OF COMMON SHAREHOLDERS

Changes  to the  Articles  and  memorandum  of Taseko  require  a  shareholders'
"special  resolution"  being a  resolution  passed  by not less  than 75% of the
shares voted in person or by proxy at a duly convened shareholders meeting. Some
organic corporate changes including  amalgamation with another company,  sale of
substantially  all of Taseko's  assets,  redomiciling out of the jurisdiction of
British  Columbia,  creation of new classes of shares not only  require such 75%
approval but  generally  also give rise to a dissent right which is the right to
be paid  the fair  value of the  stockholder's  shares  in cash if the  required
special  resolution  is actually  passed and Taseko  elects to proceed  with the
matter  notwithstanding  receipt of dissent notices.  A notice of a shareholders
meeting at which such an organic change action is intended to be considered must
include a prominent notice of the dissent right. Dissent provisions are governed
by the BCCA and not by the Articles of Taseko.

SHAREHOLDERS MEETINGS

Shareholders  meetings are governed by the Articles of Taseko but many important
shareholder  protections  are also  contained  in the  SECURITIES  ACT  (British
Columbia)  and the BCCA.  The  Articles  provide that Taseko will hold an annual
shareholders'  meeting,  will  provide at least 21 days' notice and will provide
for certain procedural matters and rules of order with respect to conduct of the
meeting.  The  SECURITIES  ACT  (British  Columbia)  and  the  BCCA  superimpose
requirements that generally provide that shareholders  meetings require not less
than a 60 day notice  period from initial  public notice and that Taseko makes a
thorough advanced search of intermediary and brokerage registered  shareholdings
to facilitate  communication with beneficial  shareholders so that meeting proxy
and  information  materials can be sent via the brokerages to  unregistered  but
beneficial  shareholders,  The form and  content of  information  circulars  and
proxies and like matters are governed by the SECURITIES  ACT and the BCCA.  This
legislation  specifies the disclosure  requirements  for the proxy materials and
various corporate actions,  background  information on the nominees for election
for director,  executive compensation paid in the previous year and full details
of any unusual matters or related party transactions. Taseko must hold an annual
shareholders  meeting open to all  shareholders  for personal  attendance  or by
proxy at each  shareholder's  determination.  The meeting must be held within 13
months of the previous  annual  shareholders  meeting and must  present  audited
statements which are no more than 180 days old at such meeting.

SHARES FULLY PAID

All Taseko  shares must,  by  applicable  law, be issued as fully paid for cash,
property or services.  They are,  therefore,  non-assessable  and not subject to
further calls for payment.

REDEMPTION

Taseko has no redeemable securities authorized or issued. Therefore,  Taseko has
no sinking fund or like security redemption fund.

PRE-EMPTIVE RIGHTS

There are no  pre-emptive  rights  applicable to Taseko which provide a right to
any person to participate in offerings of Taseko's equity or other securities

RIGHTS TO PROFITS AND LIQUIDATION RIGHTS

All common  shares of Taseko  participate  rateably in any net profit or loss of
Taseko and share  rateably any available  assets in the event of a winding up or
other liquidation.

NO LIMITATION ON FOREIGN OWNERSHIP

There are no limitations  under Taseko's Articles or in the BCCA on the right of
persons who are not citizens of Canada to hold or vote common shares.  (See also
"Exchange Controls".)

DIVIDENDS

Dividends  may be  declared  by the Board out of  available  assets and are paid
rateably to holders of common  shares.  No dividend may be paid if Taseko is, or
would thereby become, insolvent.

VOTING RIGHTS

Each  Taseko  share is entitled  to one vote on matters to which  common  shares
ordinarily  vote  including  the annual  election of directors,  appointment  of
auditors and  approval of  corporate  changes.  There are no  cumulative  voting
rights applicable to Taseko.

CHANGE IN CONTROL

Taseko has not  implemented  any  shareholders'  rights or other  "poison  pill"
protection against possible take-over. Taseko does not have any agreements which
are triggered by a take-over or other change of control. There are no provisions
in its articles triggered by or affected by a change in outstanding shares which
gives rise to a change in control.  There are no provisions in Taseko's material
agreements giving special rights to any person on a change in control.

INSIDER SHARE OWNERSHIP REPORTING

The  articles  of Taseko do not require  disclosure  of share  ownership.  Share
ownership of director nominees must be reported annually in proxy materials sent
to Taseko's  shareholders.  There are no  requirements  under  British  Columbia
corporate  law to report  ownership of shares of Taseko but the  SECURITIES  ACT
(British  Columbia)  requires  disclosure  of  trading  by  insiders  (generally
officers,  directors and holders of 10% of voting  shares) within 10 days of the
trade. Controlling shareholders (generally those in excess of 20% of outstanding
shares) must provide seven days advance notice of share sales.

SECURITIES ACT (BRITISH COLUMBIA)

This  statute  applies to Taseko and governs  matters  typically  pertaining  to
public securities such as continuous  quarterly financial  reporting,  immediate
disclosure of material changes,  insider trade reporting,  take-over protections
to ensure fair and equal  treatment of all  shareholders,  exemption  and resale
rules  pertaining  to  non-prospectus  securities  issuances  as well  as  civil
liability for certain misrepresentations, disciplinary, appeal and discretionary
ruling  matters.  All Taseko  shareholders  regardless  of residence  have equal
rights under this legislation.

Subsidiary - Gibraltar Mines Ltd.

This company is wholly-owned by Taseko and has constituting  documents  ordinary
to such single-purpose corporations.


<page>

C.       MATERIAL CONTRACTS

Taseko's material contracts are:

(a)      Convertible  Debenture  July 21,  1999 in the  principal  amount of CDN
         $17,000,000  issued by Gibraltar to Boliden  Westmin  (Canada)  Limited
         pursuant  to the  acquisition  of the  Gibraltar  Mine (see Item 4 "The
         Gibraltar Mine") filed with 20-F in March 30, 2000;

(b)      Geological Management and Administration Services Agreement with Hunter
         Dickinson  Inc.  dated for reference  December 31, 1996 filed with Form
         20-F for fiscal year 1999 filed on March 30, 2000 (See Item 7 "Interest
         of Management in Certain Transactions");

(c)      Arrangement  Agreement  dated  February  22, 2001 among  Taseko,  Misty
         Mountain Gold Limited and Gibraltar Mines Ltd.  whereby Taseko proposes
         to acquire the 3 million ounce Harmony Gold Project (See Item 4);

(d)      Consulting   Services   Agreement   between   Gibraltar  and  the  GESL
         Partnership relating to the Defined Work Program, dated October 1, 2000

(e)      Arrangement Agreement. dated February 28, 2003 pursuant to which Taseko
         will  acquire the 61% of the GESL  business it does not already own for
         7,446,809  common  shares to be issued to Norman  Cressey of  Vancouver
         British Columbia as described in Items 4 and 5b herein.


<page>

D.       EXCHANGE CONTROLS

Taseko is a Province of British Columbia, Canada corporation. There is no law or
governmental  decree or regulation in Canada that restricts the export or import
of capital,  or affects the remittance of dividends,  interest or other payments
to  a  non-resident  holder  of  Common  Shares,   other  than  withholding  tax
requirements.  Any such  remittances  to United  States  residents are generally
subject  to  withholding  tax,  however  no such  remittances  are likely in the
foreseeable future. See "Taxation", below.

There is no limitation  imposed by the laws of Canada or by the charter or other
constituent  documents of Taseko on the right of a non-resident  to hold or vote
its common shares,  other than as provided in the INVESTMENT CANADA ACT (Canada)
(the  "INVESTMENT  ACT").  The  following  discussion  summarizes  the  material
features of the  INVESTMENT  ACT for a  non-resident  who  proposes to acquire a
controlling  number of Taseko's  common shares.  It is general only, it is not a
substitute for  independent  advice from an investor's own advisor,  and it does
not anticipate statutory or regulatory  amendments.  Taseko does not believe the
INVESTMENT  ACT will have any affect on it or on its  non-Canadian  shareholders
due to a number of factors  including the nature of its  operations and Taseko's
relatively small capitalization.

The  INVESTMENT  ACT  generally  prohibits   implementation  of  a  "reviewable"
investment  by  an  individual,   government  or  agency  thereof,  corporation,
partnership,  trust or joint venture (each an "entity") that is not a "Canadian"
as defined in the  INVESTMENT ACT (i.e. a  "non-Canadian"),  unless after review
the  Director of  Investments  appointed  by the  minister  responsible  for the
INVESTMENT  ACT is satisfied  that the investment is likely to be of net benefit
to Canada.  The size and nature of a  proposed  transaction  may give rise to an
obligation  to notify the Director to seek an advance  ruling.  An investment in
Taseko's  common shares by a  non-Canadian  (other than a "WTO Investor" as that
term is defined in the INVESTMENT ACT and which term includes entities which are
nationals of or are  controlled by nationals of member states of the World Trade
Organization)  when  Taseko  was not  controlled  by a WTO  Investor,  would  be
reviewable  under the INVESTMENT ACT if it was an investment to acquire  control
of Taseko and the value of the assets of Taseko,  as  determined  in  accordance
with the  regulations  promulgated  under the Investment Act, was over a certain
figure, or if an order for review was made by the federal cabinet on the grounds
that the investment  related to Canada's cultural heritage or national identity,
regardless  of the value of the assets of Taseko.  An  investment  in the Common
Shares by a WTO Investor,  or by a non-Canadian  when Taseko was controlled by a
WTO  Investor,  would  be  reviewable  under  the  INVESTMENT  ACT  if it was an
investment  to acquire  control of Taseko and the value of the assets of Taseko,
as  determined  in  accordance  with  the  regulations   promulgated  under  the
Investment  Act,  was not less than a specified  amount,  which for 2000 exceeds
Cdn$192 million. A non-Canadian would acquire control of Taseko for the purposes
of the  INVESTMENT  ACT if the  non-Canadian  acquired a majority  of the Common
Shares.  The  acquisition  of less than a majority but  one-third or more of the
Common Shares would be presumed to be an acquisition of control of Taseko unless
it could be established  that, on the acquisition,  Taseko was not controlled in
fact by the acquiror through the ownership of the Common Shares.

The foregoing assumes Taseko will not engage in the production of uranium or own
an interest in a producing  uranium property in Canada, or provide any financial
service or transportation  service,  as the rules governing these businesses are
different.

Certain  transactions  relating  to the Common  Shares  would be exempt from the
INVESTMENT ACT, including (a) an acquisition of the Common Shares by a person in
the ordinary course of that person's business as a

(a)               trader or dealer in securities,

(b)               an  acquisition  of control of Taseko in  connection  with the
                  realization of security  granted for a loan or other financial
                  assistance and not for a purpose  related to the provisions of
                  the INVESTMENT Act, and

(c)               an   acquisition   of  control  of  Taseko  by  reason  of  an
                  amalgamation,     merger,     consolidation    or    corporate
                  reorganization following which the ultimate direct or indirect
                  control in fact of Taseko, through the ownership of the Common
                  Shares, remained unchanged.


<page>

E.                TAXATION

MATERIAL CANADIAN FEDERAL INCOME TAX CONSEQUENCES FOR UNITED STATES RESIDENTS

The following,  in management's  understanding  summarizes the material Canadian
federal  income  tax  consequences  generally  applicable  to  the  holding  and
disposition of Common Shares by a holder (in this summary, a "U.S. Holder") who,
(a) for the  purposes of the Income Tax Act  (Canada)  (the "Tax  Act"),  is not
resident in Canada,  deals at arm's length with Taseko,  holds the Common Shares
as capital  property and does not use or hold the Common Shares in the course of
carrying on, or otherwise in connection with, a business in Canada,  and (b) for
the  purposes  of the  Canada-United  States  Income Tax  Convention,  1980 (the
"Treaty"),  is a resident solely of the United States, has never been a resident
of Canada,  and has not held or used (and does not hold or use) Common Shares in
connection with a permanent  establishment or fixed base in Canada. This summary
does not apply to traders or dealers in securities, limited liability companies,
tax-exempt entities,  insurers, financial institutions (including those to which
the mark-to-market provisions of the Tax Act apply), or any other U.S. Holder to
which special considerations apply.

This summary is based on the current  provisions  of the Tax Act  including  all
regulations thereunder,  the Treaty, all proposed amendments to the Tax Act, the
regulations and the Treaty publicly announced by the Government of Canada to the
date hereof, and the current administrative  practices of the Canada Customs and
Revenue Agency. It has been assumed that all currently proposed  amendments will
be enacted as proposed  and that there will be no other  relevant  change in any
governing law or administrative practice, although no assurances can be given in
these respects. This summary does not take into account provincial,  U.S., state
or  other  foreign  income  tax law or  practice.  The tax  consequences  to any
particular  U.S.  Holder will vary  according to the status of that holder as an
individual,  trust, corporation,  partnership or other entity, the jurisdictions
in which that holder is subject to  taxation,  and  generally  according to that
holder's particular circumstances.  Accordingly, this summary is not, and is not
to be construed as, Canadian tax advice to any particular U.S. Holder.

DIVIDENDS

Dividends  paid or deemed to be paid to a U.S.  Holder by Taseko will be subject
to Canadian  withholding  tax. Under the Treaty,  the rate of withholding tax on
dividends paid to a U.S. Holder is generally  limited to 15% of the gross amount
of the dividend (or 5% if the U.S. Holder is a corporation and beneficially owns
at least 10% of Taseko's voting shares). Taseko will be required to withhold the
applicable  withholding  tax from any such dividend and remit it to the Canadian
government for the U.S. Holder's account.

DISPOSITION

A U.S.  Holder is not  subject  to tax under the Tax Act in respect of a capital
gain realized on the disposition of a Common Share in the open market unless the
share is "taxable  Canadian  property" to the holder thereof and the U.S. Holder
is not  entitled  to relief  under the  Treaty.  A Common  Share will be taxable
Canadian  property  to a U.S.  Holder  if,  at any  time  during  the 60  months
preceding the disposition,  the U.S. Holder or persons with whom the U.S. Holder
did not deal at arm's length alone or together  owned, or had rights to acquire,
25% or more of Taseko's issued shares of any class or series.

A U.S. Holder whose Common Shares do constitute taxable Canadian  property,  and
who might  therefore be liable for Canadian  income tax under the Tax Act,  will
generally be relieved from such  liability  under the Treaty unless the value of
such shares at the time of disposition is derived principally from real property
situated in Canada.  Management  of Taseko  believes  that the value of Taseko's
Common Shares is not currently  derived  principally from real property situated
in Canada.

UNITED STATES TAX CONSEQUENCES

UNITED STATES FEDERAL INCOME TAX CONSEQUENCES

The following  is, in  management's  understanding  a discussion of the material
United States  federal  income tax  consequences,  under current law,  generally
applicable to a U.S. Holder (as hereinafter defined) of common shares of Taseko.
This  discussion does not address all  potentially  relevant  federal income tax
matters and it does not  address  consequences  peculiar  to persons  subject to
special  provisions of federal income tax law, such as those  described below as
excluded from the definition of a U.S. Holder. In addition, this discussion does
not cover any  state,  local or  foreign  tax  consequences.  (see  "Taxation  -
Canadian  Federal  Income Tax  Consequences"  above).  Accordingly,  holders and
prospective  holders of common  shares of Taseko  should  consult  their own tax
advisors about the specific federal,  state, local, and foreign tax consequences
to them of  purchasing,  owning and disposing of common shares of Taseko,  based
upon their individual circumstances.

The following discussion is based upon the sections of the Internal Revenue Code
of 1986,  as amended (the  "Code"),  Treasury  Regulations,  published  Internal
Revenue Service ("IRS") rulings,  published  administrative positions of the IRS
and court decisions that are currently applicable,  any or all of which could be
materially and adversely  changed,  possibly on a retroactive basis, at any time
and which are subject to differing  interpretations.  This  discussion  does not
consider the potential  effects,  both adverse and  beneficial,  of any proposed
legislation  which,  if  enacted,  could be applied,  possibly on a  retroactive
basis, at any time.

U.S.  HOLDERS

As used herein, a "U.S. Holder" means a holder of common shares of Taseko who is
a citizen  or  individual  resident  of the  United  States,  a  corporation  or
partnership created or organized in or under the laws of the United States or of
any  political  subdivision  thereof,  an estate  whose income is taxable in the
United  States  irrespective  of  source  or a  trust  subject  to  the  primary
supervision  of a court within the United  States and control of a United States
fiduciary as described  Section  7701(a)(30) of the Code.  This summary does not
address  the tax  consequences  to, and U.S.  Holder does not  include,  persons
subject to specific  provisions  of federal  income tax law,  such as tax-exempt
organizations,  qualified retirement plans,  individual  retirement accounts and
other tax-deferred accounts,  financial institutions,  insurance companies, real
estate  investment  trusts,  regulated  investment  companies,   broker-dealers,
non-resident  alien  individuals,  persons or entities  that have a  "functional
currency" other than the U.S.  dollar,  shareholders  subject to the alternative
minimum tax, shareholders who hold common shares as part of a straddle,  hedging
or conversion  transaction,  and  shareholders  who acquired their common shares
through the exercise of employee stock options or otherwise as compensation  for
services.  This  summary  is limited to U.S.  Holders  who own common  shares as
capital  assets and who own  (directly  and  indirectly,  pursuant to applicable
rules of  constructive  ownership)  no more  than 5% of the  value of the  total
outstanding stock of Taseko. This summary does not address the consequences to a
person or entity holding an interest in a shareholder or the  consequences  to a
person of the ownership,  exercise or  disposition  of any options,  warrants or
other  rights to acquire  common  shares.  In  addition,  this  summary does not
address special rules applicable to United States persons (as defined in Section
7701(a)(30) of the Code) holding common shares through a foreign  partnership or
to foreign persons holding common shares through a domestic partnership.

DISTRIBUTION ON COMMON SHARES OF TASEKO

In  general,   U.S.  Holders   receiving   dividend   distributions   (including
constructive  dividends) with respect to common shares of Taseko are required to
include in gross income for United States  federal income tax purposes the gross
amount  of  such  distributions,   equal  to  the  U.S.  dollar  value  of  such
distributions  on the date of receipt (based on the exchange rate on such date),
to the extent that  Taseko has  current or  accumulated  earnings  and  profits,
without reduction for any Canadian income tax withheld from such  distributions.
Such  Canadian tax withheld  may be  credited,  subject to certain  limitations,
against the U.S. Holder's federal income tax liability or, alternatively, may be
deducted in computing  the U.S.  Holder's  federal  taxable  income by those who
itemize  deductions.  (See more  detailed  discussion  at  "Foreign  Tax Credit"
below). To the extent that distributions  exceed current or accumulated earnings
and profits of Taseko,  they will be treated  first as a return of capital up to
the U.S.  Holder's  adjusted  basis in the common shares and  thereafter as gain
from the sale or  exchange of  property.  Preferential  tax rates for  long-term
capital gains are applicable to a U.S. Holder which is an individual,  estate or
trust. There are currently no preferential tax rates for long-term capital gains
for a U.S. Holder which is a corporation.

In the case of foreign currency  received as a dividend that is not converted by
the recipient into U.S. dollars on the date of receipt,  a U.S. Holder will have
a tax basis in the foreign  currency equal to its U.S.  dollar value on the date
of receipt.  Generally,  any gain or loss  recognized  upon a subsequent sale or
other  disposition  of the foreign  currency,  including  the  exchange for U.S.
dollars,  will be ordinary income or loss. However, an individual whose realized
gain does not exceed $200 will not recognize that gain,  provided that there are
no expenses  associated  with the  transaction  that meet the  requirements  for
deductibility  as a trade or business  expense  (other  than travel  expenses in
connection with a business trip) or as an expense for the production of income.

Dividends paid on the common shares of Taseko generally will not be eligible for
the dividends received deduction  provided to corporations  receiving  dividends
from certain United States  corporations.  A U.S.  Holder which is a corporation
and which owns shares representing at least 10% of the voting power and value of
Taseko may,  under  certain  circumstances,  be entitled to a 70% (or 80% if the
U.S. Holder owns shares  representing at least 20% of the voting power and value
of Taseko)  deduction of the United States source portion of dividends  received
from Taseko (unless Taseko qualifies as a "foreign  personal holding company" or
a "passive  foreign  investment  company,"  as defined  below).  Taseko does not
anticipate  that it will earn any United States income,  however,  and therefore
does not  anticipate  that any U.S.  Holder will be eligible  for the  dividends
received deduction.

Under current Treasury Regulations, dividends paid on Taseko's common shares, if
any,  generally will not be subject to information  reporting and generally will
not be  subject to U.S.  backup  withholding  tax.  However,  dividends  and the
proceeds from a sale of Taseko's  common shares paid in the U.S.  through a U.S.
or U.S.  related  paying  agent  (including  a broker)  will be  subject to U.S.
information  reporting  requirements  and may  also be  subject  to the 31% U.S.
backup  withholding  tax,  unless  the  paying  agent is  furnished  with a duly
completed  and signed  Form W-9.  Any  amounts  withheld  under the U.S.  backup
withholding  tax rules will be allowed as a refund or a credit  against the U.S.
Holder's U.S. federal income tax liability, provided the required information is
furnished to the IRS.

FOREIGN TAX CREDIT

A U.S. Holder who pays (or has withheld from distributions)  Canadian income tax
with respect to the ownership of common shares of Taseko may be entitled, at the
option of the U.S.  Holder,  to either  receive a deduction  or a tax credit for
such foreign tax paid or withheld.  Generally,  it will be more  advantageous to
claim a credit  because a credit reduces United States federal income taxes on a
dollar-for-dollar  basis, while a deduction merely reduces the taxpayer's income
subject to tax.  This  election is made on a  year-by-year  basis and  generally
applies to all foreign taxes paid by (or withheld  from) the U.S.  Holder during
that year.  There are  significant  and complex  limitations  which apply to the
credit,  among which is the general limitation that the credit cannot exceed the
proportionate share of the U.S. Holder's United States income tax liability that
the U.S.  Holder's  foreign source income bears to his or its worldwide  taxable
income. In the determination of the application of this limitation,  the various
items of income and  deduction  must be  classified  into  foreign and  domestic
sources.  Complex rules govern this classification  process.  In addition,  this
limitation is calculated  separately with respect to specific  classes of income
such as "passive income,  "high withholding tax interest,"  "financial  services
income,"  "shipping  income,"  and  certain  other  classifications  of  income.
Dividends  distributed by Taseko will generally  constitute "passive income" or,
in the case of certain  U.S.  Holders,  "financial  services  income"  for these
purposes.  The availability of the foreign tax credit and the application of the
limitations on the credit are fact specific,  and U.S.  Holders of common shares
of Taseko  should  consult  their own tax advisors  regarding  their  individual
circumstances.

DISPOSITION OF COMMON SHARES OF TASEKO

In general,  U.S.  Holders will  recognize  gain or loss upon the sale of common
shares of Taseko equal to the difference, if any, between (i) the amount of cash
plus the fair market value of any property received,  and (ii) the shareholder's
tax  basis in the  common  shares of  Taseko.  Preferential  tax rates  apply to
long-term  capital  gains of U.S.  Holders  which are  individuals,  estates  or
trusts. In general,  gain or loss on the sale of common shares of Taseko will be
long-term  capital gain or loss if the common  shares are a capital asset in the
hands of the U.S. Holder and are held for more than one year. Deductions for net
capital losses are subject to significant  limitations.  For U.S.  Holders which
are not corporations, any unused portion of such net capital loss may be carried
over to be used in later  tax  years  until  such net  capital  loss is  thereby
exhausted.  For U.S.  Holders  that are  corporations  (other than  corporations
subject to Subchapter S of the Code),  an unused net capital loss may be carried
back three years and carried  forward five years from the loss year to be offset
against capital gains until such net capital loss is thereby exhausted.

OTHER CONSIDERATIONS

Set forth below are certain material exceptions to the  above-described  general
rules  describing the United States federal  income tax  consequences  resulting
from the holding and disposition of common shares:

FOREIGN PERSONAL HOLDING COMPANY

If at any time during a taxable year more than 50% of the total combined  voting
power or the total value of Taseko's  outstanding  shares is owned,  directly or
indirectly (pursuant to applicable rules of constructive ownership),  by five or
fewer  individuals who are citizens or residents of the United States and 60% or
more of Taseko's  gross  income for such year is derived  from  certain  passive
sources (e.g., from certain interest and dividends),  Taseko may be treated as a
"foreign personal holding company." In that event, U.S. Holders that hold common
shares  would be  required  to  include  in gross  income  for such  year  their
allocable portions of such passive income to the extent Taseko does not actually
distribute such income. Taseko does not believe that it currently qualifies as a
foreign personal holding company. However, there can be no assurance that Taseko
will not be considered a foreign personal holding company for the current or any
future taxable year.

FOREIGN INVESTMENT COMPANY

If 50% or  more  of the  combined  voting  power  or  total  value  of  Taseko's
outstanding shares is held, directly or indirectly,  by citizens or residents of
the United States,  United States  domestic  partnerships  or  corporations,  or
estates or trusts other than  foreign  estates or trusts (as defined by the Code
Section  7701(a)(31)),  and  Taseko  is found  to be  engaged  primarily  in the
business of investing,  reinvesting,  or trading in securities,  commodities, or
any interest  therein,  it is possible  that Taseko may be treated as a "foreign
investment  company" as defined in Section 1246 of the Code, causing all or part
of any gain realized by a U.S. Holder selling or exchanging  common shares to be
treated as ordinary  income  rather than capital  gain.  Taseko does not believe
that it currently qualifies as a foreign investment company.  However, there can
be no assurance that Taseko will not be considered a foreign  investment company
for the current or any future taxable year.

PASSIVE FOREIGN INVESTMENT COMPANY

United  States  income  tax  law  contains  rules  governing   "passive  foreign
investment  companies"  ("PFIC") which can have  significant tax effects on U.S.
Holders of foreign corporations.  These rules do not apply to non-U.S.  Holders.
Section 1297 of the Code defines a PFIC as a  corporation  that is not formed in
the United States if, for any taxable year,  either (i) 75% or more of its gross
income is "passive income," which includes interest, dividends and certain rents
and royalties or (ii) the average  percentage,  by fair market value (or, if the
corporation  is  not  publicly  traded  and  either  is  a  controlled   foreign
corporation  or makes an election,  by adjusted  tax basis),  of its assets that
produce  or are held for the  production  of  "passive  income"  is 50% or more.
Taseko appears to have been a PFIC for the fiscal year ended September 30, 1999,
and at least certain prior fiscal years. In addition,  Taseko expects to qualify
as a PFIC for the fiscal year ending  September 30, 2000 and may also qualify as
a PFIC in future fiscal years.  Each U.S. Holder of Taseko is urged to consult a
tax advisor  with  respect to how the PFIC rules  affect such U.S.  Holder's tax
situation.

Each U.S.  Holder who holds  stock in a foreign  corporation  during any year in
which such  corporation  qualifies as a PFIC is subject to United States federal
income  taxation under one of three  alternative  tax regimes at the election of
such U.S. Holder.  The following is a discussion of such alternative tax regimes
applied to such U.S.  Holders of Taseko.  In addition,  special rules apply if a
foreign  corporation  qualifies  as  both  a  PFIC  and  a  "controlled  foreign
corporation"   (as  defined  below)  and  a  U.S.   Holder  owns,   actually  or
constructively, 10% or more of the total combined voting power of all classes of
stock entitled to vote of such foreign corporation (See more detailed discussion
at "Controlled Foreign Corporation" below).

A U.S.  Holder who elects to treat Taseko as a qualified  electing  fund ("QEF")
will be subject,  under Section 1293 of the Code, to current  federal income tax
for any taxable year to which the election  applies in which Taseko qualifies as
a PFIC on his pro rata share of Taseko's (i) "net  capital  gain" (the excess of
net long-term  capital gain over net  short-term  capital  loss),  which will be
taxed as long-term  capital gain,  and (ii)  "ordinary  earnings" (the excess of
earnings  and profits  over net capital  gain),  which will be taxed as ordinary
income,  in each  case,  for the  shareholder's  taxable  year in which (or with
which)  Taseko's  taxable  year ends,  regardless  of whether  such  amounts are
actually  distributed.  A U.S.  Holder's tax basis in the common  shares will be
increased by any such amount that is included in income but not distributed.

The  procedure  a U.S.  Holder  must  comply  with in  making an  effective  QEF
election, and the consequences of such election, will depend on whether the year
of the election is the first year in the U.S.  Holder's  holding period in which
Taseko is a PFIC.  If the U.S.  Holder  makes a QEF election in such first year,
i.e., a "timely" QEF election, then the U.S. Holder may make the QEF election by
simply filing the  appropriate  documents at the time the U.S.  Holder files his
tax return for such first year.  If,  however,  Taseko  qualified as a PFIC in a
prior year during the U.S. Holder's holding period,  then, in order to avoid the
Section 1291 rules discussed  below, in addition to filing  documents,  the U.S.
Holder  must  elect to  recognize  under the rules of  Section  1291 of the Code
(discussed  herein),  (i) any gain that he would otherwise recognize if the U.S.
Holder  sold  his  stock  on the  qualification  date  or (ii)  if  Taseko  is a
controlled  foreign  corporation,  the U.S.  Holder's pro rata share of Taseko's
post-1986  earnings and profits as of the qualification  date. The qualification
date is the first day of Taseko's first tax year in which Taseko  qualified as a
QEF with respect to such U.S. Holder.  For purposes of this  discussion,  a U.S.
Holder who makes (i) a timely QEF election, or (ii) an untimely QEF election and
either of the above-described  gain-recognition  elections under Section 1291 is
referred to herein as an "Electing U.S.  Holder." A U.S. Holder who holds common
shares at any time during a year of Taseko in which  Taseko is a PFIC and who is
not an Electing U.S.  Holder  (including a U.S. Holder who makes an untimely QEF
election and makes neither of the above-described gain-recognition elections) is
referred to herein as a "Non-Electing  U.S. Holder." An Electing U.S. Holder (i)
generally  treats any gain realized on the disposition of his Registrant  common
shares as capital gain;  and (ii) may either avoid  interest  charges  resulting
from PFIC  status  altogether,  or make an annual  election,  subject to certain
limitations,  to defer payment of current taxes on his share of Taseko's  annual
realized net capital gain and ordinary earnings subject, however, to an interest
charge.  If the U.S.  Holder is not a corporation,  any interest  charge imposed
under the PFIC  regime  would be  treated  as  "personal  interest"  that is not
deductible.

In order for a U.S.  Holder to make (or maintain) a valid QEF  election,  Taseko
must provide  certain  information  regarding its net capital gains and ordinary
earnings  and  permit  its books  and  records  to be  examined  to verify  such
information.  Taseko intends to make the necessary information available to U.S.
Holders to permit them to make (and  maintain)  QEF  elections  with  respect to
Taseko.  Taseko urges each U.S.  Holder to consult a tax advisor  regarding  the
availability of, and procedure for making, the QEF election.

A QEF  election,  once made with respect to Taseko,  applies to the tax year for
which it was made and to all  subsequent  tax  years,  unless  the  election  is
invalidated or terminated, or the IRS consents to revocation of the election. If
a QEF election is made by a U.S.  Holder and Taseko  ceases to qualify as a PFIC
in a subsequent tax year,  the QEF election will remain in effect,  although not
applicable,  during  those tax years in which Taseko does not qualify as a PFIC.
Therefore, if Taseko again qualifies as a PFIC in a subsequent tax year, the QEF
election  will be  effective  and the U.S.  Holder  will be subject to the rules
described  above for Electing U.S.  Holders in such tax year and any  subsequent
tax years in which  Taseko  qualifies as a PFIC.  In addition,  the QEF election
remains in effect,  although not  applicable,  with respect to an Electing  U.S.
Holder  even after  such U.S.  Holder  disposes  of all of his or its direct and
indirect  interest  in the  shares of  Taseko.  Therefore,  if such U.S.  Holder
reacquires an interest in Taseko,  that U.S. Holder will be subject to the rules
described  above for  Electing  U.S.  Holders for each tax year in which  Taseko
qualifies as a PFIC.

In the case of a Non-Electing U.S. Holder,  special taxation rules under Section
1291 of the Code will apply to (i) gains realized on the  disposition (or deemed
to be realized by reasons of a pledge) of his Registrant  common shares and (ii)
certain "excess distributions," as defined in Section 1291(b), by Taseko.

A Non-Electing  U.S.  Holder  generally  would be required to pro rate all gains
realized  on the  disposition  of his  Registrant  common  shares and all excess
distributions on his Registrant common shares over the entire holding period for
the common shares. All gains or excess distributions allocated to prior years of
the U.S. Holder (excluding any portion of the holder's period prior to the first
day of the first year of Taseko (i) which began after  December  31,  1986,  and
(ii) for which  Taseko was a PFIC)  would be taxed at the  highest  tax rate for
each such prior year applicable to ordinary income. The Non-Electing U.S. Holder
also would be liable for interest on the  foregoing  tax liability for each such
prior year  calculated  as if such  liability  had been due with respect to each
such prior year. A Non-Electing U.S. Holder that is not a corporation must treat
this interest charge as "personal interest" which, as discussed above, is wholly
non-deductible. The balance, if any, of the gain or the excess distribution will
be treated as ordinary  income in the year of the  disposition or  distribution,
and no interest charge will be incurred with respect to such balance. In certain
circumstances,  the sum of the tax and the PFIC  interest  charge may exceed the
amount  of the  excess  distribution  received,  or the  amount of  proceeds  of
disposition realized, by the U.S. Holder.

If Taseko is a PFIC for any taxable year during which a Non-Electing U.S. Holder
holds  Registrant  common  shares,  then Taseko will continue to be treated as a
PFIC with  respect to such  Registrant  common  shares,  even if it is no longer
definitionally a PFIC. A Non-Electing U.S. Holder may terminate this deemed PFIC
status by  electing  to  recognize  gain  (which  will be taxed  under the rules
discussed above for  Non-Electing  U.S.  Holders) as if such  Registrant  common
shares had been sold on the last day of the last taxable year for which it was a
PFIC.

Effective for tax years of U.S. Holders  beginning after December 31, 1997, U.S.
Holders who hold  (actually  or  constructively)  marketable  stock of a foreign
corporation  that qualifies as a PFIC may elect to mark such stock to the market
annually (a "mark-to-market  election").  If such an election is made, such U.S.
Holder will  generally not be subject to the special  taxation  rules of Section
1291  discussed  above.  However,  if the  mark-to-market  election is made by a
Non-Electing  U.S. Holder after the beginning of the holding period for the PFIC
stock,  then the  Section  1291 rules will  apply to  certain  dispositions  of,
distributions on and other amounts taxable with respect to Taseko common shares.
A U.S.  Holder who makes the mark-to market  election will include in income for
each  taxable  year for which the  election is in effect an amount  equal to the
excess,  if any, of the fair market  value of the common  shares of Taseko as of
the close of such tax year over such U.S. Holder's adjusted basis in such common
shares.  In addition,  the U.S.  Holder is allowed a deduction for the lesser of
(i) the excess,  if any, of such U.S.  Holder's adjusted tax basis in the common
shares  over the fair  market  value of such  shares  as of the close of the tax
year, or (ii) the excess, if any, of (A) the mark-to-market gains for the common
shares in Taseko included by such U.S. Holder for prior tax years, including any
amount which would have been treated as a mark-to-market  gain for any prior tax
year but for the Section 1291 rules discussed above with respect to Non-Electing
U.S. Holders, over (B) the mark-to-market losses for shares that were allowed as
deductions for prior tax years. A U.S. Holder's adjusted tax basis in the common
shares of Taseko will be adjusted to reflect the amount  included in or deducted
from income as a result of a mark-to-market  election. A mark-to-market election
applies to the taxable year in which the election is made and to each subsequent
taxable  year,   unless  Taseko  common  shares  cease  to  be  marketable,   as
specifically defined, or the IRS consents to revocation of the election. Because
the IRS has not  established  procedures for making a  mark-to-market  election,
U.S.  Holders  should  consult their tax advisor  regarding the manner of making
such an election. No view is expressed regarding whether common shares of Taseko
are marketable for these purposes or whether the election will be available.

Under  Section  1291(f)  of the  Code,  the IRS  has  issued  Proposed  Treasury
Regulations that, subject to certain exceptions,  would treat as taxable certain
transfers of PFIC stock by  Non-Electing  U.S.  Holders that are  generally  not
otherwise taxed, such as gifts, exchanges pursuant to corporate reorganizations,
and  transfers  at death.  Generally,  in such cases the basis of Taseko  common
shares in the hands of the transferee and the basis of any property  received in
the exchange  for those  common  shares would be increased by the amount of gain
recognized.  Under the Proposed  Treasury  Regulations,  an Electing U.S. Holder
would not be taxed on certain transfers of PFIC stock, such as gifts,  exchanges
pursuant to corporate reorganizations,  and transfers at death. The transferee's
basis in this case will depend on the manner of the  transfer.  In the case of a
transfer by an Electing U.S. Holder upon death,  for example,  the  transferee's
basis is generally equal to the fair market value of the Electing U.S.  Holder's
common  shares  as of the date of death  under  Section  1014 of the  Code.  The
specific tax effect to the U.S.  Holder and the transferee may vary based on the
manner in which the common shares are transferred. Each U.S. Holder of Taseko is
urged to consult a tax advisor  with respect to how the PFIC rules affect his or
its tax situation.

Whether or not a U.S.  Holder makes a timely QEF election with respect to common
shares of Taseko,  certain adverse rules may apply in the event that both Taseko
and any foreign  corporation in which Taseko directly or indirectly holds shares
is  a  PFIC  (a  "lower-tier  PFIC").  Pursuant  to  certain  Proposed  Treasury
Regulations,  a U.S. Holder would be treated as owning his or its  proportionate
amount of any lower-tier PFIC shares, and generally would be subject to the PFIC
rules with respect to such  indirectly-held  PFIC shares unless such U.S. Holder
makes a timely QEF election  with respect  thereto.  Taseko  intends to make the
necessary  information  available  to U.S.  Holders to permit  them to make (and
maintain)  QEF  elections  with respect to each  subsidiary  of Taseko that is a
PFIC.

Under the  Proposed  Treasury  Regulations,  a U.S.  Holder  who does not make a
timely QEF election with respect to a lower-tier PFIC generally would be subject
to tax (and the PFIC interest charge) on (i) any excess  distribution  deemed to
have been  received with respect to his or its  lower-tier  PFIC shares and (ii)
any gain deemed to arise from a so-called "indirect disposition" of such shares.
For this  purpose,  an indirect  disposition  of  lower-tier  PFIC shares  would
generally  include (i) a disposition  by Taseko (or an  intermediate  entity) of
lower-tier PFIC shares, and (ii) any other transaction resulting in a diminution
of the U.S. Holder's  proportionate  ownership of the lower-tier PFIC, including
an issuance of additional  common shares by Taseko (or an intermediate  entity).
Accordingly, each prospective U.S. Holder should be aware that he or it could be
subject to tax even if such U.S.  Holder receives no  distributions  from Taseko
and  does  not  dispose  of  its  common  shares.  TASEKO  STRONGLY  URGES  EACH
PROSPECTIVE  U.S.  HOLDER TO CONSULT A TAX ADVISOR  WITH  RESPECT TO THE ADVERSE
RULES APPLICABLE,  UNDER THE PROPOSED TREASURY  REGULATIONS,  TO U.S. HOLDERS OF
LOWER-TIER PFIC SHARES.

Certain special,  generally adverse, rules will apply with respect to Registrant
common  shares while Taseko is a PFIC unless the U.S.  Holder makes a timely QEF
election.  For example under Section  1298(b)(6) of the Code, a U.S.  Holder who
uses PFIC stock as security for a loan (including a margin loan) will, except as
may be provided in regulations,  be treated as having made a taxable disposition
of such shares.

CONTROLLED FOREIGN CORPORATION

If more than 50% of the total  combined  voting  power of all  classes of shares
entitled to vote or the total  value of the shares of Taseko is owned,  actually
or constructively,  by citizens or residents of the United States, United States
domestic  partnerships or  corporation,  or estates or trusts other than foreign
estates or trusts (as defined by the Code  Section  7701(a)(31)),  each of which
own, actually or constructively,  10% or more of the total combined voting power
of  all  classes  of  shares   entitled  to  vote  of  Taseko   ("United  States
Shareholder"),  Taseko  could be treated  as a  controlled  foreign  corporation
("CFC")  under  Subpart F of the Code.  This  classification  would  effect many
complex results,  one of which is the inclusion of certain income of a CFC which
is subject to current U.S. tax. The United States  generally taxes United States
Shareholders of a CFC currently on their pro rata shares of the Subpart F income
of the CFC. Such United  States  Shareholders  are  generally  treated as having
received a current  distribution  out of the CFC's Subpart F income and are also
subject to current  U.S.  tax on their pro rata shares of increases in the CFC's
earnings invested in U.S.  property.  The foreign tax credit described above may
reduce the U.S. tax on these  amounts.  In addition,  under  Section 1248 of the
Code, gain from the sale or exchange of shares by a U.S. Holder of common shares
of Taseko  which is or was a United  States  Shareholder  at any time during the
five-year  period  ending  on the date of the sale or  exchange  is  treated  as
ordinary income to the extent of earnings and profits of Taseko  attributable to
the shares sold or exchanged. If a foreign corporation is both a PFIC and a CFC,
the foreign corporation  generally will not be treated as a PFIC with respect to
United States Shareholders of the CFC. This rule generally will be effective for
taxable years of United States Shareholders beginning after 1997 and for taxable
years of foreign corporations ending with or within such taxable years of United
States  Shareholders.  Special rules apply to United States Shareholders who are
subject to the special  taxation rules under Section 1291  discussed  above with
respect to a PFIC.  Because  of the  complexity  of  Subpart F, a more  detailed
review of these  rules is outside of the scope of this  discussion.  Taseko does
not believe  that it  currently  qualifies  as a CFC.  However,  there can be no
assurance that Taseko will not be considered a CFC for the current or any future
taxable year.

F.       DIVIDENDS AND PAYING AGENTS

Not applicable.

G.       STATEMENT BY EXPERTS

Not applicable.

H.       DOCUMENTS ON DISPLAY

Exhibits  attached  to this  Form 20-F are also  available  for  viewing  at the
offices  of Taseko,  Suite 1020 - 800 West  Pender  Street,  Vancouver,  British
Columbia  V6C 2V6 or on request of Taseko at  604-684-6365,  attention:  Shirley
Main. Copies of Taseko's  financial  statements and other continuous  disclosure
documents  required under the British Columbia  SECURITIES ACT are available for
viewing on the internet at  www.SEDAR.com.  Taseko's only  material  subsidiary,
Gibraltar Mines Ltd., is also a British  Columbia  corporation and the foregoing
discussion of articles and memorandum is generally applicable.

I.       SUBSIDIARY INFORMATION

Not applicable.


<page>

ITEM 11  QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK

(A)      TRANSACTION RISK AND CURRENCY RISK MANAGEMENT

Taseko's operations do not employ financial instruments or derivatives which are
market sensitive and Taseko does not have financial market risks.

(B)      EXCHANGE RATE SENSITIVITY

Taseko's operations are in Canada and hence it is not significantly  affected by
exchange rate risk. Its liabilities are all denominated in Canadian dollars.

(C)      INTEREST RATE RISK AND EQUITY PRICE RISK

Taseko  is  equity  financed  and does not have  any debt  which is  subject  to
interest rate change risks. Its only long term liability, the Boliden Debenture,
is non-interest bearing.

(D)      COMMODITY PRICE RISK

While the value of Taseko's resource  properties can always be said to relate to
the price of gold and copper and the outlook for same,  Taseko does not have any
operating  mines and hence does not have any  hedging or other  commodity  based
risks respecting its operations.

ITEM 12  DESCRIPTION OF SECURITIES OTHER THAN EQUITY SECURITIES

A.       DEBT SECURITIES

Not applicable.  (Taseko has a single outstanding  debenture issued to Boliden -
see Item 2 and Exhibits.)

B.       WARRANTS AND RIGHTS

Not applicable. (Taseko's warrants are non-transferable and no market exists for
them. Taseko has issued no rights.)

C.       OTHER SECURITIES

Not applicable.

D.       AMERICAN DEPOSITARY SHARES

Not applicable.


<page>

                                     PART II

ITEM 13  DEFAULTS, DIVIDEND ARREARAGES AND DELINQUENCIES

Not applicable.

ITEM 14  MATERIAL  MODIFICATIONS  TO THE RIGHTS OF  SECURITY  HOLDERS AND USE OF
         PROCEEDS

Not applicable.

ITEM 15  [RESERVED]

ITEM 16  [RESERVED]


<page>

                                    PART III

ITEM 17           FINANCIAL STATEMENTS

The following attached financial statements are incorporated herein:

(1)      Auditors' Report on the consolidated balance sheets as at September 30,
         2002 and 2001, and the consolidated  statements of operations,  deficit
         and cash  flows for each of the years in the  three-year  period  ended
         September 30, 2002;

(2)      Consolidated balance sheets as at September 30, 2002 and 2001;

(3)      Consolidated statements of operations and deficit for each of the years
         in the three-year period ended September 30, 2002;

(4)      Consolidated  statements  of cash flows for the periods  referred to in
         (3) above;

(5)      Notes to the consolidated financial statements;

ITEM 18           FINANCIAL STATEMENTS

NOT APPLICABLE.  See Item 17.


ITEM 19           EXHIBITS

Key to the following document types:

1.                Articles  of   Incorporation   and  Registered   Incorporation
                  Memorandum of Taseko.

2.                Other Instruments defining the rights of the holders of equity
                  or debt securities.

3.                A. Agreements to which Directors,  Officers,  promoters voting
                  trustees or security  holders or their affiliates named in the
                  Registration   Statement  are  parties  other  than  contracts
                  involving only the purchase or sale of current assets having a
                  determinable market price.

B.                Material contracts not made in the ordinary course of business
                  or which are to be  performed  in whole or in part at or after
                  the filing of the Registration  Statement or which was entered
                  into not more than two years before filing.

The following  Exhibits  were filed with Taseko's  Annual Report on Form 20-F in
previous years:

Type of
Document  Description
- --------- ----------------------------------------------------------------------

1 & 2    Articles of  incorporation,  bylaws and instruments  defining rights of
         common  shareholders  have been previously filed with the 20-F filed in
         1994.

3B       Convertible  Debenture  July 21,  1999 in the  principal  amount of CDN
         $17,000,000  issued by Gilbraltarco to Boliden Westmin (Canada) Limited
         pursuant  to the  acquisition  of the  Gibraltar  Mine (see Item 4 "The
         Gibraltar Mine") filed with 20-F in March 30, 2000.

3A       Geological  Management and Administration  Services Agreement dated for
         reference  December  31, 1996 filed with Form 20-F for fiscal year 1999
         on March 30,  2000 (See  Item 7  "Interest  of  Management  in  Certain
         Transactions").

3A       Amended Share  Incentive  Plan dated for reference  March 20, 2000 (See
         Item 6 "Share Incentive Plan").

3B       Arrangement  Agreement  dated  February  22, 2001 among  Taseko,  Misty
         Mountain Gold Limited and Gibraltar Mines Ltd., whereby Taseko proposes
         to acquire the 3 million  ounce Harmony Gold Project (See Item 4)(filed
         with Taseko's  Annual Report on Form 20-F for the year ended  September
         30, 2000 filed on March 31, 2001).

3B       Memorandum of Agreement with Cominco Engineering Services Ltd. ("CESL")
         dated  October  6, 2000  whereby  Gibraltar  and CESL will form a joint
         venture   to   explore    the    feasibility    of    applying    novel
         hydro-metallurgical/electrowinning     technology    to     Gibraltar's
         mineralization as a viable economic mineral extraction  method.  (filed
         with Taseko's  Annual Report on Form 20-F for the year ended  September
         30, 2000 filed on March 31, 2001)

3A       Memorandum of Agreement  dated for reference  December 1, 2000 pursuant
         to which Procorp  Services Limited  Partnership  ("Procorp") and Taseko
         have  agreed  that  Procorp  will  seek  to  finance  engineering  of a
         processing  plant  using  the CESL  technology  and other  services  in
         consideration of $900,000 US cash (initial payment made), $900,000 cash
         on successful  start up of the Gibraltar  Mine plus 3.4 million  Taseko
         Warrants,  subject to regulatory acceptance (filed with Taseko's Annual
         Report on Form 20-F for the year ended  September 30, 2000 filed on 31,
         2001)


There is one Exhibit filed with this Form 20-F namely the Arrangement  Agreement
dated February  28th,  2003 between  Taseko and Gibraltar  Engineering  Services
Limited and certain other affiliated  corporations pursuant to which Taseko will
acquire the 61% of the GESL business it does not already own in consideration of
the issuance of 7,446,809  common shares which is expected to completed in April
2003.


<page>

                                   SIGNATURES

Taseko  certifies that it meets all of the  requirements for filing on Form 20-F
and that it has duly caused and authorized  the  undersigned to sign this annual
report on its behalf.

TASEKO MINES LIMITED

/s/ Jeffrey R. Mason

JEFFREY R. MASON
Chief Financial Officer

DATED April 15, 2003


<page>


                                 CERTIFICATIONS

I, Ronald W. Thiessen, certify that:

1. I have reviewed this annual report on Form 20-F of Taseko Mines Limited;

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         (a)      designed  such  disclosure  controls and  procedures to ensure
                  that  material   information   relating  to  the   registrant,
                  including its consolidated  subsidiaries,  is made known to us
                  by others  within  those  entities,  particularly  during  the
                  period in which this annual report is being prepared;

         (b)      evaluated the  effectiveness  of the  registrant's  disclosure
                  controls and  procedures  as of a date within 90 days prior to
                  the filing date of this annual report (the "Evaluation Date");
                  and

         (c)      presented  in this  annual  report our  conclusions  about the
                  effectiveness of the disclosure  controls and procedures based
                  on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

         (a)      all  significant  deficiencies  in the design or  operation of
                  internal   controls   which   could   adversely   affect   the
                  registrant's ability to record, process,  summarize and report
                  financial  data  and  have  identified  for  the  registrant's
                  auditors any material weaknesses in internal controls; and

         (b)      any fraud,  whether or not material,  that involves management
                  or  other  employees  who  have  a  significant  role  in  the
                  registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: April 15, 2003

/S/ RONALD W. THIESSEN

Ronald W. Thiessen

Director, President, and Chief Executive Officer


<page>


                                  CERTIFICATION

I, Jeffrey R. Mason, certify that:

1. I have reviewed this annual report on Form 20-F of Taseko Mines Limited;

2.  Based on my  knowledge,  this  annual  report  does not  contain  any untrue
statement of a material fact or omit to state a material fact  necessary to make
the statements made, in light of the  circumstances  under which such statements
were made,  not  misleading  with  respect to the period  covered by this annual
report;

3.  Based  on my  knowledge,  the  financial  statements,  and  other  financial
information  included  in this annual  report,  fairly  present in all  material
respects the financial  condition,  results of operations  and cash flows of the
registrant as of, and for, the periods presented in this annual report;

4.  The  registrant's  other  certifying  officers  and  I are  responsible  for
establishing and maintaining  disclosure  controls and procedures (as defined in
Exchange Act Rules 13a-14 and 15d-14) for the registrant and have:

         (a)      designed  such  disclosure  controls and  procedures to ensure
                  that  material   information   relating  to  the   registrant,
                  including its consolidated  subsidiaries,  is made known to us
                  by others  within  those  entities,  particularly  during  the
                  period in which this annual report is being prepared;

         (b)      evaluated the  effectiveness  of the  registrant's  disclosure
                  controls and  procedures  as of a date within 90 days prior to
                  the filing date of this annual report (the "Evaluation Date");
                  and

         (c)      presented  in this  annual  report our  conclusions  about the
                  effectiveness of the disclosure  controls and procedures based
                  on our evaluation as of the Evaluation Date;

5. The registrant's other certifying officers and I have disclosed, based on our
most recent evaluation,  to the registrant's auditors and the audit committee of
registrant's board of directors (or persons performing the equivalent function):

         (a)      all  significant  deficiencies  in the design or  operation of
                  internal   controls   which   could   adversely   affect   the
                  registrant's ability to record, process,  summarize and report
                  financial  data  and  have  identified  for  the  registrant's
                  auditors any material weaknesses in internal controls; and

         (b)      any fraud,  whether or not material,  that involves management
                  or  other  employees  who  have  a  significant  role  in  the
                  registrant's internal controls; and

6. The  registrant's  other  certifying  officers  and I have  indicated in this
annual report whether or not there were significant changes in internal controls
or in other factors that could significantly affect internal controls subsequent
to the date of our most recent evaluation, including any corrective actions with
regard to significant deficiencies and material weaknesses.

Date: April 15, 2003

/s/ Jeffrey R. Mason

Jeffrey R. Mason

Director, Chief Financial Officer, and Secretary

</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-99
<SEQUENCE>3
<FILENAME>fstext.txt
<DESCRIPTION>AUDITED FINANCIAL STATEMENTS AND AUDITORS REPORT
<TEXT>
Auditors' Report

To the Board of Directors
Taseko Mines Limited

We have audited the  consolidated  balance  sheets of Taseko Mines Limited as at
September  30,  2002 and 2001 and the  consolidated  statements  of  operations,
deficit  and cash  flows for each of the years in the  three-year  period  ended
September 30, 2002.  These financial  statements are the  responsibility  of the
Company's  management.  Our  responsibility  is to  express  an opinion on these
financial statements based on our audits.

With respect to the consolidated  financial  statements for each of the years in
the  two-year  period  ended  September  30,  2002,  we  conducted  our audit in
accordance with Canadian generally accepted auditing standards and United States
generally  accepted  auditing  standards.   With  respect  to  the  consolidated
financial  statements  for the year ended  September  30, 2000, we conducted our
audit in accordance with Canadian generally accepted auditing  standards.  Those
standards  require  that we plan  and  perform  an audit  to  obtain  reasonable
assurance whether the financial statements are free of material misstatement. An
audit includes examining,  on a test basis,  evidence supporting the amounts and
disclosures in the financial  statements.  An audit also includes  assessing the
accounting principles used and significant estimates made by management, as well
as evaluating the overall financial statement presentation.

In our opinion,  these consolidated  financial statements present fairly, in all
material  respects,  the  financial  position of the Company as at September 30,
2002 and 2001 and the results of its  operations  and its cash flows for each of
the years in the three-year  period ended  September 30, 2002 in accordance with
Canadian generally accepted accounting principles.

KPMG LLP

Chartered Accountants

Vancouver, Canada
January 29, 2003

Comments by Auditors for U.S. Readers on Canada-U.S. Reporting Difference


In the United States,  reporting  standards for auditors require the addition of
an explanatory  paragraph  (following the opinion  paragraph) when the financial
statements are affected by conditions and events that cast substantial  doubt on
the Company's ability to continue as a going concern, such as those described in
note 1 to the  consolidated  financial  statements.  Our  report to the Board of
Directors  dated  January 29, 2003,  is expressed in  accordance  with  Canadian
reporting  standards  which do not permit a  reference  to such  conditions  and
events in the  auditors'  report  when  these are  adequately  disclosed  in the
financial statements.

KPMG LLP

Chartered Accountants

Vancouver, Canada
January 29, 2003

<PAGE>

                              TASEKO MINES LIMITED
                       CONSOLIDATED FINANCIAL STATEMENTS

                               SEPTEMBER 30, 2002

                        (Expressed in Canadian Dollars)

<PAGE>

TASEKO MINES LIMITED
Consolidated Balance Sheets
(Expressed in Canadian Dollars)

<TABLE>
<S>                                                             <C>              <C>
                                                      September 30     September 30
                                                              2002             2001
                                                     -------------    -------------
Assets

Current assets

Cash and equivalents .............................   $      39,104    $      82,296
Amounts receivable ...............................         336,247          231,432
Supplies inventory ...............................       2,282,954        2,400,000
Prepaid expenses .................................         103,631           27,183
                                                     -------------    -------------
                                                         2,761,936        2,740,911

Property, plant and equipment (note 4) ...........      10,158,525       10,872,590
Reclamation deposits (notes 3, 7(d)(ii) and 11(b))      18,576,524       17,854,892
Mineral property interests (note 5) ..............      28,813,296          602,001
                                                     -------------    -------------
                                                     $  60,310,281    $  32,070,394
                                                     =============    =============

Liabilities and Shareholders' Equity (Deficiency)

Current liabilities

Bank operating loan (note 6) .....................   $   2,000,000    $        --
Accounts payable and accrued liabilities .........       1,569,288        1,644,810
Advances from related parties (note 10) ..........       3,469,168        1,283,779
                                                     -------------    -------------
                                                         7,038,456        2,928,589

Reclamation liability (notes 4 and 11(b)) ........      32,700,000       32,700,000
                                                     -------------    -------------
                                                        39,738,456       35,628,589
                                                     -------------    -------------

Shareholders' equity (deficiency)

Share capital (note 7) ...........................      91,889,200       87,897,199
Convertible debenture (note 7(d)) ................      17,000,000       17,000,000
Tracking preferred shares (note 3) ...............      26,641,948             --
Deficit ..........................................    (114,959,323)    (108,455,394)
                                                     -------------    -------------
                                                        20,571,825       (3,558,195)
Continuing operations  (note 1)
Commitments (note 5)
Subsequent  events (notes 5(e) and 11)
                                                     -------------    -------------
                                                     $  60,310,281    $  32,070,394
                                                     =============    =============
</TABLE>

See accompanying notes to consolidated financial statements.

Approved by the Board of Directors

/s/ Ronald W. Thiessen                                      /s/ Jeffrey R. Mason

Ronald W. Thiessen                                          Jeffrey R. Mason
Director                                                    Director


<PAGE>

TASEKO MINES LIMITED
Consolidated Statements of Operations
(Expressed in Canadian Dollars)

<TABLE>
<S>                                                                                                                <C>
                                                                                             Years ended September 30,
                                                                              -----------------------------------------------------
                                                                                       2002                2001                2000
                                                                              -------------       -------------       -------------
Expenses
   Conference and travel ...............................................      $      44,429       $      72,981       $      36,428
   Consulting ..........................................................            133,672           1,750,662             104,683
   Corporation taxes ...................................................            577,228             211,486              94,836
   Depreciation ........................................................            714,065             714,857             717,002
   Exploration (schedule) ..............................................          2,071,885           3,860,176           4,464,999
   Interest and finance charges ........................................            507,790              73,058                --
   Legal, accounting and audit .........................................            334,492             483,653             199,905
   Office and administration ...........................................            247,061             674,783             795,049
   Refinery project (schedule) .........................................          1,698,826           3,571,942                --
   Shareholder communication ...........................................             90,835              73,523             101,953
   Trust and filing ....................................................             36,802              51,155              72,446
                                                                              -------------       -------------       -------------
                                                                                  6,457,085          11,538,276           6,587,301
                                                                              -------------       -------------       -------------
Other items
   Interest and other income ...........................................            551,842           1,110,431             678,014
   Gain on sale of property, plant and equipment .......................              1,314                --                  --
   Write down of mineral property acquisition costs ....................           (600,000)        (44,224,214)               --
   Write down of supplies inventory ....................................               --            (3,509,465)               --
                                                                              -------------       -------------       -------------
                                                                                    (46,844)        (46,623,248)            678,014
                                                                              -------------       -------------       -------------

Loss for the year ......................................................      $  (6,503,929)      $ (58,161,524)      $  (5,909,287)
                                                                              =============       =============       =============

Basic and diluted loss per common share (note 2) .......................      $       (0.21)      $       (2.32)      $       (0.25)
                                                                              =============       =============       =============
Weighted average number of
   common shares outstanding ...........................................         30,338,098          25,067,697          23,402,726
                                                                              =============       =============       =============
</TABLE>



Consolidated Statements of Deficit
(Expressed in Canadian Dollars)

<TABLE>
<S>                                                                                                                <C>
                                                                                             Years ended September 30,
                                                                              -----------------------------------------------------
                                                                                       2002                2001                2000
                                                                              -------------       -------------       -------------
Deficit, beginning of year .............................................      $(108,455,394)      $ (50,293,870)      $ (44,384,583)
Loss for the year ......................................................         (6,503,929)        (58,161,524)         (5,909,287)
                                                                              -------------       -------------       -------------
Deficit, end of year ...................................................      $(114,959,323)      $(108,455,394)      $ (50,293,870)
                                                                              =============       =============       =============
</TABLE>


See accompanying notes to consolidated financial statements

<PAGE>

TASEKO MINES LIMITED
Consolidated Statements of Cash Flows
(Expressed in Canadian Dollars)


<TABLE>
<S>                                                                                                                 <C>
                                                                                              Years ended September 30,
                                                                                    -----------------------------------------------
Cash provided by (used for)                                                                  2002             2001             2000
                                                                                     ------------     ------------     ------------
Operating activities
   Loss for the year ............................................................    $ (6,503,929)    $(58,161,524)    $ (5,909,287)
   Items not involving cash
       Accrued interest income on reclamation deposits ..........................        (546,632)        (837,062)        (455,803)
       Depreciation .............................................................         714,065          714,857          717,002
       Write down of mineral property acquisition costs .........................         600,000       44,224,214               --
       Write down of supplies inventory .........................................              --        3,509,465               --
       Gain on sale of property, plant and equipment ............................          (1,314)              --               --
       Acquisition premium paid for Gibraltar Refinery (2002) Ltd. ..............         314,330               --               --
       Shares issued for loan guarantee .........................................         400,000               --               --
   Changes in non-cash operating working capital
       Amounts receivable .......................................................        (104,815)       1,542,111        2,524,523
       Supplies inventory .......................................................         117,046           62,968          244,235
       Prepaid expenses .........................................................         (76,448)         102,702          (69,461)
       Accounts payable and accrued liabilities .................................         764,478         (430,256)        (757,536)
                                                                                     ------------     ------------     ------------
                                                                                       (4,323,219)      (9,272,525)      (3,706,327)
                                                                                     ------------     ------------     ------------

Investing activities
   Cash paid on acquisition of Harmony Gold Property ............................      (2,230,000)              --               --
   Cash acquired on business acquisition (note 5(e)) ............................              --               --           52,456
   Mineral property interests, net ..............................................              --               (1)          48,274
   Notes receivable .............................................................              --               --        3,457,213
   Proceeds on sale of mineral property interests ...............................               1               --               --
   Proceeds received on the sale of property, plant and equipment ...............           9,802               --               --
   Reclamation deposit (note 7(d)(ii)) ..........................................              --       (8,500,000)              --
                                                                                     ------------     ------------     ------------
                                                                                       (2,220,197)      (8,500,001)       3,557,943
                                                                                     ------------     ------------     ------------

Financing activities
   Bank operating loan ..........................................................       2,000,000               --               --
   Advances from related parties ................................................       2,185,389        2,663,188       (1,370,389)
   Advances from Gibraltar Engineering Services Limited Partnership .............       1,849,000               --               --
   Common shares issued for cash, net of issue costs ............................         465,835               --        2,421,480
   Convertible debenture (note 7(d)) ............................................              --        8,500,000        4,500,000
                                                                                     ------------     ------------     ------------
                                                                                        6,500,224       11,163,188        5,551,091
                                                                                     ------------     ------------     ------------

Increase (decrease) in cash and equivalents .....................................         (43,192)      (6,609,338)       5,402,707
Cash and equivalents, beginning of year .........................................          82,296        6,691,634        1,288,927
                                                                                     ------------     ------------     ------------
Cash and equivalents, end of year ...............................................    $     39,104     $     82,296     $  6,691,634
                                                                                     ============     ============     ============
</TABLE>

Supplementary cash flow disclosures (note 9)

See accompanying notes to consolidated financial statements.

<PAGE>

TASEKO MINES LIMITED
Consolidated Schedules of Mineral Property Exploration Expenses
(Expressed in Canadian dollars)

<TABLE>
<S>                                                                       <C>             <C>                   <C>    <C>
                                                                                           Property
                                                                          -----------------------------------------
Year ended September 30, 2002                                               Prosperity     Gibraltar      Westgarde           Total
                                                                          ------------    ----------   ------------    ------------
Exploration expenses
   Assays and analysis ................................................   $      7,352    $      367            $ -    $      7,719
   Equipment rentals ..................................................          6,546             -              -           6,546
   Geological .........................................................              -        39,830              -          39,830
   Mine planning ......................................................        (50,800)      215,900              -         165,100
   Site activities ....................................................          1,044     2,081,645              -       2,082,689
   Recovery of exploration expense
       incurred on sale (note 3) ......................................              -             -       (229,999)       (229,999)
                                                                          ------------    ----------   ------------    ------------
Exploration expenses (recovery) during the year .......................        (35,858)    2,337,742       (229,999)      2,071,885
Cumulative expenses, beginning of year ................................     41,523,768     6,650,841        210,976      48,385,585
                                                                          ------------    ----------   ------------    ------------
Cumulative expenses, end of year ......................................   $ 41,487,910    $8,988,583   $    (19,023)   $ 50,457,470
                                                                          ============    ==========   ============    ============



                                                                                           Property
                                                                          -----------------------------------------
Year ended September 30, 2001                                               Prosperity     Gibraltar      Westgarde           Total
                                                                          ------------    ----------   ------------    ------------
Exploration expenses
   Assays and analysis ................................................   $     88,679    $  147,209   $     10,016    $    245,904
   Equipment rentals ..................................................         72,873        18,723              -          91,596
   Geological .........................................................         72,339       546,123        167,392         785,854
   Mine planning ......................................................        149,068        18,700              -         167,768
   Option payment .....................................................              -             -         30,000          30,000
   Site activities ....................................................            626     2,503,963              -       2,504,589
   Transportation .....................................................          3,350        27,547          3,568          34,465
                                                                          ------------    ----------   ------------    ------------
Exploration expenses during the year ..................................        386,935     3,262,265        210,976       3,860,176
Cumulative expenses, beginning of year ................................     41,136,833     3,388,576              -      44,525,409
                                                                          ------------    ----------   ------------    ------------
Cumulative expenses, end of year ......................................   $ 41,523,768    $6,650,841   $    210,976    $ 48,385,585
                                                                          ============    ==========   ============    ============



                                                                                           Property
                                                                          -----------------------------------------
Year ended September 30, 2000                                               Prosperity     Gibraltar      Westgarde           Total
                                                                          ------------    ----------   ------------    ------------
Exploration expenses
   Assays and analysis ................................................   $     13,458    $  249,458            $ -    $    262,916
   Drilling ...........................................................              -       389,671              -         389,671
   Equipment rentals ..................................................         31,225        87,548              -         118,773
   Geological .........................................................         32,808       353,289              -         386,097
   Mine planning ......................................................        812,186       111,308              -         923,494
   Site activities ....................................................        115,388     2,193,138              -       2,308,526
   Transportation .....................................................         71,358         4,164              -          75,522
                                                                          ------------    ----------   ------------    ------------
Exploration expenses during the year ..................................      1,076,423     3,388,576              -       4,464,999
Cumulative expenses, beginning of year ................................     40,060,410             -              -      40,060,410
                                                                          ------------    ----------   ------------    ------------
Cumulative expenses, end of year ......................................   $ 41,136,833    $3,388,576            $ -    $ 44,525,409
                                                                          ============    ==========   ============    ============
</TABLE>



See accompanying notes to consolidated financial statements.



<PAGE>

TASEKO MINES LIMITED
Consolidated Schedule of Refinery Project Expenses
(Expressed in Canadian dollars)

<TABLE>
<S>                                                                                                                     <C>
                                                                                                  Years ended September 30,
                                                                                          ------------------------------------------
Refinery Project Expenses                                                                       2002           2001             2000
                                                                                          ----------     ----------     ------------
Concentrate production ..............................................................     $        -     $  168,381              $ -
Engineering .........................................................................        403,494      1,649,375                -
Environmental and permitting ........................................................         57,988        352,421                -
Interest ............................................................................         73,289        121,011                -
Metallurgy ..........................................................................         10,883        363,098                -
Pilot plant testwork ................................................................        290,680        508,759                -
Support services ....................................................................        548,162        408,897                -
Acquisition premium paid for Gibraltar Refinery (2002) Ltd. .........................        314,330              -                -
                                                                                          ----------     ----------     ------------
Expenses during the year ............................................................      1,698,826      3,571,942                -
Cumulative expenses, beginning of year ..............................................      3,571,942              -                -
                                                                                          ----------     ----------     ------------
Cumulative expenses, end of year ....................................................     $5,270,768     $3,571,942              $ -
                                                                                          ==========     ==========     ============
</TABLE>


See accompanying notes to consolidated financial statements.

<PAGE>

TASEKO MINES LIMITED
Notes to Consolidated Financial Statements
For the year ended September 30, 2002
(Expressed in Canadian Dollars)

1.       CONTINUING OPERATIONS

Taseko Mines Limited ("Taseko" or the "Company") is incorporated  under the laws
of the Province of British Columbia.  Its principal business  activities are the
operations of the Gibraltar  Copper Mine, which is currently on standby care and
maintenance,  and  the  exploration  of  the  Company's  100%  owned  Prosperity
Gold-Copper  property.  Both  mineral  properties  are located in south  central
British Columbia,  Canada,  near the City of Williams Lake. On October 16, 2001,
the Company acquired the Harmony Gold Property,  a mineral exploration  property
located  on  Graham  Island,  Queen  Charlotte  Islands - Haida  Gwaii,  British
Columbia, from a company related by way of common directors (note 3).

The Company's continuing  operations and the underlying value and recoverability
of the amounts shown for the Prosperity and Harmony mineral  property  interests
are entirely  dependent upon the existence of economically  recoverable  mineral
reserves,  the  ability  of the  Company to obtain the  necessary  financing  to
complete the exploration and development of its mineral property interests,  and
upon future  profitable  production  or  proceeds  from the  disposition  of its
mineral  property  interests.  The  recoverability  of the amounts shown for the
Gibraltar  Mine mineral  property  interest and related  plant and equipment and
supplies  inventory is  dependent  upon the ability of the Company to obtain the
necessary  financing to re-start operations of the mine, should metal prices and
other factors warrant it, and upon future profitable production or proceeds from
the disposition of the mine.

These  financial  statements  are  prepared on the basis that the  Company  will
continue as a going concern. As at September 30, 2002, the Company had a working
capital  deficiency of approximately  $4.3 million and had recorded  significant
losses and  operating  cash flow  deficiencies  in each of the last three fiscal
years. Management recognizes that the Company must generate additional financial
resources  in order to meet  liabilities  as they  come due and to  enable it to
continue  operations.  The  Company  and its  financial  advisors  are  actively
targeting  sources of  additional  funding  through  alliances  with  financial,
exploration  and mining  entities or other  business and financial  transactions
which  would  generate  sufficient  resources  to  assure  continuation  of  the
Company's  operations  and  exploration  programs.  However,  there  can  be  no
assurances that the Company will obtain  additional  financial  resources and/or
achieve profitability or positive cash flows. If the Company is unable to obtain
adequate  additional  financing,   the  Company  will  be  required  to  curtail
operations and exploration activities. These financial statements do not reflect
adjustments,  which  could be  material,  to the  carrying  values of assets and
liabilities  which may be required should the Company be unable to continue as a
going  concern.  Subsequent to September 30, 2002, the Company  completed  $4.24
million in equity  financings  and received a $2.5 million  refund in respect of
its reclamation deposits (note 11).


2.       SIGNIFICANT ACCOUNTING POLICIES


BASIS OF PRESENTATION AND PRINCIPLES OF CONSOLIDATION

     These  financial  statements have been prepared in accordance with Canadian
     generally accepted  accounting  principles  ("GAAP") which conform,  in all
     material  respects,  with those  generally  accepted in the United  States,
     except as  disclosed in note 12. These  consolidated  financial  statements
     include  the  accounts of Taseko,  its  wholly-owned  subsidiaries,  Taseko
     Resources Inc.,  Concentrated  Exploration  Ltd. (note 5(e)),  Concentrated
     Exploration  2000 Ltd. (note 5(e)),  Gibraltar  Refinery  (2002) Ltd. (note
     5(e)) and  Gibraltar  Mines  Ltd.  (note  5(a)),  its 70% owned  subsidiary
     Cuisson  Lake  Mines  Ltd.  (note  5(a)),  and its  interest  in  Gibraltar
     Engineering  Services Limited Partnership ("GESL Partnership") (note 5(a)).
     All material intercompany accounts and transactions have been eliminated.


CASH AND EQUIVALENTS

     Cash and equivalents consist of cash and highly liquid investments,  having
     maturity dates of three months or less from the date of  acquisition,  that
     are readily convertible to known amounts of cash.


SUPPLIES INVENTORY

     Supplies  inventory is reported at the lower of moving average cost and net
     realizable value.


PROPERTY, PLANT AND EQUIPMENT

     Plant and  equipment  are  stated at cost  less  accumulated  depreciation.
     Depreciation is recorded over the estimated  economic life of the plant and
     equipment  on a straight  line basis at annual  rates  ranging from 1.3% to
     16.5%, except for the solvent extraction/electrowinning plant and equipment
     included  in  Gibraltar  Mine  plant  and  equipment  (note  4),  which are
     depreciated on a straight line basis at rates from 20% to 50% per annum.


MINERAL PROPERTY INTERESTS

     The   Company   defers   mineral   property    acquisition   costs   on   a
     property-by-property  basis.  Exploration  expenditures and option payments
     incurred prior to the determination of the feasibility of mining operations
     are charged to operations as incurred.  Development  expenditures  incurred
     subsequent to such determination,  to increase production, or to extend the
     life of existing  production are capitalized,  except as noted below.  Such
     acquisition costs and deferred  development  expenditures are amortized and
     depreciated  over the  estimated  life of the  property,  or written off to
     operations if the property is abandoned,  allowed to lapse,  or if there is
     little  prospect  of further  work being  carried out by the Company or its
     option or joint venture partners.

     All costs incurred by the Company  during the standby care and  maintenance
     period at the Gibraltar Mine are expensed as incurred (note 5(a)).

     Mineral property  acquisition costs include the cash  consideration and the
     fair  market  value of common  shares,  based on the  trading  price of the
     shares at the  agreement  date,  issued  for  mineral  property  interests,
     pursuant to the terms of the  relevant  agreement.  Payments  relating to a
     property  acquired under an option or joint venture  agreement,  where such
     payments are made at the sole  discretion  of the Company,  are recorded in
     the accounts upon payment.

     Costs  related  to  feasibility  work  and the  development  of  processing
     technology  are  expensed as incurred.  Costs  incurred  subsequent  to the
     determination  of the  feasibility  of the  processing  technology  will be
     capitalized and amortized over the life of the related plant.

     Administrative expenditures are expensed as incurred.

     The amount shown for mineral property  interests  represents costs incurred
     to date and the fair value of shares issued to date relating to acquisition
     costs, less write-downs (note 5), but does not necessarily  reflect present
     or future values.


SHARE CAPITAL

     Common shares issued for  non-monetary  consideration  are recorded at fair
     value  based  upon the  trading  price  of the  shares  on the TSX  Venture
     Exchange on the date of the agreement to issue the shares.

     The proceeds,  net of issue costs,  from common  shares issued  pursuant to
     flow-through  share financing  agreements are credited to share capital and
     the tax benefits of these  exploration  expenditures are transferred to the
     purchaser of the shares.


SHARE PURCHASE OPTION COMPENSATION PLAN

     The  Company  has a share  purchase  option  compensation  plan,  which  is
     described in Note 7(e). No compensation expense is recognized for this plan
     when stock options are granted. Any consideration paid on exercise of stock
     options is credited to share capital.


INCOME TAXES

     The Company uses the asset and liability  method of  accounting  for income
     taxes.  Under this method,  future  income tax assets and  liabilities  are
     computed  based on  differences  between the carrying  amount of assets and
     liabilities  on the  balance  sheet and  their  corresponding  tax  values,
     generally  using the  substantively  enacted  income tax rates  expected to
     apply to taxable  income in the years in which those  temporary  difference
     are  expected to be  recovered  or settled.  Future  income tax assets also
     result from unused loss carry forwards,  resource-related  pools, and other
     deductions.  Future tax assets are  recognized  to the extent that they are
     considered  more likely than not to be  realized.  The  valuation of future
     income tax assets is  adjusted,  if  necessary,  by the use of a  valuation
     allowance to reflect the estimated realizable amount.


LOSS PER COMMON SHARE

     In December 2000, the Accounting  Standards Board of the Canadian Institute
     of  Chartered  Accountants  ("CICA')  revised  Section  3500  of  the  CICA
     Handbook,  Earnings per Share ("Section  3500").  Section 3500 requires the
     use of the treasury stock method of calculating  diluted loss per share for
     options  and  warrants,  and  the  use  of  the  "if-converted"  method  of
     calculating diluted loss for convertible  securities.  Basic loss per share
     continues to be calculated by dividing  earnings (loss) available to common
     shareholders by the weighted  average number of shares  outstanding  during
     the year.

     Under the treasury  stock  method,  the weighted  average  number of common
     shares outstanding for the calculation of diluted earnings (loss) per share
     assumes that the  proceeds to be received on the exercise of stock  options
     or warrants is applied to repurchase  common  shares at the average  market
     price for the period.  Under the "if-converted"  method, the computation of
     diluted  earnings  (loss)  per  share  assumes  conversion  of  convertible
     securities at the earlier of the  beginning of the reporting  period or the
     time of issuance  and adjusts for the  earnings  effect of the  convertible
     securities.  Where there is a loss for the period,  the potential shares to
     be issued are not included in the computation of diluted loss per share.

     During  the  year  ended  September  30,  2002,  the  Company  adopted  the
     recommendations  of Section 3500 with  retroactive  restatement  for fiscal
     2001 and 2000.  However,  there was no effect on reported  basic or diluted
     loss per share  for  fiscal  2001 or 2000,  as the  effect  of  outstanding
     options,  warrants and convertible securities on basic loss per share would
     be anti-dilutive.


FAIR VALUE OF FINANCIAL INSTRUMENTS

     The  carrying  amounts  of  cash  and  equivalents,   amounts   receivable,
     reclamation deposits,  bank operating loan and accounts payable and accrued
     liabilities,  approximate  their fair  values due to their  short  terms to
     maturity.  The fair value of the  convertible  debenture  and the  tracking
     preferred shares are not readily  determinable with sufficient  reliability
     due to the difficulty in obtaining  appropriate market  information.  It is
     not practicable to determine the fair values of the advances due to related
     parties because of the related party nature of such amounts and the absence
     of a secondary market for such  instruments.  Details of the terms of these
     financial   instruments  are  disclosed  in  the  notes  to  the  financial
     statements.


USE OF ESTIMATES

     The  presentation  of financial  statements  in  conformity  with  Canadian
     generally  accepted  accounting  principles  requires  management  to  make
     estimates and  assumptions  that affect the reported  amounts of assets and
     liabilities and the disclosure of contingent  assets and liabilities at the
     date of the financial  statements  and the reported  amounts of revenue and
     expenses during the reporting  period.  Significant areas requiring the use
     of management estimates include the determination of impairment, if any, of
     mineral  property  interests  and  plant  and  equipment,  the  balance  of
     reclamation  liability  and rates for  depreciation.  Actual  results could
     differ from those estimates.


SEGMENT DISCLOSURES

     The  Company  operates  in  a  single  reportable  operating  segment,  the
     exploration,  development  and  operation  of mineral  property  interests,
     within the geographic area of British Columbia, Canada.


COMPARATIVE FIGURES

     Certain of the prior  years'  comparative  figures  have been  restated  to
     conform with the presentation adopted for the current year.


<PAGE>

3.       ARRANGEMENT AGREEMENT

Harmony Gold Property

After receiving shareholder and regulatory approval, effective October 16, 2001,
the Company and its subsidiary Gibraltar Mines Ltd. (`Gibraltar")  completed the
acquisition  of the Harmony Gold  Property and related  assets from  Continental
Minerals Corporation  ("Continental")  (formerly Misty Mountain Gold Limited), a
British  Columbia  company  with certain  directors  in common with Taseko,  for
12,483,916  series "A"  non-voting  tracking  preferred  shares of Gibraltar and
$2.23  million  cash.  Subsequent  to  closing,  a  dissenting   shareholder  of
Continental  exchanged his 717,500 Gibraltar preferred shares for 114,800 common
shares of the Company.  The tracking  preferred shares are designed to track and
capture the value of the Harmony Gold Property and will be converted into common
shares of Taseko upon a  realization  event,  such as a sale to a third party or
commercial  production  at  the  Harmony  Gold  Property,  or at the  option  of
Gibraltar,   if  a  realization   event  has  not  occurred  within  ten  years.
Accordingly,   the  tracking   preferred  shares  have  been  classified  within
shareholders' equity on the consolidated balance sheet.

As this acquisition was a related party  transaction not in the normal course of
business that is not the culmination of an earnings process, the acquisition was
recorded by the Company at the net book value of the assets transferred,  net of
cash consideration, as follows:

                                                            Amount
                                                       -----------
Assets acquired
   Property and equipment ..........................   $     8,488
   Reclamation deposit .............................       175,000
   Mineral property interests ......................    28,811,296
                                                       -----------
                                                       $28,994,784
                                                       ===========

Consideration given
   Cash ............................................   $ 2,230,000
   12,483,916 tracking preferred shares of Gibraltar    26,641,948
   114,800 common shares of the Company ............       122,836
                                                       -----------
                                                       $28,994,784
                                                       ===========


The Gibraltar  tracking  preferred  shares issued to Continental  have initially
been  recorded for Canadian tax purposes at a paid up amount of $62.77  million,
but such  amount is  subject  to  adjustment  based on the fair  value of Taseko
common shares  ultimately  received by  Continental.  As previously  noted,  the
Gibraltar  tracking  preferred shares are redeemable for common shares of Taseko
upon the  occurrence  of certain value  realization  events for the Harmony Gold
Property.  The tracking  preferred shares are redeemable at specified prices per
common share of Taseko  starting at $3.39 and escalating by $0.25 per year. If a
realization  event  does not  occur  within  ten  years  from the date of issue,
Gibraltar  has the right to redeem  the  tracking  preferred  shares  for Taseko
common  shares at a deemed  price  equal to the  greater  of the  average 20 day
trading  price of the common  shares of Taseko  and  $10.00.  The Taseko  common
shares to be issued to  Continental  upon a  realization  event  will in turn be
distributed  pro-rata,  after  adjustment  for  any  taxes,  to the  holders  of
redeemable  preferred  shares of  Continental  that were  issued to  Continental
shareholders at the time of the Arrangement Agreement.

In connection with this  acquisition,  Taseko sold its interest in the Westgarde
property  to  Continental  for  $230,000  cash,  which has been  presented  as a
recovery of  exploration  expenses  incurred,  and  exchanged its 5% net profits
interest,  valued at $600,000, in the Harmony Project for a 1% working interest,
valued at  $600,000,  in the  Company's  Prosperity  Property  held by a limited
partnership  beneficially  controlled by  Continental.  In connection  with this
Arrangement  Agreement,  the  Company  undertook  a bank  loan in the  amount of
$2,000,000, which is fully secured by a private company controlled by one of the
directors of Taseko. In consideration for providing  security for this loan, the
Company issued 606,061 common shares (note 6).

4. PROPERTY, PLANT AND EQUIPMENT


<TABLE>
<S>                                   <C>           <C>           <C>           <C>
                                                    Accumulated
                                            Cost   Depreciation         Net book value
                                      -----------   -----------   -------------------------
Prosperity Property                   September 30 September 30  September 30  September 30
Equipment                            2002 and 2001         2002          2002          2001
- -----------------------------------   -----------   -----------   -----------   -----------
Field .............................   $    11,879   $     9,426   $     2,453   $     3,504
Computer and office ...............        15,172        13,314         1,858         2,655
                                      -----------   -----------   -----------   -----------
Total Prosperity Property .........   $    27,051   $    22,740   $     4,311   $     6,159
                                      -----------   -----------   -----------   -----------
Gibraltar Mine
Plant and Equipment
- -----------------------------------   -----------   -----------   -----------   -----------
Buildings and equipment ...........   $ 5,931,580   $   340,420   $ 5,591,160   $ 5,666,965
Mine equipment ....................     5,454,001     1,591,652     3,862,349     4,331,248
Plant and equipment ...............     1,015,303       441,911       573,392       703,579
Vehicles ..........................       152,854        70,045        82,809       103,444
Computer equipment ................       101,162        56,658        44,504        61,195
                                      -----------   -----------   -----------   -----------
Total Gibraltar Mine ..............   $12,654,900   $ 2,500,686   $10,154,214   $10,866,431
                                      -----------   -----------   -----------   -----------

                                      -----------   -----------   -----------   -----------
Total property, plant and equipment   $12,681,951   $ 2,523,426   $10,158,525   $10,872,590
                                      ===========   ===========   ===========   ===========
</TABLE>


As part of the  acquisition of the Gibraltar  Mine in 1999, the Company  pledged
the Gibraltar Mine plant and equipment as well as reclamation  deposits of $18.4
million, as security for the estimated  environmental liability of $32.7 million
assumed as part of the acquisition.


<PAGE>

5.       MINERAL PROPERTY INTERESTS

                                             September 30  September 30
                                                     2002          2001
                                              -----------   -----------
Gibraltar Copper Mine (note 5(a)) .........   $     1,000   $     1,000
Prosperity Gold-Copper Property (note 5(b))         1,000         1,000
Harmony Gold Property (note 5(c)) .........    28,811,296       600,000
Westgarde Property (note 5(d)) ............             -             1
                                              -----------   -----------
                                              $28,813,296   $   602,001
                                              ===========   ===========

(a)      Gibraltar Copper Mine

In 1999, the Company,  through Gibraltar Mines Ltd., acquired a 100% interest in
the Gibraltar Copper Mine mineral property,  located near Williams Lake, British
Columbia, Canada from Boliden Westmin (Canada) Limited ("BWCL"), for $3,324,844.
This acquisition  included 100% of NGMT Resources  Limited and 70% of the shares
of Cuisson Lake Mines Ltd., companies with mineral property interests within the
Gibraltar  mine  property.  The Company  subsequently  entered into an agreement
whereby a party  purchased a 7.5%  interest in the  Gibraltar  mine property for
$352,500,  which was subsequently reacquired in fiscal 2000 (note 5(e)). As part
of its  operating  permits,  Gibraltar  Mines  Ltd.  agreed  to incur a total of
$4,000,000 on reclamation and environmental  programs during the six year period
July 1999 to July 2005,  of which a total of  $2,131,650  had been  incurred  to
September 30, 2002.

In fiscal 2001,  Gibraltar Mines Ltd.,  Gibraltar  Engineering  Services Limited
Partnership  (the "GESL  Partnership")  (see note 5(e)) and Cominco  Engineering
Services Ltd.  ("CESL")  concluded a Memorandum of Agreement  ("MOA") to jointly
complete an evaluation for a potential hydrometallurgical copper refinery at the
Gibraltar mine. The parties initially agreed to complete a $2.7 million detailed
investigation  of the feasibility of the refinery,  including the production and
bulk testing of six tonnes of concentrate  through CESL's  existing pilot plant.
CESL and  GESL  Partnership  were  each  responsible  for  funding  50% of these
evaluation costs.

GESL  Partnership  is a limited  partnership  formed  under the laws of  British
Columbia,  which  commenced  business  on October 1, 2000.  The  Company was the
initial limited partner of the GESL Partnership. The principal business activity
of the GESL  Partnership  is to conduct an integrated  engineering  and contract
services  business.  It has  implemented a defined work program,  the results of
which  will  contribute  to  a  final   determination   of  the  feasibility  of
commercializing a hydrometallurgical technology developed by CESL for extracting
copper from  concentrates in a proposed  refinery to be located at the Gibraltar
Mine (the "Gibraltar Refinery").

The GESL  Partnership  has the right, in the event that a final decision is made
to proceed with the construction of the Gibraltar Refinery on or before June 30,
2003,  to provide  necessary  engineering  services  relating  to a start-up  of
operations  at  the  Gibraltar  Mine,  and  for  the  final  design,  tendering,
procurement and construction of the Gibraltar Refinery,  as well as the right to
become contract  operator of the Gibraltar Mine, the Gibraltar Mine concentrator
and the Gibraltar Refinery.  In each case, the GESL Partnership will provide its
services for a fixed fee equal to industry standard rates for such services, and
such services will be provided pursuant to a definitive consulting and operating
agreement  negotiated in good faith between the parties and containing customary
industry terms and conditions.

If Gibraltar Mines Ltd. does not proceed with the  construction of the Gibraltar
Refinery,  the GESL  Partnership  has the right to construct,  own and operate a
refinery  utilizing the CESL  technology at the Gibraltar mine site,  subject to
the approval by CESL of satisfactory  licensing  arrangements for the use of the
CESL technology.  In addition, if Gibraltar Mines Ltd. does not proceed with the
construction  of the Gibraltar  Refinery,  the GESL  Partnership  has the right,
until July 1, 2006, to provide  engineering and contract  operation  services to
Gibraltar Mines Ltd. or any other party, for the construction and operation of a
refinery  using the CESL  technology on the Gibraltar  property,  subject to the
approval by CESL of satisfactory  licensing arrangements for the use of the CESL
technology.

To September 30, 2002, the GESL Partnership incurred project costs of $4,956,438
(September 30, 2001 - $3,571,942),  including expenses  originally  contemplated
under the MOA but excluding  the premium on  acquisition  of Gibraltar  Refinery
(2002) Ltd. (see note 5(e)).  Expenses  incurred in excess of the amounts agreed
to in the original MOA were funded by Taseko and the GESL Partnership.

The Company retained Procorp Services Limited Partnership ("Procorp") to provide
technical, financial, management and marketing services related to all facets of
the start-up,  expansion and  development of the Gibraltar Mine and the proposed
hydrometallurgical  refinery.  Procorp  is  a  mining  services,  financing  and
marketing   partnership  comprised  of  experienced,   specialized   independent
contractors  as well as  members  who are also  directors  and  officers  of the
Company.  Compensation to Procorp  included an initial payment of US$900,000 for
services  rendered  in  fiscal  2001 and 2002  (paid)  and a second  payment  of
US$900,000  upon  successful  recommencement  of  commercial  production  of the
Gibraltar Mine. In addition, the Company agreed, subject to regulatory approval,
to issue to Procorp  3.4  million  warrants  to  purchase  common  shares of the
Company  at  a  price  of  $1.70  per  share  for  five  years  upon  successful
recommencement of commercial production at the Gibraltar Mine.

The  Gibraltar  Mine has been on care and  maintenance  since being  acquired in
1999. Due to continued  uncertainty  regarding start-up and an extended cycle of
depressed metal prices, the Company wrote down the accumulated  mineral property
interest acquisition costs of $5,936,568 to a nominal $1,000 during fiscal 2001.

(b)      Prosperity Gold-Copper Property

The Company owns 100% of the  Prosperity  Gold-Copper  Property,  located in the
Clinton Mining Division,  British Columbia,  Canada, which was acquired prior to
1995 for total cash and share consideration of $28,660,010.  During fiscal 1999,
the Company  entered into an  agreement  that allowed a party to earn up to a 5%
working interest in the Prosperity Property,  which was subsequently  reacquired
in fiscal  2000 (note  5(e)),  and entered  into an  agreement  that  allowed an
exploration limited  partnership  controlled by Continental to earn a 1% working
interest in the  property for  $600,001,  which was  reacquired  in October 2001
(note 3).

During fiscal 2001, the Prosperity  Project was written down to a nominal $1,000
to reflect  the  extended  depressed  conditions  in the metal  markets  and the
Company's  intention to defer  significant work on the project until a sustained
recovery of metal prices had occurred.  The working interest  previously held by
Continental was written down to a nominal amount when it was reacquired.

(c) Harmony Gold Property (note 3)

In February 1999, the Company  acquired a 5% net profits  royalty on the Harmony
Gold Property  located in the Skeena  Mining  Division on Graham  Island,  Queen
Charlotte Islands - Haida Gwaii,  British Columbia,  Canada,  for $600,000,  and
purchased  for $1,  an  exclusive  farm-out  right  to earn up to a 10%  working
interest in the Harmony  Property,  by  expending  $600,000  for each 1% working
interest  prior to January 1,  2001.  The  Harmony  Gold  Property  was owned by
Continental,  a public  British  Columbia  company  with certain  directors  and
officers in common with the Company.  During  fiscal 2001,  the Company  allowed
this working interest option to expire, unexercised.

Under the terms of an  Arrangement  Agreement  (note 3), the Company  acquired a
100% interest in the Harmony Gold Property in fiscal 2002.

(d)      Westgarde Property

The Westgarde  Property consists of 27 contiguous  mineral claims that contain a
copper prospect covering an area of 6000 hectares located 63 kilometres south of
Smithers, British Columbia.

Revelation  Exploration Limited Partnership  ("Revelation"),  of which Gibraltar
Mines Ltd.  is the  original  limited  partner,  arranged  for the staking of 13
claims and  signed an option  agreement  dated  December  7, 2000,  on behalf of
Gibraltar Mines Ltd.,  whereby  Revelation may earn a 100% interest in 14 claims
known as the Star and CL claims.  In order for the option to be exercised,  cash
payments totaling $870,000, plus share issuances of total value of not less than
$1,290,000 were to be made on or before January 1, 2010. An initial cash payment
of $30,000 was paid on December  7, 2000.  During  fiscal  2002,  the  Westgarde
Property, including the Star and CL claims, was sold to Continental for $230,000
(note 3).

(e) Farm-out, joint venture and acquisition agreements

In  February  1999,  the  Company   entered  into  a  farm-out   agreement  with
Concentrated  Exploration 1999 Limited  Partnership  ("CELP99"),  whereby CELP99
could earn up to a 5% working interest in the Prosperity Property project on the
basis of a 1.5% working interest for each $900,000 expended.  Pursuant to a July
1999 acquisition and joint venture  agreement,  CELP99 purchased a 7.5% interest
in the Gibraltar mineral lands for $352,500 by way of a note receivable due July
31,  2001 which bore  interest  at 8% per  annum,  and agreed to use  reasonable
efforts to expend up to $4.5  million on the  Gibraltar  Project by January  31,
2000. CELP99 was a private British Columbia based resource  exploration  limited
partnership that raised approximately $4.7 million for the purposes of incurring
exploration  expenditures  on the  Company's  Prosperity  and  Gibraltar  mining
projects. The Company had a call right to repurchase both of CELP99's Prosperity
and Gibraltar  working  interests by issuing  shares of the Company for CELP99's
investment in each project, at 122% and 135% of the earn-in  expenditures of the
respective projects.

On January 31, 2000,  the Company  reached an agreement  with CELP99 whereby the
Company  made a takeover  bid offer to acquire,  for Taseko  shares,  all of the
shares of CELP99's  subsidiary,  Concentrated  Exploration 2000 Ltd. ("CEL2000")
for  $5,484,574,  which had acquired the 7.5% interest in the Gibraltar  mineral
lands owned by CELP99 and the 3.61% working  interest in the Prosperity  mineral
property earned by CELP99. In February 2000, the Company issued 2,492,988 common
shares at a value of $2.20 per share to CELP99 to complete the  acquisition.  In
addition to the Prosperity and Gibraltar property interests, CEL2000 had working
capital deficiency of $661,624,  which included cash of $52,456, and held 34,620
common shares of the Company, at the time of completion of the acquisition.

In December 2001, the GESL Partnership  completed a private placement of limited
partnership units for aggregate proceeds of $1.85 million. In February 2002, the
Company issued  4,966,659  Taseko common shares at a value of $0.44 per share to
complete the acquisition of Gibraltar  Refinery (2002) Ltd.,  which had acquired
the private  placement  units of the GESL  Partnership.  The Company also issued
50,000 Taseko common  shares to its  financial  adviser in connection  with this
acquisition.

A further $3 million of  expenditures  were  incurred  by the GESL  Partnership,
which were financed by a separate partnership, the GESL Refinery Process ("GRP")
Partnership,  for a total  financing  amount of $4,850,000.  In December 2002, a
general partnership interest in the GRP Partnership was acquired and financed by
a third party for $3,000,000. Pursuant to a call option agreement dated December
27, 2002, the Company has an exclusive option, until August 31, 2003, to acquire
the third party's general  partnership  interest in the GRP Partnership for $3.5
million, at the Company's sole discretion, in either cash or through an issuance
of Taseko common  shares,  valued at the  prevailing  ten-day  weighted  average
closing  price of the  Company's  common  shares as  quoted  on the TSX  Venture
Exchange for the period ending  immediately prior to the Company's delivery of a
letter to exercise its option.

<PAGE>

6.       BANK OPERATING LOAN

During fiscal 2002,  the Company  negotiated a $2 million bank operating line of
credit  with a Canadian  chartered  bank at an interest  rate of prime,  with no
fixed terms of  repayment.  A private  company  affiliated  with a director  has
provided a fully collateralized  guarantee and received 606,061 common shares of
the Company in exchange for the guarantee. The market value of the shares issued
has  been  included  in  interest  expense  in  the  consolidated  statement  of
operations.

<PAGE>

7.       SHARE CAPITAL

(a)      Authorized

Authorized  share capital of the Company  consists of 100,000,000  common shares
without par value.

(b) Issued and outstanding

<TABLE>
<S>                                                                    <C>          <C>
                                                                            Number
Common shares                                                            of Shares         Amount
                                                                      ------------   ------------
  Balance, issued and outstanding, September 30, 2000 and 2001 ....     25,067,697   $ 87,973,363
     Less: 34,620 shares of the Company held by CEL2000 (note 5(e))              -        (76,164)
                                                                      ------------   ------------
  Balance, September 30, 2000 and 2001 ............................     25,067,697     87,897,199
  Issued during the period
     To a dissenting Continental shareholder in exchange for
       Gibraltar preferred shares at $1.07 per share (note 3) .....        114,800        122,836
     Loan guarantee at $0.66 per share (note 6) ...................        606,061        400,000
     Private placement at $0.50 per share, net of issue costs .....        414,850        185,835
     Private placement at $0.47 per share .........................        276,596        130,000
     Private placement at $0.40 per share .........................        375,000        150,000
     For the acquisition of Gibraltar Refinery (2002) Ltd. ........
        at $0.44 per share, net of issue costs (note 5(e)) ........      4,966,659      2,163,330
     For debt settlement at $0.40 per share (note 7(c)) ...........      2,100,000        840,000
                                                                      ------------   ------------
Balance, September 30, 2002 .......................................     33,921,663   $ 91,889,200
                                                                      ============   ============
</TABLE>


(c) Debt settlement with shares

In  April  2002,  the  Company  settled  $840,000  of  accounts  payable  due to
arm's-length  creditors by issuing 2.1 million  common shares,  which  reflected
their market value at settlement date.

(d)      Convertible debenture

                                                    September 30  September 30
                                                            2002          2001
                                                     -----------   -----------
Convertible debenture ............................   $17,000,000   $17,000,000
Price per common share of the unexercised
   conversion right ..............................   $      3.89   $      3.64
                                                     -----------   -----------
Number of common shares potentially issuable
   under unexercised conversion right ............     4,370,180     4,670,330
                                                     ===========   ===========



(i) On July 21, 1999, in connection  with the acquisition of the Gibraltar Mine,
the Company issued a $17 million  interest-free  debenture to BWCL, which is due
on July 21, 2009, but is convertible into common shares of the Company over a 10
year period  commencing at a price of $3.14 per share in year one and escalating
by $0.25 per share  per year  thereafter.  BWCL's  purchase  of the  convertible
debenture was payable as to  $4,000,000 in July 1999,  $1,000,000 on October 19,
1999,  $3,500,000 on July 21, 2000,  and $8,500,000 by December 31, 2000, all of
which were received.  BWCL has the right to convert, in part or in all from time
to time,  the  debenture  into fully paid common shares of the Company from year
one to year ten.

From the  commencement  of the sixth year to the tenth year, the Company has the
right  to  automatically  convert  the  debenture  into  common  shares  at  the
then-prevailing  market price. Since the Company has the right and the intention
to settle the  convertible  debenture  through the  issuance  of common  shares,
notwithstanding  the Company's  right to settle the debenture  with cash, it has
been included as a separate component of shareholders' deficiency on the balance
sheet.

(ii) In connection  with the acquisition of the Gibraltar Mine assets from BWCL,
the Company agreed to place  $8,500,000  debenture  payment received on December
29,  2000 as a  reclamation  deposit to replace an  $8,500,000  letter of credit
previously posted by BWCL.

(e) Share purchase option compensation plan

The  Company  has a share  purchase  option  compensation  plan  approved by the
shareholders  that allows it to grant up to 4,400,000  share  purchase  options,
subject to regulatory terms and approval, to its employees,  officers, directors
and  consultants.  The  exercise  price of each  option  can be set  equal to or
greater than the closing  market  price of the common  shares on the TSX Venture
Exchange  on the day  prior to the date of the  grant  of the  option,  less any
allowable  discounts.  Options have a maximum term of ten years and terminate 30
to 90 days following the  termination  of the  optionee's  employment or term of
engagement,  except  in  the  case  of  retirement  or  death.  In the  case  of
retirement,  they terminate 30 to 90 days following retirement,  at management's
discretion.  In the case of death,  they  terminate  at the  earlier of one year
after the event or the expiry of the options.  Vesting of options is done at the
discretion of the Board of Directors at the time the options are granted.

The continuity of share purchase options is as follows:

<TABLE>
<S>                                                 <C>                    <C>                     <C>
                                                    2002                   2001                    2000
                                           --------------------   ----------------------   ---------------------
                                               Number   Average       Number     Average      Number     Average
                                            of shares     Price    of shares       Price   of shares       Price
                                           ----------    ------   ----------    --------   ---------    --------
Opening balance ........................      657,000    $ 1.56    2,242,500    $   2.31   1,931,500    $   2.43
   Granted during the year .............    4,042,500      0.50      218,500        1.07     351,500        1.88
   Expired/cancelled during year .......     (554,500)     1.38   (1,804,000)       2.43     (40,500)       2.39
                                           ----------    ------   ----------    --------   ---------    --------
Closing balance ........................    4,145,000    $ 0.50      657,000    $   1.56   2,242,500    $   2.31
                                           ==========    ======   ==========    ========   =========    ========

Contractual remaining life in years ....                   1.96                     1.21                    1.79
                                           --------------------   ----------------------   ---------------------

Range of exercise prices ...............                 $ 0.50               $1.65-3.64             $1.65-$3.64
                                           --------------------   ----------------------   ---------------------
</TABLE>



During the year ended  September 30, 2002,  the Company  repriced  317,500 share
purchase options with an average price of $1.21 per share to $0.50 per share. In
addition,  the expiry date was changed on 35,000  share  purchase  options  from
September 27, 2002 to September  24, 2004;  on 15,000  options from February 12,
2003 to September  24, 2004;  on 72,000  options from June 11, 2003 to September
24, 2004; and on 35,000 options from September 27, 2002 to September 24, 2004.

(f) Share purchase warrants

The continuity of share purchase warrants is as follows:

<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                 Outstanding                               Outstanding
                      Exercise     September                                 September
Expiry dates             price      30, 2001        Issued       Expired      30, 2002
                       -------    ----------    ----------    ----------    ----------
March 3, 2002 ......   $  1.30       138,089            --      (138,089)           --
March 3, 2002 ......   $  2.35       407,877            --      (407,877)           --
December 31, 2000/01   $  1.38     1,245,000            --    (1,245,000)           --
October 19, 2003 ...   $  0.58            --       276,596            --       276,596
December 27, 2003 ..   $  0.55            --       414,850            --       414,850(1)
January 8, 2006 ....   $  0.40            --       375,000            --       375,000
                       -------    ----------    ----------    ----------    ----------
                                   1,790,966     1,066,446    (1,790,966)    1,066,446
                                  ==========    ==========    ==========    ==========
</TABLE>

- ----------
(1) The  414,850  warrants  expiring  December  23, 2003 are subject to a 45-day
    accelerated  expiry if the closing price of the Company's common shares,  as
    traded on the TSX Venture  Exchange,  is at least $0.83 for ten  consecutive
    trading days.

<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                 Outstanding                               Outstanding
                      Exercise     September                                 September
Expiry dates .......     price      30, 2000        Issued       Expired      30, 2001
                       -------   -----------    ----------    ----------    ----------
March 3, 2002 ......   $  1.30       138,089            --            --       138,089
March 3, 2002 ......   $  2.35       407,877            --            --       407,877
December 31, 2001 ..   $  1.38     1,245,000            --            --     1,245,000
                       -------   -----------    ----------    ----------    ----------
                                   1,790,966            --            --     1,790,966
                                 ===========    ==========    ==========    ==========
</TABLE>

<PAGE>

8.       INCOME TAXES

Substantially  all of the  difference  between  the actual  income  tax  expense
(recovery) of $nil (2001 - $nil) and the expected statutory corporate income tax
recovery  relates to losses not  recognized.  As at September 30, 2002 and 2001,
the tax effect of the  significant  components  within the Company's  future tax
assets are as follows:

                                                   2002           2001
                                           ------------   ------------
Resource pools ........................    $  1,555,000   $  7,041,000
Loss carry forwards ...................       3,211,000      4,452,000
Other tax pools .......................       1,556,000        864,000
                                           ------------   ------------
                                              6,322,000     13,357,000
Valuation allowance ...................      (6,322,000)   (13,357,000)
                                           ------------   ------------
Net future income tax asset (liability)    $         -    $         -
                                           ============   ============


At September 30, 2002, the Company's tax attributes  include  non-capital losses
for income tax purposes in Canada totaling approximately $7.5 million,  expiring
at various times from 2003 to 2009, and certain  resource  related and other tax
pools.  The  Gibraltar  tracking  preferred  shares issued to  Continental  have
initially  been recorded for Canadian tax purposes at a paid up amount of $62.77
million,  but such  amount is subject to  adjustment  based on the fair value of
Taseko common shares ultimately received by Continental (note 3).

<PAGE>

9. SUPPLEMENTARY CASH FLOW DISCLOSURES

In  addition to the  non-cash  operating,  financing  and  investing  activities
primarily disclosed,  the Company's non-cash operating,  financing and investing
activities were as follows:

<TABLE>
<S>                                                                      <C>            <C>           <C>
                                                               September 30   September 30  September 30
                                                                       2002           2001          2000
                                                               ------------  -------------  ------------
Issuance of tracking preferred shares of Gibraltar Mines Ltd.
   on acquisition of Harmony Gold Property (note 3) .........  $ 26,764,784   $          -  $          -
Issuance of common shares on acquisition of Gibraltar
   Refinery (2002) Ltd. (note 5(e)) .........................     2,163,330              -             -
Issuance of common shares on redemption of Gibraltar
   tracking preferred shares held by a dissenting Continental
   shareholder (note 3) .....................................       122,836              -             -
Issuance of common shares for loan guarantee (note 6) .......       400,000              -             -
Issuance of common shares settlement of debt (note 7(c)) ....       840,000              -             -
Acquisition of mineral properties for shares (note 5) .......             -              -     5,484,574
Notes receivable proceeds used to redeem preferred shares
   of subsidiary ............................................             -              -   (19,000,000)
                                                               ------------  -------------  ------------
    .........................................................  $ 30,290,950   $          -  $(13,515,426)
                                                               ============  =============  ============
</TABLE>



<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
Supplemental cash flow information
                                                               September 30   September 30  September 30
                                                                       2002           2001          2000
                                                               ------------  -------------  ------------
Cash paid during the period for
  Interest ..................................................  $    107,790   $         -    $        -
  Taxes .....................................................  $    117,333   $   150,888    $   94,836
                                                               ------------  -------------  ------------
</TABLE>



<PAGE>

10. RELATED PARTY TRANSACTIONS AND ADVANCES
<TABLE>
<S>     <C>    <C>    <C>    <C>    <C>    <C>
                                                            September 30  September 30  September 30
Transactions                                                        2002          2001          2000
- -----------------------------------------------------------  -----------   -----------   -----------
Hunter Dickinson Inc.
  Services rendered to the Company and its subsidiaries and
     reimbursement of third party expenses (a) ............  $   574,892   $   768,710   $   874,541
  Services rendered to GESL Partnership (b) ...............  $ 1,384,496   $ 3,571,9$             --
- -----------------------------------------------------------  -----------   -----------   -----------


                                                            September 30  September 30  September 30
Advances                                                            2002          2001          2000
- -----------------------------------------------------------  -----------   -----------   -----------
Advances to (from) (d)
  Hunter Dickinson Inc. (a) ...............................  $  (468,168)  $(1,283,779)  $ 1,379,409
  Hunter Dickinson Group Inc. (c) .........................  $(3,001,000)  $        --   $        --
- -----------------------------------------------------------  -----------   -----------   -----------
Advances to (from) related parties ........................  $(3,469,168)  $(1,283,779)  $ 1,379,409
                                                             ===========   ===========   ===========
</TABLE>


(a) Hunter Dickinson Inc. ("HDI") is a private company with certain directors in
common that  provides  geological,  corporate  development,  administrative  and
management  services  to, and incurs third party costs on behalf of, the Company
and its  subsidiaries  on a full cost  recovery  basis  pursuant to an agreement
dated December 31, 1996.

(b) During fiscal 2001 and 2002, Hunter Dickinson Inc. provided  engineering and
other services to the GESL Partnership at industry standard rates (note 5(a)).

(c) Hunter  Dickinson  Group  Inc.  ("HDG") is a private  company  with  certain
directors in common that provides  consulting services to the Company, at market
rates.  The  balance  payable to HDG has  resulted  from a series of  agreements
between  Taseko,  HDI, HDG, GESL  Partnership and GRP  Partnership,  whereby HDI
assigned to HDG the balance payable owed to it by Taseko.

(d) Advances are non-interest bearing and due on demand.

(e) Bank operating loan (see note 6).

<PAGE>

11.      SUBSEQUENT EVENTS

(a)      Share issuances

On December 31, 2002, the Company closed three equity private  placements of its
securities, as follows:

(i)      2,185,000 common shares at $0.30 per share;

(ii)     4,232,001  units at $0.30 per unit.  Each unit  consisted of one common
         share  and  one   non-transferable   common  share   purchase   warrant
         exercisable  at $0.50 per share until  December 31,  2004.  The warrant
         shares are subject to a regulatory  four month hold period expiring May
         1,  2003,   and  thereafter  the  warrants  are  subject  to  a  45-day
         accelerated expiry in the event that the closing price of the Company's
         common shares, as traded on the TSX Venture Exchange, is at least $0.75
         for ten consecutive trading days.

(iii)    5,787,500  flow-through units at $0.40 per unit. Each unit consisted of
         one flow-through common share and one-half of a non-transferable common
         share  purchase  warrant.  Each whole  common  share  purchase  warrant
         entitles  the holder to purchase  one common  share at a price of $0.50
         per share until  December 31, 2004. The warrant shares are subject to a
         regulatory  four month hold period expiring May 1, 2003, and thereafter
         the  warrants are subject to a 45-day  accelerated  expiry in the event
         that the closing price of the Company's common shares, as traded on the
         TSX Venture  Exchange,  is at least $0.75 for ten  consecutive  trading
         days.

On certain portions of the financings,  the following finders' fees and brokers'
fees, units and warrants were paid and issued:

(i)      Cash of $126,876;

(ii)     302,250 warrants,  exercisable at $0.40 per common share until December
         31, 2003,  subject to a regulatory four month hold period expiring May
         1, 2003; and

(iii)    268,000  units,  consisting  of one common share and one warrant.  Each
         warrant is  exercisable  at $0.50 per common  share until  December 31,
         2004.  The shares and warrant  shares are subject to a regulatory  four
         month hold period expiring May 1, 2003, and thereafter the warrants are
         subject to a 45-day  accelerated  expiry in the event that the  closing
         price of the  Company's  common  shares,  as traded on the TSX  Venture
         Exchange, is at least $0.75 for ten consecutive trading days.

(b)      Reclamation deposit refund

In December 2002, the British Columbia  Ministry of Energy and Mines accepted an
application  made by the  Company to reduce  the  security  for its  reclamation
liability,  and accordingly,  released $2.5 million of the Company's reclamation
deposits in connection with the Gibraltar Mine.

<PAGE>

12.      DIFFERENCES BETWEEN CANADIAN AND UNITED STATES GAAP

As  disclosed  in note 2,  these  financial  statements  have been  prepared  in
accordance with Canadian GAAP which, for purposes of the Company conform, in all
material respects with those of the United States, except as described below.

(a)      Under the asset and liability  method of tax allocation  required under
         United  States  Statement of  Financial  Accounting  Standards  No. 109
         ("SFAS  109"),  future income tax assets and  liabilities  are measured
         using  enacted  tax  rates  for  the  future  income  tax  consequences
         attributable to differences  between the financial  statement  carrying
         amount of existing  assets and  liabilities  and their  respective  tax
         bases,  which is  comparable to Canadian GAAP for fiscal 2001 and 2002.
         For the year ended  September 30, 2000,  there is no effect of adopting
         the provisions of SFAS 109 on the Company's financial statements as the
         recognition criteria for future tax assets has not been met.

(b)      United States  Statement of Financial  Accounting  Standards 123 ("SFAS
         123") requires that stock-based  compensation be accounted for based on
         a  fair  value  methodology,  although  it  allows  the  effects  to be
         disclosed in the notes to the financial  statements  rather than in the
         statement of operations.  SFAS 123 also allows an entity to continue to
         measure compensation costs for stock-based compensation plans using the
         intrinsic value based method of accounting as prescribed by APB Opinion
         No. 25 ("APB 25"). The Company has elected to measure compensation cost
         for those plans using APB 25.

         Under US GAAP,  stock  options  granted to  non-employees  for services
         rendered to the Company are required to be  accounted  for based on the
         fair value of the services  provided or the consideration  issued.  The
         compensation  cost is to be  measured  based on the fair value of stock
         options  granted,   with  the   compensation   cost  being  charged  to
         operations.  The stock-based  compensation  expense in respect of stock
         options granted to  non-employees,  under US GAAP,  based upon the fair
         value of the options using a Black Scholes option pricing model,  would
         be  $546,000  for the year ended  September  30, 2002 (2001 - $109,000,
         2000 - $280,000).

(c)      In June 2001, the Financial  Accounting Standards Board ("FASB") issued
         SFAS No. 143, "Accounting for Asset Retirement  Obligations" ("SFAS No.
         143"). SFAS No. 143 requires the Company to record the fair value of an
         asset  retirement  obligation  as a liability in the period in which it
         incurs a legal  obligation  associated  with the retirement of tangible
         long-lived  assets  that  result  from the  acquisition,  construction,
         development and/or normal use of the assets. The Company also records a
         corresponding  asset  which is  amortized  over the life of the  asset.
         Subsequent  to  the  initial   measurement  of  the  asset   retirement
         obligation,  the obligation  will be adjusted at the end of each period
         to reflect the passage of time and changes in the estimated future cash
         flows underlying the obligation.  The Company is required to adopt SFAS
         No. 143 on October 1, 2002.

(d)      In August  2001,  the FASB  issued  SFAS No.  144  "Accounting  for the
         Impairment or Disposal of Long-Lived Assets" ("SFAS No. 144"). SFAS No.
         144 addresses financial  accounting and reporting for the impairment or
         disposal of long-lived assets.  This statement requires that long-lived
         assets  be  reviewed  for  impairment  whenever  events or  changes  in
         circumstances  indicate that the carrying amount of an asset may not be
         recoverable.  Recoverability  of assets to be held and used is measured
         by a comparison  of the carrying  amount of an asset to future net cash
         flows expected to be generated by the asset.  If the carrying amount of
         an asset exceeds its estimated future cash flows, an impairment  charge
         is recognized  in the amount by which the carrying  amount of the asset
         exceeds  the fair value of the asset.  SFAS No. 144 also  broadens  the
         definition of  discontinued  operations to include all  distinguishable
         components  of  an  entity  that  will  be   eliminated   from  ongoing
         operations. The Company is required to adopt SFAS No. 144 on October 1,
         2002, on a prospective basis.


</TEXT>
</DOCUMENT>
<DOCUMENT>
<TYPE>EX-10
<SEQUENCE>4
<FILENAME>exhibit1.txt
<DESCRIPTION>GESL TASEKO ET AL AGREEMENT
<TEXT>
                             ARRANGEMENT AGREEMENT

       MEMORANDUM OF AGREEMENT made as of the 28th day of February, 2003,

                                 B E T W E E N:


TASEKO MINES LIMITED, a company incorporated under the laws of British Columbia

                                   ("Taseko")

                                    - and -

GIBRALTAR ENGINEERING SERVICES LIMITED, a company incorporated under the laws of
                                British Columbia
                                    ("GESL")

                                    - and -

GIBRALTAR REFINERY (2002) LTD., a company incorporated under the laws of British
                                    Columbia

                               ("Gibraltar 2002")

                                    - and -

TASEKO RESOURCES INC., a company incorporated under the laws of British Columbia

                              ("Taseko Resources")

                                    - and -

CONCENTRATED EXPLORATION LTD., a company incorporated under the laws of British
                                    Columbia

                          ("Concentrated Exploration")

                                    - and -

  CONCENTRATED EXPLORATION 2000 LTD., a company incorporated under the laws of
                                British Columbia

                                  ("CE 2000")

  (Gibraltar 2002, Taseko Resources, Concentrated Exploration and CE 2000 are
                herein referred to as the "Taseko Subsidiaries")

                                    - and -

 GIBRALTAR REFINERY (2002) NO. 2 LTD., a company incorporated under the laws of
                                British Columbia

                            ("Gibraltar 2002 No. 2")

WHEREAS GESL owns the GESL Business, as hereinafter defined;

AND WHEREAS GESL is wholly owned by Taseko, which indirectly holds approximately
38% of GESL's common shares through its wholly owned subsidiary  Gibraltar 2002,
and Norman E. Cressey ("Cressey"),  who holds approximately 62% of GESL's common
shares;

AND WHEREAS Taseko wishes to purchase that portion of the GESL Business which it
does not already own;

AND  WHEREAS  GESL has agreed to undergo a plan of  arrangement  to provide  for
Taseko's  buyout of Cressey under the Plan of  Arrangement  and to allow for the
consolidation  of Taseko's  assets by providing for the dissolution of Gibraltar
2002 No. 2, a wholly-owned  subsidiary of GESL,  GESL's own  dissolution and for
the dissolution of the Taseko Subsidiaries.

THIS AGREEMENT  WITNESSES THAT in consideration of the respective  covenants and
agreements herein contained, the parties hereto covenant and agree as follows:

                                   ARTICLE 1.

                                 INTERPRETATION

1.1      DEFINITIONS

In this  Agreement,  unless there is something in the subject  matter or context
which is  inconsistent  therewith,  the following terms shall have the following
meanings, respectively:

1.1.1 "ACT"  means the COMPANY ACT  (British  Columbia),  R.S.B.C.  1996,  c.62,
including  all  regulations  made  thereunder,  as now in  effect  and as may be
amended from time to time prior to the Effective Date;

1.1.2    "AFFILIATE" has the meaning ascribed thereto in the Act;

1.1.3  "APPROPRIATE  REGULATORY  APPROVALS"  means  those  sanctions,   rulings,
consents, orders, exemptions,  permits and other approvals (including the lapse,
without objection, of a prescribed time under a statute, rule or regulation that
states  that a  transaction  may be  implemented  if a  prescribed  time  lapses
following the giving of notice without an objection  being made) of Governmental
Entities, regulatory agencies or self-regulatory organizations;

1.1.4  "ARRANGEMENT" means a plan of arrangement under Sections 252, 253 and 254
of the Act on the terms and conditions set forth in the Plan of Arrangement  and
any  amendment,   variation,   or  supplement  thereto,  giving  effect  to  the
transactions described in Section 2.1;

1.1.5 "BUSINESS DAY" means any day, other than a Saturday, Sunday or a statutory
holiday  in the  province  of  British  Columbia,  on which  banks  are open for
business in the city of Vancouver;

1.1.6 "CALL OPTION AGREEMENT" means the call option agreement dated December 27,
2002 pursuant to which Cressey  granted  Taseko an option to purchase  Cressey's
indirect interest in the GESL Business;

1.1.7  "CIRCULAR"  means  the  notice  of  the  GESL  Meeting  and  accompanying
management information circular,  including all schedules thereto, to be sent to
GESL Shareholders in connection with the GESL Meeting;

1.1.8  "COMPETING  TRANSACTION"  means an offer  or a  proposal  made to GESL in
writing and duly  authorized  by the board of directors of the Person making the
offer or proposal (i) to purchase or otherwise  acquire,  directly or indirectly
(including by means of a transaction described in clause (iv) below), all of the
GESL  Shares  or all or  substantially  all of the  assets  of GESL,  (ii)  that
provides in the good faith opinion of the Board of Directors after  consultation
with GESL's  investment  advisor,  for a value per GESL Share  greater  than the
value per GESL Share  contemplated by this Agreement,  (iii) that, to the extent
it offers  cash  consideration,  is fully  financed  (subject to usual terms and
conditions  on the  drawing of such  financing),  (iv) is made or proposed to be
made by means of a take-over bid,  amalgamation,  plan of arrangement,  business
combination,  sale of assets or similar transaction, (v) with conditions no more
beneficial,  taken as a whole, to the Person  proposing or making the offer than
those  contemplated by this Agreement for the benefit of Taseko,  and (vi) which
the Board of Directors  determines  in good faith to be more  favourable  to the
GESL   Shareholders  from  a  financial  point  of  view  than  the  transaction
contemplated by this  Agreement,  having regard to all  circumstances  including
income tax considerations  under such offer or proposal,  and which the Board of
Directors intends to recommend to the GESL Shareholders;

1.1.9    "COURT" means the Supreme Court of British Columbia;

1.1.10   "CRESSEY" means Norman E. Cressey;

1.1.11  "EFFECTIVE  DATE" means the date on which a certified  copy of the Final
Order is accepted for filing under section 252 of the Act by the Registrar;

1.1.12 "EFFECTIVE TIME" means 12:01 a.m.  (Vancouver,  British Columbia time) on
the Effective Date;

1.1.13  "EXCHANGE RATIO" means an exchange where one GESL Share is exchanged for
2.333333 Taseko Shares;

1.1.14  "EXCLUDED  SHAREHOLDERS"  means,  in  respect  of GESL,  Taseko  and its
Affiliates and any other GESL  Shareholder  that is excluded from casting a vote
pursuant to Section 252(8) of the Act;

1.1.15  "FINAL  ORDER"  means  the  final  order  of  the  Court  approving  the
Arrangement,  as such order may be  amended  at any time prior to the  Effective
Date;

1.1.16 "GAAP" means, for those generally accepted  accounting  principles stated
in the  Handbook  of the  Canadian  Institute  of  Chartered  Accountants,  such
principles so stated;

1.1.17 "GESL  BUSINESS"  means all of the  business,  assets,  both tangible and
intangible, goodwill and undertakings of GESL acquired pursuant to a dissolution
agreement of Gibraltar  Engineering  Services Limited Partnership dated February
24, 2003;

1.1.18 "GESL MEETING" means the special meeting of GESL Shareholders  (including
any adjournment thereof) that is to be convened as provided by the Interim Order
to consider and, if deemed advisable, to approve the Arrangement;

1.1.19 "GESL SHAREHOLDER" means a registered holder of GESL Shares, from time to
time, and "GESL SHAREHOLDERS" means all of such holders;

1.1.20   "GESL SHARES" means common shares in the capital of GESL;

1.1.21 "GOVERNMENTAL ENTITY" means any: (a) multinational,  federal, provincial,
state,  regional,  municipal,  local or other governmental or public department,
central bank,  court,  tribunal,  arbitral body,  commission,  board,  bureau or
agency,  domestic or foreign; (b) any subdivision,  agent commission,  board, or
authority of any of the foregoing; or (c) any quasi-governmental or private body
exercising any regulatory,  expropriation  or taxing  authority under or for the
account of any of the foregoing;

1.1.22 "INTERIM ORDER" means the interim order of the Court issued in respect of
the  Arrangement,  as contemplated by Section 2.1, as such order may be amended,
supplemented or varied by the Court;

1.1.23  "LAWS" means all laws,  statutes,  codes,  ordinances,  decrees,  rules,
regulations, by-laws, statutory rules, principles of law, published policies and
guidelines,   judicial  or  arbitral  or   administrative   or   ministerial  or
departmental  or regulatory  judgments,  orders,  decisions,  rulings or awards,
including  general  principles of common and civil law, and terms and conditions
of any grant of approval,  permission,  authority or license of any Governmental
Entity,  statutory body (including the TSX Venture Exchange) or  self-regulatory
authority,  and the  term  "applicable"  with  respect  to such  Laws and in the
context that refers to one or more  Persons,  means that such Laws apply to such
Person or Persons or its or their business, undertaking,  property or securities
and emanate from a Person having  jurisdiction over the Person or Persons or its
or their business, undertaking, property or securities;

1.1.24  "MATERIAL  ADVERSE  CHANGE" means, in relation to any  corporation,  any
change (or any condition,  event or development  involving a prospective change)
in  the  business,  operations,  affairs,  assets,  liabilities  (including  any
contingent liabilities that may arise through outstanding, pending or threatened
litigation  or  otherwise),   capitalization,   financial  condition,  licenses,
permits,  rights or privileges  of the  corporation  or any of its  Subsidiaries
which would  reasonably  be  expected to  materially  and  adversely  affect the
corporation and its Subsidiaries, taken as a whole;

1.1.25   "MATERIAL FACT" has the meaning ascribed thereto in the Securities Act;

1.1.26   "MEETING DATE" means any date on which the GESL Meeting occurs;

1.1.27  "OPTION"  means the call option granted by Cressey to Taseko to purchase
Cressey's  indirect  interest in the GESL  Business  pursuant to the Call Option
Agreement;

1.1.28  "PERSON"  includes any  individual,  firm,  partnership,  joint venture,
venture capital fund,  association,  trust,  trustee,  executor,  administrator,
legal personal  representative,  estate,  group,  body  corporate,  corporation,
unincorporated  association or organization,  Governmental Entity,  syndicate or
other entity, whether or not having legal status;

1.1.29 "PLAN OF ARRANGEMENT" means the plan of arrangement  substantially in the
form attached as Schedule "A", as the same may be supplemented  and amended from
time to time in accordance with the terms thereof;

1.1.30  "REGISTRAR"  means the British Columbia  Registrar of Companies or other
duly appointed person performing duties as registrar under the Act;

1.1.31 "SECURITIES ACT" means the Securities Act (British  Columbia),  as now in
effect and as it may be amended from time to time prior to the Effective Date;

1.1.32   "SUBSIDIARY" has the meaning ascribed thereto in the Securities Act;

1.1.33  "TASEKO  SHARES"  means common shares in the capital of Taseko issued in
exchange for the GESL Shares pursuant to the Plan of Arrangement;

1.1.34  "TASEKO   SUBSIDIARIES"   means  Taseko   Resources,   Gibraltar   2002,
Consolidated Exploration and CE 2000;

1.1.35 "TAX" and "TAXES"  means,  with  respect to any entity,  all income taxes
(including  any tax on or  based  upon  net  income,  gross  income,  income  as
specially  defined,  earnings,  profits or  selected  items of  income)  and all
capital taxes,  gross receipts  taxes,  environmental  taxes,  sales taxes,  use
taxes, AD VALOREM taxes,  value added taxes,  transfer taxes,  franchise  taxes,
license taxes,  withholding taxes,  payroll taxes,  employment taxes,  Canada or
Quebec Pension Plan  premiums,  excise,  severance,  social  security  premiums,
workers' compensation premiums, unemployment insurance or compensation premiums,
stamp taxes,  occupation taxes, premium taxes,  property taxes, windfall profits
taxes,  alternative  or add-on minimum  taxes,  goods and services tax,  customs
duties  or other  taxes,  fees,  imports,  assessments  or  charges  of any kind
whatsoever,  together with any interest and any penalties or additional  amounts
imposed by any taxing  authority  (domestic or foreign) on such entity,  and any
interest,  penalties,  additional  taxes and  additions  to tax  unopposed  with
respect to the foregoing, and any liability for the payment of any amount of the
type described in the immediately preceding clause of another entity; and

1.1.36 "TAX  RETURNS"  means all  returns,  declarations,  reports,  information
returns and statements  required to be filed with any taxing authority  relating
to Taxes (including any attached schedules),  including, without limitation, any
information  return,  claim  for  refund,  amended  return  and  declaration  of
estimated Tax.

1.2      INTERPRETATION NOT AFFECTED BY HEADINGS

The division of this Agreement into Articles,  sections,  and other portions and
the insertion of headings are for  convenience  of reference  only and shall not
affect the construction or interpretation  hereof.  Unless otherwise  indicated,
all references to an "Article" or "Section" followed by a number and/or a letter
refer to the  specified  Article or Section of this  Agreement.  The terms "this
Agreement",  "hereof", "herein" and "hereunder" and similar expressions refer to
this  Agreement  (including  the  Schedules  hereto)  and not to any  particular
Article, Section or other portion hereof and include any agreement or instrument
supplementary or ancillary hereto.

1.3      CURRENCY

All sums of money  referred  to in this  Agreement  are  expressed  in  Canadian
dollars.

1.4      NUMBER

Unless the context  otherwise  requires,  words  importing  the  singular  shall
include the plural and VICE VERSA and words  importing  any gender shall include
all genders.

1.5      DATE FOR ANY ACTION

In the event that any date on which any action is required to be taken hereunder
by any of the  parties  hereto  is not a  Business  Day,  such  action  shall be
required to be taken on the next succeeding day which is a Business Day.

1.6      ENTIRE AGREEMENT

This  Agreement  constitutes  the entire  agreement  between the parties  hereto
pertaining to the terms of the Arrangement and ancillary arrangements.

                                   ARTICLE 2.

                                 THE ARRANGEMENT

2.1      TERMS OF ARRANGEMENT

GESL,  Gibraltar  2002  No.  2 and the  Taseko  Subsidiaries  agree,  as soon as
reasonably practicable,  to apply to the Court pursuant to sections 252, 253 and
254 of the Act for the interim order providing for, among other things:

2.1.1 the calling and holding of the GESL Meeting for the purpose of considering
and approving the  Arrangement  pursuant to which the existing GESL Shares shall
be  exchanged  for Taseko  Shares  based on the  Exchange  Ratio and pursuant to
Section 85.1 of the INCOME TAX ACT (Canada); and

2.1.2 upon approval of the Arrangement by the GESL Shareholders, the dissolution
of each of GESL,  Gibraltar 2002 No. 2 and the Taseko Subsidiaries to facilitate
the reconstruction of Taseko's corporate  structure to consolidate its assets by
dissolving certain of its wholly owned subsidiaries.

If approval by the GESL Shareholders is obtained, GESL, Gibraltar 2002 No. 2 and
the Taseko  Subsidiaries  will promptly  thereafter  take the necessary steps to
submit  the  Arrangement  to the Court and apply for a Final  Order of the Court
approving the Arrangement.

2.2      IMPLEMENTATION STEPS BY GESL

GESL covenants in favour of Taseko that GESL shall:

2.2.1 convene and hold the GESL Meeting not later than April 14, 2003, or in the
event that the GESL Shareholders  agree to waiver notice of the GESL Meeting not
later than April 14, 2003, for the purpose of considering and voting on the Plan
of Arrangement (and for any other proper purpose as may be set out in the notice
for such meeting which is acceptable to Taseko, acting reasonably);

2.2.2 solicit the GESL  Shareholders  to waive notice of the GESL Meeting and to
hold the GESL Meeting as soon as reasonably practicable thereafter;

2.2.3  subject to obtaining the Final Order,  as soon as reasonably  practicable
thereafter  and subject to the  satisfaction  or waiver of the other  conditions
herein  contained  in  favour  of each  party,  file the  Final  Order  with the
Registrar,  together with such other  documents as may be required under the Act
to give effect to the Arrangement;

2.2.4  permit  Taseko and its counsel to review and  comment  upon drafts of all
material  to be filed  with the Court in  connection  with the  Arrangement  and
provide  counsel  to  Taseko on a timely  basis  with  copies  of any  notice of
appearance  and  evidence  served  on  GESL or its  counsel  in  respect  of the
application  for the  Final  Order or any  appeal  therefrom  and of any  notice
(written or oral) received by GESL  indicating any intention to appeal the Final
Order; and

2.2.5 not file any material with the Court in connection with the Arrangement or
serve any such material, and not agree to modify or amend any materials so filed
or served,  except with Taseko's  prior written  consent (such consent not to be
unreasonably withheld).

2.3      INTERIM ORDER

The Interim Order shall provide:

2.3.1 for the class of Persons to whom  notice is to be  provided  in respect of
the  Arrangement and the GESL Meeting and for the manner in which such notice is
to be provided;

2.3.2 that the requisite  GESL  Shareholder  approval  shall be 75% of the votes
cast by GESL Shareholders and by a majority of the GESL Shareholders, other than
the Excluded Shareholders; and

2.3.3 that, in all other respects, the terms, restrictions and conditions of the
memorandum and articles of GESL,  including  quorum  requirements  and all other
matters, shall apply in respect of the GESL Meeting.

2.4      GESL INFORMATION CIRCULAR

GESL,  Gibraltar  2002 No.  2,  Taseko  and the  Taseko  Subsidiaries  shall use
commercially  reasonable efforts to prepare the Circular together with any other
documents  required by the Securities Act or other applicable Laws in connection
with the Arrangement  and GESL shall cause the Circular and other  documentation
required in connection with the GESL Meeting to be sent to each GESL Shareholder
(and other Person) and filed as required by the Interim Order or applicable Laws
as  soon as  reasonably  practicable,  provided  that  the  Circular  and  other
documentation  required in connection  with the  Arrangement  shall not be sent,
except with Taseko's prior written  consent (such consent not to be unreasonably
withheld).

2.5      SECURITIES AND CORPORATE COMPLIANCE

Taseko shall use commercially  reasonable  efforts to obtain all orders required
from the  applicable  securities  authorities  to permit the  issuance and first
resale of the Taseko Shares to be issued pursuant to the Arrangement without the
qualification  with, or the approval of, or the filing of any document including
any prospectus or similar  document or the taking of any proceeding with, or the
obtaining of any further order,  ruling or consent from, any Governmental Entity
or regulatory  authority  under  applicable  securities  Laws or pursuant to the
rules and regulations of any regulatory  authority  administering  such Laws, or
the fulfilment of any other legal  requirement in any such  jurisdiction  (other
than, with respect to such first resales, any restrictions on transfer by reason
of, among other things, a holder being a "control person" of Taseko for purposes
of Canadian provincial or territorial securities Laws).

2.6      PREPARATION OF FILINGS

2.6.1  GESL,  Gibraltar  2002 No. 2,  Taseko and the Taseko  Subsidiaries  shall
cooperate in:

2.6.1.1 the  preparation of any  application for the Interim Order and the Final
Order and the  preparation  of any other  documents  reasonably  deemed by GESL,
Gibraltar  2002 No. 2,  Taseko or the Taseko  Subsidiaries  to be  necessary  to
discharge their respective  obligations under applicable Laws in connection with
the Arrangement and all other matters contemplated by this Agreement; and

2.6.1.2 the taking of all such action as may be required under  applicable  Laws
in connection with the  Arrangement  and all other matters  contemplated by this
Agreement.

2.6.2 Each of GESL,  Gibraltar  2002 No. 2,  Taseko and the Taseko  Subsidiaries
shall  furnish  to  the  other  all  such  information  concerning  it  and  its
shareholders as may be required to effect the actions  described in Sections 2.4
and 2.5 and the  foregoing  provisions  of this Section 2.6, and each  covenants
that no information furnished by it in connection with such actions or otherwise
in connection with the  consummation of the Arrangement  will contain any untrue
statement  of a material  fact or omit to state a material  fact  required to be
stated in any such  document or  necessary in order to make any  information  so
furnished  for use in any  such  document  not  misleading  in the  light of the
circumstances in which it is furnished or to be used.

2.6.3 Each of GESL,  Gibraltar  2002 No. 2,  Taseko and the Taseko  Subsidiaries
shall  promptly  notify the other if at any time  before the  Effective  Time it
becomes aware that the Circular or an  application  for any order referred to in
Section  2.6.1.1  contains any untrue  statement of a material  fact or omits to
state a material  fact  required to be stated  therein or  necessary to make the
statements  contained  therein not misleading in light of the  circumstances  in
which they are made,  or that  otherwise  requires an amendment or supplement to
the Circular or such application.  In any such event GESL, Gibraltar 2002 No. 2,
Taseko and the Taseko  Subsidiaries  shall  cooperate  in the  preparation  of a
supplement or amendment to the Circular or such other document,  as required and
as the case may be, and, if required,  shall cause the same to be distributed to
their  respective   shareholders  and/or  filed  with  the  relevant  securities
regulatory authorities.

2.6.4 GESL shall ensure that the Circular complies with all applicable Laws and,
without  limiting the  generality of the  foregoing,  that the Circular does not
contain any untrue statement of a material fact or omit to state a material fact
required to be stated  therein or  necessary  to make the  statements  contained
therein  not  misleading  in light of the  circumstances  in which they are made
(other than with respect to any information relating to and provided by Taseko).
Without  limiting the  generality of the  foregoing,  GESL shall ensure that the
Circular  provides GESL  Shareholders  with information in sufficient  detail to
permit  them to form a reasoned  judgment  concerning  the  matters to be placed
before them at the GESL Meeting.

                                   ARTICLE 3.

                         REPRESENTATIONS AND WARRANTIES

3.1      REPRESENTATIONS AND WARRANTIES OF GESL

GESL and Gibraltar 2002 No. 2 jointly and severally represent and warrant to and
in favour of Taseko and the Taseko Subsidiaries as set forth in this Section 3.1
and acknowledge  that Taseko and the Taseko  Subsidiaries  are relying upon such
representations  and warranties in connection  with the matters  contemplated by
this Agreement;  except,  however, that Taseko and the Taseko Subsidiaries shall
not be entitled to rely on these  representations  and warranties  which, at the
time of their putative reliance thereon,  Taseko or the Taseko Subsidiaries know
or reasonably ought to have known to be false.

3.1.1 Incorporation and Qualification.  Each of GESL and Gibraltar 2002 No. 2 is
a corporation  duly  incorporated,  organized,  validly  subsisting  and in good
standing  under  the  laws  of its  jurisdiction  of  incorporation  and has all
requisite corporate power and authority to own, lease and operate its properties
and to carry on its business as now being conducted.  Each of GESL and Gibraltar
2002 No. 2 is not in default  under,  or in violation  of, any  provision of its
memorandum  or articles in any respect  which is material and adverse to GESL or
Gibraltar 2002 No. 2, as the case may be.

3.1.2  Authority and  Enforceability.  Each of GESL and Gibraltar 2002 No. 2 has
the  requisite  corporate  power and  authority  and has received all  necessary
corporate   approvals  to  enter  into  this   Agreement  and  to  complete  the
transactions  contemplated  by this  Agreement.  This  Agreement  has been  duly
authorized,  executed and delivered by each of GESL and Gibraltar 2002 No. 2 and
constitutes a valid and binding  obligation  of each of GESL and Gibraltar  2002
No. 2 enforceable by Taseko and the Taseko Subsidiaries against each of GESL and
Gibraltar  2002  No.  2 in  accordance  with  its  terms,  subject  however,  to
limitations  with  respect  to  enforcement  imposed by law in  connection  with
bankruptcy,  arrangement  or similar  proceedings,  the  equitable  power of the
courts to stay proceedings before them and the execution of judgments and to the
extent that equitable  remedies such as specific  performance and injunction are
in the discretion of the court from which they are sought.

3.1.3  Capitalization.  The  authorized  capital of GESL  consists of  5,000,000
common  shares.  As of the date hereof,  4,906,004  common shares are issued and
outstanding. The issued and outstanding GESL Shares have been validly authorized
and issued, and are fully paid and non-assessable. There are no other issued and
outstanding  shares  in the  capital  of GESL.  There  are not  now,  and at the
Effective  Date there will not be, any  outstanding  options,  warrants or other
rights to purchase or acquire,  or securities  convertible  into or exchangeable
for,  any shares in the share  capital of GESL and there are not now, and at the
Effective  Date  there  will  not  be,  any  contract,  commitment,   agreement,
understanding,  arrangement or restriction which requires GESL to issue, sell or
deliver  any  shares in its  share  capital  or any  securities  or  obligations
convertible into, or exchangeable for, any shares of its share capital. GESL has
no outstanding  bonds,  debentures,  notes or other  indebtedness the holders of
which  have the  right to vote (or that  are  convertible  or  exercisable  into
securities having the right to vote) with GESL Shareholders or in respect of the
election of directors of GESL.

3.1.4  Subsidiaries.  GESL  owns all of the  issued  and  outstanding  shares of
Gibraltar 2002 No. 2. Other than Gibraltar 2002 No. 2, GESL has no subsidiaries.

3.1.5 No Conflict.  The  execution  and  delivery of this  Agreement by GESL and
Gibraltar 2002 No. 2 does not and the  performance of this Agreement by GESL and
Gibraltar 2002 No. 2 and the successful  completion of the Arrangement  does not
and will not:

(a) conflict with or violate the  memorandum or articles GESL or Gibraltar  2002
No. 2, as the case may be; or

(b) conflict with or violate any law, rule,  permit,  order,  judgment or decree
applicable to GESL or Gibraltar 2002 No. 2 or by which any of GESL's  properties
is bound or affected, the conflict with which or violation of which would result
in a Material Adverse Change in respect of GESL.

3.1.6  Compliance.  Neither  GESL  nor  Gibraltar  2002  No.  2 nor  any  of its
Subsidiaries is in conflict with, or in default  (including  cross-defaults)  or
violation  of, in any respect which is material and adverse to GESL or Gibraltar
2002 No. 2, as the case may be:

(a) its memorandum or articles or equivalent organizational documents;

(b) any law,  rule,  order,  permit,  judgment or decree  applicable  to GESL or
Gibraltar 2002 No. 2 or by which any one of their respective properties is bound
or affected,  which conflict  default or violation  would  constitute a Material
Adverse Change;

(c) any credit  agreement,  note,  bond,  mortgage,  indenture or other  similar
contract,  agreement or instrument  relating to indebtedness  for borrowed money
("GESL Debt  Agreements") to which GESL or Gibraltar 2002 No. 2 is a party or by
which  GESL or  Gibraltar  2002 No. 2 or any of  GESL's  properties  is bound or
affected; or

(d)  any  contract,  agreement,  lease,  licence,  permit,  franchise  or  other
instrument or obligation  (other than the GESL Debt Agreements) to which GESL or
Gibraltar  2002 No. 2 is a party or by which GESL or Gibraltar 2002 No. 2 or any
of GESL's properties is bound or affected which conflict,  default or violation,
in any such case, would result in a Material Adverse Change or materially impede
the completion of the transactions contemplated in the Agreement.

In particular,  and without  limiting the generality of the foregoing,  GESL and
Gibraltar  2002  No.  2 have  complied  with the  provisions  of all  applicable
securities  legislation,  except for non-compliance that could not reasonably be
expected to result in a Material Adverse Change.

3.1.7 Severance or Termination. Neither GESL nor Gibraltar 2002 No. 2 is a party
to any written or oral agreement providing for severance or termination payments
to any director or officer as a result of the transactions  contemplated by this
Agreement  or which may be affected by a change of control of GESL or  Gibraltar
2002 No. 2.

3.1.8 Disclosure. There is no fact which GESL has not disclosed to Taseko and of
which any of its  officers,  directors or members of senior  management is aware
and which has resulted,  or would reasonably be expected to result in a Material
Adverse Change to GESL or Gibraltar 2002 No. 2.

3.1.9 Tax Filings. GESL and Gibraltar 2002 No. 2 have each filed all tax returns
required  to be filed by each of them and have each paid all taxes which are due
and payable,  and have each made all accruals in its  financial  statements  for
taxes payable by it for the current period.

3.1.10  Recommendation  by the Board of  Directors.  The Board of Directors  has
resolved to recommend that GESL Shareholders vote in favour of the Arrangement.

3.2      REPRESENTATIONS AND WARRANTIES OF TASEKO

Taseko and the Taseko  Subsidiaries  jointly and severally represent and warrant
to and in favour of GESL and  Gibraltar  2002 No. 2 as set forth in this Section
3.2 and  acknowledges  that GESL and Gibraltar  2002 No. 2 are relying upon such
representations  and warranties in connection  with the matters  contemplated by
this Agreement.

3.2.1 Incorporation and Qualification.  Each of Taseko and its Subsidiaries is a
corporation  duly  incorporated,  organized,  validly  subsisting  and  in  good
standing  under  the  laws  of its  jurisdiction  of  incorporation  and has all
requisite corporate power and authority to own, lease and operate its properties
and to carry on its  business  as now being  conducted.  Taseko  and each of its
Subsidiaries  is not in default under,  or in violation of, any provision of its
memorandum or articles in any respect which is material and adverse to Taseko or
the particular Subsidiary, as the case may be.

3.2.2 Authority and Enforceability.  Taseko and the Taseko Subsidiaries have the
requisite  corporate  power  and  authority  and  have  received  all  necessary
corporate   approvals  to  enter  into  this   Agreement  and  to  complete  the
transactions  contemplated  by this  Agreement.  This  Agreement  has been  duly
authorized,  executed and  delivered by Taseko and the Taseko  Subsidiaries  and
constitutes a valid and binding obligation of Taseko and the Taseko Subsidiaries
enforceable  by GESL and  Gibraltar  2002 No. 2 against  Taseko  and the  Taseko
Subsidiaries in accordance with its terms,  subject however, to limitations with
respect to enforcement imposed by law in connection with bankruptcy, arrangement
or similar  proceedings,  the equitable power of the courts to stay  proceedings
before them and the  execution  of  judgments  and to the extent that  equitable
remedies such as specific  performance  and  injunction are in the discretion of
the court from which they are sought.

3.2.3  Capitalization.  The authorized capital of Taseko consists of 100,000,000
common shares.  As of the date hereof,  the issued and outstanding share capital
of Taseko consists of 46,434,164 common shares. As of the date hereof,  not more
than  4,400,000  common shares of Taseko were reserved for issuance  pursuant to
Taseko's stock option plan. The issued and  outstanding  common shares of Taseko
have been,  and the common  shares of Taseko to be issued  pursuant  to Taseko's
stock option plan as well as the common  shares of Taseko to be issued  pursuant
to the Plan of Arrangement  will be, validly  authorized and issued,  fully paid
and non-assessable  and free of pre-emptive  rights. The common shares of Taseko
are listed and posted for trading on the TSX Venture  Exchange.  Except pursuant
to Taseko's  stock option plan,  no Person has any  agreement or option,  or any
right  capable  of  becoming  an  agreement,  for  the  purchase,  subscription,
allotment or issuance of any of the unissued shares in the capital of Taseko. No
common  shares of Taseko  are held as  treasury  stock or by any  Subsidiary  of
Taseko.

3.2.4  Subsidiaries.  All of the issued and outstanding shares in the capital of
the Subsidiaries of Taseko are duly authorized,  validly issued,  fully paid and
non-assessable. Each of the Taseko Subsidiaries is wholly owned by Taseko.

3.2.5 Absence of Changes.  Since  September 30, 2002, and except as disclosed in
the public  disclosure  documents  filed by Taseko  with  securities  regulatory
authorities since September 30, 2002 (the "Taseko Disclosure Documents"),  there
has not been any Material Adverse Change in relation to Taseko. Without limiting
the generality of the foregoing, from September 30, 2002, to the date hereof,

(a) except as publicly disclosed, neither Taseko nor any of its Subsidiaries has
declared,  set aside or paid any dividend or made any distribution  with respect
to its  capital  stock  (whether  in cash  or in kind  and  except  for  regular
quarterly  dividends in an amount consistent with  pre-established  policies) or
redeemed, purchased or otherwise acquired any of its capital stock;

(b) except in the  ordinary  course of business,  neither  Taseko nor any of its
Subsidiaries  has granted any increase in the  compensation of any of its senior
officers or directors; and

(c) neither Taseko nor any of its Subsidiaries has adopted,  amended,  modified,
or terminated any bonus, profit-sharing,  incentive, severance, pension or other
plan,  contract,  or  commitment  (or taken any such action with  respect to any
other such plan) for the  benefit of (i) any of its  officers or  directors,  or
(ii) any of its other employees outside the ordinary course of business.

3.2.6 Absence of Undisclosed Material Liabilities. Other than as fully disclosed
in the Taseko Disclosure  Documents,  neither Taseko nor any of its Subsidiaries
has any material  liabilities or obligations of any nature (whether  absolute or
contingent,  whether accrued or unaccrued,  whether  liquidated or unliquidated,
and whether due or to become due, including any liability for taxes),  including
guarantees, support obligations or other similar obligations with respect to the
obligations  of  any  person,  except  liabilities  or  obligations   adequately
reflected or reserved against in the audited comparative  consolidated financial
statements of Taseko as at September 30, 2002.

3.2.7  Securities  Law  Filings.  Taseko  has  filed  all  information  or proxy
circulars,  annual  information  forms,  financial  statements,  material change
reports,  press releases and other documents required to be filed by it pursuant
to applicable securities legislation, including applicable rules and policies of
the TSX Venture Exchange (collectively,  the "Taseko Securities Reports").  Each
Taseko  Securities  Report  was,  as of the  date  of  filing  such  report,  in
compliance  in  all  material  aspects  with  all  applicable   requirements  of
securities  legislation  and  none  of the  Taseko  Securities  Reports  nor any
prospectus filed by Taseko, as of their respective  filing dates,  contained any
untrue  statement of material  fact or omitted to state a material fact required
to be stated  therein or necessary to make the statements  therein,  in light of
the circumstances under which they were made, not misleading.

3.2.8 No  Conflict.  The  execution  and  delivery of this  Agreement by each of
Taseko  and  the  Taseko  Subsidiaries  does  not and  the  performance  of this
Agreement by Taseko and the successful  completion of the  Arrangement  does not
and shall not:

(a)  conflict  with  or  violate  the   memorandum  or  articles  or  equivalent
organizational documents of Taseko or any Subsidiary;

(b) conflict with or violate any law, rule,  permit,  order,  judgment or decree
applicable  to  Taseko  or any of its  Subsidiaries  or by  which  any of  their
respective properties is bound or affected, the conflict with which or violation
of which would result in a Material Adverse Change in respect of Taseko;

(c)  result in any breach of or  constitute  a default  (or an event  which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination, amendment, acceleration or cancellation of, or result
in the creation of a lien on any of the properties or assets of Taseko or any of
its  Subsidiaries  pursuant  to any  credit  agreement,  note,  bond,  mortgage,
indenture  or other  similar  contract,  agreement  or  instrument  relating  to
indebtedness for borrowed money (the "Taseko Debt Agreements) to which Taseko or
any of its Subsidiaries is a party or by which Taseko or any of its Subsidiaries
or any of their respective properties is bound or affected; or

(d)  result in any breach of or  constitute  a default  (or an event  which with
notice or lapse of time or both would become a default) under, or give to others
any rights of termination,  amendment, acceleration or cancellation of or result
in the creation of a lien on any of the properties or assets of Taseko or any of
its Subsidiaries pursuant to any contract,  agreement,  lease, licence,  permit,
franchise  or  other  instrument  or  obligation  (other  than the  Taseko  Debt
Agreements)  to which Taseko or any of its  Subsidiaries  is a party or by which
Taseko or any of its Subsidiaries or any of their respective properties is bound
or affected which breach or default in any such case, would result in a Material
Adverse  Change  or  materially   impede  the  completion  of  the  transactions
contemplated by the Agreement.

3.2.9  Compliance.  Neither  Taseko nor any of its  Subsidiaries  is in conflict
with, or in default  (including  cross-defaults) or violation of, in any respect
which is material  and adverse to Taseko or the  particular  Subsidiary,  as the
case may be:

(a) its memorandum or articles or equivalent organizational documents;

(b) any law, rule, order, permit, judgment or decree applicable to Taseko or any
of its Subsidiaries or by which any one of their respective  properties is bound
or affected,  which conflict,  default or violation would  constitute a Material
Adverse Change; or

(c)  any  contract,  agreement,  lease,  licence,  permit,  franchise  or  other
instrument or obligation to which Taseko or any of its  Subsidiaries  is a party
or by  which  Taseko  or any  of its  Subsidiaries  or any of  their  respective
properties is bound or affected which would result in a Material  Adverse Change
or materially  impede the  completion of the  transactions  contemplated  in the
Agreement.

In particular, and without limiting the generality of the foregoing,  Taseko has
complied with the provisions of all applicable  securities  legislation,  except
for non-compliance that could not reasonably be expected to result in a Material
Adverse Change.

3.2.10  Taseko  Financial   Statements.   The  financial  statements  of  Taseko
previously  filed  in the  Taseko  Securities  Reports  present  fairly,  in all
material respects, the consolidated financial position of Taseko and the results
of its  operations  and its cash  flows as of the  respective  dates and for the
periods presented therein in conformity with GAAP as in effect on the applicable
dates of such financial  statements and applied on a consistent basis, except as
noted therein and except that in the case of the unaudited financial statements,
no notes are included and such unaudited financial  statements may be subject to
normal  adjustments  that would be made in the course of an audit and that would
not be material and adverse to Taseko.

3.2.11  Litigation.   There  are  no  claims,   actions,   proceedings,   suits,
investigations,  reviews, judgments, or decrees outstanding,  pending or, to the
knowledge  of  Taseko,  threatened  against  or  involving  Taseko or any of its
Subsidiaries or any of their  businesses,  assets or properties before any court
or other tribunal or by or before any agency or arbitrator,  that,  individually
or in the aggregate, if adversely determined, would result in a Material Adverse
Change. As at the date hereof neither Taseko nor any of its Subsidiaries nor any
of their assets or properties  is subject to any judgment  order or decree which
was or will result in a Material Adverse Change.

3.2.12 Disclosure. There is no fact which Taseko or the Taseko Subsidiaries have
not disclosed to GESL and of which any of its officers,  directors or members of
senior  management  is aware and  which has  resulted,  or would  reasonably  be
expected to result in a Material Adverse Change to Taseko.

3.2.13 Tax Filings.  Taseko has filed all tax returns required to be filed by it
and has paid all taxes which are due and  payable,  and has made all accruals in
its financial statements for taxes payable by it for the current period.

3.3      SURVIVAL

For greater  certainty,  the  representations  and  warranties  of each of GESL,
Gibraltar 2002 No. 2, Taseko and the Taseko Subsidiaries  contained herein shall
survive the termination of this Agreement for a period of one year.

                                   ARTICLE 4.

                              REGULATORY APPROVALS

4.1      APPLICATIONS

The parties hereto  covenant and agree to proceed  diligently,  in a coordinated
fashion, to apply for and obtain the Appropriate Regulatory Approvals.

4.2      OBTAINING OF APPROPRIATE REGULATORY APPROVALS

For purposes of this  Agreement,  no  Appropriate  Regulatory  Approval shall be
considered to have been obtained  unless it is on terms  satisfactory to Taseko,
acting reasonably.

                                   ARTICLE 5.

                                    COVENANTS

5.1      RECOMMENDATION OF ARRANGEMENT

GESL hereby covenants that it will through its Board of Directors recommend that
GESL Shareholders vote all of their GESL Shares in favour of the Arrangement and
GESL through its Board of Directors shall publicly reconfirm such recommendation
upon the reasonable request in writing from time to time of Taseko.

5.2      COVENANTS OF GESL

GESL hereby also covenants  that,  from the date hereof until the earlier of (i)
the Effective Date, or (ii) this Agreement  having been  terminated  pursuant to
Article 7 hereof, GESL shall:

5.2.1 not take any action of any kind which might reduce the  likelihood  of, or
interfere with, the completion of the Arrangement including, but not limited to,
any action to solicit, assist or encourage enquiries, submissions,  proposals or
offers from any other Person,  entity or group of Persons  relating to, and will
not continue or participate  in any  discussions  or  negotiations  regarding or
furnish to any other  Person,  entity or group of Persons any  information  with
respect to, or otherwise co-operate in any way with or assist or participate in,
or facilitate or encourage any effort or attempt with respect to:

5.2.1.1 the direct or indirect  acquisition  or  disposition  of all or any GESL
Shares or any other securities of GESL; or

5.2.1.2  any  amalgamation,  merger,  sale of all or any part of  GESL's  assets
(other than in the ordinary  course of business),  take-over bid,  tender offer,
plan of  arrangement,  issuer bid,  reorganization,  dividend  or  distribution,
recapitalization, liquidation or winding-up of, or other business combination or
similar transaction involving GESL. Notwithstanding the foregoing, GESL shall be
entitled to supply  information  to a third party in response to an  unsolicited
written proposal which, if implemented,  would, in GESL's  reasonable  judgment,
constitute  a Competing  Transaction  provided  that a copy of such  proposal is
immediately  delivered  to Taseko and  provided  further  that such third  party
enters into a  confidentiality  agreement  with GESL and provided  that all such
information  made available to the third party has been, or immediately will be,
provided to Taseko;

5.2.2 notify Taseko forthwith upon becoming aware of any submission, proposal or
offer  related to a transaction  of the nature  referred to in Section 5.2.1 and
inform  Taseko of all  information  (including  the identity of any  prospective
party and the consideration  proposed) known at that time to GESL regarding such
submission, proposal or offer;

5.2.3 not,  directly or  indirectly,  bid for or purchase any GESL Shares or any
rights to purchase GESL Shares or securities convertible or exercisable into any
GESL Shares,  or attempt to induce any person to purchase  any such  security or
right;

5.2.4 use  commercially  reasonable  efforts  to assist  Taseko to  successfully
complete the transactions contemplated by this Agreement including by making all
regulatory  filings  and  in  obtaining  all  requisite  regulatory   approvals,
including the Appropriate Regulatory Approvals and making submissions and giving
evidence in relation  thereto,  in mailing or otherwise  making and successfully
completing  the  Arrangement  in a manner  which is most tax  effective  for the
parties  hereto,  and in acquiring all  outstanding  GESL Shares pursuant to the
Arrangement;

5.2.5  provide a  current  list of  shareholders  of GESL  prepared  by GESL and
deliver  such list to Taseko  within two Business  Days after  execution of this
Agreement;

5.2.6 use commercially  reasonable efforts to obtain any consents required under
leases and other contracts as a result of the transactions  contemplated by this
Agreement;

5.2.7 use commercially reasonable efforts to cause the conditions in Section 6.1
and Section 6.2 to be satisfied on a timely basis;

5.2.8  immediately  cease to provide to any person (other than Taseko) access to
GESL's information,  properties, books, records, agreements or commitments other
than in the ordinary course of business or as required by applicable law; and

5.2.9  provide or cause to be  provided to Taseko all proxy  return  information
with respect to the GESL Meeting on a timely basis upon request by Taseko.

5.3      OPERATION OF BUSINESS

GESL  hereby  covenants  from the  date  hereof  until  the  earlier  of (i) the
Effective Date or (ii) this Agreement having been terminated pursuant to Article
7 hereof,  (except as Taseko shall otherwise  consent which consent shall not be
unreasonably  withheld) to carry on business only in the usual course consistent
with past practice and that it shall:

5.3.1 not take any action  (directly or  indirectly)  with respect to any of the
following,  except to the extent  necessary to give effect to obligations  under
this Agreement:

5.3.1.1 any take-over bid, tender offer, issuer bid, merger, amalgamation,  plan
of arrangement  (other than the  Arrangement),  reorganization or other business
combination or similar  transaction  involving GESL or substantially  all of its
assets;

5.3.1.2  any joint  venture,  strategic  alliance,  non-competition  or  similar
restrictive  covenant or other transaction with strategic  implications for GESL
or which may have an adverse effect on Taseko;

5.3.1.3 make any change in its debt or equity capitalization (including, but not
limited  to,  any  increase  in the  amount  or  maturity  of  its  consolidated
borrowings) or any conversion of short term borrowings into long term borrowings
other  than  accessing  existing  credit  facilities  in the  normal  course  of
business;

5.3.1.4 declaring or paying any dividend or declaring, authorizing or making any
distribution  of, on or in respect of any of its securities  whether  payable in
cash, securities or otherwise;

5.3.1.5 the amendment of its memorandum or articles, or the issuance or purchase
or other  acquisition  of any  shares  of its  capital  stock or of any class of
securities convertible into, or rights, warrants or options to acquire, any such
shares or other convertible securities, except as referred to in this Agreement;

5.3.1.6  agreeing  or  committing  to  guarantee  the  payment  of any  material
indebtedness;

5.3.2 not sell or issue any GESL  Shares and not grant any  options to  purchase
GESL Shares;

5.3.3  except as  otherwise  contemplated  hereby or in the  ordinary  course of
business, not enter into or amend existing agreements,  commitments or contracts
which  are  material  to  GESL  which  alone  accounts  for  10% or  more of the
consolidated revenues of GESL;

5.3.4  promptly  advise  Taseko  of any  fact  or any  change  in the  business,
operations, affairs, assets, liabilities,  capitalization or financial condition
of GESL or Gibraltar  2002 No. 2 that could  reasonably be expected to result in
or give rise to a Material Adverse Change; and

5.3.5  not  enter  into any  transaction  or  perform  any act  which  might (i)
interfere or be inconsistent  with the successful  completion of the Arrangement
(ii) render  inaccurate  any of the  representations  and  warranties  set forth
herein if such  representations and warranties were made at a date subsequent to
such transaction or act and all references to the date hereof were to such later
date, or (iii)  adversely  affect GESL's  ability to perform and comply with its
covenants and agreements under this Agreement.

5.4      CIRCULAR DISCLOSURE COVENANTS

5.4.1 GESL Covenant.  GESL hereby  covenants to Taseko that GESL will provide to
Taseko,  both  on  the  date  of the  Circular  and on  the  Effective  Date,  a
representation and warranty that the disclosure pertaining to GESL and Gibraltar
2002 No. 2 in the Circular  does not contain any untrue  statement  and does not
omit to state  any  material  fact  that is  required  to be  stated  or that is
necessary to prevent a statement  that is made from being false or misleading in
the circumstances in which it was made.

5.4.2 Taseko Covenant.  Taseko hereby covenants to GESL that Taseko will provide
to  GESL,  both  on the  date  of the  Circular  and on the  Effective  Date,  a
representation and warranty that the disclosure in the Circular does not contain
any  untrue  statement  and does not omit to state  any  material  fact  that is
required to be stated or that is necessary  to prevent a statement  that is made
from being false or misleading in the circumstances in which it was made.

5.5      COVENANTS OF TASEKO

Taseko hereby  covenants  that from the date hereof until the earlier of (i) the
Effective  Date,  or (ii) this  Agreement  having  been  terminated  pursuant to
Article 7 hereof, Taseko shall:

5.5.1  use  commercially   reasonable  efforts  to  successfully   complete  the
Arrangement  including  co-operating  with GESL in preparing the Circular and in
making all requisite  regulatory filings and giving evidence in relation to such
filings;

5.5.2  use  commercially  reasonable  efforts  to obtain  acceptance  by the TSX
Venture  Exchange of the Arrangement and to cause the Taseko Shares to be issued
upon the Arrangement  becoming  effective to be listed and posted for trading on
the TSX Venture Exchange on or before the Effective Date; and

5.5.3 use  commercially  reasonable  efforts to cause the conditions in Sections
6.1 and 6.3 to be satisfied on a timely basis.

5.6      COVENANTS REGARDING A COMPETING TRANSACTION

5.6.1  Competing  Transaction.  Nothing in this Agreement shall prevent the GESL
Board of Directors from  withdrawing,  modifying or changing any  recommendation
regarding the Arrangement in response to a bona fide Competing  Transaction that
has not been  solicited,  assisted,  or encouraged by or on behalf of GESL or by
any advisor to or director, officer or employee of GESL or any Affiliate thereof
where (i) written  notice has been given to Taseko  pursuant to Section  5.6.2.1
hereof and Taseko has not exercised its rights under Section  5.6.2.2,  and (ii)
where in the opinion of the special  committee of the Board of Directors  acting
in good faith,  after  consulting  its outside  legal  counsel,  a failure to so
respond would be inconsistent with the performance of its fiduciary  obligations
under applicable law.

5.6.2 Notification of Competing Transaction. GESL shall inform Taseko in writing
forthwith upon becoming aware of a Competing  Transaction and GESL and its Board
of Directors shall not withdraw,  modify,  amend or change its recommendation to
GESL Shareholders to vote in favour of the Arrangement unless:

5.6.2.1 it has provided  Taseko with notice in writing  delivered to Taseko that
there is a Competing  Transaction together with all documentation related to and
detailing  the  Competing  Transaction  at least five Business Days prior to the
date on which the Board of  Directors  proposes to  withdraw,  modify,  amend or
change  its  recommendation  to  GESL  Shareholders  to vote  in  favour  of the
Arrangement,  which notice may be given only if the  Competing  Transaction  has
been publicly announced or made on or before the fifth Business Day prior to the
Meeting Date; and

5.6.2.2 Taseko,  within five Business Days after receipt of the notice and other
documentation  referred to in Section  5.6.2.1,  does not  publicly  announce an
intention to amend the terms of this Agreement and the Arrangement the result of
which would be, upon acceptance by GESL (and, if applicable,  other approvals of
the Court),  a transaction  having a value per GESL Share greater than the value
per GESL Share under the  Competing  Transaction,  and does not offer to GESL to
amend this  Agreement  within two Business  Days after such public  announcement
and,  in any event  before  the  Meeting  Date;  provided  that if more than one
Competing  Transaction exists, the provisions of this Section shall apply to and
in respect of only the  Competing  Transaction  that the GESL Board of Directors
concludes is the superior transaction and has so notified Taseko in writing.

5.7      TASEKO'S ACCESS TO INFORMATION

Notwithstanding  the  pre-agreement  investigation  of GESL  conducted  by or on
behalf of Taseko,  GESL shall give Taseko and its authorized  agents  reasonable
ongoing access during the term of this Agreement upon reasonable notice to GESL,
to  all  of  GESL's  and  its  Subsidiaries'   information,   senior  personnel,
properties, books, records, agreements and commitments, as Taseko may reasonably
require. In addition,  GESL shall co-operate with Taseko and any such authorized
persons in their review and furnish  such persons with all material  information
with  respect to GESL and its  Subsidiaries  and their  ongoing  operations  and
activities  as Taseko or any person  authorized by them may  reasonably  request
provided  that  Taseko  shall   designate  the   individual  or  individuals  to
co-ordinate  such access and further provided that Taseko shall not unreasonably
disrupt  the normal  business  operations  of GESL or its  Subsidiaries.  GESL's
obligations under this Section are subject to any legally binding obligations of
confidentiality in favour of any third party.

5.8      GESL'S ACCESS TO INFORMATION

Notwithstanding  the  pre-agreement  investigation  of Taseko conducted by or on
behalf of GESL,  Taseko  shall give GESL and its  authorized  agents  reasonable
ongoing  access  during the term of this  Agreement  upon  reasonable  notice to
Taseko, to all of Taseko's and its Subsidiaries'  material  information,  senior
officers,  and  material  agreements  and  commitments,  as GESL may  reasonably
require. In addition,  Taseko shall co-operate with GESL and any such authorized
persons in their review and furnish  such persons with all material  information
with respect to Taseko and its Subsidiaries as GESL or any person  authorized by
them may reasonably  request,  provided that GESL shall designate the individual
or individuals to co-ordinate  such access and further  provided that GESL shall
not  disrupt  the  normal  business  operations  of Taseko or its  Subsidiaries.
Taseko's  obligations  under this  Section are  subject to any  legally  binding
obligations of confidentiality in favour of any third party.

                                   ARTICLE 6.

                                   CONDITIONS

6.1      MUTUAL CONDITIONS PRECEDENT

The respective obligations of the parties hereto to complete the Arrangement and
the other  transactions  contemplated  by this Agreement shall be subject to the
satisfaction,  on or before the  Effective  Date,  of the  following  conditions
precedent,  each of which may be waived only by the mutual consent of Taseko and
GESL:

6.1.1 the  Arrangement  shall have been approved at the GESL Meeting by at least
75% of the votes cast by GESL  Shareholders  represented  and voting at the GESL
Meeting  and by a  majority  of such  votes  other  than the  votes of  Excluded
Shareholders;

6.1.2 the Arrangement shall have been approved at the GESL Meeting in accordance
with any  conditions  in addition to those set out in Section 6.1.1 which may be
imposed  by the  Interim  Order and which are  satisfactory  to each of GESL and
Taseko, acting reasonably;

6.1.3 the Interim  Order and the Final  Order  shall each have been  obtained in
form and terms satisfactory to each of GESL and Taseko,  acting reasonably,  and
shall not have been set aside or  modified in a manner  unacceptable  to each of
GESL and  Taseko on appeal or  otherwise  and the Final  Order  shall  have been
accepted for filing by the Registrar;

6.1.4 there shall not be in force any order or decree  restraining  or enjoining
the  consummation of the Arrangement or the other  transactions  contemplated by
this Agreement;

6.1.5    this Agreement shall not have been terminated pursuant to Section 7.3;

6.1.6 the  Arrangement  shall have been  accepted  for filing by the TSX Venture
Exchange and the Taseko Shares issuable  pursuant to the Arrangement  shall have
been conditionally approved for listing on the TSX Venture Exchange,  subject to
the filing of required documentation; and

6.1.7 all necessary  regulatory approvals shall have been obtained to permit the
issuance and first resale of the Taseko Shares without the  qualification  with,
or  approval  of, or the filing of any  document  including  any  prospectus  or
similar  document or the taking of any proceeding  with, or the obtaining of any
further  order,  ruling or consent from any  Governmental  Entity or  regulatory
authority  under the Securities Act or pursuant to the rules and  regulations of
any regulatory authority administering such Laws, or the fulfilment of any other
legal  requirement in any such  jurisdiction  (other than,  with respect to such
first  resales,  any  restrictions  on  transfer  by reason of a holder  being a
"control person" for purposes of the Securities Act).

6.2 ADDITIONAL  CONDITIONS PRECEDENT TO THE OBLIGATIONS OF TASEKO AND THE TASEKO
SUBSIDIARIES

The  obligations  of  Taseko  and  the  Taseko   Subsidiaries  to  complete  the
transactions  contemplated  by  this  Agreement  shall  also be  subject  to the
satisfaction,  on or  before  the  Effective  Date,  of  each  of the  following
conditions precedent (each of which is for Taseko's exclusive benefit and may be
waived by Taseko and any one or more of which, if not satisfied or waived,  will
relieve Taseko of any obligation under this Agreement):

6.2.1 all covenants of GESL and Gibraltar  2002 No. 2 under this Agreement to be
performed on or before the Effective Date shall have been duly performed by GESL
and Gibraltar 2002 No. 2 in all material respects;

6.2.2 the  representations  and warranties of GESL and Gibraltar 2002 No. 2 made
pursuant to this  Agreement  shall be true and correct in all material  respects
immediately  prior  to the  Effective  Date as if  made  on and as of such  date
(except to the extent such representations and warranties speak as of an earlier
date,  in which  event such  representations  and  warranties  shall be true and
correct in all material  respects as of such earlier date, or except as affected
by transactions contemplated or permitted by this Agreement);

6.2.3 the Board of Directors  shall have adopted all necessary  resolutions  and
all other necessary corporate action shall have been taken by GESL and Gibraltar
2002  No.  2, to  permit  the  consummation  of the  Arrangement  and the  other
transactions contemplated hereby;

6.2.4 the Board of  Directors  shall  have made and shall not have  modified  or
amended,  in a  manner  adverse  to  Taseko,  prior  to  the  GESL  Meeting,  an
affirmative  recommendation  that  GESL  Shareholders  vote  in  favour  of  the
Arrangement;

6.2.5  the  Appropriate   Regulatory  Approvals  shall  have  been  obtained  in
accordance with Article 4 and shall be in full force and effect and shall not be
the  subject  of any  stop-order  or  proceedings  seeking a  stop-order  or any
revocation proceedings;

6.2.6  between  the date  hereof and the  Effective  Date,  there shall not have
occurred,  in the  judgment of Taseko,  acting  reasonably,  a Material  Adverse
Change with respect to GESL;

6.2.7 Taseko shall have  determined in its  reasonable  judgment that there does
not exist any covenant,  term or condition in any of the material instruments or
agreements  to which any of GESL or Gibraltar  2002 No. 2 is a party or to which
they or any of their  properties  or assets  are  subject  (of which  Taseko was
unaware at the date of this Agreement)  which may be breached or cause a default
or permit third parties to exercise rights against any of GESL or Gibraltar 2002
No. 2 which would result in a Material  Adverse Change with respect to GESL as a
result of the Arrangement becoming effective;

6.2.8 Taseko shall be satisfied  that (i) no action,  suit or  proceeding  shall
have been  threatened  to be taken or taken before or by any domestic or foreign
arbitrator,  court or  tribunal  or  governmental  agency  or  other  regulatory
authority or administrative  agency or commission or by any elected or appointed
public  official  or  private  person  (including,   without   limitation,   any
individual,  company,  firm,  group or other  entity)  in Canada  or  elsewhere,
whether  or not having the force of law,  and (ii) no law,  regulation,  rule or
policy shall have been proposed, enacted, promulgated or applied, in the case of
(i) or (ii) above:

6.2.8.1 to cease  trade,  enjoin,  prohibit or impose  material  limitations  or
conditions on the completion of the Arrangement or the right of Taseko to own or
exercise full rights of ownership of all of the outstanding  GESL Shares and all
of the outstanding shares of Gibraltar 2002 No. 2 owned by GESL;

6.2.8.2 which, if the Arrangement  was completed,  could in Taseko's  reasonable
judgment adversely affect GESL;

6.2.9 there shall not exist any  prohibition  at law  against  Taseko  owning or
exercising full rights of ownership of all of the outstanding GESL Shares;

Taseko  may not rely on the  failure  to  satisfy  any of the  above  conditions
precedent as a basis for  non-compliance  by Taseko with its  obligations  under
this  Agreement if the condition  precedent  would have been satisfied but for a
default by Taseko in complying with its obligations hereunder.

6.3  ADDITIONAL  CONDITIONS  PRECEDENT TO THE  OBLIGATIONS OF GESL AND GIBRALTAR
2002 NO. 2

The  obligations of GESL and Gibraltar  2002 No. 2 to complete the  transactions
contemplated by this Agreement shall also be subject to the satisfaction,  on or
before the Effective Date, to each of the following  conditions  precedent (each
of which is for the exclusive  benefit of GESL and may be waived by GESL and any
one or more of which,  if not  satisfied  or waived,  will  relieve  GESL of any
obligation under this Agreement):

6.3.1 all covenants of Taseko and the Taseko  Subsidiaries  under this Agreement
to be performed on or before the Effective  Date shall have been duly  performed
by Taseko and the Taseko Subsidiaries in all material respects;

6.3.2 all representations and warranties of Taseko under this Agreement shall be
true and correct in all material  respects  immediately  prior to the  Effective
Date  as  if  made  on  and  as  of  such  date   (except  to  the  extent  such
representations  and warranties speak as of an earlier date, in which event such
representations  and  warranties  shall  be true  and  correct  in all  material
respects  as of such  earlier  date,  or  except  as  affected  by  transactions
contemplated or permitted by this Agreement);

6.3.3  the board of  directors  of  Taseko  shall  have  adopted  all  necessary
resolutions,  and all other necessary  corporate action shall have been taken by
Taseko and each of the Taseko  Subsidiaries,  to permit the  consummation of the
Arrangement and the issue of the Taseko Shares contemplated thereby; and

6.3.4  between  the date  hereof and the  Effective  Date,  there shall not have
occurred, in the judgment of GESL, acting reasonably,  a Material Adverse Change
with respect to Taseko.

GESL  may  not  rely on the  failure  to  satisfy  any of the  above  conditions
precedent as a basis for  non-compliance by GESL with its obligations under this
Agreement if the condition precedent would have been satisfied but for a default
by GESL in complying with its obligations hereunder.

6.4      NOTICE AND CURE PROVISIONS

The  parties  hereto  will  give  prompt  notice  to the  other  parties  of the
occurrence,  or failure  to occur,  at any time from the date  hereof  until the
Effective  Date,  of any event or state of facts  which  occurrence  or  failure
would, or would be likely to:

6.4.1 constitute a material breach of any  representations  or warranties of the
other contained herein or which would cause such  representations and warranties
to be untrue or inaccurate in any material respect on the Effective Date; or

6.4.2 result in the failure to comply with or satisfy any covenant, condition or
agreement to be complied with or satisfied by the other  hereunder  prior to the
Effective Date.

None of the parties  hereto may elect not to  complete  the  Arrangement  or the
other  transactions  contemplated  hereby  pursuant to the conditions  precedent
contained  in  Sections  6.1,  6.2 and 6.3, or exercise  any  termination  right
arising therefrom, unless forthwith such party has delivered a written notice to
the  other   specifying  in   reasonable   detail  all  breaches  of  covenants,
representations and warranties or other matters which such party is asserting as
the basis for the  non-fulfilment of the applicable  condition  precedent or the
exercise  of the  termination  right,  as the case may be. If any such notice is
delivered,  provided  that  such  party is  proceeding  diligently  to cure such
matter,  if such matter is susceptible to being cured, the other parties may not
terminate this Agreement prior to April 30, 2003.

                                   ARTICLE 7.

                            AMENDMENT AND TERMINATION

7.1      AMENDMENT

This  Agreement  may,  at any time and from  time to time  before  or after  the
holding of the GESL Meeting but not later than the Effective Date, be amended by
mutual  written  agreement of the parties  hereto,  and any such  amendment may,
without limitation:

7.1.1 change the time for  performance of any of the  obligations or acts of the
parties;

7.1.2 waive any inaccuracies or modify any  representation or warranty contained
herein or in any document delivered pursuant hereto;

7.1.3 waive  compliance with or modify any of the covenants herein contained and
waive or modify performance of any of the obligations of the parties; and

7.1.4 waive compliance with or modify any conditions precedent herein contained;

provided that notwithstanding the foregoing, the terms of this Agreement and the
Plan of Arrangement shall not be amended in a manner  materially  prejudicial to
the GESL Shareholders without the approval of the GESL Shareholders given in the
same manner as required by law for the approval of the  Arrangement or as may be
ordered by the Court.

7.2      MUTUAL UNDERSTANDING REGARDING AMENDMENTS

The parties agree that if any party proposes any amendment or amendments to this
Agreement or to the Plan of  Arrangement,  the other parties will act reasonably
in  considering  such  amendment  and if the other  parties  and their  security
holders are not  prejudiced  by reason of any such  amendment  such parties will
co-operate in a reasonable  fashion with the party  proposing the amendment,  so
that such amendment can be effected subject to applicable Laws and the rights of
the security holders.

7.3      TERMINATION

7.3.1  Termination by GESL. GESL, when not in default in any material respect in
the performance of its obligations  under this Agreement may, without  prejudice
to any other rights, terminate this Agreement by written notice to Taseko if:

7.3.1.1 any condition  contained in Section 6.1 or 6.2 is not satisfied by April
30, 2003 to the satisfaction of GESL, acting reasonably;

7.3.1.2 any  representation  or warranty of Taseko in this  Agreement  shall not
have been as of the date hereof,  as of the date on which the Circular is mailed
and as of the Effective Date, true and correct in all material respects;

7.3.1.3  Taseko  fails  to  comply  in  any  material  respect  with  any of its
obligations under this Agreement; or

7.3.1.4  Taseko has been notified in writing by GESL of a Competing  Transaction
in accordance with Section 5.6.2.1 and Taseko does not take the action described
in Section 5.6.2.2 within the time periods specified therein.

7.3.2 Termination by Taseko. Taseko, when not in default in any material respect
in  the  performance  of its  obligations  under  this  Agreement  may,  without
prejudice to any other rights,  terminate  this  Agreement by written  notice to
GESL if:

7.3.2.1 any condition  contained in Section 6.1 or 6.3 is not satisfied by April
30, 2003 to the satisfaction of Taseko acting reasonably;

7.3.2.2  the  Circular  has not been  mailed to the  shareholders  of GESL on or
before April 14, 2003, for any reason other than a default of Taseko hereunder;

7.3.2.3 any  representation or warranty of GESL in this Agreement shall not have
been as of the date  hereof,  as of the date on which the Circular is mailed and
as of the Effective Date, true and correct in all material respects;

7.3.2.4 GESL fails to comply in any material respect with any of its obligations
under this Agreement;

7.3.2.5 for any reason other than the default of Taseko  hereunder the Effective
Date has not occurred on or before April 30, 2003 ; or

7.3.2.6  Taseko has been notified in writing by GESL of a Competing  Transaction
in accordance with Section 5.6.2.1 and Taseko does not take the action described
in Section 5.6.2.2 within the time periods specified therein.

7.3.3 Mutual  Termination.  This  Agreement may, at any time before or after the
holding of the GESL Meeting but not later than the Effective Time:

7.3.3.1 be terminated by the mutual  agreement of the parties  (without  further
action on the part of GESL's shareholders if terminated after the holding of the
GESL Meeting); or

7.3.3.2  be  terminated  by GESL by  written  notice  to Taseko  and the  Taseko
Subsidiaries   upon  the  failure  of  the  GESL  Shareholders  to  approve  the
Arrangement at the GESL Meeting.

7.3.4 Effect of  Termination.  In the case of any  termination of this Agreement
pursuant  to this  Article 7, this  Agreement  shall be of no further  force and
effect.

                                   ARTICLE 8.

                                     CLOSING

8.1      TASEKO CLOSING DOCUMENTS

On the Effective Date, Taseko shall provide to GESL:

8.1.1 an officer's  certificate  certifying as of the  Effective  Date as to the
accuracy of the representations and warranties in Section 3.2; and

8.1.2  an  opinion  of legal  counsel  to  Taseko  as to the  incorporation  and
existence of Taseko and the Taseko Subsidiaries; the power of Taseko to carry on
its  business  and  enter  into  this  Agreement;  the  enforceability  of  this
Agreement; compliance with all legal and regulatory requirements with respect to
the  Arrangement;  the valid  issuance  of the  common  shares of Taseko  issued
pursuant  to  the  Arrangement;  and  the  tradeability  of  such  shares  under
applicable securities laws.

8.2      GESL CLOSING DOCUMENTS

On the Effective Date, GESL shall provide to Taseko:

8.2.1 an officer's  certificate  certifying as of the  Effective  Date as to the
accuracy of the representations and warranties in Section 3.1; and

8.2.2 an opinion of legal counsel to GESL as to the  incorporation and existence
of GESL and its Subsidiaries; the ownership by GESL of Gibraltar 2002 No. 2; and
the power of GESL and  Gibraltar  2002 No. 2 to carry on their  business  and to
enter into this Agreement.

                                   ARTICLE 9.

                                     GENERAL

9.1      NOTICES

All  notices  and other  communications  which may or are  required  to be given
pursuant to any  provision of this  Agreement  shall be given or made in writing
and shall be deemed to be validly  given if served  personally or by telecopy or
email, in each case addressed to the particular party at:

(a) Taseko, as follows:

Taseko Mines Limited
1020 - 800 West Pender Street
Vancouver, B.C.

V6C 2V6

Attention:        Ronald W. Thiessen
Fax:              (604) 684-8092

with a copy to:

Lang Michener
1500 - 1055 West Georgia Street
Vancouver, B.C.
V6E 4N7

Attention:        Bernhard Zinkhofer
Fax:              (604) 685-7084

(b) GESL and Gibraltar 2002 No. 2, as follows:

Gibraltar Engineering Services Limited
920 - 800 West Pender Street
Vancouver, B.C.

V6C 2V6

Attention:        Brian F. Causey
Fax:              (604) 681-2741

with a copy to:

Davis & Company
2800 Park Place
666 Burrard Street
Vancouver, B.C.

V6C 2Z7

Attention:        Albert J. Hudec
Telecopier:       (604) 687-1612

or at such other address of which any party may,  from time to time,  advise the
other parties by notice in writing given in accordance  with the foregoing.  The
date of receipt of any such notice shall be deemed to be the date of delivery or
facsimile thereof.

9.2      ASSIGNMENT

This  Agreement  shall not be assignable by any party hereto without the consent
of the other party.

9.3      FURTHER ASSURANCES

Each party hereto shall,  from time to time, and at all times hereafter,  at the
request of the other party hereto,  but without  further  consideration,  do all
such  further  acts and  execute  and deliver  all such  further  documents  and
instruments as shall be reasonably  required in order to fully perform and carry
out the terms and intent hereof.

9.4      EXPENSES

Except as otherwise  specifically provided herein, each of the parties shall pay
its own legal,  financial,  advisory,  accounting  and other costs and  expenses
incurred in  connection  with the  preparation,  execution  and delivery of this
Agreement and the  Arrangement  and any other costs and expenses  whatsoever and
howsoever incurred.

9.5      PUBLIC ANNOUNCEMENTS

Except to the extent required by law, securities policy or rule or policy of any
applicable stock exchange,  no public  announcement or press release  concerning
the matters  referred  to in this  Agreement  may be made by the parties  hereto
without  the  prior  consent  of  the  other  party,  such  consent  not  to  be
unreasonably  withheld.  Except to the extent  required  by law, no copy of this
Agreement  may be  provided by the parties  hereto to any other  person,  except
their respective directors, officers, employees, advisors or lenders without the
prior consent of the other party, such consent not be unreasonably withheld. The
provisions of this  Agreement  may be  summarized  in the  Circular,  and in any
material   change  report  filed  by  Taseko  in  connection   with  the  public
announcement of the  Arrangement.  The parties agree to consult with each other,
to the extent reasonably possible, in connection with any public announcement or
other disclosure related to this Agreement.

9.6      GOVERNING LAWS

This Agreement shall be governed by and construed in accordance with the laws of
the Province of British Columbia and the laws of Canada  applicable  therein and
shall be treated in all respects as a British Columbia contract.

9.7      INVALIDITY OF PROVISIONS

If any  term or  other  provision  of this  Agreement  is  invalid,  illegal  or
incapable of being enforced by any applicable rule or law, or applicable  public
policy, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the  economic or legal  substance  of
the transactions  contemplated  hereby is not affected in any manner  materially
adverse to any party. Upon such  determination  that any term or other provision
is invalid,  illegal or incapable of being  enforced,  the parties  hereto shall
negotiate  in good faith to modify this  Agreement  so as to effect the original
intent of the parties as closely as possible in an acceptable  manner to the end
that the  transactions  contemplated  hereby are fulfilled to the fullest extent
possible.

9.8      COUNTERPARTS

This  Agreement may be executed in one or more  counterparts,  which may include
facsimile,  each of which  shall be  deemed to be an  original  but all of which
together shall constitute one and the same instrument.

9.9      INVESTIGATION BY PARTIES

No  investigations  made by or on behalf  of a party or any of their  respective
authorized agents at any time shall have the effect of waiving,  diminishing the
scope of or otherwise affecting any representation, warranty or covenant made by
the other parties in or pursuant to this Agreement.

9.10     TIME

Time shall be of the essence of this Agreement.

9.11     AMENDMENTS

This Agreement may not be modified,  amended,  altered or supplemented except in
the manner  contemplated herein and upon the execution and delivery of a written
agreement executed by both parties.

9.12     SPECIFIC PERFORMANCE AND OTHER EQUITABLE RIGHTS

Each of the  parties  recognizes  and  acknowledges  that  Taseko and the Taseko
Subsidiaries would not have agreed to pursue the Arrangement, and GESL would not
have agreed to recommend that  shareholders  vote in favour of the  Arrangement,
unless this  Agreement was executed and,  accordingly,  acknowledges  and agrees
that a breach by a party of any  obligation  in this  Agreement  will  cause the
other parties to sustain injury for which they would not have an adequate remedy
at law for money  damages.  Therefore,  each of the  parties  agrees that in the
event of any such breach,  the  aggrieved  party or parties shall be entitled to
the remedy of  specific  performance  of such  obligation  and  preliminary  and
permanent  injunctive and other equitable relief in addition to any other remedy
to which it may be entitled,  at law or in equity, and the parties further agree
to waive any  requirement  for the securing or posting of any bond in connection
with the obtaining of any such injunctive or other equitable relief.

IN WITNESS  WHEREOF the parties  hereto have executed  this  Agreement as of the
date first written above.



<table>
<s>                                      <C>

TASEKO MINES LIMITED                     CONCENTRATED EXPLORATION LTD.

- ------------------------------------     --------------------------------------
Authorized Signatory                     Authorized Signatory



GIBRALTAR ENGINEERING SERVICES LIMITED   CONCENTRATED EXPLORATION 2000 LTD.


- ------------------------------------     --------------------------------------
Authorized Signatory                     Authorized Signatory



GIBRALTAR REFINERY (2002) LTD            GIBRALTAR REFINERY (2002) NO. 2 LTD.



- ------------------------------------     --------------------------------------
Authorized Signatory                     Authorized Signatory



TASEKO RESOURCES INC


- ------------------------------------
Authorized Signatory
</table>


</TEXT>
</DOCUMENT>
</SEC-DOCUMENT>
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