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2006 marked the inaugural year of Cadiscor Resources Inc. (“the Company” or “Cadiscor”). Cadiscor was created as a subsidiary of Strateco Resources Inc. (“Strateco”) to hold Strateco’s gold assets. In exchange for the transfer of the properties, Cadiscor issued 20,000,000 common shares to Strateco and assumed previous obligations related to the acquisition of those assets. The Cadiscor shares were later distributed to Strateco shareholders on a pro rata basis.

From the outset, the Company rapidly took certain steps to secure its future development. The third quarter of 2006 saw the closing of an Initial Public Offering (IPO), the listing of the Company’s shares on the TSX Venture Exchange under the symbol CAO and on the Frankfurt Exchange under the symbol DQN, and the initiation of exploration work by the Company.

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On August 17, 2006, the Company announced that it had closed an IPO for $6,599,000. The offering included flow-through common shares and units (“Units”). Each Unit consisted of one common shares of Cadiscor and half a warrant. Each whole warrant entitling its holder to purchase one common share of Cadiscor at $1.25 for a period of 18 months following the closing date of the financing. Each Unit and flow-through common share purchased by the investment syndicate, which was led by Dundee Securities Corporation and included Canaccord Capital Inc. and Haywood Securities Inc., was priced at $1.00.

This initial financing was primarily used to finance exploration on the Discovery property during the year. After deducting brokerage, listing and legal fees and the repayment of the balance of the Discovery property purchase price, the Company had approximately $5,400,000, including $4,300,000 in flow-through funds that must be spent on exploration by December 31, 2007.

On August 18, 2006, the TSX Venture Exchange approved the listing of 27,599,000 common shares of Cadiscor. The shares began trading under the symbol CAO at the opening of the market on August 21, 2006. Since September 11, 2006, the shares have also traded on the Frankfurt Exchange under the symbol DQN.

The Company began operations in September 2006 with the planning of the drilling program on the Discovery property. Dresden Capital of Montreal was retained as an investor relations advisor to publicize the Company and its projects.  Management also held numerous meetings to inform investors on the Company and its growth potential, and a website was created to provide direct, easy access to information on the Company, at www.cadiscor.com .

As part of its IPO, the Company had geological consultants InnovExplo Inc. prepare a report on the Discovery zone in compliance with National Instrument 43-101. The report identified a total indicated resource of 381,100 tonnes grading 6.74 g/t Au and an inferred resource of 847,200 tonnes grading 6.35 g/t Au. The authors of the report noted the good continuity of the gold-bearing zones, and the strong potential for extending the zones laterally and at depth through additional drilling.

On September 25, 2006, the Company announced that it had granted a contract for 19,000 metres of drilling on the Discovery property. The contract provided for the use of two drills at the outset, with the addition of a third in mid-December. In October 2006, the Company began drilling on Discovery to increase the Discovery zone resource and upgrade the resource from inferred to indicated. At year-end, 11,763 metres had been drilled and 23 holes completed. Full assay results received for nine holes as at December 31, 2006, confirmed the presence and continuity of the mineralization, as well as the potential for additional high-grade gold mineralization around and below the Discovery zone.

Seven of the first nine holes returned gold grades equal to or greater than the grades calculated in InnovExplo Inc.’s qualification report, which attests to the strength and continuity of the mineralization. The following is a summary of the best drill results reported in the press release dated December 12, 2006:   

Hole

Au (g/t)

Length*

(m)

B-06-107

7.02

3.80

B-06-108

6.25

3.45

B-06-109

6.83

3.60

B-06-110

7.64

2.00

B-06-112

7.71

1.40

B-06-113

24.70

2.00

B-06-116

6.66

3.00


    * core length

Management also entered into two partnership agreements. On November 30, 2006, the Company announced that it had signed an option agreement with Agnico-Eagle Mines Limited ("Agnico") for the Montbray gold property. This option provides for Agnico to earn a 50% undivided interest by conducting exploration worth $750,000 over four years and making payments totalling $60,000 over the same period. Agnico will be the project operator. Once it has earned its 50% interest, Agnico has a three-year option to increase its interest to 60% by funding the full cost of $10,000,000 of exploration or a bankable feasibility study. This agreement allows the Company to benefit immediately, not only from Agnico’s recognized gold exploration know-how, but from the property’s exploration potential, without the dilution that would result from funding this work through a share offering.

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On December 19, 2006, the Company signed a letter of intent with Canadian Royalties Inc. to acquire a 50% interest in the Cameron Shear property. This property covers the eight-kilometre extension to the east of the geological formations seen on the Discovery property. The Cameron Shear property consists of 193 claims covering 3,038 hectares. The Company issued 75,000 shares to Canadian Royalties Inc. upon signature of the agreement, and must incur $1,000,000 in exploration over five years and make total cash payments of $50,000 over the same period to earn its interest. Once it has acquired its 50% interest, the Company may acquire another 10% by financing the entire cost of a bankable feasibility study. The Company is the project operator. This agreement enables the Company to consolidate its control over an area that is relatively unexplored but has strong gold potential given the results obtained to date on Discovery.

At December 31, 2006, your Company held 100% interests in the Discovery and Montbray properties and an option on the Cameron Shear property, three gold exploration projects.

On December 31, 2006, Cadiscor shares were trading at $0.77 on the TSX Venture Exchange. In just over four months since they were listed, over 18,000,000 shares traded, nearly 65% of the capitalization. The decline in price relative to the issue price was partly due to the pressure resulting from the rapid sale of some of the shares distributed to Strateco shareholders. The share price has firmed since October 2006 thanks to management’s efforts to raise the Company’s profile, combined with steps taken by the investor relations firm and the release of drill results for the Discovery property. The rising gold market also helped support the share price.

On February 19, 2007, the Company released in a press release more strong drill results for the Discovery property. The best result was 13.11 g/t Au over 5.4 metres in Hole B-06-123, confirming the project’s excellent gold potential. Drilling is ongoing until the end of March 2007, after which a new resource calculation will be performed. An opportunity study on an underground exploration program will also be carried out.

On behalf of the Board of Directors,

(Signed) Michel Bouchard

Date: March 5, 2007

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