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The gold price weakened on fear of raising interest rates and a rising US dollar.

Record high Central Bank selling, (170 tonnes of gold in three months) has also left the gold price low. The price of gold stayed relatively strong despite the dramatic increase in Central Bank selling, which points to its underlying strength. Historically after Central Bank selling is over the gold price climbs.

Silver continues to out perform gold and is currently around US$13.00. Fundamentals for silver continue to be bullish. Approximately 600 million ounces of silver are mined each year. About 870 million ounces of silver are consumed each year by industry, jewellery and photography. Recycling and investor selling make up the “shortfall” between production and consumption.

A total of 25 diamond drill holes have been drilled on the Hislop property, (in excess of 9,000 metres) in the current drilling program. Stroud is currently waiting for additional assay results. Results from the current drilling program will be compiled and a new resource estimate will be prepared. Depending on the results of this resource estimate, additional drilling will be required or Stroud may consider going underground on the project.

A Qualifying Report compliant with NI 43-101 confirms indicated resources of 102,750 oz. of gold and inferred resources of 69,700. Gold deposits along the Destor Porcupine fault zone tend to get richer with depth. The Company has looked into the feasibility of carrying out an underground program on the property. There is potential for the discovery of more mineralized zones on the property with additional drilling.

Drilling is scheduled to recommence in the summer on the Santo Domingo project. A minimum of 4,000 metres is planned for the drilling program. Drilling will concentrate on delineating the ore grade mineralized silver, gold, lead and zinc zones encountered in the previous drill holes and in adits.

Goals of the drilling program will be to:

• Confirm the at-depth extension of the La Rayas zone, which was previously intersected in the 1999 drilling program
• Qualify the potential grade and size of the La Rayas zone
• An additional two drill ready projects
• Evaluate the newly discovered Guadalupe zone

High natural gas and natural gas condensate prices continue to increase the Company's revenues. Currently Stroud has a 3.75% interest in six producing wells. Revenues are now in excess of $200,000 a year.

In conclusion there are a number of reasons to be optimistic about Stroud:

• Rising metal prices
• An ongoing drilling program at the Santo Domingo property
• An additional two drill ready projects
• Increased revenue from natural gas and natural gas condensate
• A debt free company

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