AMAZON MINING HOLDING PLC MANAGEMENT'S ... - Verde Potash

AMAZON MINING HOLDING PLC
MANAGEMENT’S DISCUSSION AND ANALYSIS FOR THE YEAR ENDED 31
DECEMBER 2008
The following management’s discussion and analysis (“MD&A”) of the operating results and
financial condition of Amazon Mining Holding PLC (“Amazon” or the “Company”) and its
subsidiaries is for the year ended 31 December 2008. The following discussion provides
information that management believes is relevant to an assessment and understanding of the
consolidated results of operations and financial condition. This MD&A should be read in
conjunction with the audited consolidated financial statements for the year ended 31 December
2008. The statements have been prepared in accordance with International Financial Reporting
Standards (IFRS). All amounts herein are expressed in British Pounds Sterling unless otherwise
stated, and the information is current to 29 April 2009.
Additional information relating to the Company is available under the Company’s profile on
SEDAR at www.sedar.com and the Company’s website at www.amazonplc.com .
FORWARD LOOKING STATEMENTS
This discussion may contain forward-looking statements. Although the Company believes that its
expectations reflected in forward-looking information are reasonable, such information involves
known or unknown risks, uncertainties and other factors that may cause the actual results,
performance or achievements of the Company or the Company’s projects in Brazil to be
materially different from any future results, performance or achievements expressed or implied by
the forward-looking information. Such risk factors include, but are not limited to: general business,
economic, competitive, political and social uncertainties; the actual results from current
exploration activities; conclusions of economic evaluations; unexpected increases in capital or
operating costs; changes in equity markets, inflation and changes in foreign currency exchange
rates; changes in project parameters as plans continue to be refined; changes in labour costs;
future prices of gold; possible variations of mineral grade or recovery rates; accidents, labour
disputes and other risks of the mining industry; political risks arising from operating in Brazil;
delays in obtaining governmental consents, permits, licenses and registrations; approvals or
financing; as well as those factors discussed in the section entitled “Risk Factors” in this MD&A.
Although the Company has attempted to identify important factors that could cause actual
actions, events or results to differ materially from those described in forward-looking information,
there may be other factors that cause actions, events or results not to be as anticipated,
estimated or intended. There can be no assurance that forward-looking information will prove to
be accurate, as actual results and future events could differ materially from those anticipated in
such information. Accordingly, readers should not place undue reliance on forward-looking
information. The forward-looking information contained herein, unless stated otherwise, is made
at the date of this MD&A and the Company makes no responsibility to update them or to revise
them to reflect new events or circumstances, except as required by law.

BUSINESS & OPERATIONS OVERVIEW
Amazon was incorporated in England and Wales on 14 August 2006 and acquired the issued
share capital of Amazon Mining Limited (“AML”) by way of a share-for-share exchange. The
transaction was effectively treated as a group reorganization and the consolidated financial
statements are presented in a way that reflects the continuation of AML and its subsidiaries.
Amazon’s ordinary shares were admitted for trading on the Canadian Toronto Venture Exchange
(TSX-V) on 21 November 2007 under the symbol “AMZ”.
The principal activity of the Group is that of a mineral exploration company engaged in the
acquisition and exploration of mineral properties in Brazil. The Group´s strategic focus is to
acquire projects with demonstrated potential for hosting gold deposits and to define those
resources through exploration and drilling campaigns. The Group began in Q3 2008 to consider
and assess resource opportunities outside the core focus of gold.
The Group does not currently have any revenues and does not expect to have any revenues until
the completion of the recommended exploration programmes on Group projects, receipt of
mineral licences and permits for mining of one or more commercial reserves located thereon.
Up to 30 June 2008, Amazon’s exploration activities were primarily focused on the Madeira Gold
Project in Amazonas, located in Northwestern Brazil, Tocantins Gold Project, located in the state
of Tocantins in Central Brazil and on the Lavras Gold Project, located in the state of Minas Gerais
in Central Brazil. Subsequent to 30 June 2008 and following a review of further drill results from
the projects, it was the determination of the Board of Directors that the Tocantins and Lavras
projects were unlikely to host gold reserves of sufficient economic size and therefore discontinued
exploration on those projects. The group elected to broaden its focus beyond gold and staked the
Cerrado Verde Potash Project (“Cerrado Verde”) located in the state of Minas Gerais in central
Brazil. Amazon’s activities are now currently focused on the Cerrado Verde, the Madeira Gold
Project and the generation and investigation of new strategic opportunities.
During the second half of 2008, the Company downsized its corporate structure to minimize
ongoing expenditures in light of market conditions, thereby preserving cash for potential
entrepreneurial opportunities. Manoel Cerqueira and Oscar Yokoi resigned on July 9, 2008. Mr.
Cerqueira continued in the capacity of CFO until October 25, 2008, when he was replaced by Mr.
Tim Slater on an interim basis whilst Vice President of Exploration Mr Oscar Yokoi was replaced
with a highly experienced Technical Advisory Committee whose appointees are Dr. Richard
Garnett, Mr. Ysao Munemassa and Mr. Persio Mandetta. Amazon has elected to outsource future
geological work, which, as projects were discontinued, allowed for progressive reductions to
fulltime staff over the past three months. Brazilian staff numbers have been reduced to four full
time employees, from thirty eight, responsible for project management, government and
corporate relations and regulatory filings.
Cerrado Verde
During Q3 2008 the Company staked a large mineral occurrence of a potash bearing rock, known
as verdete slate (“Verdete”) that is believed to be uniquely suited to Brazil’s domestic fertilizer
needs. The Cerrado Verde project initially consisted of 84 claims covering 165,069 hectares and
has now been reduced to 118,742 hectares.
.
Cerrado Verde is an open pittable source of Verdete slate, a potash rich rock from which Amazon
plans to produce a slow-release non-chloride multi-nutrient fertilizer product. The main potashbearing
minerals of Verdete are glauconite (a hydrated potassium-iron silicate) and sericite (a
monoclinic, basic potassium aluminosilicate of the mica group), with K 2 O contents ranging from
5% to 14%.The Company is investigating the viability of applying a pyro-metallurgical treatment
process to deliver a ThermoPotash product. Working in conjunction with Brazilian government
institutions and agricultural investment programs, Amazon hopes to gain objective data that will
assist in determining the economic and metallurgical parameters associated with the manufacture
of ThermoPotash, and to quantify the delivery of potash and other required plant nutrients that
may be carried in the potential fertilizer product. The manufacture of conventional potash salts

from Cerrado Verde will also be investigated, the results of which could improve potash product
concentrations and assist in the development of specialty products and/or the creation of
products for long-haul export.
Amazon intends to utilise its treasury conservatively in developing the Cerrado Verde project. The
Company believes the strategic importance of potash to Brazil will provide financing opportunities
outside of conventional market financing, from government, land funds, growers associations and
established fertilizer distributors.
Madeira
The Madeira gold project located in Amazonas State of Western Brazil. The Company staked
Madeira and holds 100% of the mineral rights. Further, there are no staged payments to
underlying owners.
The Company has completed a successful reconnaissance drill program. Gold mineralization was
also encountered in the coarse-grained sandy stratigraphic layers occurring above and below the
targeted Mocururu structure. Historically, buried conglomerate structures exposed by the Madeira
River provided for reported gold production of over 1.6 million ounces. The interpretation of the
geological setting is that the Mocururu mineralization is a result of the transport and deposition of
gold and heavy minerals that were eroded during the uplift of the Bolivian Andes. Given the
abundance of identified gold deposits in the Andean cachement feeding this basin, the Company
believes it controls a highly prospective area. The initial results are the first clear indication that
gold mineralization extends beyond the immediate vicinity of the Madeira River.
Due to the encouraging results of this initial phase of exploration, Amazon increased the project’s
area to over 430,000 hectares, after work refining targets the holding has been reduced to
229,231 hectares. We are also conducting discussions with third parties to assess possible
shared involvement in future exploration.
Caximbo
During Q3 2008 the company staked the Caximbo project, initially with 84,248 hectares of land
but since reduced to 37,909 hectares. The claims cover targets selected for high sulphidationtype
gold mineralization in volcanics of the Colider Complex and associated with intensely
hydrothermally altered granitoids (sericite-pyrite) of the Matupá-Juruena Suite. The already
known mineralization is mostly associated with sulphide-rich quartz veins. Zones of massive
sericite-muscovite-pyrite in granitoids have been defined in some of the claims.
The Caximbo Project is located in the north of Mato Grosso state, a recognized gold producing
region of Brazil. Historic operations in this area are reported to have extracted 5 million oz of gold.
It is a region of extensive exploration by a number of Brazilian and foreign mining companies.
Amazon’s project generation team staked the project using airborne geophysics (magnetics)
matching anomalies to known gold deposits in the area.
No further exploration work is planned for this project at this time.
Tocantins
The drill campaign staged Q1 2008 consisted of 12 DDH holes for a total of 1,731 linear meters
with locations structurally orientated to target potential “cigar type” gold zones. Results were
adequate but inconclusive.
During Q2 2008, further exploration consisting of ground magnetic geophysics, auger drilling and
soil sampling focused on a 4km X 4km area. This target area was believed to host a major “nose
fold” hinge structure. Subsequent results from this exploration did not indicate the presence of
such a structure and it was hence considered that the Tocantins property was not likely to host a

gold resource of the size initially targeted and the Company immediately discontinued exploration
work and ceased staged property payments to the underlying owners.
Capitalized deferred exploration costs incurred up to 30 June 2008 have been written-down, as
per the Company’s accounting policies and residual costs during the second half of 2008 were
expensed.
Lavras
Based on an initial review of the project, a diamond drilling program, using large diameter PQ
core was initiated during Q1 2008. The objective of this drilling program was to evaluate the bulk
tonnage potential of the Fazenda Lavras geological unit. The drilling results were not
encouraging and gold grades were considered to be too low for economic extraction. Hence, the
Company elected to immediately discontinue exploration work and cease staged property
payments to the underlying owners.
Capitalized deferred exploration costs incurred up to 30 June 2008 have been provided for, as
per the Company’s accounting policies and residual costs incurred during the second half of 2008
were expensed.
Terra Branca
The Terra Branca Diamond project consisted of 20 concessions along a 90km length of the
Jequintinhonha River in the state of Minas Gerais, Brazil. Under the terms of the Terra Branca
option agreement, the Company was due to pay US$900,000 in August 2008 with a further
US$2,000,000 in subsequent staged payments. Prospective economics have weakened
markedly since commencement of the option agreement. The diamond market has seen little to
no change in the US$ price for small to medium sized diamonds whilst the currency (Brazilian
Real) as measured against the US$ has appreciated considerably.
As a result of these adverse market conditions and the upcoming significant property payment,
early in Q3 2008 the Company ceased property maintenance costs and payments and returned
control to the underlying owner.
SUMMARY OF DEFERRED EXPLORATION EXPENSES
During the year ended 31 December 2008, the Company incurred and capitalized project
acquisition and drilling costs. The following table summarizes the deferred exploration costs
capitalized to Intangible Assets to 31 December 2008 by the Group, and the associated writedown
of specific projects due to the July 2008 decision to discontinue activity and association with
those projects:

Project
12 months
to 30 April
2006
12 months
to 30 April
2007
8 months to
31 December
2007
12 months to
31 December
2008
Impairment
losses
Total
Tocantins 59,184 131,676 109,486 441,616 (741,962) -
Lavras - - 316,890 643,040 (959,930) -
Terra Branca - 55,316 79,335 183,630 (318,281) -
Madeira - 56,723 61,035 200,740 - 318,498
Caximbo - - - 70,699 - 70,699
Cerrado
Verde - - - 85,652 - 85,652
Other - - 9,158 9,827 (18,985) -
59,184 243,715 575,904 1,635,204 (2,039,158) 474,849
SELECTED AUDITED FINANCIAL INFORMATION
Selected Financial Information
All amounts in £
12 months
ended 31
Dec 2008
8 months
ended 31
Dec 2007
12 months
ended 30 Apr
2007
Revenue - - -
Administrative Expenses 884,612 619,392 145,151
Write down of deferred exploration costs 2,220,191 - -
Net (loss) (2,509,249) (343,234) (146,663)
(Loss) per share in pence (basic and diluted) (9.12) (2.09) (0.24)
Cash Flow (used) for operating activities (1,112,449) (351,097) (106,305)
Cash Flow (used) for investing activities (1,504,404) (522,467) (251,807)
Cash Flow from financing activities - 7,435,351 893,427
Cash & cash equivalents at end of period 5,263,616 7,393,769 587,415
Total Assets 5,805,568 8,294,701 893,326
Total Liabilities 384,265 385,531 41,270
Working Capital 4,910,520 7,019,628 546,802
Weighted average number of shares
outstanding 27,519,159 16,417,118 62,308,598
HISTORICAL CORPORATE OVERVIEW
Amazon has corporately evolved and strengthened over the period May 2006 to December 2008.
During the year ended 30 April 2007, the Company restructured via a group reorganization with
Amazon Mining Ltd. (“AML”) which included the wholly-owned Brazilian subsidiary Pesquisa
Mineral e Mineracao Ltda. Net proceeds of £893,427 were raised during the year and initial
acquisition and exploration activity commenced with an aggregate of £243,715 expended in
respect of the Tocantins, Madeira and Terra Branca projects in Brazil.
During the eight-month period ended 31 December 2007, the Company continued its
restructuring by consolidating common shares on a 5 to 1 basis and completing its Initial Public
Offering and listing on the TSX Venture Exchange. As much of the efforts during the period was
focused on conducting the IPO process, most of the £575,904 in deferred exploration costs
concerned property maintenance costs on the Tocantins, Madeira and Terra Branca projects and
preliminary exploration work on the Lavras project. Following the close of the IPO in November
2007, which raised net proceeds of £7,435,351, efforts were quickly directed to setting up the
Brazilian corporate infrastructure in anticipation of commencement of full exploration activity in
January 2008.
The year ended 31 December 2008 comprised two distinct levels of corporate operations. The
first half of the year involved a steady period of headcount ramp-up and significant exploration on

the Tocantins and Lavras projects. Combined with maintenance and acquisitions costs
associated with the Terra Branca, Caximbo and Cerrado Verde projects, annual deferred
exploration costs incurred aggregated to £1,635,204. The second half of the year saw a dramatic
reversal of headcount and exploration activity for two reasons:
1) the lack of positive drill results that would indicate the presence of a viable gold resource
prompted the decision to discontinue exploration on the Tocantins and Lavras projects and writedown
all associated deferred exploration costs; and
2) with the growing global economic turmoil, the Company considered it prudent to scale back all
facets of corporate activity and preserve cash reserves.
As at the date of this report, the uncertainty of the ongoing global economic situation remains and
the Company therefore continues to be diligent in monitoring its expenditures. Headcount
remains modest with five full-time employees and consultants, exploration activity on the existing
projects are advancing in a conservative and cost effective manner and the company continues to
evaluate new value-adding opportunities.
RESULTS OF OPERATIONS
Year ended 31 December 2008 as compared to the eight months ended 31 December 2007
Selected Financial Information
All amounts in £
12 months
ended 31
Dec 2008
8 months
ended 31 Dec
2007
Revenue - -
Administrative salary costs 131,739 42,988
Consultancy 206,690 87,462
Legal and professional 211,420 422,607
Travel and promotional 147,536 21,947
General administrative expenses 95,585 15,589
Share based payments 91,642 28,799
Administrative expenses 884,612 619,392
Write down of deferred exploration costs 2,039,158 -
Exploration costs expensed 181,033 -
Operating loss (3,104,803) (619,932)
Exchange gains 486,699 265,253
Interest income 108,855 10,905
Net loss (2,509,249) (343,234)
Compared to the eight months ended 31 December 2007, net losses for the year ended 31
December 2008 increased £2,166,015 to £2,509,249 and the loss per share increased from
2.09p to 9.12p. Note the Company changed its fiscal year end from 30 April to 31 December
during 2007.
Administrative salary costs
The administrative salary costs include the remuneration of the directors and in 2008, the
administrative staff employed in Brazil. The increase of £88,751 includes £57,831 for the
administrative staff in Brazil with the balance reflecting twelve months executive director’s salary
and non-executive director fees versus only six months worth of non-executive director fees in
2007.
Consultancy
Consultancy expenses include fees paid to key management and external consultants. The
increase of £119,228 reflects a full twelve months fees paid to key management plus new fees
stemming from the addition of the Vice President – Corporate Development in June 2008.

Legal and professional
Legal and professional fees include legal, accountancy, audit related and regulatory costs. The
reduction of £211,187 primarily reflects the significantly reduced costs associated with Initial
Public Offering process conducted through much of 2007.
Travel and promotional expenses
Travel and promotional costs include international flights, national travel within Brazil, public
relations and attendance at trade shows. The increase of £125,589 stems from an increase of
£36,481 in travel costs relating to the operations of the Brazilian subsidiaries, £12,780 in
international travel costs relating to the parent company, £36,560 in public relation costs, £17,488
in print costs and £22,280 in trade show and other promotional expenses.
General administrative expenses
These costs include general office expenses, rent and occupancy fees, insurance and equipment
depreciation. The increase of £79,996 consists of an increase in rent for the Brazilian, UK and
Canadian offices of £19,722 reflecting a full year’s charge, increase of £16,504 in insurance
costs, and £43,770 in sundry general office expenses due to the increased activities in Brazil.
Share based payments
These costs represent the expense associated with stock options granted to employees, directors
and consultants. The amount recorded in a particular period is directly related to the number of
options that have vested with recipients during that period. Stock-based compensation expense
recognized during the year ended December 31, 2008 was £91,642, an increase of £62,843 over
the eight-month period ended December 31, 2007.
Exchange gains
The exchange gain recorded in the year arose mainly from the effect of the strengthening of the
Canadian dollar against the GB Pound during the latter quarter of the year on the average
Canadian Dollar deposits of approximately Can $9 million.
Write down of deferred exploration costs
Based on less than optimal drill results and/or significant impending scheduled property
payments, the Directors made the decision in July 2008 to cease work on and association with
three projects. As a result, those exploration costs that had been capitalized from as far back as
2006 were considered impaired and thereby written off to the income statement. The aggregate
of £2,039,158 in project costs written down stemmed from: Lavras (£959,930); Tocantins
(£741,962); Terra Branca (£318,281); and other miscellaneous projects (£18,985).

Quarter ended 31 December 2008
Selected Financial Information
All amounts in £
3 months ended
31 Dec 2008
Revenue -
Administrative salary costs 29,993
Consultancy 64,644
Legal and professional 55,587
Travel and promotional 19,171
General administrative expenses 28,461
Share based payments 62,077
Administrative expenses 259,933
Write down of deferred exploration costs -
Exploration costs expensed 181,034
Operating loss 440,967
Exchange gains (441,402)
Interest income 7,099
Net loss (6,664)
Due to the change of fiscal year end during 2007 and the fact that the corporate activities for the
respective quarters were materially different, there is no constructive comparative information
available for Q4 2007. Quarterly comparative expense analysis will commence with Q1 2009.
Administrative salary costs
The administrative salary costs include the remuneration of the directors and administrative staff
employed in Brazil.
Consultancy
Consultancy expenses include fees paid to key management and external consultants
Legal and professional
Legal and professional fees include legal, accountancy, audit related and regulatory costs
Travel and promotional expenses
Travel and promotional costs include international flights, national travel within Brazil, public
relations and attendance at trade shows.
General administrative expenses
These costs include general office expenses, rent and occupancy fees, insurance and equipment
depreciation
Share based payments
These costs represent the expense associated with stock options granted to employees, directors
and consultants. The amount recorded in a particular period is directly related to the number of
options that have vested with recipients during that period.
Exchange gains
The exchange gain recorded in the period arose from the effect of the strengthening of the
Canadian dollar against the GB Pound during Q4 2008 on the average Canadian Dollar deposits
of approximately Can $9million.

LIQUIDITY AND CASH FLOWS
For additional detail see the consolidated statements of cash flows for the year ended 31
December 2008 and the eight months ended 31 December 2007 in the annual financial
statements.
Cash received from (used for): 2008 2007
Operating activities (1,112,449) (351,097)
Investing activities (1,504,404) (522,467)
Financing activities - 7,435,351
Exchange gains 486,700 244,567
At 31 December 2008, the Group held cash of £5,263,616, a decrease of £2,130,153 from the
cash balance at 31 December 2007.
Operating activities
For the quarter ended 31 December 2008 net cash utilised in operating activities was £208,857.
For the year ended 31 December 2008 net cash utilised in operating activities increased by
£761,352 compared to the eight months ended 31 December 2007 reflecting the increased
operational activity following the successful IPO in November 2007.
Investing activities
For the quarter ended 31 December 2008 net cash utilised in investing activities was £141,064
reflecting exploration activity at the Madeira, Caximbo and Cerrado projects.
For the year ended 31 December 2008 net cash utilised in investing activities increased by
£981,937. Of this increase, £762,575 related to increased acquisition and exploration
expenditures on the Tocantins, Lavras and Terra Branca projects (relative to 2007).
Financing activities
The cash received from financing activities in the eight months ended 31 December 2007 reflect
the net proceeds generated from the IPO successfully concluded in November 2007.
Financial condition
At 31 December 2008 the Group had current assets of £5,294,785 and current liabilities of
£384,265 providing a working capital surplus of £4,910,520 which represents a reduction of
£2,109,108 from the surplus of £7,019,628 at 31 December 2007.
Given the Board’s decision to discontinue all activity associated with the Tocantins, Lavras and
Terra Branca projects, the Group no longer holds any properties or exploration tenements
requiring significant staged payment obligations to underlying property owners. Amazon has
staked its Madeira, Cerrado Verde, and Caximbo properties and is the sole owner of those
mineral rights.
The Group maintains a strong cash position and is not presently engaged in extensive exploration
activity. Further, where it is conducting exploratory work, it is in discussion with other companies
and Brazilian government bodies to possibly share in those investigative and exploratory costs.
As such, the Group is in a good position to carry on its planned activities for at least the next
twelve months, irrespective of the challenging global economic climate, and to consider new
project opportunities that may present themselves.

COMMITMENTS
The Group does not have any exploration and development capital expenditure commitments in
respect of its projects (31.12.07: £nil). The Group will not need to make significant payments to
maintain its current projects in good standing compared with £4.75 million at 31 December 2007
which would have been necessary to maintain the Tocantins, Lavras and Terra Branca projects
had they not been discontinued.
GLOBAL MARKET AND ECONOMIC CONDITIONS
Through the second half of 2008, market and economic conditions faced unprecedented
challenges with tighter credit conditions and severe market declines. Into the first quarter of 2009,
continued concerns about the systematic impact of these difficult economic times, geopolitical
issues, the availability and cost of credit, and decline of real estate markets have contributed to
increased market volatility and diminished expectations for global economies. These conditions,
combined with declining business and consumer confidence and increased unemployment, are
contributing to volatility of unprecedented levels. Continued turbulence in the mineral resources
markets may adversely affect the commercial viability of our exploration projects and our ability to
raise project finance which may adversely affect results of operations in the future.
To the date of this report, the Group has not been materially negatively affected by the poor
global economic condition and outlook. Following our decision to terminate non-commercially
viable projects during the year we have sufficient working capital available to progress the
Company’s planned corporate activity and exploration programs for at least the next twelve
months.
PROPOSED TRANSACTIONS
On April 9, 2009, the Company reached an agreement in principle to acquire 100% of the shares
of Uaua Pesquisa Mineral Ltda. (“Uaua”), the wholly-owned Brazilian subsidiary of Toucan Metals
Ltd. (“Toucan”), a privately-held Canadian corporation, for an aggregate purchase price of
CDN$127,332 in cash and 853,712 common shares of the Company . Pursuant to the
acquisition, the Company would acquire a 100% interest in two Brazilian projects encompassing
thirty-four exploration licenses providing mining rights to the vanadium, copper and zinc deposits
therein. The entering into of the agreement remains subject to the approval of the shareholders
of Toucan and closing will be subject to, among others, the approval of the TSX Venture
Exchange.
Given that the CEO (Cristiano Veloso) and two of the directors of Amazon (Simon Lawrence and
Kevin van Niekerk), are each shareholders of Amazon, and are also directors of Toucan, and
hold collectively approximately 19% of the shares of Toucan, a special committee consisting
solely of the independent directors of Amazon (Richard Topham and Dr. Getulio Lamartine de
Paula Fonseca) was formed by the board of directors at the beginning of the process to consider,
conduct appropriate due diligence and negotiate terms of the Transaction. The special committee
unanimously approved the Transaction at a Board of Directors meeting held on March 27, 2009.
OFF-BALANCE SHEET FINANCING
The Group has not entered into any off-balance sheet financing arrangements.
FINANCIAL INSTRUMENTS
The board of directors determines, as required, the degree to which it is appropriate to use
financial instruments and hedging techniques to mitigate risks. The main risks for which such

instruments may be appropriate are foreign exchange risk, interest rate risk and liquidity risk
each of which is discussed below. There is no perceived credit risk as the Group has no trade
receivables and minimal other receivables and bank deposits are made with financial institutions
considered to be safe by the board of directors. The maximum credit risk to which the group was
exposed at 31 December 2008 was £5,294,785 (2007: £7,405,159). There were no derivative
instruments outstanding at 31 December 2008.
Foreign currency risk
The Group's cash resources are held in GB Pounds, Canadian Dollars and Brazilian Reais.
Exchange rate fluctuations may adversely affect the Group’s financial position and results. Gold is
sold throughout the world, primarily in US Dollars. The Group’s financial results are reported in
GB Pounds and its costs are primarily incurred in GB Pounds, Canadian Dollars and Brazilian
Reais. The appreciation of Canadian Dollars or Brazilian Reais against the GB Pound could
increase the actual capital and operating costs of the Group’s mineral exploration projects and
materially adversely affect the results presented in the Group’s financial statements. Currency
exchange fluctuations may also materially adversely affect the Group’s future cash flow from
operations, its results of operations, financial condition and prospects.
The Group had the following cash and cash equivalents in currencies other than its functional
currency. The amounts are stated in GB Pound equivalents.
31.12.08 31.12.07
£ £
GB Pounds 66,192 18,883
Canadian Dollars 5,127,395 7,240,253
Brazilian Reais 70,029 134,633
5,263,616 7,393,769
Foreign currency risk sensitivity analysis showing a 10% weakening/strengthening of the
Canadian Dollars and Brazilian Reais against GB pounds with all other variable held constant:
31.12.08 31.12.07
£ £
10% weakening of Canadian Dollar (466,126) (658,205)
10% strengthening of Canadian Dollar 569,711 804,472
10% weakening of Brazilian Real (189,326) (13,411)
10% strengthening of Brazilian Real 231,399 16,388
Liquidity risk
To date the Group has relied on shareholder funding to finance its operations. As the Group has
finite cash resources and no material income, the liquidity risk is significant and is managed by
controls over expenditure and cash resources.
Interest rate risk
The Group's policy is to retain its surplus funds on the most advantageous term of deposit
available up to twelve month's maximum duration. Given that the directors do not consider that
interest income is significant in respect of the Group’s operations no sensitivity analysis has been
provided in respect of any potential fluctuations in interest rates.
Financial assets
The floating rate financial assets comprise interest earning bank deposits at rates set by
reference to the prevailing LIBOR or equivalent to the relevant country. The Group has no fixed
rate deposits.

Fair values
In the directors’ opinion there is no material difference between the book value and fair value of
any of the group’s financial instruments.
The classes of financial instruments are the same as the line items included on the face of the
balance sheet and have been analysed in more detail in the notes to the accounts. All the
group’s financial assets are categorised as loans and receivables and all financial liabilities are
measured at amortised cost.
RELATED PARTY TRANSACTIONS
The Group incurred consultancy and travel expenses of £nil for the 3 months period ended 31
December 2008 and £22,473 for the year and (eight months ended 31.12.07 £28,886) under a
consulting agreement with a trust in which a director has a beneficial interest. This agreement
was terminated during the period. The Group incurred consultancy expenses of £28,262 for the 3
months period and £92,439 for the year ended 31 December 2008 (eight months to 31.12.07
£19,927) under service agreements with other key management.
CRITICAL ACCOUNTING ESTIMATES
The preparation of financial statements requires the Group select from possible alternatives
accounting principles, and to make estimates and assumptions that determine the reported
amounts of assets and liabilities at the balance sheet date, and reported costs and expenditures
during the reporting period. While management believes that these estimates and assumptions
are reasonable, actual results could vary significantly. A summary of critical accounting estimates
are described below:
Deferred exploration and evaluation expenditure
Exploration and evaluation costs arising following the application for the legal right are capitalised
on a project-by-project basis, pending determination of the technical feasibility and commercial
viability of the project. Costs incurred include appropriate technical and administrative overheads
and includes:
• researching and analysing historical exploration data
• gathering exploration data through topographical, geochemical and geophysical studies
• exploratory drilling, trenching and sampling
• determining and examining the volume and grade of the resource
• surveying transportation and infrastructure requirements
• conducting market and finance studies
Impairment reviews for deferred exploration and evaluation costs are carried out on a project by
project basis, with each project representing a potential single cash generating unit. An
impairment review is undertaken when indicators of impairment arise such as:
(i)
(ii)
(iii)
unexpected geological occurrences that render the resource uneconomic
title to the asset is compromised
variations in metal prices that render the project uneconomic
The Group may periodically revise its valuation based on additional exploration results and
determine that the carrying value of the property on the balance sheet is impaired. When such a
change in estimate is made, there may be a material effect on the balance sheet and income
statement.

Share-based payments
The Group charges the Income Statement with the fair value of share options issued. This charge
is not based on historical cost, but is derived based on assumptions input into an option pricing
model. The model requires management to make several assumptions as to future events,
including: an estimate of the average future hold period of issued stock options before exercise,
expiry or cancellation; future volatility of the Company’s share price in the expected hold period
(using historical volatility as a reference); and the appropriate risk-free rate of interest. The
resulting value calculated is not necessarily the value of which the holder of the option could
receive in an arm’s length transaction, given there is no market for the options and they are not
transferable. The value derived from the option pricing model is highly subjective and dependent
entirely upon the input assumptions made.
MI 52-109 COMPLIANCE
Internal controls over financial reporting
As at 31 December 2008, the Chief Executive Officer, C Veloso and the Chief Financial Officer, T
Slater evaluated the design of the Group’s internal controls over financial reporting. Based on
that evaluation, the Chief Executive Officer and the Chief Financial Officer concluded that the
design of internal control over financial reporting was effective as at 31 December 2008 to
provide reasonable assurance regarding the reliability of financial reporting and the preparation of
financial statements for external purposes in accordance with IFRS.
FINANCIAL REPORTING STANDARDS
International Financial Reporting Standards that have recently been issued or amended but are
not yet effective have not been adopted for the annual reporting period ended 31 December
2008:
IFRS
/Amendment
Title
Application date of
standard
Application date
for Group
IFRS 8 Operating segments 1 January 2009 1 January 2009
IAS 23
amendment
IAS 1 revised
IFRS3/IAS27
amendment
IFRS 2
amendment
IFRS 7
amendment
IFRIC 16
Borrowing costs 1 January 2009 1 January 2009
Presentation of financial
statements
1 January 2009 1 January 2009
Business
1 July 2009 1 January 2010
combinations/consolidated and
separate financial statements
Share-based payment 1 January 2009 1 January 2009
Financial instruments: disclosures 1 January 2009 1 January 2009
Hedges of a net investment in a
foreign operation
1 October 2008 1 January 2009
Management have reviewed the impact of the above standards and have determined that they do
not result in any changes to accounting policies.
IFRIC’s 12 to 15 and 17 to 18 have been issued but in the opinion of the directors are not relevant
to the operations of the Group.

OUTSTANDING SHARE DATA
As at the date of this MD&A the following securities are outstanding:
Ordinary Shares 27,519,159
Warrants 7,650,000
Compensation options 800,000
Stock Options 1,855,000
Total 37,824,159
RISKS
The exploration for and exploitation of natural resources are speculative activities that involve a
high degree of risk. The following risk factors should be considered in assessing the Company’s
activities. Should any one or more of these risks occur, it could have a material adverse effect on
the business, prospects, assets, financial position or operating results of the Company. The risks
noted below do not necessarily comprise all those faced by the Company. Additional risks not
currently known to the Company or that the Company currently deems would not likely influence
an investor’s decision to purchase securities of the Company may also impact the Company’s
business, prospects, assets, financial position or operating results.
Early Stage Projects and Dependence on Mineral Exploration Projects
Each of the Madeira Gold Project, Cerrado Project and Caximbo Project is in the early or preexploration
stage. There is no certainty that the expenditures made by the Group towards the
search and evaluation of mineral deposits on these or any other properties will result in
discoveries of commercially exploitable reserves. Furthermore, unless the Group acquires
additional properties or projects, any adverse developments affecting these projects or the
Group’s rights to develop mining concessions that are held on these properties, could materially
adversely affect the Group’s business, financial condition and results of operations.
Exploration and Operating Risks
The exploration for mineral deposits is a speculative venture involving a high degree of risk. Even
a combination of careful evaluation, experience and knowledge may not eliminate such risk.
While the discovery of a commercially viable ore body may result in substantial rewards, few
mineral properties which are explored are ultimately developed into producing mines. Unusual or
unexpected rock formations, unanticipated changes in metallurgical characteristics and mineral
recovery, environmental hazards, fires, power outages, labour disruptions, flooding, cave-ins,
landslides, unfavourable operating conditions and the inability of the Group to obtain suitable
machinery, equipment or labour are all risks involved with the conduct of exploration programs
and the operation of mines.
Should any of these risks and hazards adversely affect the Group’s mining operations or
activities, it may
cause an increase in the cost of operations to the point where it is no longer economically
feasible to continue such operations or activities. It may also require the Group to write down the
carrying value of one or more mines or a property, cause delays or a stoppage in mineral
exploration, development or production, result in damage to or destruction of mineral properties
or processing facilities, and may result in personal injury or death or legal liability, all of which
may have a material adverse effect on the Group’s financial condition, results of operation, and
future cash flows. Substantial expenditures may be required to locate and establish mineral
reserves, to develop metallurgical processes and to construct mining and processing facilities at a

particular site, and substantial additional financing may be required. It is impossible to ensure that
the exploration or development programs planned by the Group will result in a profitable
commercial mining operation.
The decision as to whether a particular property contains a commercial mineral deposit and
should be brought into production will depend on the results of exploration programmes and
feasibility studies, and the recommendations of duly qualified engineers and geologists. Several
significant factors will be considered, including, but not limited to:
(i) the particular attributes of the deposit, such as size, grade and proximity to infrastructure;
(ii) metal prices, which are highly cyclical;
(iii) government regulations, including regulations relating to prices, taxes, royalties, land
tenure, land use importing and exporting of minerals and environmental protection;
(iv) ongoing costs of production; and
(v) availability and cost of additional funding.
The exact effect of these factors cannot be accurately predicted, but the combination of these
factors may result in the Group not receiving an adequate return on invested capital.
Uncertainty of Acquiring Necessary Permits
The Group’s current and future operations will require approvals and permits from various federal,
state and local governmental authorities, and such operations are and will be governed by laws
and regulations governing prospecting, development, mining, production, taxes, labour standards,
health, waste disposal, toxic substances, land use, environmental protection, mine safety and
other matters. There is no assurance that delays will not occur in connection with obtaining all
necessary renewals of such approvals and permits for the existing operations or additional
approvals or permits for any possible future changes to operations. Prior to any development on
any of its properties, the Group must receive permits from appropriate governmental authorities.
There can be no assurance that the Group will continue to hold all permits necessary to develop
or continue operating at any particular property or obtain all required permits on reasonable terms
or on a timely basis.
Uncertainty of Additional Capital
The ability of the Group to arrange additional financing in the future will depend, in part, on the
prevailing capital market conditions as well as the business performance of the Group. The
development and exploration of the Group’s properties may require substantial additional
financing. Failure to obtain such financing may result in delaying or indefinite postponement of
exploration, development or production on any or all of the Group’s properties or even a loss of
property interest. There can be no assurance that additional capital or other types of financing will
be available if needed or that, if available, the terms of such financing will be favourable to the
Group. If additional financing is raised by the Group through the issuance of securities from
treasury, control of the Group may change and security holders may suffer additional dilution.
See “Risk Factors – Dilution”.
Government Royalties
The Federal Government of Brazil collects royalties on mineral production, with up to half of such
royalties being paid to surface rights owners. The current Brazilian Federal royalty applicable to
gold production is a 1% NSR. This level, and the level of any other royalties, payable to the
Brazilian government in respect of the production of minerals may be varied at any time as a
result of changing legislation which could materially adversely affect the Group’s results of
operations.

Market Factors and Volatility of Commodity Prices
The Group’s future profitability and long term viability will depend, in large part, on the global
market price of minerals produced and their marketability. The marketability of mineralized
material which may be acquired or discovered by the Group will be affected by numerous factors
beyond the control of the Group. These factors include market fluctuations in the prices of
minerals sought, which are highly volatile, inflation, consumption patterns, speculative activities,
international political and economic trends, currency exchange fluctuations, interest rates,
production costs and increased production. The effect of these factors cannot be accurately
predicted, but may result in the Group not receiving an adequate return on invested capital.
Prices of certain minerals have fluctuated widely, particularly in recent years, and are affected by
numerous factors beyond the control of the Group. Future mineral prices cannot be accurately
predicted. A severe decline in the price of a mineral being produced or expected to be produced
by the Group would have a material adverse effect on the Group, and could result in the
suspension of mining operations by the Group.
Exchange Rate Fluctuations
Exchange rate fluctuations may adversely affect the Group’s financial position and results. The
Group’s financial results are reported in British Pounds and its costs are incurred primarily in
British Pounds, Canadian Dollars, and Brazilian Real. The appreciation of the Canadian Dollar, or
Brazilian Real against the British Pound could increase the actual capital and operating costs of
the Group’s mineral exploration projects and materially adversely affect the results presented in
the Group’s financial statements. Currency exchange fluctuations may also materially adversely
affect the Group’s future cashflow from operations, its results of operations, financial condition
and prospects. The Group does not currently have in place a policy for managing or controlling
foreign currency risks.
Dependence on Key Executives and Technical Personnel
The Group is currently dependent on the services of Cristiano Veloso, the President and Chief
Executive Officer of the Group. Locating mineral deposits in Brazil depends on a number of
factors, not the least of which is the technical skill of the exploration personnel involved. Due to
the relatively small size of the Group, the loss of Mr. Veloso or the Group’s inability to attract and
retain additional highly skilled employees may materially adversely affect its business and future
operations. The Group does not currently carry any keyman life insurance on any of its
executives. The non-executive directors of the Group will only devote part of their time to the
affairs of the Group.
Conflicts of Interest
Certain of the directors and officers of the Group also serve as directors and/or officers of other
companies involved in natural resource exploration and development. To the extent that such
other companies may participate in ventures in which the Group may participate there exists the
possibility for such directors and officers to be in a position of conflict. Such directors and officers
have duties and obligations under the laws of Canada and the United Kingdom to act honestly
and in good faith with a view to the best interests of the Group and its shareholders. Accordingly,
such directors and officers will declare and abstain from voting on any matter in which such
director and/or officer may have a conflict of interest.
Lack of Hedging Policy
The Group does not have a resource hedging policy and has no present intention to establish
one. Accordingly, the Group has no protection from declines in mineral resource prices. The
Group will explore the merits of hedging foreign currency reserves against foreign currency
exchange rate fluctuations.

No History of Earnings
The Group has no history of earnings, and there is no assurance that any of the properties it now
or may hereafter acquire or obtain an interest in will generate earnings, operate profitably, or
provide a return on investment in the future. The Group has not generated operating revenue
since incorporation. Management anticipates that the Group will experience net losses as a result
of ongoing exploration and general corporate and administrative costs and expenses until such
time as revenue generating activity is commenced.
Dilution
To the extent the Group should, in future, issue any warrants, options, convertible securities or
other similar rights, the holders of such securities will have the opportunity to profit from a rise in
the market price of the Ordinary Shares with a resulting dilution in the equity interest of any
persons who become holders of Ordinary Shares as a result of or subsequent to the Offering.
The Group’s ability to obtain additional financing during the period such rights are outstanding
may be adversely affected and the existence of the rights may have an adverse effect on the
price of the Ordinary Shares. The holders of warrants, options and other rights may exercise such
securities at a time when the Group would, in all likelihood, be able to obtain any needed capital
by a new offering of securities on terms more favourable than those provided by the outstanding
rights.
In some circumstances, the increase in the number of Ordinary Shares issued and outstanding
and the possibility of sales of such shares may have a depressive effect on the price of the
Ordinary Shares. In addition, as a result of such additional Ordinary Shares, the voting power of
the Group’s existing shareholders may be diluted.
Officers and Directors of the Group Own Significant Ordinary Shares and Can Exercise
Significant
Influence
The officers and directors of the Group, as a group, beneficially own, on a non-diluted basis,
approximately 20.9% of the outstanding Ordinary Shares of the Group. As such, as shareholders,
the officers and directors will be able to exert significant influence on matters requiring approval
by shareholders, including the election of directors and the approval of any significant corporate
transactions. The concentration of ownership may also have the effect of delaying, deterring or
preventing a change in control and may make some transactions more difficult or impossible to
complete without the support of these shareholders.
Future Sales of Ordinary Shares by Existing Shareholders
Sales of a large number of Ordinary Shares in the public markets, or the potential for such sales,
could decrease the trading price of the Ordinary Shares and could impair the Group’s ability to
raise capital through future sales of Ordinary Shares. Each investor should carefully consider the
foregoing risk factors and review with their professional advisors the tax and other implications of
making an investment in any securities of the Group.
Further information
Additional information relating to the Group can be found on SEDAR at www.sedar.com and on
the Group’s web site at www.amazonmining.com.