The Tanlouka Gold Project is a 79 square kilometre property located within a one hour drive east of the capital city of Ouagadougou. The Tanlouka permit area straddles the Markoye Shear Zone, a crustal scale structure that extends from northern Ghana 450 kilometres to northern Burkina Faso. This important structure has some economic significance as it links some of Burkina's largest gold deposits including Essakane (IAMGOLD), Bombore (Orezone Gold), Taparko-Bouroum (High River Gold) and Kiaka (Volta Resources). It is thought that this structure provides the prime plumbing system for gold mineralized fluids in the region.

In recent years Burkina Faso has seen significant investment from international exploration and mining companies. Several mines are now in production and the country currently ranks as Africa's fourth largest gold producer.

The mineralized zones in the surveyed area of Tanlouka appear to be related to brittle-ductile deformation associated with an intrusive margin. A 12 kilometre long trend of regional scale (500m grid spacing) gold-in-soil anomalies has been outlined on the property within which three main centres are indicated. The most explored of these centres, known as the Mankarga Zone is located in the southern portion of the permit, and this is where the majority of artisanal workings are located.

A semi-detailed soil geochemistry survey (100 X 50 metre centres), with mapping and trenching and rock chip sampling have also been conducted over parts of the Mankarga Zone. The semi-detailed soil survey gold values ranged from less than 5ppb to a maximum of 1931 ppb gold. Channel sampling in one of the artisanal mining cuts on one of the soil anomalies returned an average grade of 2.33 g/T gold over 11.0 meters.

Also within the Mankarga Zone, a 30 line-kilometer gradient IP and ground magnetic survey identified several strong anomalies including a 1,300 metre long by up to 200 metre wide north-northwest trending zone characterized by high chargeability and high resistivity that also coincides with artisanal workings.

In the summer of 2010, Channel conducted a reverse circulation (RC) drilling program to targets targets outlined in the Mankarga zone based on the presence of geochemical anomalies, high resistivity and chargeability structures, magnetic anomalies, as well as extensive artisanal workings. This program consisted of eleven holes and successfully indicated the discovery two new mineralized areas approximately 1.3 kilometres apart - Mankarga 1 and Mankarga 5.

Following this initial success, the company commenced a second RC drilling program for an additional 10,000 meters in approximately 65 holes, to include bracketing and follow-up of the initial discoveries, as well as reconnaissance drilling to assess additional targets.

Of the holes drilled and reported thus far in the Phase II program (twelve holes totalling 2,335 metres), two holes drilled in Mankarga 1 confirmed mineralization on either side of the discovery hole where an intersection of high grade gold was encountered. Seven additional holes confirmed extensions to Mankarga 5, a north-east trending structure where two discovery holes intersected multiple discrete mineralized horizons. Holes were also drilled to test targets in Mankarga 2 and Mankarga 1 North area, where a new mineralized structure was discovered coincident with the presence of geochemical and geophysical anomalies, as well as extensive artisanal workings. To date, Channel has completed 90 RC Drill holes with over 7,000 meters of drilling.