Canyon Copper (CNYC) 10-Q 2009 Q3 Quarterly report

UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549

FORM 10-Q

(Mark One)

[ x ]QUARTERLY REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the quarterly period endedMarch 31, 2009

[ ]TRANSITION REPORT PURSUANT TO SECTION 13 OR 15(d) OF THE SECURITIES EXCHANGE ACT OF 1934

For the transition period from ________ to ________

COMMISSION FILE NUMBER000-33189

CANYON COPPER CORP.
(Exact name of registrant as specified in its charter)

NEVADA	88-0454792
(State or other jurisdiction of incorporation or organization)	(I.R.S. Employer Identification No.)
Suite 408 - 1199 West Pender Street
Vancouver, BC, Canada	V6E 2R1
(Address of principal executive offices)	(Zip Code)

(604) 331-9326
(Registrant's telephone number, including area code)

N/A
(Former name, former address and former fiscal year, if changed since last report)

Indicate by check mark whether the 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 the registrant was required to file such reports), and (2) has been subject to such filing requirements for the past 90 days.[ x ]Yes[ ] No

Indicate by check mark whether the registrant has submitted electronically and posted on its corporate Web site, if any, every Interactive Data File required to be submitted and posted pursuant to Rule 405 of Regulation S-T (s. 232.405 of this chapter) during the preceding 12 months (or for such shorter period that the registrant was required to submit and post such files).[ ] Yes[ ] No

Indicate by check mark whether the registrant is a large accelerated filer, an accelerated filer, a non-accelerated filer, or a smaller reporting company. See the definitions of “large accelerated filer,” “accelerated filer” and “smaller reporting company” in Rule 12b-2 of the Exchange Act.

Large accelerated filer [ ]	Accelerated filer [ ]
Non-accelerated filer [ ] (Do not check if a smaller reporting company)	Smaller reporting company[ x ]

Indicate by check mark whether the registrant is a shell company (as defined in Rule 12b-2 of the Exchange Act):
[ ] Yes[ x ]No

Indicate the number of shares outstanding of each of the issuer's classes of common stock, as of the latest practicable date:As of May 12, 2009, the Registrant had 76,881,399 shares of common stock, par value of $0.00001 per share, issued and outstanding.

PART I - FINANCIAL INFORMATION

ITEM 1. FINANCIAL STATEMENTS.

The accompanying unaudited financial statements have been prepared in accordance with the instructions to Form 10-Q and Rule 8-03 of Regulation S-X, and, therefore, do not include all information and footnotes necessary for a complete presentation of financial position, results of operations, cash flows, and stockholders' equity in conformity with generally accepted accounting principles. In the opinion of management, all adjustments considered necessary for a fair presentation of the results of operations and financial position have been included and all such adjustments are of a normal recurring nature. Operating results for the nine months ended March 31, 2009 are not necessarily indicative of the results that can be expected for the year ending June 30, 2009.

As used in this Quarterly Report, the terms "we,” "us,” "our,” and “Canyon Copper” mean Canyon Copper Corp. unless otherwise indicated. All dollar amounts in this Quarterly Report are in U.S. dollars unless otherwise stated.

2

Canyon Copper Corp.
(An Exploration Stage Company)

March 31, 2009

	Index
Balance Sheets	F–1
Statements of Operations	F–2
Statements of Cash Flows	F–3
Notes to the Financial Statements	F–4

Canyon Copper Corp.

(An Exploration Stage Company)

Balance Sheets

(Expressed in U.S. dollars)

	March 31,		June 30,
	2009		2008
	$		$
	(unaudited)
ASSETS
Current Assets
Cash	72,444		15,580
Prepaid expenses and deposits	4,578		10,435
Total Assets	77,022		26,015
LIABILITIES AND STOCKHOLDERS’ DEFICIT
Current Liabilities
Accounts payable (Note 5)	291,477		376,835
Accrued liabilities (Note 4)	210,141		143,979
Due to related parties (Note 5)	214,631		145,046
Convertible debt, less unaccreted discount of $nil and $72,506,
respectively (Note 6)	259,664		647,495
Derivative liabilities (Note 6)	421,356		91,017
Total Current Liabilities	1,397,269		1,404,372
Convertible debt, less unaccreted discount of $415,105 and $nil,
respectively (Note 6)	84,895		49,092
Total Liabilities	1,482,164		1,453,464
Contingencies (Notes 1 and 10)
Stockholders’ Deficit
Preferred Stock
Authorized: 100,000,000 shares, par value $0.00001
Issued and outstanding: 500,000 shares	5		5
Common Stock
Authorized: 500,000,000 shares, par value $0.00001
Issued and outstanding: 76,881,399 shares
(June 30, 2008 – 71,981,399 shares)	769		720
Additional Paid-in Capital	16,138,249		15,648,298
Deficit Accumulated During the Exploration Stage	(17,544,165	)	(17,076,472	)
Total Stockholders’ Deficit	(1,405,142	)	(1,427,449	)
Total Liabilities and Stockholders’ Deficit	77,022		26,015

The Accompanying Notes are an Integral Part of These Financial Statements

F-1

Canyon Copper Corp.

(An Exploration Stage Company)

Statements of Operations

(Expressed in U.S. dollars)

(unaudited)

	Accumulated from
	January 21, 2000		For the				For the
	(Date of Inception)		Three Months Ended				Nine Months Ended
	to March 31,		March 31,				March 31,
	2009		2009		2008		2009		2008
	$		$		$		$		$
Revenue	–		–		–		–		–
Expenses
Depreciation	5,540		–		–		–		–
Foreign exchange (gain) loss	(88,770	)	(12,947	)	(9,159	)	(73,974	)	1,676
General and administrative (Note 5)	8,640,384		69,900		154,833		258,076		823,228
Impairment of mineral property costs	2,759,130		–		–		–		–
Impairment of property and equipment	10,811		–		–		–		–
Mineral exploration costs	4,596,489		15,110		22,601		237,738		257,408
Total Operating Expenses	15,923,584		72,063		168,275		421,840		1,082,312
Operating Loss	(15,923,584	)	(72,063	)	(168,275	)	(421,840	)	(1,082,312	)
Other Income (Expense)
Accretion of discounts on convertible debt	(716,170	)	(89,160	)	(45,691	)	(157,400	)	(99,611	)
Gain (Loss) on change in fair values of beneficial
conversion features	527,441		405,594		(7,151	)	422,115		20,373
Interest expense	(308,301	)	(28,884	)	(21,005	)	(75,944	)	(63,407	)
Loss on sale of investment securities	(411,430	)	–		–		–		–
Gain on settlement of debt	150		3,021		–		3,021		–
Loss on extinguishment of debt	(252,454	)	(252,454	)	–		(252,454	)	–
Recovery (impairment loss) on investment securities	(459,817	)	–		–		14,809		104,406
Total Other Income (Expense)	(1,620,581	)	38,117		(73,847	)	(45,853	)	(38,239	)
Net Loss	(17,544,165	)	(33,946	)	(242,122	)	(467,693	)	(1,120,551	)
Net Loss Per Share – Basic and Diluted			–		–		(0.01	)	(0.02	)
Weighted Average Shares Outstanding			76,881,000		71,981,000		76,023,000		71,785,000

The Accompanying Notes are an Integral Part of These Financial Statements

F-2

Canyon Copper Corp.

(An Exploration Stage Company)

Statements of Cash Flows

(Expressed in U.S. dollars)

(unaudited)

	For the
	Nine Months Ended
	March 31,
	2009		2008
	$		$
Operating Activities
Net loss	(467,693	)	(1,120,551	)
Adjustments to reconcile net loss to net cash used in operating activities:
Accretion of discounts on convertible debt	157,400		99,611
Foreign exchange translation gain (loss) on debt	(23,600	)	2,465
Gain on change in fair values of beneficial conversion features	(422,115	)	(20,374	)
Loss on extinguishment of debt	252,454		–
Stock-based compensation	–		578,932
Recovery of loss on investment securities	(14,809	)	(104,406	)
Changes in operating assets and liabilities:
Prepaid expenses and deposits	5,857		5,009
Accounts payable and accrued liabilities	(19,196	)	131,930
Due to related parties	59,182		45
Net Cash Used in Operating Activities	(472,520	)	(427,339	)
Investing Activities
Proceeds received on sale of investment securities	14,809		104,406
Net Cash Provided by Investment Activities	14,809		104,406
Financing Activities
Advances from related party	24,575		–
Issuance of common stock	490,000		300,000
Net Cash Provided by Financing Activities	514,575		300,000
Increase (Decrease) in Cash	56,864		(22,933	)
Cash – Beginning of Period	15,580		34,401
Cash – End of Period	72,444		11,468
Supplemental Disclosures:
Interest paid	–		–
Income taxes paid	–		–

The Accompanying Notes are an Integral Part of These Financial Statements

F-3

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

1.	Nature of Operations and Continuance of Business
	Canyon Copper Corp., (the “Company”), was incorporated in the State of Nevada, U.S.A. on January 21, 2000 under the name Aberdene Mines Limited. On August 7, 2006, the Company changed its name to Canyon Copper Corp. The Company is an Exploration Stage Company, as defined by Statement of Financial Accounting Standard (“SFAS”) No. 7, “Accounting and Reporting by Development Stage Enterprises”. The Company’s principal business plan is to acquire, explore and develop mineral properties and ultimately seek earnings by exploiting mineral claims.
	The Company has been in the exploration stage since its formation in January 2000 and has not yet realized any revenues from its planned operations. It is primarily engaged in the acquisition, exploration and development of mineral properties. Upon location of a commercial mineable reserve, the Company will actively prepare the site for extraction and enter a development stage. At present, management devotes most of its activities to raise sufficient funds to further explore and develop its mineral properties. Planned principal activities have not yet begun. The ability of the Company to emerge from the exploration stage with respect to any planned principal business activity is dependent upon its successful efforts to raise additional equity financing and/or attain profitable mining operations. As at March 31, 2009, the Company has a working capital deficit of $1,320,247 and has accumulated losses of $17,544,165 since inception. The Company also has significant mineral property acquisition and exploration commitments. There is no guarantee that the Company will be able to complete any of the above objectives. These factors raise substantial doubt regarding the Company’s ability to continue as a going concern.
	Management’s plan for the next twelve months is to continue initial exploration activities on the New York Canyon Project in Nevada. The agreements pursuant to which the Company acquired its interests in the New York Canyon Project provide for a series of cash payments and annual filing maintenance costs. If the Company fails to make such payments or expenditures in a timely fashion it may lose its interest in those properties. As at March 31, 2009, the Company had cash of $72,444 on hand, and for the next twelve months, management anticipates that the minimum cash requirements to fund its proposed exploration program and continued operations will be $3,200,000. Accordingly, the Company does not have sufficient funds to meet planned expenditures over the next twelve months, and will need to seek additional debt or equity financing to meet its planned expenditures. There is no assurance that the Company will be able to raise sufficient cash to fund its future exploration programs and operational expenditures.
2.	Summary of Significant Accounting Policies
	a)	Basis of Presentation
		These financial statements and related notes are prepared in conformity with accounting principles generally accepted in the United States and are expressed in U.S. dollars. The Company’s fiscal year-end is June 30.
	b)	Interim Financial Statements
		These interim unaudited financial statements have been prepared on the same basis as the annual financial statements and in the opinion of management, reflect all adjustments, which include only normal recurring adjustments, necessary to present fairly the Company’s financial position, results of operations and cash flows for the periods shown. The results of operations for such periods are not necessarily indicative of the results expected for a full year or for any future period.
	c)	Use of Estimates
		The preparation of financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. The Company regularly evaluates estimates and assumptions related to long-lived assets, mineral property costs, derivative liabilities, asset retirement obligations, stock-based compensation, and deferred income tax asset valuations. The Company bases its estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by the Company may differ materially and adversely from the Company’s estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

F-4

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

2.	Summary of Significant Accounting Policies (continued)
	d)	Cash and Cash Equivalents
		The Company considers all highly liquid instruments with maturity of three months or less at the time of issuance to be cash equivalents.
	e)	Investment Securities
		The Company reports investments in debt and marketable equity securities at fair value based on quoted market prices or, if quoted prices are not available, discounted expected cash flows using market rates commensurate with credit quality and maturity of the investment. All investment securities are designated as available for sale with unrealized gains and losses included in stockholders' equity. Unrealized losses that are other than temporary are recognized in earnings. Realized gains and losses are accounted for on the specific identification method.
		The Company periodically reviews these investments for other-than-temporary declines in fair value based on the specific identification method and writes down investments to their fair value when an other-than- temporary decline has occurred. When determining whether a decline is other-than-temporary, the Company examines (i) the length of time and the extent to which the fair value of an investment has been lower than its carrying value: (ii) the financial condition and near-term prospects of the investee, including any specific events that may influence the operations of the investee such as changes in technology that may impair the earnings potential of the investee: and (iii) the Company’s intent and ability to retain its investment in the investee for a sufficient period of time to allow for any anticipated recovery in market value. The Company generally believes that an other-than-temporary decline has occurred when the fair value of the investment is below the carrying value for one year, absent of evidence to the contrary.
	f)	Mineral Property Costs
		The Company has been in the exploration stage since its inception on January 21, 2000, and has not yet realized any revenues from its planned operations. It is primarily engaged in the acquisition and exploration of mining properties. Mineral property exploration costs are expensed as incurred. Mineral property acquisition costs are initially capitalized when incurred using the guidance in EITF 04-02, “Whether Mineral Rights Are Tangible or Intangible Assets”. The Company assesses the carrying costs for impairment under SFAS No. 144, “Accounting for Impairment or Disposal of Long Lived Assets” at each fiscal quarter end. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs then incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.
	g)	Long-lived Assets
		In accordance with SFAS No. 144, “Accounting for the Impairment or Disposal of Long-Lived Assets”, the Company tests long-lived assets or asset groups for recoverability when events or changes in circumstances indicate that their carrying amount may not be recoverable. Circumstances which could trigger a review include, but are not limited to: significant decreases in the market price of the asset; significant adverse changes in the business climate or legal factors; accumulation of costs significantly in excess of the amount originally expected for the acquisition or construction of the asset; current period cash flow or operating losses combined with a history of losses or a forecast of continuing losses associated with the use of the asset; and current expectation that the asset will more likely than not be sold or disposed significantly before the end of its estimated useful life. Recoverability is assessed based on the carrying amount of the asset and its fair value which is generally determined based on the sum of the undiscounted cash flows expected to result from the use and the eventual disposal of the asset, as well as specific appraisal in certain instances. An impairment loss is recognized when the carrying amount is not recoverable and exceeds fair value.
	h)	Asset Retirement Obligations
		The Company accounts for asset retirement obligations in accordance with the provisions of SFAS No. 143 “Accounting for Asset Retirement Obligations”. 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.

F-5

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

2.	Summary of Significant Accounting Policies (continued)
	i)	Foreign Currency Translation
		The Company’s functional and reporting currency is the United States dollar. Occasional transactions may occur in a foreign currency and management has adopted SFAS No. 52, “Foreign Currency Translation”. Monetary assets and liabilities denominated in foreign currencies are translated using the exchange rate prevailing at the balance sheet date. Non-monetary assets and liabilities denominated in foreign currencies are translated at rates of exchange in effect at the date of the transaction. Average monthly rates are used to translate revenues and expenses. Gains and losses arising on translation or settlement of foreign currency denominated transactions or balances are included in the determination of income. Foreign currency transactions are primarily undertaken in Canadian dollars. The Company has not, to the date of these financial statements, entered into derivative instruments to offset the impact of foreign currency fluctuations.
	j)	Financial Instruments
		SFAS No. 157 “Fair Value Measurements” requires an entity to maximize the use of observable inputs and minimize the use of unobservable inputs when measuring fair value. SFAS No. 157 establishes a fair value hierarchy based on the level of independent, objective evidence surrounding the inputs used to measure fair value. A financial instrument’s categorization within the fair value hierarchy is based upon the lowest level of input that is significant to the fair value measurement. SFAS No. 157 prioritizes the inputs into three levels that may be used to measure fair value:

Level 1

Level 1 applies to assets or liabilities for which there are quoted prices in active markets for identical assets or liabilities.

Level 2

Level 2 applies to assets or liabilities for which there are inputs other than quoted prices that are observable for the asset or liability such as quoted prices for similar assets or liabilities in active markets; quoted prices for identical assets or liabilities in markets with insufficient volume or infrequent transactions (less active markets); or model-derived valuations in which significant inputs are observable or can be derived principally from, or corroborated by, observable market data.

Level 3

Level 3 applies to assets or liabilities for which there are unobservable inputs to the valuation methodology that are significant to the measurement of the fair value of the assets or liabilities.

	The Company’s financial instruments consist principally of cash, accounts payable, amounts due to related parties, derivative liabilities, and convertible debt. Pursuant to SFAS No. 157, fair value of assets and liabilities measured on a recurring basis include cash equivalents determined based on “Level 1” inputs, which consist of quoted prices in active markets for identical assets. Derivative liabilities are valued based on “Level 2” inputs, consisting of quoted prices in less active markets. The Company believes that the recorded values of all of the other financial instruments approximate their current fair values because of their nature and respective maturity dates or durations.
	The Company’s operations are in Canada, which results in exposure to market risks from changes in foreign currency rates. The financial risk is the risk to the Company’s operations that arise from fluctuations in foreign exchange rates and the degree of volatility of these rates. Currently, the Company does not use derivative instruments to reduce its exposure to foreign currency risk.
k)	Income Taxes
	The Company accounts for income taxes using the asset and liability method in accordance with SFAS No. 109, “Accounting for Income Taxes”. The asset and liability method provides that deferred tax assets and liabilities are recognized for the expected future tax consequences of temporary differences between the financial reporting and tax bases of assets and liabilities, and for operating loss and tax credit carryforwards Deferred tax assets and liabilities are measured using the currently enacted tax rates and laws that will be in effect when the differences are expected to reverse. The Company records a valuation allowance to reduce deferred tax assets to the amount that is believed more likely than not to be realized.
l)	Comprehensive Income
	SFAS No. 130, “Reporting Comprehensive Income,” establishes standards for the reporting and display of comprehensive income and its components in the financial statements. As at March 31, 2009 and 2008, the Company had no items that represent comprehensive income.

F-6

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

2.	Summary of Significant Accounting Policies (continued)
	m)	Earnings (Loss) Per Share
		The Company computes earnings (loss) per share in accordance with SFAS No. 128, "Earnings per Share" which requires presentation of both basic and diluted earnings per share (“EPS”) on the face of the income statement. Basic EPS is computed by dividing earnings (loss) available to common shareholders (numerator) by the weighted average number of shares outstanding (denominator) during the period. Diluted EPS gives effect to all dilutive potential common shares outstanding during the period using the treasury stock method and convertible preferred stock using the if-converted method. In computing diluted EPS, the average stock price for the period is used in determining the number of shares assumed to be purchased from the exercise of stock options or warrants. Diluted EPS excludes all dilutive potential shares if their effect is anti-dilutive. Shares underlying these securities totalled 38,652,778 as at March 31, 2009 (9,775,000 as at June 30, 2008).
	n)	Stock-based Compensation
		The Company records stock based compensation in accordance with SFAS No. 123(R), “Share-Based Payments,” which requires the measurement and recognition of compensation expense, based on estimated fair values, for all share-based awards, made to employees and directors, including stock options.
		SFAS No. 123(R) requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. The Company uses the Black-Scholes option-pricing model as its method of determining fair value. This model is affected by the Company’s stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to the Company’s expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period.
		All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.
	o)	Recent Accounting Pronouncements
		In June 2008, the Financial Accounting Standards Board (“FASB”) issued FASB Staff Position EITF 03-6-1, “Determining Whether Instruments Granted in Share-Based Payment Transactions Are Participating Securities”. FSP EITF 03-6-1 addresses whether instruments granted in share-based payment transactions are participating securities prior to vesting, and therefore need to be included in the computation of earnings per share under the two-class method as described in FASB Statement of Financial Accounting Standards No. 128, “Earnings per Share.” FSP EITF 03-6-1 is effective for financial statements issued for fiscal years beginning on or after December 15, 2008 and earlier adoption is prohibited. The adoption of this statement is not expected to have a material effect on the Company’s financial statements
		In May 2008, the Financial Accounting Standards Board (“FASB”) issued SFAS No. 163, “Accounting for Financial Guarantee Insurance Contracts – An interpretation of FASB Statement No. 60”. SFAS No. 163 requires that an insurance enterprise recognize a claim liability prior to an event of default when there is evidence that credit deterioration has occurred in an insured financial obligation. It also clarifies how Statement 60 applies to financial guarantee insurance contracts, including the recognition and measurement to be used to account for premium revenue and claim liabilities, and requires expanded disclosures about financial guarantee insurance contracts. It is effective for financial statements issued for fiscal years beginning after December 15, 2008, except for some disclosures about the insurance enterprise’s risk- management activities. SFAS No. 163 requires that disclosures about the risk-management activities of the insurance enterprise be effective for the first period beginning after issuance. Except for those disclosures, earlier application is not permitted. The adoption of this statement is not expected to have a material effect on the Company’s consolidated financial statements.
		In May 2008, the FASB issued SFAS No. 162, “The Hierarchy of Generally Accepted Accounting Principles”. SFAS No. 162 identifies the sources of accounting principles and the framework for selecting the principles to be used in the preparation of financial statements of nongovernmental entities that are presented in conformity with generally accepted accounting principles in the United States. It is effective 60 days following the SEC’s approval of the Public Company Accounting Oversight Board amendments to AU Section 411, “The Meaning of Present Fairly in Conformity With Generally Accepted Accounting Principles”. The adoption of this statement is not expected to have a material effect on the Company’s consolidated financial statements.

F-7

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

2.	Summary of Significant Accounting Policies (continued)
	o)	Recent Accounting Pronouncements (continued)
		In March 2008, the FASB issued SFAS No. 161, “Disclosures about Derivative Instruments and Hedging Activities – an amendment to FASB Statement No. 133”. SFAS No. 161 is intended to improve financial standards for derivative instruments and hedging activities by requiring enhanced disclosures to enable investors to better understand their effects on an entity's financial position, financial performance, and cash flows. Entities are required to provide enhanced disclosures about: (a) how and why an entity uses derivative instruments; (b) how derivative instruments and related hedged items are accounted for under Statement No. 133 and its related interpretations; and (c) how derivative instruments and related hedged items affect an entity’s financial position, financial performance, and cash flows. It is effective for financial statements issued for fiscal years beginning after November 15, 2008, with early adoption encouraged. The adoption of this statement is not expected to have a material effect on the Company's financial statements.
		In December 2007, the FASB issued SFAS No. 141 (revised 2007), “Business Combinations”. This statement replaces SFAS No.141 and defines the acquirer in a business combination as the entity that obtains control of one or more businesses in a business combination and establishes the acquisition date as the date that the acquirer achieves control. SFAS No. 141 (revised 2007) requires an acquirer to recognize the assets acquired, the liabilities assumed, and any noncontrolling interest in the acquiree at the acquisition date, measured at their fair values as of that date. SFAS No. 141 (revised 2007) also requires the acquirer to recognize contingent consideration at the acquisition date, measured at its fair value at that date. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. The adoption of this statement is not expected to have a material effect on the Company's financial statements.
		In December 2007, the FASB issued SFAS No. 160, “Noncontrolling Interests in Consolidated Financial Statements Liabilities –an Amendment of ARB No. 51”. This statement amends ARB 51 to establish accounting and reporting standards for the Noncontrolling interest in a subsidiary and for the deconsolidation of a subsidiary. This statement is effective for fiscal years, and interim periods within those fiscal years, beginning on or after December 15, 2008. Earlier adoption is prohibited. The adoption of this statement is not expected to have a material effect on the Company's financial statements.
		In February 2007, FASB issued SFAS No. 159, “The Fair Value Option for Financial Assets and Financial Liabilities – Including an Amendment of FASB Statement No. 115”. This statement permits entities to choose to measure many financial instruments and certain other items at fair value. Most of the provisions of SFAS No. 159 apply only to entities that elect the fair value option. However, the amendment to SFAS No. 115 “Accounting for Certain Investments in Debt and Equity Securities” applies to all entities with available-for- sale and trading securities. SFAS No. 159 is effective as of the beginning of an entity’s first fiscal year that begins after November 15, 2007. Early adoption is permitted as of the beginning of a fiscal year that begins on or before November 15, 2007, provided the entity also elects to apply the provision of SFAS No. 157, “Fair Value Measurements”. The adoption of this statement did not have a material effect on Company's financial statements.
		In September 2006, the FASB issued SFAS No. 157, “Fair Value Measurements”. The objective of SFAS No. 157 is to increase consistency and comparability in fair value measurements and to expand disclosures about fair value measurements. SFAS No. 157 defines fair value, establishes a framework for measuring fair value in generally accepted accounting principles, and expands disclosures about fair value measurements. SFAS No. 157 applies under other accounting pronouncements that require or permit fair value measurements and does not require any new fair value measurements. The provisions of SFAS No. 157 are effective for fair value measurements made in fiscal years beginning after November 15, 2007. The adoption of this statement did not have a material effect on Company's financial statements.
3.	Mineral Properties
	a)	The Company owns a 100% interest, subject to a 2% net smelter royalty, in the New York Canyon Copper Project located in Mineral County, Nevada. The Company acquired its interest by making cash payments of $460,000, issuing 2,000,000 shares at a fair value of $1,495,000, and incurring $2,000,000 in exploration expenditures.

F-8

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

3. Mineral Properties (continued)

In addition the Company was assigned two lease agreements in which the Company must make quarterly lease payments. On October 9, 2004, a lease agreement was entered into with Tammy Gentry and Pat Hannigan on the Copper Queen #2 patented claim located within the overall New York Canyon property. The term of the lease is nine years. As required by the lease agreement, there was an initial payment of $1,000, with quarterly payments of $1,500 commencing October 1, 2004. The Company also has the right to purchase the claim for $50,000 at any time during the term of the lease agreement and that all quarterly payment made shall be applied to the purchase price.

On January 1, 2005, a lease agreement was entered into with Clifford DeGraw and Richard Markiewicz on the Mildred and Copper Queen #1 patented claims located within the overall New York Canyon property. The term of the lease is seven years. As required by the lease agreement, there was an initial payment of $2,500, with quarterly payments commencing April 1, 2005 and required so long as the lease agreement remains in effect as follows: $2,500 per quarter during the first year; $3,500 per quarter during the second year; $4,000 per quarter during the third year; $5,000 per quarter during the fourth year; and $7,500 per quarter thereafter. The Company also has the right to purchase the claims for $130,000 at any time during the term of the lease agreement and that all quarterly payments made shall be applied to the purchase price.

b) On July 21, 2004, the Company entered into a fifteen-year renewable lease agreement, which gives the Company the right of exploration for and production of minerals in eighteen mineral claims owned by the lessor. The mineral claims are located within the area of the Company’s New York Canyon Copper Project. Under the terms of the agreement, the Company must make cash payments of $25,000 on execution of the agreement (paid). On the first anniversary of the execution of the agreement, the Company must make payments to the lessor of $1,000 per month, $2,000 per month after the second anniversary and $3,000 per month after the third anniversary for as long as the lease is in effect. In addition, at six and twenty-four months after the execution of the agreement the Company will give the lessor, respectively, 10,000 shares (issued at a fair value of $3,500 in fiscal 2005) and 15,000 shares (issued at a fair value of $7,950 in fiscal 2007) of the Company’s common stock. This agreement is subject to a Net Smelter Interest payable to two parties (1.75% Net Smelter Royalty (“NSR”) + 0.5% NSR). The 1.75% is terminated upon payments of $2,000,000; then the second party will retain 1.5% NSR which will revert to 0.5% after an additional $2,000,000 is paid.

4. Accrued Liabilities

	March 31,	June 30,
	2009	2008
	$	$
Interest accrued on debt	206,532	135,370
Professional fees and other accruals	3,609	8,609
	210,141	143,979

5.	Related Party Transactions
	a)	As at March 31, 2009, the Company was indebted to the President of the Company for $63,460 (Cdn$80,000) (June 30, 2008 - $34,364 (Cdn$35,000)) of consulting fees. The amount due is non-interest bearing, unsecured and due on demand.
	b)	As at March 31, 2009, the Company was indebted to the Chief Executive Officer of the Company for $151,171 (June 30, 2008 - $110,224), which consists of the following amounts:
		i)	$66,675 (Cdn$84,050) (June 30, 2008 - $36,132 (Cdn$36,800)) for consulting fees, which is non- interest bearing, unsecured and due on demand;
		ii)	$19,832 (Cdn$25,000) (June 30, 2008 - $24,546 (Cdn$25,000)) in advances for working capital purposes which bears interest at 15% per annum, is unsecured and due on demand;
		iii)	$19,832 (Cdn$25,000) (June 30, 2008 - $Nil) in advances for working capital purposes which bears interest at 15% per annum, is secured by a promissory note, and was due on January 7, 2009. On January 13, 2009, the maturity date on the notes was extended to April 7, 2010;

F-9

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

5. Related Party Transactions (continued)

iv)	$19,832 (Cdn$25,000) (June 30, 2008 - $24,546 (Cdn$25,000)) in advances for working capital purposes which bears interest at 15% per annum, is secured by a promissory note, and is due on November 8, 2009. On January 13, 2009, the maturity date on the notes was extended to February 8, 2010; and
v)	$25,000 (June 30, 2008 - $25,000) in advances for working capital purposes which bears interest at 15% per annum, is secured by a promissory note, and is due on October 1, 2008. On January 13, 2009, the maturity date on the notes was extended to January 1, 2010.

Refer to Note 6(a) for convertible debt owing the Chief Executive Officer of the Company.

c)	As at March 31, 2009, the Company was indebted to the Chief Financial Officer of the Company for $nil (June 30, 2008 - $458) of general and administrative expenses. The amounts due are non-interest bearing, unsecured and due on demand.
d)	As at March 31, 2009, $70,190 (June 30, 2008 - $70,190) is owed to a former Vice President of Finance of the Company and is included in accounts payable. The amount due is non-interest bearing, unsecured and due on demand.
e)	As at March 31, 2009, $6,980 (June 30, 2008 - $9,980) is owed to a former Vice President of the Company and is included in accounts payable. The amount due is non-interest bearing, unsecured and due on demand.
f)	During the nine months ended March 31, 2009, the Company incurred consulting fees of $40,224 (2008 - $20,060), $38,309 (2008 - $20,949), and $51,975 (2008 - $52,305) to the Chief Executive Officer of the Company, President of the Company, and Chief Financial Officer, respectively.

6.	Convertible Debt
	a)	On March 14, 2007, the Chief Executive Officer of the Company advanced $100,000 to the Company. On April 25, 2007, the Chief Executive Officer loaned the Company a further $39,664 (Cdn$50,000). This loan bears interest at a rate of 15% per annum, is unsecured and due on demand. On April 25, 2007, the Company secured these loans by issuing convertible notes. The notes were due on March 14, 2008 and April 25, 2008, respectively, and are convertible at $0.30 per unit with each unit to consist of one common share and one share purchase warrant exercisable at $0.35 per common share for a period of two years. In accordance with EITF 98-5 “Accounting for Convertible Securities with Beneficial Conversion Features or Contingently Adjustable Conversion Ratios”, (“EITF 98-5”) the Company recognized the intrinsic value of the embedded beneficial conversion feature of $43,707 as additional paid-in capital and an equivalent discount which was expensed over the term of the convertible loans. During the year ended June 30, 2008, the Company recorded accretion of $35,123, increasing the carrying value of the convertible loans to their face value. On May 9, 2008, the maturity date on the notes was extended to June 14, 2009 and July 25, 2009, respectively. These modifications had no accounting impact.
	b)	On September 12, 2006, the Company entered into a convertible loan agreement with Aton Ventures Fund Ltd. (“Aton”) pursuant to which the Company received a loan of $250,000 from Aton. On September 11, 2006, the Company entered into a convertible loan agreement with Asset Protection Fund Ltd. (“APF”) pursuant to which the Company received a loan of $250,000 from APF. The Aton loan was to mature on December 12, 2006 and the APF loan was to mature on December 11, 2006. Both loans bear interest at 8% per annum and were convertible at the option of the lender at any time prior to maturity into shares of common stock at a price of $0.30 per share. In accordance with EITF 98-5, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $175,000 as additional paid-in capital and an equivalent discount which was being expensed over the term of the convertible loans.

F-10

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

6. Convertible Debt (continued)

On November 27, 2006, the convertible loans were amended to modify the conversion privileges and the maturity date for the APF loan was extended to April 11, 2007 and the maturity date for the Aton loan was extended to April 12, 2007. The loans are convertible into units at the lesser of $0.30 per unit or the closing price of the Company’s shares on the business day preceding the date that the Company receives a notice of conversion. Each unit will consist of one share of common stock and one half of a share purchase warrant. Each whole share purchase warrant is exercisable at $0.40 per common share for a period of one year from the date of issuance. In accordance with EITF 05-7 “Accounting for Modifications to Conversion Options Embedded in Debt Instruments and Related Issues” and EITF 96-19 “Debtor’s Accounting for a Modification or Exchange of Debt Instruments”, (“EITF 96-19”) the Company deemed the terms of the amendment to be substantially different and treated the original convertible loans extinguished and exchanged for new convertible loans. The Company determined that the conversion feature of the convertible loans met the criteria of an embedded derivative and therefore the conversion features of the loans needed to be bifurcated and accounted for as a derivative. The Company recorded accretion of the discount of $148,077 up to November 27, 2006. On November 27, 2006, the Company recognized the difference of $44,843 between the fair value of the conversion feature before and after the amendment. The Company will adjust the carrying value of the conversion feature to its fair value at each reporting date.

On April 11, 2007, the maturity date of the APF loan was extended to October 11, 2007 and on April 12, 2007 the maturity date of the Aton loan was extended to October 12, 2007. In accordance with EITF 06-6 “Debtor’s Accounting for a Modification or Exchange of (Convertible) Debt Instruments” (“EITF 06-6”), the Company determined it should not apply extinguishment accounting as the fair value of the embedded conversion option was not greater than 10% of the carrying amount of the original debt instrument immediately prior to the modification. To October 12, 2007, the Company recorded accretion of the discount of $71,766 increasing the carrying value of the convertible loans to $500,000.

On November 30, 2007, the maturity date of the APF loan was extended to January 11, 2009 and the maturity date of the Aton loan was extended to January 12, 2009. In accordance with EITF 06-6, the Company determined it should apply extinguishment accounting as the fair value of the embedded conversion option was greater than 10% of the carrying amount of the original debt instrument immediately prior to the modification. On November 30, 2007, the Company recognized a gain of $41,201 upon extinguishment of the modified debt. In addition, the Company recognized a discount of $151,502 and increased the derivative liability to $151,502. During the year ended June 30, 2008, the Company recorded accretion of the discount of $78,996 increasing the carrying value of the convertible loans to $427,494. The Company recorded a gain on the change in the fair values of the derivative liabilities of $60,484 during the year ended June 30, 2008, decreasing the fair value of the derivative liabilities to $91,017.

On January 13, 2009, the maturity dates of the APF loan and the Aton loan were extended to April 11, 2010 and April 12, 2010, respectively. In accordance with EITF 06-6, the Company determined it should apply extinguishment accounting as the fair value of the embedded conversion option was greater than 10% of the carrying amount of the original debt instrument immediately prior to the modification. On January 13, 2009, the Company recognized a loss of $252,454 upon extinguishment of the modified debt. In addition, the Company recognized a discount of $500,000 and increased the derivative liability to $752,454. During the nine months ended March 31, 2009, the Company recorded accretion of the discount of $157,400 increasing the carrying value of the convertible loans to $84,895. The Company recorded a gain on the change in the fair values of the derivative liabilities of $422,115 during the nine months ended March 31, 2009, decreasing the fair value of the derivative liabilities to $421,356. The outstanding amounts under the loans may be repaid, in whole or in part, at any time at the option of Company without penalty. For as long as the loans remain outstanding the Company has agreed not to mortgage, pledge or otherwise encumber its interest in its minerals claims in the State of Nevada without the consent of its lenders. Proceeds of the loans are to be used for working capital purposes to fund the Company’s continued operations.

c) On March 20, 2007, the Company received a loan of $120,000 from Aton Select Fund Limited. The loan bears interest at a rate of 15% per annum, was unsecured and due on demand. On April 25, 2007, the Company secured this loan by issuing a convertible note. The note is due on March 20, 2008 and is convertible at $0.30 per unit with each unit to consist of one common share and one share purchase warrant exercisable at $0.35 per common shares for a period of two years. In accordance with EITF 98-5, the Company recognized the intrinsic value of the embedded beneficial conversion feature of $36,041 as additional paid-in capital and an equivalent discount which was expensed over the term of the convertible loan. During the year ended June 30, 2008, the Company recorded accretion of the discount of $36,041 increasing the carrying value of the convertible loan to $120,000. On May 9, 2008, the maturity date on the note was extended to June 20, 2009. This modification had no accounting impact.

F-11

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

7.	Common Stock
	On August 18, 2008, the Company issued 4,900,000 units for proceeds of $490,000. Each unit consisted of one share of common stock and one share purchase warrant. Each share purchase warrant is exercisable at a price of $0.12 per common share for a period of two years from the date of issuance.
8.	Stock Options
	On December 3, 2007, the Company established a 2007 Stock Incentive Plan (the “2007 Plan”) to issue up to a maximum of 7,000,000 shares of common stock. The maximum aggregate number of shares of common stock that may be optioned and sold under the 2007 Plan will be increased effective the first day of each of the Company’s fiscal quarters commencing January 1, 2008, by an amount equal the lesser of (i) 10% of the total increase in the number of shares of common stock outstanding during the previous fiscal quarter, or (ii) a lesser number of shares of common stock as determined by the board of directors. The exercise price for consultants cannot be less than 85% of the fair market value of the common stock on the grant date. The exercise price for all others can not be less than 100% of the fair market value of the common stock on the grant date for incentive stock options and can not be less than 85% of the fair market value of the common stock on the grant date for non-qualified stock options. The Plan Administrator shall establish the option term or, if not so established, shall be ten years from the grant date. As at March 31, 2009, the Company had 4,115,000 stock options available for granting pursuant to the 2007 Plan.
	On April 5, 2006, the Company established a 2006 Stock Incentive Plan (the “2006 Plan”) to issue up to a maximum of 10,000,000 shares of common stock. The maximum aggregate number of shares of common stock that may be optioned and sold under the 2006 Plan will be increased effective the first day of each of the Company’s fiscal quarters commencing April 1, 2006, by an amount equal the lesser of (i) 15% of the total increase in the number of shares of common stock outstanding during the previous fiscal quarter, or (ii) a lesser number of shares of common stock as determined by the board of directors. The exercise price for consultants cannot be less than 75% of the fair market value of the common stock on the grant date. The exercise price for all others can not be less than 100% of the fair market value of the common stock on the grant date for incentive stock options and can not be less than 75% of the fair market value of the common stock on the grant date for non-qualified stock options. The Plan Administrator shall establish the option term or, if not so established, shall be ten years from the grant date. As at March 31, 2009, the Company had 3,458,750 stock options available for granting pursuant to the 2006 Plan.
	The Company’s 2004 Non-qualified Stock Option Plan (the “2004 Plan”) is intended to provide incentives to employees, directors and consultants by providing them with opportunities to purchase shares of our common stock. The 2004 Plan is effective as of June 17, 2004 and all stock options granted under the 2004 Plan must be granted within ten years from the date the 2004 Plan was adopted. The Company originally registered the 2004 Plan on June 17, 2004 pursuant to a registration statement on Form S-8. Effective April 6, 2005, the Company amended the 2004 Plan and increased the total of common shares reserved for issuance under the 2004 Plan from one million to a total of four million common shares. The Board of Directors is authorized to administer the 2004 Plan. In doing so, the Board of Directors may: (i) designate optionees; (ii) determine the terms and provisions of respective option agreements (which need not be identical) including, but not limited to, the number of shares to be covered by each option, provisions concerning the time or times when and the extent to which the options may be exercised, and the nature and duration of restrictions as to transferability or restrictions constituting substantial risk of forfeiture; (iii) accelerate the right of an optionee to exercise, in whole or in part, any previously granted option; (iv) interpret the provisions and supervise the administration of the 2004 Plan; (v) determine the fair market value of shares issuable under the 2004 Plan; (vi) designate the type of options to be granted to an optionee; and (vii) determine any other matter which is necessary or desirable for, or incidental to, the administration of the 2004 Plan. As at March 31, 2009, the Company had 2,800,000 stock options available for granting pursuant to the 2004 Plan.
	A summary of the Company’s stock option activity is as follows:

			Weighted Average	Aggregate
	Number of		Exercise Price	Intrinsic Value
	Options		$	$
Outstanding, June 30, 2008	4,175,000		0.26
Expired	(300,000	)	0.25
Outstanding, March 31, 2009	3,875,000		0.26	–
Exercisable, March 31, 2009	3,875,000		0.26	–

F-12

Canyon Copper Corp.

(An Exploration Stage Company)

Notes to the Financial Statements

(Expressed in U.S. dollars)

(unaudited)

8.	Stock Options (continued)
	As at March 31, 2009, the weighted average remaining contractual life of the outstanding stock options is 3.36 years.
	As at March 31, 2009, the Company had no unvested options outstanding.
9.	Share Purchase Warrants
	The following table summarizes the continuity of the Company’s share purchase warrants:

			Weighted
			Average
			Exercise
	Number of		Price
	Warrants		$
Balance, June 30, 2008	1,366,667		0.31
Issued	4,900,000		0.12
Expired	(166,667	)	0.40
Balance, March 31, 2009	6,100,000		0.16

As at March 31, 2009, the following share purchase warrants were outstanding:

	Exercise
Number of	Price
Warrants	$	Expiry Date
1,200,000	0.30	August 15, 2009
4,900,000	0.12	August 17, 2010
6,100,000

10.	Legal Proceeding
	On January 23, 2007, Focused Investor Relations Marketing Inc. commenced an action in Ontario, Canada against the Company seeking payment in the amount of $84,000 pursuant to an oral agreement. The Company believes that this action is without merit and will defend its position vigorously.
11.	Subsequent Event
	Subsequent to March 31, 2009, the Board of Directors of the Company approved a one-for-three reverse split of the Company’s common stock. Upon completion of the reverse stock split, the Company’s authorized capital of common stock will be decreased from 500,000,000 shares, par value $0.00001 per share, to 166,666,666 shares, par value $0.00001 per share, and the issued and outstanding common stock will be reduced from 76,881,399 shares to 25,627,133 shares. The Reverse Stock Split is expected to be effective by the end of May 2009.

F-13

ITEM 2. MANAGEMENT'S DISCUSSIONANDANALYSISOFFINANCIALCONDITIONANDRESULTS OF OPERATIONS.

CAUTIONARY STATEMENT REGARDING FORWARD-LOOKING STATEMENTS

Certain statements contained in this Quarterly Report on Form 10-Q constitute "forward-looking statements.” These statements, identified by words such as “plan,” "anticipate,” "believe,” "estimate,” "should,” "expect" and similar expressions include our expectations and objectives regarding our future financial position, operating results and business strategy. These statements reflect the current views of management with respect to future events and are subject to risks, uncertainties and other factors that may cause our actual results, performance or achievements, or industry results, to be materially different from those described in the forward-looking statements. Such risks and uncertainties include those set forth under the caption “Part II - - Item 1A. Risk Factors” and elsewhere in this Quarterly Report on Form 10-Q. We do not intend to update the forward-looking information to reflect actual results or changes in the factors affecting such forward-looking information. We advise you to carefully review the reports and documents, particularly our annual reports, quarterly reports and current reports we file from time to time with the Securities and Exchange Commission (the “SEC”).

OVERVIEW

We were incorporated on January 21, 2000 under the laws of the State of Nevada under the name “Aberdene Mines Limited.” We subsequently changed our name to “Canyon Copper Corp.” on August 8, 2006.

We are an exploration stage company engaged in the acquisition, exploration and development of mineral properties. We currently hold 100% title in two major claim blocks comprising a total of 1,332 mineral claims, covering approximately 27,440 acres located in Mineral County, Nevada (the “New York Canyon Claims”). We also hold 21 patented mineral claims covering an area of approximately 420 acres, located within the vicinity of the New York Canyon Claims area. We collectively refer to the New York Canyon Claims and the patented claims as the “New York Canyon Project.”

We have not earned any revenues to date and do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties. We are presently in the exploration stage of our business and we can provide no assurance that commercially viable mineral deposits exist on our claims or that we will discover commercially exploitable levels of mineral resources on our properties, or if such deposits are discovered, that we will enter into further substantial exploration programs.

Recent Corporate Developments

Since our quarter ended December 31, 2008, we experienced the following significant corporate developments:

1.	On January 13, 2009, we entered into amendments to our loan agreements dated September 12, 2006 and September 11, 2006, respectively, with Aton Ventures Fund Ltd. (“AVF”) and Asset Protection Fund Ltd. (“APF”) (together the “Lenders”) whereby the Lenders loaned $500,000 to us. Under the terms of the amendment agreements, AVF agreed to extend the maturity date of its loan to April 12, 2010 and APF agreed to extend the maturity date of its loan to April 11, 2010. In consideration of the Lenders agreeing to extend the term of their respective loans, we agreed to increase the interest rate on each of the loans to 15% per annum effective January 12, 2009.
2.	Also on January 13, 2009, we entered into amendments to our loan agreements dated April 1, 2008, May 8, 2008 and July 7, 2008 with Anthony R. Harvey, our Chief Executive Officer, Chairman and a member of our Board of Directors, whereby Mr. Harvey loaned to us $25,000 USD, $25,000 CDN and $25,000 CDN, respectively. Under the terms of the amendment agreements, Mr. Harvey agreed to extend the terms of his loans to January 1, 2010, February 8, 2010 and April 7, 2010, respectively.
3.	On February 12, 2009, John Carlesso resigned as a member of our Board of Directors. Mr. Carlesso resigned to pursue other business opportunities. There was no disagreement between Mr. Carlesso and us regarding any matter relating to our operations, policies or practices.
4.	On April 15, 2009, we appointed James Yates as a member of our Board of Directors.

3

5. Also on April 15, 2009, our Board of Directors approved a one-for-three reverse split of our common stock (the “Reverse Stock Split”). Upon completion of the Reverse Stock Split, our authorized capital of common stock will be decreased from 500,000,000 shares, par value $0.00001 per share, to 166,666,666 shares, par value $0.00001 per share, and the issued and outstanding common stock will be reduced from 76,881,399 shares to 25,627,133 shares. The Reverse Stock Split is expected to be effective on May 15, 2009.

PLAN OF OPERATION

The following discussion and analysis summarizes our plan of operation for the next twelve months, our results of operations for the three and nine month periods ended March 31, 2009 and changes in our financial condition from June 30, 2008. This discussion should be read in conjunction with the Management’s Discussion and Analysis of Financial Condition and Results of Operation included in our Annual Report on Form 10-K for the year ended June 30, 2008 filed with the SEC on September 29, 2008.

Our plan of operation for the next twelve months is to continue our initial exploration activities of the New York Canyon Project in Nevada. Our estimated expenses for the next twelve months are as follows:

		12 Month Total
ITEM AND ACTIVITY		Budget
LAND STATUS
2009 - 2010 unpatented claim maintenance fees	$	175,000
Monthly Payments – Patented Claims		45,000
PERMITTING
Road and drill site work		50,000
Archeological and biological surveys		20,000
Water quality monitoring		20,000
Drill Permitting & Bonding		100,000
Reclamation		20,000
DRILL PROGRAM
(includes assays & supervision)
Compile data for engineering evaluation		60,000
Drilling Reverse Circular		900,000
Drilling Core		600,000
METALLURGICAL PROGRAM
Investigation into acid costs, sites, transport, etc.		-
Preliminary metallurgical work		105,000
Preliminary alternative leach studies		150,000
ENGINEERING & REPORTING
Engineering Reports		20,000
Modeling, Scoping study		50,000
GEOPHYSICAL SURVEYS
Induced polarization		70,000
Airborne radiometric survey		65,000
GEOLOGICAL MAPPING AND INVESTIGATIONS
Mapping and sampling		50,000
Contingency 10%		250,000
Management fee 5%		125,000
GENERAL AND ADMINISTRATIVE EXPENSES
General and Administrative		325,000
TOTAL	$	3,200,000

4

Our plan of operation calls for significant expenses in connection with the exploration of the New York Canyon Project and requires us to obtain additional financing. We recorded a net loss of $467,693 for the nine months ended March 31, 2009 and have an accumulated deficit of $17,544,165 since inception. As at March 31, 2009, we had cash of $72,444 and, for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $3,200,000. Accordingly, we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures.

We have not had revenues since inception. We are currently seeking to identify sources of additional financing. However, there is no assurance we will be successful in raising the necessary funding or on terms that are acceptable to us. Since inception, we have been dependent on investment capital and debt financing from third parties as our primary source of liquidity. We anticipate continuing to rely on equity sales of shares of our common stock and loans in order to continue to fund our business operations. Issuances of additional shares will result in further dilution of our existing shareholders. See “Future Financings” below.

RESULTS OF OPERATIONS

Three Months and Nine Months Summary

		Three Months Ended					Percentage		Nine Months Ended					Percentage
		March 31					Increase /		March 31					Increase /
		2009			2008		(Decrease)		2009			2008		(Decrease)
Revenue	$	-		$	-		n/a	$	-		$	-		n/a
Operating		(72,063	)		(168,275	)	(57.2)%		(421,840	)		(1,082,312	)	(61.0)%
Expenses
Other Income		38,117			(73,847	)	(151.6)%		(45,853	)		(38,239	)	19.9%
(Expenses)
Net Loss	$	(33,946	)	$	(242,122	)	(86.0)%	$	(467,693	)	$	(1,120,551	)	(58.3)%

Revenues

We have not earned any revenues to date and do not anticipate earning revenues until such time as we enter into commercial production of our mineral properties. There can be no assurance that we will be successful in discovering commercial quantities or that we can commercially produce metals or minerals. We are presently an exploration stage company engaged in the search for mineral reserves. We can provide no assurances that we will be able to discover any commercially exploitable levels of mineral resources on our property, or, even if such resources are discovered, that we will be able to enter into commercial production of our mineral properties.

Expenses

Our expenses for the three and nine month periods ended March 31, 2009 and 2008 consisted of the following:

		Three Months Ended					Percentage		Nine Months Ended				Percentage
		March 31					Increase /		March 31				Increase /
		2009			2008		(Decrease)		2009			2008	(Decrease)
Operating
Expenses:
Foreign exchange	$	(12,947	)	$	(9,159	)	41.4%	$	(73,974	)	$	1,676	(4,513.7)%
loss (gain)
General and		69,900			154,833		(54.9)%		258,076			823,228	(68.7)%
administrative
Mineral exploration		15,110			22,601		(33.1)%		237,738			257,408	(7.6)%
costs
Sub-total	$	72,063		$	168,275		(57.2)%	$	421,840		$	1,082,312	(61.0)%

5

		Three Months Ended				Percentage		Nine Months Ended					Percentage
		March 31				Increase /		March 31					Increase /
		2009			2008	(Decrease)		2009			2008		(Decrease)
Other Expenses:
Accretion of		89,160			45,691	95.1%		157,400			99,611		58.0%
discounts on
convertible debt
(Gain) Loss on		(405,594	)		7,151	(5,771.9)%		(422,115	)		(20,373	)	1,971.9%
change in fair
values of beneficial
conversion
features
Interest expense		28,884			21,005	37.5%		75,944			63,407		19.8%
Gain on settlement		(3,021	)		-	n/a		(3,021	)		-		n/a
of debt
Loss on		252,454			-	n/a		252,454			-		n/a
extinguishment of
debt
(Recovery)		-			-	n/a		(14,809	)		(104,406	)	(85.8)%
impairment loss on
investment
securities
Sub-total	$	(38,117	)	$	73,847	(151.6)%	$	45,853		$	38,239		19.9%
Total Expenses	$	33,946 $			242,122	(86.0)%	$	467,693		$	1,120,551		(58.3)%

Our operating expenses decreased from $168,275, during the quarter ended March 31, 2008, to $72,063, during the quarter ended March 31, 2009. The decrease in our operating expenses is due to the fact our general and administration expenses decreased during the period.

General and administration expenses consist of consulting fees and professional fees. Our general and administration expenses were higher during the quarter ended March 31, 2008 as compared to March 31, 2009 due to the fact that we incurred stock based compensation expense of $59,899 during the quarter ended March 31, 2008.

Mineral exploration costs consisted of annual payments and lease payments in connection with maintaining the New York Canyon Project in good standing.

During the nine months ended March 31, 2009, we received distribution proceeds of $14,809 in connection with Langley Park’s liquidation.

We anticipate that our expenses will increase over the next twelve months due to our ongoing planned exploration activities on the New York Canyon Project.

LIQUIDITY AND CAPITAL RESOURCES

Working Capital
							Percentage
		At March 31, 2009			At June 30, 2008		Increase / Decrease
Current Assets	$	77,022		$	26,015		196.1%
Current Liabilities		(1,397,269	)		(1,404,372	)	(0.5)%
Working Capital (Deficit)	$	(1,320,247	)	$	(1,378,357	)	(4.2)%

6

Cash Flows
		Nine Months Ended			Nine Months Ended
		March 31, 2009			March 31, 2008
Cash Used in Operating Activities	$	(472,520	)	$	(427,339	)
Cash Provided by (Used in) Investing Activities		14,809			104,406
Cash Provided by Financing Activities		514,575			300,000
Net Increase (decrease) in Cash During Period	$	56,864		$	(22,933	)

The slight decrease in our working capital deficit from $1,378,357 as at June 30, 2008 to a working capital deficit of $1,320,247 as at March 31, 2009 was primarily a result of the fact that received $490,000 in proceeds from the completion of our private placement on August 18, 2008. During the nine months ended March 31, 2009, we also received a loan of CDN $25,000 from Mr. Harvey. The loan bears interest at a rate of 15% per annum and is due on or before April 7, 2010. The proceeds of these financings were used to fund our mineral lease payments and for general and administrative expenses.

Future Financings

Our plan of operation calls for significant expenses in connection with the exploration of the New York Canyon Project and requires us to obtain additional financing. We recorded a net loss of $467,693 for the nine months ended March 31, 2009 and have an accumulated deficit of $17,544,165 since inception. As at March 31, 2009, we had cash of $72,444 and, for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $3,200,000. Accordingly, we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures. There is no assurance that we will be able to obtain additional financing in the future.

On March 29, 2007, we entered into an engagement letter with Union Securities Ltd. (“Union”) pursuant to which Union agreed to act as our sponsor in connection with a proposed listing of our common stock on a Canadian stock exchange and to act as our agent for a proposed equity offering of a minimum of $6,000,000 and a maximum of $12,000,000 in units to non-US residents pursuant to Regulation S of the Securities Act. Each unit is expected to consist of one common share and one share purchase warrant to purchase an additional common share at a price to be determined for a period of 18 months from the closing of the offering. We have agreed to pay Union a sponsorship fee of $25,000 (which fee has been paid), a cash commission equal to 8% of the proceeds received from units sold and options to acquire additional shares of our common stock equal to 10% of the number of units sold. As a condition of the engagement letter, on or before the closing of the offering, we must provide Union with a copy of our final listing application and the conditional listing approval of the Canadian stock exchange. Due to market conditions, it is highly unlikely that we will be able to complete the proposed equity offering as contemplated.

On August 1, 2007, we approved an offering on a private placement basis of up to 2,000,000 units at a price of $0.25 per unit pursuant to Regulation S of the Securities Act. Each unit consists of one share of the Corporation’s common stock and one share purchase warrant, each warrant entitling the holder thereof to purchase an additional share of our common stock for a period of one year from the date of issuance at an exercise price of $0.30 per share. On August 15, 2007, we issued 1,200,000 units to one subscriber. The balance of the offering has not been closed and there is no assurance that the remaining units will be sold.

Obtaining additional financing is subject to a number of factors, including the market prices for the mineral property and copper and our proposed listing of our common stock on a Canadian stock exchange. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. Since our inception, we have used our common stock to raise money for our operations and for our property acquisitions. We have not attained profitable operations and are dependent upon obtaining financing to pursue our plan of operation. For these reasons, our independent auditors believe there exists a substantial doubt about our ability to continue as a going concern.

OFF-BALANCE SHEET ARRANGEMENTS

None.

7

CRITICAL ACCOUNTING POLICIES

We have identified certain accounting policies, described below, that are most important to the portrayal of our current financial condition and results of operations. Our significant accounting policies are disclosed in Note 2 to the interim financial statements included in this Quarterly Report.

Use of Estimates

The preparation of financial statements in accordance with United States generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities at the date of the financial statements and the reported amounts of revenue and expenses in the reporting period. We regularly evaluate estimates and assumptions related to long-lived assets, derivative liabilities, asset retirement obligations, stock-based compensation and deferred income tax asset valuations. We base our estimates and assumptions on current facts, historical experience and various other factors that it believes to be reasonable under the circumstances, the results of which form the basis for making judgments about the carrying values of assets and liabilities and the accrual of costs and expenses that are not readily apparent from other sources. The actual results experienced by us may differ materially and adversely from our estimates. To the extent there are material differences between the estimates and the actual results, future results of operations will be affected.

Mineral Property Costs

We have been in the exploration stage since its inception on January 21, 2000, and have not yet realized any revenues from our planned operations. We are primarily engaged in the acquisition and exploration of mining properties. Mineral property exploration costs are expensed as incurred. Mineral property acquisition costs are initially capitalized when incurred using the guidance in EITF 04-02, “Whether Mineral Rights Are Tangible or Intangible Assets.” We assess the carrying costs for impairment under SFAS 144, “Accounting for Impairment or Disposal of Long Lived Assets” at each fiscal quarter end. When it has been determined that a mineral property can be economically developed as a result of establishing proven and probable reserves, the costs then incurred to develop such property, are capitalized. Such costs will be amortized using the units-of-production method over the estimated life of the probable reserve. If mineral properties are subsequently abandoned or impaired, any capitalized costs will be charged to operations.

Stock-Based Compensation

We record stock based compensation in accordance with SFAS 123(R), “Share-Based Payments,” which requires the measurement and recognition of compensation expense, based on estimated fair values, for all share-based awards, made to employees and directors, including stock options.

SFAS 123(R) requires companies to estimate the fair value of share-based awards on the date of grant using an option-pricing model. We use the Black-Scholes option-pricing model as its method of determining fair value. This model is affected by our stock price as well as assumptions regarding a number of subjective variables. These subjective variables include, but are not limited to our expected stock price volatility over the term of the awards, and actual and projected employee stock option exercise behaviors. The value of the portion of the award that is ultimately expected to vest is recognized as an expense in the statement of operations over the requisite service period.

All transactions in which goods or services are the consideration received for the issuance of equity instruments are accounted for based on the fair value of the consideration received or the fair value of the equity instrument issued, whichever is more reliably measurable.

ITEM 3. QUANTITATIVE AND QUALITATIVE DISCLOSURES ABOUT MARKET RISK.

Not Applicable.

8

ITEM 4T. CONTROLS AND PROCEDURES.

Disclosure Controls and Procedures

We carried out an evaluation of the effectiveness of our disclosure controls and procedures (as defined in Exchange Act Rules 13a-15(e) and 15d-15(e)) as of March 31, 2009 (the “Evaluation Date”).  This evaluation was carried out under the supervision and with the participation of our Chief Executive Officer and Chief Financial Officer.  Based upon that evaluation, our Chief Executive Officer and Chief Financial Officer concluded that our disclosure controls and procedures were not effective as of the Evaluation Date as a result of the material weaknesses disclosed in our Annual Report on Form 10-K for the year ended June 30, 2008 (the “2008 Annual Report”).

Disclosure controls and procedures are those controls and procedures that are designed to ensure that information required to be disclosed in our reports filed or submitted under the Exchange Act are recorded, processed, summarized and reported within the time periods specified in the SEC's rules and forms. Disclosure controls and procedures include, without limitation, controls and procedures designed to ensure that information required to be disclosed in our reports filed under the Exchange Act is accumulated and communicated to management, including our Chief Executive Officer and Chief Financial Officer, to allow timely decisions regarding required disclosure.

Notwithstanding the assessment that our internal control over financial reporting was not effective and that there were material weaknesses as identified in our 2008 Annual Report, we believe that our financial statements contained in our Quarterly Report on Form 10-Q for the quarter ended March 31, 2009 fairly present our financial condition, results of operations and cash flows in all material respects.

Changes in Internal Control Over Financial Reporting

There were no changes in our internal control over financial reporting that occurred during the fiscal quarter ended March 31, 2009 that have materially affected, or that are reasonably likely to materially affect, our internal control over financial reporting.

9

PART II - OTHER INFORMATION

ITEM 1. LEGAL PROCEEDINGS.

Other than as previously disclosed in our Annual Report for the fiscal year ended June 30, 2008, we are not party to any legal proceedings and there have been no material developments to the proceedings previously disclosed in our Annual Report.

ITEM 1A. RISK FACTORS.

The following are some of the important factors that could affect our financial performance or could cause actual results to differ materially from estimates contained in our forward-looking statements. We may encounter risks in addition to those described below. Additional risks and uncertainties not currently known to us, or that we currently deem to be immaterial, may also impair or adversely affect our business, financial condition or results of operation.

If we do not obtain additional financing, our business will fail.

Our current operating funds are inadequate to complete our planned exploration of the New York Canyon Project and to meet our general and administrative expenses. Our business plan calls for significant expenses in connection with the exploration and development of those mineral claims. As a result, we will require additional financing to complete our exploration and development plans. We will also require additional financing if the costs of exploration are greater than anticipated and to sustain our business operations if we are not successful in earning revenues once exploration is complete. Obtaining additional financing would be subject to a number of factors, the known material factors being market prices for copper, investor acceptance of our mineral claims, and investor sentiment. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us.

If we complete a financing through the sale of additional shares of our common stock, shareholders will experience dilution.

The most likely source of future financing presently available to us is through the issuance of our common stock. Any sale of share capital will result in dilution to existing shareholders. The only other anticipated alternative for the financing of further exploration would be the offering by us of an interest in our properties to be earned by another party or parties carrying out further exploration thereof, which is not presently contemplated.

In order to maintain our rights to the New York Canyon Project, we will be required to make annual filings with federal and state regulatory agencies and/or be required to complete assessment work on the New York Canyon Project.

In order to maintain our rights to the New York Canyon Project, we will be required to make annual filings with federal and state regulatory authorities. In addition, we may be required by federal and/or state legislation or regulations to complete minimum annual amounts of mineral exploration work on the New York Canyon Project. A failure by us to meet the annual maintenance requirements under federal and state laws could cause our rights to the New York Canyon Project to lapse.

We lack an operating history and have losses which we expect to continue into the future. As a result, we may have to suspend or cease exploration activities and if we do not obtain additional financing, our business will fail.

We have been involved primarily in organizational activities, the acquisition of mineral claims and the exploration and development on these claims. Our ability to achieve and maintain profitability and positive cash flow is dependent upon:

(i)	our ability to locate a profitable mineral property; and
(ii)	our ability to generate revenues.

10

Our plan of operation calls for significant expenses in connection with the exploration of the New York Canyon Project, which will require us to obtain additional financing. We recorded a net loss of $544,165 for the nine months ended March 31, 2009 and have an accumulated deficit of $17,544,165 since inception. As at March 31, 2009, we had cash of $72,444 and for the next twelve months, management anticipates that the minimum cash requirements to fund our proposed exploration program and our continued operations will be $3,200,000. Accordingly we do not have sufficient funds to meet our planned expenditures over the next twelve months and will need to seek additional financing to meet our planned expenditures.

Obtaining additional financing would be subject to a number of factors, including the market prices for the mineral property and base and precious metals. These factors may make the timing, amount, terms or conditions of additional financing unavailable to us. Since our inception, we have used our common stock to raise money for our operations and for our property acquisitions. We have not attained profitable operations and are dependent upon obtaining financing to pursue our plan of operation. For these reasons, our independent auditors believe there exists a substantial doubt about our ability to continue as a going concern.

Because we have not commenced business operations, we face a high risk of business failure.

We have not earned any revenues as of the date of this report. Potential investors should be aware of the difficulties normally encountered by new mineral exploration companies and the high rate of failure of such enterprises. The likelihood of success must be considered in light of the problems, expenses, difficulties, complications and delays encountered in connection with the exploration of the mineral properties that we plan to undertake. These potential problems include, but are not limited to, unanticipated problems relating to exploration, and additional costs and expenses that may exceed current estimates.

We have no known mineral reserves and if we cannot find any, we will have to cease operations.

We have no mineral reserves. Mineral exploration is highly speculative. It involves many risks and is often non-productive. Even if we are able to find mineral reserves on our property our production capability is subject to further risks including:

• Costs of bringing the property into production including exploration work, preparation of production feasibility studies, and construction of production facilities, all of which we have not budgeted for;
• Availability and costs of financing;
• Ongoing costs of production; and
• Environmental compliance regulations and restraints.

The marketability of any minerals acquired or discovered may be affected by numerous factors which are beyond our control and which cannot be accurately predicted, such as market fluctuations, the lack of milling facilities and processing equipment near the New York Canyon Project and such other factors as government regulations, including regulations relating to allowable production, exporting of minerals, and environmental protection. If we do not find a mineral reserve or define a mineral inventory containing gold, silver, copper, zinc or iron or if we cannot explore the mineral reserve, either because we do not have the money to do it or because it will not be economically feasible to do it, we will have to cease operations and investors will lose their investment.

Because we anticipate our operating expenses will increase prior to our earning revenues, we may never achieve profitability.

Prior to completion of our exploration stage, we anticipate that we will incur increased operating expenses without realizing any revenues. We therefore expect to incur significant losses into the foreseeable future. We recognize that if we are unable to generate significant revenues from the exploration of our mineral claims and the production of minerals thereon, if any, we will not be able to earn profits or continue operations. There is no history upon which to base any assumption as to the likelihood that we will prove successful, and we may not be able to ever generate any operating revenues or achieve profitable operations. If we are unsuccessful in addressing these risks, our business will most likely fail.

11

Because of the inherent dangers involved in mineral exploration, there is a risk that we may incur liability or damages if and when we conduct mineral exploration activities.

The search for valuable minerals involves numerous hazards. As a result, if and when we conduct exploration activities we may become subject to liability for such hazards, including pollution, cave-ins and other hazards against which we cannot insure or against which we may elect not to insure. The payment of such liabilities may have a material adverse effect on our financial position.

If the price of base and precious metals declines, our financial condition and ability to obtain future financings will be impaired.

The price of base and precious metals is affected by numerous factors, all of which are beyond our control. Factors that tend to cause the price of base and precious metals to decrease include the following:

(a)	Sales or leasing of base and precious metals by governments and central banks;
(b)	A low rate of inflation and a strong US dollar;
(c)	Speculative trading;
(d)	Decreased demand for base and precious metals industrial, jewelry and investment uses;
(e)	High supply of base and precious metals from production, disinvestment, scrap and hedging;
(f)	Sales by base and precious metals producers and foreign transactions and other hedging transactions; and
(g)	Devaluing local currencies (relative to base and precious metals price in US dollars) leading to lower production costs and higher production in certain major base and precious metals producing regions.

Our business is dependent on the price of base and precious metals. We have not undertaken hedging transactions in order to protect us from a decline in the price of base and precious metals. A decline in the price of base and precious metals may also decrease our ability to obtain future financings to fund our planned development and exploration programs.

Because we are an exploration stage company, our business has a high risk of failure.

As noted in the financial statements that are included with this report, we are an exploration stage company that has incurred net losses since inception, we have not attained profitable operations and we are dependent upon obtaining adequate financing to complete our exploration activities. These conditions, as indicated in our audit report on our Annual Report on Form 10-K for the year ended June 30, 2008 filed with the SEC on September 29, 2008, raise substantial doubt as to our ability to continue as a going concern. The success of our business operations will depend upon our ability to obtain further financing to complete our planned exploration program and to attain profitable operations. If we are not able to complete a successful exploration program and attain sustainable profitable operations, then our business will fail.

If we are unable to hire and retain key personnel, we may not be able to implement our business plan.

Our success is dependent upon the performance of key personnel working full-time in management, supervisory and administrative capacities or as consultants. This is particularly true in highly technical businesses such as mineral exploration. These individuals are in high demand and we may not be able to attract the personnel we need. The loss of the services of senior management or key personnel could have a material and adverse effect on us, our business and results of operations. Failure to hire key personnel when needed, or on acceptable terms, would have a significant negative effect on our business.

As we undertake exploration of our mineral claims, we will be subject to compliance with government regulation that may increase the anticipated cost of our exploration program.

There are several governmental regulations that materially restrict mineral exploration. We are required to obtain work permits, post bonds and perform remediation work for any physical disturbance to the land in order to comply with these laws. If we enter the production phase, the cost of complying with permit and regulatory environment laws will be greater because the impact on the project area is greater. Permits and regulations will control all aspects of the production program if the project continues to that stage. Examples of regulatory requirements include:

12

(a)	Water discharge will have to meet drinking water standards;
(b)	Dust generation will have to be minimal or otherwise re-mediated;
(c)	Dumping of material on the surface will have to be re-contoured and re-vegetated with natural vegetation;
(d)	An assessment of all material to be left on the surface will need to be environmentally benign;
(e)	Ground water will have to be monitored for any potential contaminants;
(f)	The socio-economic impact of the project will have to be evaluated and if deemed negative, will have to be re-mediated; and
(g)	There will have to be an impact report of the work on the local fauna and flora including a study of potentially endangered species.

There is a risk that new regulations could increase our costs of doing business and prevent us from carrying out our exploration program. We will also have to sustain the cost of reclamation and environmental remediation for all exploration work undertaken. Both reclamation and environmental remediation refer to putting disturbed ground back as close to its original state as possible. Other potential pollution or damage must be cleaned-up and renewed along standard guidelines outlined in the usual permits. Reclamation is the process of bringing the land back to its natural state after completion of exploration activities. Environmental remediation refers to the physical activity of taking steps to remediate, or remedy, any environmental damage caused. The amount of these costs is not known at this time as we do not know the extent of the exploration program that will be undertaken beyond completion of the recommended work program. If remediation costs exceed our cash reserves we may be unable to complete our exploration program and have to abandon our operations.

If we become subject to increased environmental laws and regulation, our operating expenses may increase.

Our development and production operations are regulated by both US Federal and Nevada state environmental laws that relate to the protection of air and water quality, hazardous waste management and mine reclamation. These regulations will impose operating costs on us. If the regulatory environment for our operations changes in a manner that increases costs of compliance and reclamation, then our operating expenses would increase with the result that our financial condition and operating results could be adversely affected.

Because our stock is a penny stock, stockholders will be more limited in their ability to sell their stock.

The SEC has adopted rules that regulate broker-dealer practices in connection with transactions in penny stocks. Penny stocks are generally equity securities with a price of less than $5.00, other than securities registered on certain national securities exchanges or quoted on the Nasdaq system, provided that current price and volume information with respect to transactions in such securities is provided by the exchange or quotation system.

Because our securities constitute "penny stocks" within the meaning of the rules, the rules apply to us and to our securities. The rules may further affect the ability of owners of shares to sell our securities in any market that might develop for them. As long as the quotation price of our common stock is less than $5.00 per share, the common stock will be subject to Rule 15g-9 under the Exchange Act. The penny stock rules require a broker-dealer, prior to a transaction in a penny stock, to deliver a standardized risk disclosure document prepared by the SEC, that:

1.	contains a description of the nature and level of risk in the market for penny stocks in both public offerings and secondary trading;
2.	contains a description of the broker's or dealer's duties to the customer and of the rights and remedies available to the customer with respect to a violation to such duties or other requirements of securities laws;
3.	contains a brief, clear, narrative description of a dealer market, including bid and ask prices for penny stocks and the significance of the spread between the bid and ask price;
4.	contains a toll-free telephone number for inquiries on disciplinary actions;
5.	defines significant terms in the disclosure document or in the conduct of trading in penny stocks; and
6.	contains such other information and is in such form, including language, type, size and format, as the SEC shall require by rule or regulation.

13

The broker-dealer also must provide, prior to effecting any transaction in a penny stock, the customer with: (a) bid and offer quotations for the penny stock; (b) the compensation of the broker-dealer and its salesperson in the transaction; (c) the number of shares to which such bid and ask prices apply, or other comparable information relating to the depth and liquidity of the market for such stock; and (d) a monthly account statements showing the market value of each penny stock held in the customer's account. In addition, the penny stock rules require that, prior to a transaction in a penny stock not otherwise exempt from those rules, the broker-dealer must make a special written determination that the penny stock is a suitable investment for the purchaser and receive the purchaser's written acknowledgment of the receipt of a risk disclosure statement, a written agreement to transactions involving penny stocks, and a signed and dated copy of a written suitability statement. These disclosure requirements may have the effect of reducing the trading activity in the secondary market for our stock.

ITEM 2. UNREGISTERED SALES OF EQUITY SECURITIES AND USE OF PROCEEDS.

None.

ITEM 3. DEFAULTS UPON SENIOR SECURITIES.

None.

ITEM 4. SUBMISSION OF MATTERS TO A VOTE OF SECURITY HOLDERS.

None.

ITEM 5. OTHER INFORMATION.

None.

ITEM 6. EXHIBITS.

The following exhibits are either provided with this Quarterly Report on Form 10-Q or are incorporated herein by reference.

Exhibit
Number	Description of Exhibit
3.1	Amended and Restated Articles of Incorporation.(15)
3.2	Bylaws.(1)
4.1	Specimen Stock Certificate.(15)
10.1	2004 Nonqualified Stock Option Plan.(4)
10.2	2006 Stock Incentive Plan dated April 5, 2006.(11)
10.3	Convertible Preferred Stock Purchase Agreement dated July 29, 2004 between the Company and Langley Park Investments PLC.(5)
10.4	Debenture Purchase Agreement dated November 19, 2004 between the Company and Glenkirk International.(7)
10.5	Convertible, Callable, Subordinated Debenture dated November 19, 2004 between the Company and Glenkirk International.(7)
10.6	Property Option Agreement dated March 18, 2004 among the Company, Robert & Sharon Weicker, Kurt & Tami Schendel, and Nevada Sunrise LLC (New York Canyon Project).(3)
10.7	Lease Agreement dated July 21, 2004 between the Company and Jaycor Mining, Inc.(6)
10.8	Consulting Agreement dated April 5, 2005 between the Company and Anthony Harvey.(8)
10.9	Consulting Agreement dated August 5, 2005 between the Company and Chris Broili.(12)
10.10	Consulting Agreement dated August 10, 2005 between the Company and Mel Klohn.(12)

14

Exhibit
Number	Description of Exhibit
10.11	Consulting Agreement dated August 22, 2005 between the Company and Carlo Civelli.(12)
10.12	Consulting Agreement dated September 20, 2005 between the Company and Richard Dixon.(12)
10.13	Consulting Agreement dated September 20, 2005 between the Company and Richard Kehmeier.(12)
10.14	Consulting Agreement dated January 6, 2006 between the Company and Kurt Bordian.(10)
10.15	Consulting Agreement dated January 19, 2006 between the Company and Mark A. Reynolds.(9)
10.16	Consulting Agreement dated February 1, 2006 between the Company and Linda Erdman.(9)
10.17	Consulting Agreement dated February 1, 2006 between the Company and Geoffrey Goodall.(9)
10.18	Consulting Agreement dated February 1, 2006 between the Company and Robert Young.(12)
10.19	Debt Settlement Agreement dated November 8, 2005 between the Company and Cameron Reynolds.(12)
10.20	Mineral Processing Research Agreement dated March 22, 2006 among the Company, Nevada Sunrise, LLC and INTOR Resources Corporation.(12)
10.21	Loan Agreement dated September 12, 2006 between the Company and Aton Ventures Fund Ltd.(13)
10.22	Loan Agreement dated September 11, 2006 between the Company and Asset Protection Fund Ltd.(13)
10.23	Convertible Promissory Note dated September 12, 2006 between the Company and Aton Ventures Fund Ltd.(13)
10.24	Convertible Promissory Note dated September 11, 2006 between the Company and Asset Protection Fund Ltd.(13)
10.25	Promissory Note dated August 16, 2006 between the Company and Anthony Harvey.(14)
10.26	First Amendment Loan Agreement dated November 27, 2006 between the Company and Aton Ventures Fund Ltd.(16)
10.27	First Amendment to Loan Agreement dated November 27, 2006 between the Company and Asset Protection Fund Ltd.(16)
10.28	Convertible Promissory Note dated November 27, 2006 between the Company and Aton Ventures Fund Ltd.(16)
10.29	Convertible Promissory Note dated November 27, 2006 between the Company and Asset Protection Fund Ltd.(16)
10.30	Quitclaim Deed for the New York Canyon Project dated March 12, 2007.(17)
10.31	Sponsorship Agreement dated March 29, 2007 between the Company and Union Securities Ltd.(18)
10.32	Engagement Letter dated March 29, 2007 between the Company and Union Securities Ltd.(18)
10.33	Second Amendment to Loan Agreement dated April 12, 2007 between the Company and Aton Ventures Fund Ltd.(18)
10.34	Second Amendment to Loan Agreement dated April 11, 2007 between the Company and Asset Protection Fund Ltd.(18)
10.35	Loan Agreement dated April 25, 2007 between the Company and Aton Select Fund Limited.(18)
10.36	Loan Agreement dated April 25, 2007 between the Company and Anthony Harvey for the loan of CDN $50,000.(18)
10.37	Loan Agreement dated April 25, 2007 between the Company and Anthony Harvey for the loan of $100,000.(18)
10.38	Promissory Note dated April 25, 2007 between the Company and Aton Select Fund Limited.(18)
10.39	Promissory Note dated April 25, 2007 between the Company and Anthony Harvey for the loan of CDN $50,000.(18)
10.40	Promissory Note dated April 25, 2007 between the Company and Anthony Harvey for the loan of $100,000.(18)
10.41	Termination Agreement dated September 25, 2007 between the Company and Mark Reynolds.(19)
10.42	Third Amendment to Loan Agreement dated November 30, 2007 between the Company and Aton Ventures Fund Ltd.(20)

15

Exhibit
Number	Description of Exhibit
10.43	Third Amendment to Loan Agreement dated November 30, 2007 between the Company and Asset Protection Fund Ltd.(20)
10.44	Convertible Promissory Note dated November 30, 2007 between the Company and Aton Ventures Fund Ltd.(20)
10.45	Convertible Promissory Note dated November 30, 2007 between the Company and Asset Protection Fund Ltd.(20)
10.46	Management Consulting Agreement dated December 1, 2007 between the Company, ARH Management Ltd. and Anthony Harvey.(20)
10.47	Management Consulting Agreement dated December 1, 2007 between the Company, Ainsworth- Jenkins Holdings Inc. and Benjamin Ainsworth.(20)
10.48	2007 Stock Incentive Plan.(20)
10.49	Form of Non-Qualified Stock Option Agreement between the Company and Directors and Officers.(20)
10.50	Loan Agreement dated April 1, 2008 between the Company and Anthony Harvey.(21)
10.51	Promissory Note dated April 1, 2008 between the Company and Anthony Harvey.(21)
10.52	Loan Agreement dated May 8, 2008 between the Company and Anthony Harvey.(22)
10.53	Promissory Note dated May 8, 2008 between the Company and Anthony Harvey.(22)
10.54	First Amendment to Loan Agreement dated May 9, 2008 between the Company and Aton Select Fund Limited.(22)
10.55	Convertible Promissory Note dated May 9, 2008 between the Company and Aton Select Fund Limited.(22)
10.56	First Amendment to Loan Agreement dated May 9, 2008 between the Company and Anthony Harvey for the loan of $100,000.(22)
10.57	Convertible Promissory Note dated May 9, 2008 between the Company and Anthony Harvey for the loan of $100,000.(22)
10.58	First Amendment to Loan Agreement dated May 9, 2008 between the Company and Anthony Harvey for the loan of CDN $50,000.(22)
10.59	Convertible Promissory Note dated May 9, 2008 between the Company and Anthony Harvey for the loan of CDN $50,000.(22)
10.60	Loan Agreement dated July 7, 2008 between the Company and Anthony Harvey for the loan of CDN $25,000.(23)
10.61	Promissory Note dated July 7, 2008 between the Company and Anthony Harvey for the loan of CDN $25,000.(23)
10.62	Fourth Amendment to Loan Agreement dated January 13, 2009 between the Company and Aton Ventures Fund Ltd.(24)
10.63	Convertible Promissory Note dated January 13, 2009 between the Company and Aton Ventures Fund Ltd.(24)
10.64	Fourth Amendment to Loan Agreement dated January 13, 2009 between the Company and Asset Protection Fund Ltd.(24)
10.65	Convertible Promissory Note dated January 13, 2009 between the Company and Asset Protection Fund Ltd.(24)
10.66	First Amendment to Loan Agreement dated January 13, 2009 between the Company and Anthony Harvey for the loan of $25,000 USD.(24)
10.67	Convertible Promissory Note dated January 13, 2009 between the Company and Anthony Harvey for the loan of $25,000 USD.(24)
10.68	First Amendment to Loan Agreement dated January 13, 2009 between the Company and Anthony Harvey for the loan of $25,000 CDN.(24)
10.69	Convertible Promissory Note dated January 13, 2009 between the Company and Anthony Harvey for the loan of $25,000 CDN.(24)
10.70	First Amendment to Loan Agreement dated January 13, 2009 between the Company and Anthony Harvey for the loan of $25,000 CDN.(24)
10.71	Convertible Promissory Note dated January 13, 2009 between the Company and Anthony Harvey

16

Exhibit
Number	Description of Exhibit
	for the loan of $25,000 CDN.(24)
14.1	Code of Ethics.(2)
31.1	Certification of Principal Executive Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
31.2	Certification of Principal Financial Officer pursuant to Section 302 of the Sarbanes-Oxley Act of 2002.
32.1	Certification of Principal Executive Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
32.2	Certification of Principal Financial Officer pursuant to 18 U.S.C. Section 1350, as adopted pursuant to Section 906 of the Sarbanes-Oxley Act of 2002.
99.1	Audit Committee Charter.(2)
99.2	Disclosure Committee Charter.(2)

Notes:
(1)	Filed with the SEC as an exhibit to our Registration Statement on Form SB-2 originally filed on April 26, 2000.
(2)	Filed with the SEC as an exhibit to our Annual Report on Form 10-KSB filed on August 26, 2003.
(3)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on April 8, 2004.
(4)	Filed with the SEC as an exhibit to our Registration Statement on Form S-8 filed on June 17, 2004.
(5)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on August 20, 2004.
(6)	Filed with the SEC as an exhibit to our Annual Report on Form 10-KSB filed on October 8, 2004.
(7)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on February 22, 2005.
(8)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on May 23, 2005.
(9)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on February 7, 2006.
(10)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on February 16, 2006.
(11)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on April 10, 2006.
(12)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on May 22, 2006.
(13)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on September 15, 2006.
(14)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on September 7, 2006.
(15)	Filed with the SEC as an exhibit to our Annual Report on Form 10-KSB filed on October 13, 2006.
(16)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on December 13, 2006.
(17)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on March 26, 2007.
(18)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-QSB filed on May 21, 2007.
(19)	Filed with the SEC as an exhibit to our Annual Report on Form 10-KSB filed on September 28, 2007.
(20)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on December 6, 2007.
(21)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on April 7, 2008.
(22)	Filed with the SEC as an exhibit to our Quarterly Report on Form 10-Q filed on May 15, 2008.
(23)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on July 11, 2008.
(24)	Filed with the SEC as an exhibit to our Current Report on Form 8-K filed on January 20, 2009.

17

SIGNATURES

Pursuant to the requirements of the Securities Exchange Act of 1934, the registrant has duly caused this report to be signed on its behalf by the undersigned thereunto duly authorized.

			CANYON COPPER CORP.
Dated:	May 13, 2009	By:	/s/ Anthony R. Harvey
			ANTHONY R. HARVEY
			Chairman and Chief Executive Officer
			(Principal Executive Officer)
Dated:	May 13, 2009	By:	/s/ Kurt Bordian
			KURT BORDIAN
			Chief Financial Officer and Treasurer
			(Principal Accounting Officer and Principal Financial
			Officer)